Welcome! Milwaukee Public Schools Pre-Retirement Seminar For MPS Teachers DATE: October 30, 2012
Today we are going to cover:
MPS Supplemental Early Retirement Plan for Teachers (“Supplemental Pension Plan”):
Eligibility Vesting Benefit calculation Benefit Payment Options Highlights of July 1, 2013 Plan Changes
How to access and use self-service calculator
2
MPS Supplemental Pension for Teachers Overview and History of the Plan Plan was established July 1, 1982 as a “supplement” to the WRS pension benefit Plan is a defined benefit plan 100% funded by the Board (e.g. no employee contributions) Significant Plan changes were negotiated effective July 1, 1998 Effective July 1, 2013 the Plan is “frozen” -for current employees years of service and final average salary “frozen” -closed to new participants including rehires Must be receiving WRS benefits to receive Plan benefits
3
MPS Supplemental Pension for Teachers Eligibility Requirements
Covers teachers under the MTEA-Teacher contract since Plan inception July 1, 1982
All WRS service is eligible for Plan benefits in accordance with Plan rules (see caveat with changes made July 1, 1998 as noted below)
For teachers hired or rehired on or after July 1, 1998: Vesting rule requires 15 years of service under MPSMTEA Teacher contract and terminate at age 55 or after Note there is an exception that service for paraprofessionals under the MTEA-Education Assistant Contract counts for vesting purposes only Years of service eligible for Plan benefits is only for WRS service earned under the MTEA-Teacher contract
4
MPS Supplemental Pension for Teachers Plan Benefits
Permanent Benefit – provides a lifetime annuity based on the WRS benefit option elected
Note that the Plan benefits are based on 60 payments guaranteed as the Normal Form
Special Supplement (also known as the “sweetener”) – provides a monthly benefit from date of retirement on/after age 55 to age 65
Note: You must retire before age 65 to receive Plan benefits. 5
MPS Supplemental Pension for Teachers Plan Benefit Formulas
Retirement between age 55 and 62
Permanent Benefit: 18% x 1.3% x YOS x FAE Special Supplement: 216% x FAE paid in equal installments from retirement date to age 65
Retirement between age 62 and 65 Permanent Benefit: 0.5% for each month retirement precedes age 65 x 1.3% x YOS x FAE Special Supplement: 2% x (age 65-Retirement Age) x FAE paid in equal installments from retirement date to age 65 Benefits are paid on 1st day of the following month YOS = Years of Service FAE = Final Average Earnings (highest 3 years)
6
MPS Supplemental Pension for Teachers Plan Benefit Example
Retirement between age 55 and 62 Age at retirement: 57 years Year of service: 25 years Final Average Earnings: $ 5,000/month
Permanent Benefit: 18% x 1.3% x 25 yrs x $ 5,000 Permanent Benefit: = $ 292.50 per month (based on 60 payments guaranteed as the Normal Form) Special Supplement: 216% x $ 5,000 = $ 10,800 Months between Retirement age and age 65 = 96 Special Supplement: $ 112.50 per month (paid from retirement date to age 65)
7
MPS Supplemental Pension for Teachers Plan Benefit Example
Retirement between age 62 and 65 Age at retirement: 63 years Year of service: 25 years Final Average Earnings: $ 5,000/month
Permanent Benefit: 12% (0.5% for each month retirement precedes age 65) x 1.3% x 25 yrs x $ 5,000 Permanent Benefit: = $ 195.00 per month (based on 60 payments guaranteed as the Normal Form) Special Supplement: 2% x 2 years (age 65-Retirement Age) x $ 5,000 paid in equal installments from retirement date to age 65 Special Supplement: $ 200.00 per month (paid from retirement date to age 65)
8
MPS Supplemental Pension for Teachers July 1, 2013 Plan Freeze and Close
Salary and service used to calculate Plan benefits will be frozen as of July 1, 2013. This means that:
No additional years of service or compensation can be earned under the Plan to calculate benefits The freeze does NOT take away earned (vested) benefits from current employees as of July 1, 2013 There is no impact to current retirees Plan participants who were hired or rehired on or after July 1, 1998 and who were active participants in the Plan as of July 1, 2013 will be able to continue to only earn vesting service for purposes of meeting the 15-year vesting requirement in accordance with Plan provisions
Plan will be closed to anyone hired, rehired, transferred or demoted into the teacher unit effective July 1, 2013 or later
9
MPS Supplemental Pension for Teachers How to Apply For Plan Benefits
Submit a copy of your completed WRS Retirement Benefit Estimate and Application Form to the MPS Office of Human Resources, Pension and Data Management, Room 128 Central Services If you retire in June 2013 – your first check will be mailed on August 1, 2013 (exception for teachers under yearround school calendar shall receive first check on September 1, 2013). Direct Deposit and tax withholding forms are mailed with your first check Your first check will be based on 80% of estimated amount of Permanent Benefit and 100% of Special Supplement benefit amount until your benefit is finalized and retro amount will be paid in full.
10
MPS Supplemental Pension for Teachers How to Access the Pension Calculator
Please review the instructions
Instructions are included in your handouts
Also available on the MPS Portal
11
MPS Supplemental Pension for Teachers How to Obtain More Information
MPS Office of Human Resources will be notifying you of the dates and times for small group sessions to be held in: November/December 2012 and January/February 2013. Please register for these sessions for course# “RET101” under PDA through your MPS Employee Self-Service (enrollment instructions provided) Enrollment is now open for Nov/Dec 2012 sessions. Jan/Feb 2013 sessions to be announced
12
MPS Pre-Retirement Seminar For MPS Teachers The information in this handout describes the MBSD Supplemental Early Retirement Plan for Teachers in general terms only, as of the date of this seminar. It is not intended to be a complete description of benefits. Your MPS benefits are governed by the terms and conditions of the plan documents, collective bargaining agreements, Board policy and practices, federal/state statute, and Internal Revenue Code and Regulations.
Date of Seminar: October 30, 2012
13
Milwaukee Public Schools Pre-Retirement Seminar For MPS Teachers October 30, 2012 MPS Board of School Directors
Senior Team
Dr. Michael Bonds, President Larry Miller, Vice President Mark Sain, District 1 Jeff Spence, District 2 Annie Woodward, District 4 Dr. Peter Blewett, District 6 David Voeltner, District 7 Meagan Holman, District 8 Terrence Falk, At-Large
Dr. Gregory Thornton, Superintendent Naomi Gubernick, Chief of Staff Darienne Driver, Chief Innovation Officer Tina Flood, Interim Chief Academic Officer Dr. Karen Jackson, Chief Human Resources Officer Michelle Nate, Chief Operations Officer Gerald Pace, Esq., Chief Financial Officer Anita Pietrykowski, Director, School Administration Denise Callaway, Communications & Partnerships Patricia Gill, Executive Director, Family Services Sue Saller, Coordinator to the Superintendent
