Welcome to KCPERS
Member Information News Publications Event Calendar About KCPERS Contact Us

  Civilian Employees' Retirement System - Frequently Asked Questions

 

When do I become a member of the Retirement System?

Why are member contributions to the Civilian Employees' Retirement System deducted from my pay check?

When am I vested in the Civilian Employees' Retirement System?

When am I eligible to retire?

How do I start the retirement process?

How is my retirement benefit calculated?

How does Social Security work with my retirement benefits?

Will I receive cost of living increases after I retire?

Who is an eligible surviving spouse and how are their benefits calculated?

What is the supplemental benefit?

When will I receive my first retirement benefit check?

What is the retirement system's role in providing retiree health insurance?

What is a PLOP?

If I leave the Police Department can I get a refund of my contributions to the Civilian Employees' Retirement System?

When I get a refund, why don't I get any of the employer contributions made on my behalf?

I am going through a divorce, why are the attorneys asking about my retirement benefits?

How can I purchase creditable service?

What about a military leave of absence?

What happens if I get injured and cannot work?

Where do I find the Missouri State Statutes or Summary Plan Description for the Civilian Employees' Retirement System?

How can I get more information about the Police Retirement System?

 

When do I become a member of the Retirement System?

You become a member of the Civilian Employees' Retirement System on your first day as an employee of the Kansas City, Missouri Police Department. All regularly appointed civilian employees of the Police Department appointed after August 28, 2001 become members of the Civilian Employees' Retirement System as a condition of employment. Members appointed prior to August 28, 2001 had a six month waiting period prior to becoming a member of the Civilian Employees' Retirement System.

 

Regularly appointed civilian employees do not include police officer candidates that do not have prior civilian service, or part time employees. Retired members of the Police Retirement System or City Employees' Retirement System who come to work for the Police Department are not eligible to participate in the Civilian Employees' Retirement System.

Why are member contributions to the Civilian Employees' Retirement System deducted from my pay check?

Member contributions are mandatory for all members in active service and are a percentage of base pay. Member and employer contributions, along with investment earnings, are used to pay current and future benefits to members. Your member contribution rate is set by the Retirement Board and is currently 5.0% of base pay and the employer contribution rate is currently 13.14% of base pay.

When am I vested in the Civilian Employees' Retirement System?

You are vested in the retirement system when you complete 5 years of creditable service. Once a member is vested you are entitled to a retirement benefit at some future date.

 

Back to Top

When am I eligible to retire?

Normal retirement for members of the Civilian Employees' Retirement System is the later of age 65 or 10 years of creditable service. Members are eligible for an unreduced service retirement at age 65 with 5 or more years of creditable service, after reaching age 60 with 10 years of creditable service, or when the combination of the member's age and creditable service total 80 and the member has not reached age 60.

 

Beginning at age 55, any member who has completed at least 10 years of creditable service may retire and receive a reduced retirement benefit. The benefit is reduced by ½ of 1% for each month the effective date of the retirement is prior to the first day of the month following the member's 60th birthday.

 

Beginning at age 60, any member who has completed at least 5 but no more than 10 years of creditable service may retire and receive a reduced retirement benefit. The benefit is reduced by ½ of 1% for each month the effective date of the retirement is prior to the first day of the month following the member's 65th birthday.

 

If you terminate employment with 5 or more years of creditable service and do not withdraw your member contributions you will become entitled to a reduced or normal retirement benefit when you meet the age and service requirements described above.

How do I start the retirement process?

We recommend that you call the retirement office about two months prior to your planned retirement date and schedule an appointment with our Benefits Specialist to select the best retirement date for your situation. Once you have decided on a date, you should contact the Personnel Records Section to begin the actual retirement process. The retirement sign out process will be reviewed and you will be given a Clearance Sheet to have signed at each stop along the way. The Retirement Office will be one of several stops in the sign out process.

 

Please call and make an appointment to sign out, otherwise we will have to prepare your retirement forms while you wait. You will need to bring a voided check or bank deposit slip as all benefit payments are made by direct deposit. If you are married, please bring a copy of your marriage license and your spouse's Social Security card. You should plan on spending a minimum of 45 minutes going through the sign out process, completing paperwork and learning more about your retirement benefits. You are welcome to bring your spouse or beneficiary to the appointment.

 

If you are considering a Partial Lump-sum Option Payment (PLOP), the application should be made 90 days prior to your retirement date and you will need to notify us that you have decided to take the PLOP 30 days prior to your retirement date.

