Saturday, April 23, 2005

Buy back military time?

Heard a rumor that Lockheed let's you buy back military time into your retirement. One year at a time up to 5 years. Any truth?
Lyle


Comments:
Military Service Credit Buy-Back
Article 20, RSSL

Message from Comptroller Alan G. Hevesi

Veterans who served in certain combat theaters or during certain periods of wartime may now be able to purchase and receive credit for up to three years of military service. Due to the Common Retirement Fund’s unprecedented performance, a significant portion of the cost of this military service retirement credit will be subsidized, making this benefit more affordable for you — the brave men and women who deserve credit for your military service to this country.

Purchased military service credit will be creditable in all retirement plans offered by the New York State and Local Employees’ Retirement System and the New York State and Local Police and Fire Retirement System.

If you are in a plan that provides for a fixed pension after 20 or 25 years of service and are eligible to retire, or if you are a Tier 1 or Tier 2 member covered by Section 75-h or 375-h and have 37½ or more years of service, military service credit may not increase your pension. Contact us for information on how this would affect your benefits.

Sincerely,

Alan G. Hevesi

Table of Contents

Eligibility
Your Cost
Making Payments
Applying for Military Service Credit
For More Information


Eligibility
To receive credit for your military service under Article 20 (Chapter 548, Laws of 2000), you must apply to purchase the credit prior to retirement and have:

been honorably discharged;
at least five years of credited service in the Retirement System at the time you apply;
not received credit for this service in any other public retirement system in New York State; and
no more than three years military service credit in all public retirement systems in New York State, including this service.
In addition, your service must have been some or all of during one or more of the following periods:
World War II (12/7/41 – 12/31/46)
Korean War (6/27/50 – 1/31/55)
Vietnam Era (2/28/61 – 5/7/75)
Theater of operations including Iraq, Kuwait, Saudi Arabia, Bahrain, Qatar, United Arab Emirates, Oman, Gulf of Aden, Gulf of Oman, Persian Gulf, Red Sea and airspace above these locations (8/2/90 – present)
Or, if you served in one or more of the following military conflicts and received an Armed Forces, Navy or Marine Corps expeditionary medal in connection with this service:
Lebanon (6/1/83 – 12/1/87)
Grenada (10/23/83 – 11/21/83)
Panama (12/20/89 – 1/31/90)
Your Cost
Article 20 provides that your cost to purchase military service credit will equal three percent of the salary you earn during the twelve months prior to filing your application for this service, times the number of years of military service you claim. We will need to recalculate the cost every 30 days if you do not make payment or begin payroll deductions within that period. Once you make payments, there will be no recalculation of the cost.

If you previously paid for military service credit under Section 244-a of the Military Law, we will recalculate your cost under Article 20 and you will receive a refund of the difference.

Making Payments
To purchase the military service credit, you must pay the full cost in a lump sum, through payroll deductions, or through an annual trustee-to-trustee transfer from your deferred compensation (457 plan) or tax deferred annuity (403b plan). If you decide on payroll deductions or through a trustee-to-trustee transfer from your deferred compensation (457 plan) or tax deferred annuity (403b plan), the time over which you make payments cannot exceed the total time of military service credit purchased, nor can it extend beyond your retirement date. For example, if you are
purchasing three years of military service credit, payroll deductions can be made for up to three years, or until your date of retirement, whichever comes first. At the time of retirement, the total cost must be paid in full. If not, you will receive credit for only that part of your military service that was paid for.

Payments for military service credit under Article 20 are not placed in your contribution account. Instead, they go into the pension accumulation fund to help offset the cost of the increased benefits you will receive. As a result, you can not borrow from the Retirement System against these payments.

Please note that once a payment is made, it is not refundable.

Applying for Military Service Credit
To receive a cost for this service, send a completed Application for Military Service Credit Pursuant to Article 20-RSSL (RS 5509) with a copy of your Certificate of Release or Discharge From Active Duty form (DD-214) to:

Arrears Military Unit
NYS&L Retirement System
110 State Street
Albany, NY 12244-0001

When we receive your request, if you are eligible, we will notify you of the cost of your military service credit.

If you do not have a copy of your military discharge papers (DD-214) you can request a copy from: National Personnel Records Center Military Personnel Records 9700 Page Avenue St. Louis, MO 63132-5100 The form needed to request a copy of your DD-214 from the Records Center can be printed from their Web Site.

For More Information
You can access our benefit projection program to give you an estimate of your retirement benefit (currently, this only works for Employees’ Retirement System members). Try estimating your retirement benefit with and without the military service credit to see how your retirement benefit will be affected if you purchase the service credit.

If you have any questions, contact us.

You can also meet with one of our Information Representatives in Albany or at any of our locations throughout the state. A list of these consultation sites is also available from your employer.

VO1708 (3/02)
© 2002, New York State and Local Retirement System






(top of page)
 
News
Davis, Hoyer, Weldon Introduce District of Columbia Military Retirement Equity Act of 2003

September 16, 2003

Washington, D.C. House Government Reform Committee Chairman Tom Davis (R-VA), Democratic Whip Steny Hoyer (D-MD) and Rep. Curt Weldon (R-PA) today introduced the District of Columbia Military Retirement Equity Act of 2003, bipartisan legislation that will allow current and former D.C. Police Officers and Firefighters, U.S. Park Police Officers, and U.S. Secret Service Employees to buy back military service time to avoid costly reductions in their monthly benefit payments.

Under current law, retirees in the D.C. Police Officers and Firefighters Retirement Plan (Plan) may use the time that they served in the military as credit toward their retirement. However, retirees who are eligible to receive their Social Security benefits may not concurrently receive credit for the time they served in the military. This means that after the retiree reaches age 65, the amount of their annuity is significantly reduced. This bill would allow members and retirees to buy back the years of military service to avoid having the reduction in their monthly benefit payment.

This is a simple matter of fairness and equity, Davis said. This legislation parallels the Civil Service Retirement Act (CSRA). Federal employees who retired under the CSRA were made aware of the post-1956 law and were permitted to buy the service credit by making payments equal to seven percent of the military basic pay for the period in question. If the employee elected to buy back the service credit, it continued to be counted after the employee became eligible for Social Security. The current and former officers covered under this bill who have served our country not once, but twice -- deserve the same opportunity.

Through no fault of their own, hundreds of retirees now find themselves in a precarious position of having to buy back their military time or have a dramatic reduction in their annuity, said Hoyer. These are retirees who served our country in the military and who returned from service to protect our communities as first responders. We have a responsibility to provide a mechanism for active duty members and retirees to be able to plan for and maintain a comfortable retirement.
Thanks to a simple legislative oversight, District of Columbia firefighters and police officers who also served in the US military, currently face drastically reduced retirement benefits or even worse, may have to pay back benefits because of a government mistake. This scenario is unfair and must be corrected, Weldon said. We have an obligation and an opportunity to right this wrong for the benefit of those who have unselfishly served to protect our nation s capital and defend our nation.

Like the Federal retirement programs, with this legislation members and retirees would be able to purchase their post-1956 military service and have it credited to their Plan benefits permanently.

Payment amounts will be seven percent of the annuitants basic pay at the time of employment if they were hired before November 10, 1996. Those hired after this date will pay eight percent of their base pay. Members and retirees who elect to retain credit for service will have a grace period of two years to make payments. Deposits made after the 2-year grace period or October 1, 2006 will include interest.
 
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