 

If you participate in deferred comp you will need to meet with the Deferred Comp Coordinator the month before your retirement date.

How is my retirement benefit calculated?

The normal retirement benefit formula is 2.0% of your final average salary multiplied by your years of creditable service. Your final average salary is the average of the highest, usually the last 24 months of base pay. An easy way to calculate the formula is for every year of service you earn 2.0% of your final average salary. So at age 65 with 30 years of service you would receive 60% of your final average salary. With a final average salary of $40,000 the retirement benefit calculation would be as follows:

 

30 Years of Service x 2.0% = 60%

 

$40,000 x 60% = an annual retirement benefit of $24,000

 

Back to Top

How does Social Security work with my retirement benefits?

Because you also contribute to Social Security, in addition to your retirement benefits you may be eligible to receive Social Security benefits upon retirement starting as early as age 62. The chart below shows the total member and employer contributions, as a percentage of base pay, made to the retirement system and Social Security.

 

 

Member

Employer 

Member

Employer

Total

 

Retirement

Retirement 

Social Security

Social Security

Contributions

 

Contributions

Contributions

Contributions

Contributions

 

 

5.00%

13.14%

6.20%

6.20%

30.54%

 

The retirement and Social Security contributions by Civilian members total 11.20% of base pay. The total contributions made by the Police Department on behalf of Civilian members are 19.34% of base pay.

 

So how does the benefit formula and contributions translate into benefits paid to members? The chart and graph below shows the income replacement for two Civilian members. The calculations assume retirement after 30 years of service and at age 62 when the members are eligible for early social security benefits. For members born between 1943 and 1954 full Social Security retirement age is 66 years old.

 

 

Retirement at Age 62

 Retirement at Age 62

Final Average Salary

$35,000

$50,000

Retirement Benefit

$21,000

$30,000

Supplemental Benefit

$1,920

$1,920

Social Security at age 62 

$11,500

$14,800

Total

$34,420

$46,720

Income Replacement

99%

94%

 

The Civilian member in the first example would replace 99% of their final average salary of which 67% would come from their retirement benefit and supplemental benefit. The Civilian member in the second example would replace 94% of their final average salary of which 69% would come from their retirement benefit and supplemental benefit. In the two examples above, the Social Security benefit makes up 33% and 31% of replacement income, respectively.

Will I receive cost of living increases after I retire?

Members, including surviving spouses, may receive an annual cost of living adjustment in an amount not to exceed 3% of their respective base retirement benefit. Statutes require that the Retirement System remain actuarially sound and that the Retirement Board must act upon the advice of a qualified actuary when granting cost of living adjustments. To be eligible for a cost of living adjustment your retirement must have started by December 31 of the prior year. Since the cost of living adjustment is calculated on the base retirement for each member, the maximum annual cost of living adjustment can be calculated at the time of retirement or when a surviving spouse begins receiving benefits. The cost of living adjustments are not compounded and are not prorated

 

The following is an example of how a member's retirement benefit increases with cost of living adjustments:

 

Base retirement benefit: $21,000

 

Average annual cost of living adjustment: $21,000 x 2.5% = $525

 

In the first year, if a 2.5% cost of living adjustment is granted the member's retirement benefit would be: $21,000 + $525 = $21,525

 

In the second year, if a 2.5% cost of living adjustment is granted the member's retirement benefit would be: $21,525 + $525 = $22,050

Who is an eligible surviving spouse and how are their benefits calculated?

An eligible surviving spouse is married to the member at the time of retirement and at the time of the member's death.

 

If an active member dies while in service the surviving spouse benefit is determined by the years of creditable service at the time of death. With less than 5 years of creditable service, the surviving spouse will be paid the amount of the member's contributions in a lump sum. if there is no surviving spouse then the lump sum payment will be made to the named beneficiary or the member's estate.

 

With at least 5 years but less than 20 years of creditable service, the surviving spouse has a choice of the lump sum payment described above or a retirement benefit of 50% of the member's accrued normal retirement benefit at the date of death, starting on the later of the day after the member's death or the date which would have been the member's early retirement date.

 

With at least 20 years of service, the surviving spouse has a choice of the lump sum payment or 50% benefit described above or a retirement benefit determined on a joint and survivor basis from the member's accrued normal retirement benefit at the date of death.

 

If a member dies after retirement and has not selected an optional 100% joint and survivor benefit, the surviving spouse benefit is 50% of the member's base benefit plus an immediate percentage cost of living adjustment equal to the total percentage cost of living adjustments received during the member's lifetime.

 

If a member retired and elected an optional 100% joint and survivor benefit, the surviving spouse benefit is 100% of the member's benefit at the time of death. For member's who elect the 100% joint and survivor benefit there is an permanent actuarial reduction in the initial retirement benefit based upon the member's and surviving spouse's ages at the time of retirement.

 

After August 2001, surviving spouses are eligible to remarry without any loss of benefits.

 

Back to Top

What is the supplemental benefit?

Members retiring with 15 years of creditable service after August 28, 2007 and eligible surviving spouses that receive a monthly retirement benefit are also entitled to receive the supplemental retirement benefit, which is currently $160 per month. The supplemental benefit started in 1992 at $50 per month to help offset the rising cost of health insurance premiums. It has increased through cost of living adjustments to the current amount. The supplemental retirement benefit is not restricted to paying for health insurance premiums. All members retiring prior to August 2007 and their surviving spouses are eligible to receive the supplemental benefit.

When will I receive my first retirement benefit check?

It depends on when you retire. Normally your first day of retirement is the day after your last day on payroll at the Police Department. If that date is early in the month and close enough to the end of a pay period you may receive your first retirement check at the beginning of the month after you retire.

 

In most cases because we have to wait for the payroll period to end before we can determine your final benefit calculation, your first retirement benefit payment will not arrive until the beginning of the month following the month after your retirement date. However that benefit payment is usually larger than a normal benefit payment because you started earning your benefit in the month you retire. For example, if your first day of retirement is September 19 you will receive a benefit payment at the beginning of November for 12 days of September, all of October and all of November.

 

So back to the original question.retirement benefits from the Civilian Employees' Retirement System are paid on the first working day of the month via direct deposit to your bank. A monthly confirmation statement from Northern Trust, our custodial bank, is mailed to your home.

What is the retirement system's role in providing retiree health insurance?

As a convenience to our members the retirement system will deduct your health insurance premium from your monthly retirement benefit and send it to the Police Department. The department then pays the monthly Blue Cross/Blue Shield bill for both active and retired members.

 

Access to retiree health insurance is provided by the Police Department and not by the Civilian Employees' Retirement System. The department contracts with Blue Cross/Blue Shield for health insurance for both active and retired members, and is responsible for negotiating the policy benefits, co-pays, deductibles, and monthly premiums.

 

Open enrollment for making changes to your retiree health insurance is coordinated by the department's Benefits Section and usually takes place from mid March to mid April. New health insurance premiums take effect on May 1, at the start of the fiscal year, and are deducted for the first time from your June benefit payment.

 

If you are over 65 and participating in the Medicare Supplemental Plan and Medicare Part D the open enrollment period, through the Benefits Section, is generally from mid November to mid December. The new Medicare premiums take effect on January 1 and are deducted for the first time from your February retirement benefit payment.

 

Back to Top

What is a PLOP?

The Partial Lump-sum Option Payment (PLOP) is an alternative way to receive your lifetime retirement benefit. Members who retire with one or more years of creditable service beyond their normal retirement date may elect to take part of their retirement benefit in a lump sum at the time of retirement and then receive a reduced monthly retirement benefit going forward.

 

In the Civilian Employees' Retirement System a member with one or more years of service beyond their eligible retirement date can elect a lump sum equal to 12 times their base monthly retirement benefit. A member with two or more years of service beyond their eligible retirement date can elect a lump sum equal to 12 or 24 times their base monthly retirement benefit and a member with three or more years of service beyond their eligible retirement date can elect a lump sum equal to 12, 24, or 36 times their base monthly retirement benefit. When a member elects to take a PLOP their monthly benefit is reduced on an actuarial basis. The new reduced base benefit is used to determine future cost of living increases and surviving spouse benefits. The actuarial reduction depends on the age of the member at retirement, the amount of the lump sum PLOP, if there is an eligible surviving spouse, and if the member elects the 100% joint and survivor benefit.

 

A portion of the PLOP distribution is nontaxable and can be paid directly to you. The taxable portion of a PLOP distribution is subject to mandatory 20% federal withholding and may be subject to an additional 10% federal tax penalty for early distribution from a retirement plan.  You may defer paying taxes, and possibly eliminate the additional 10% tax penalty, by rolling the taxable portion into an IRA or other qualified retirement plan like the department's ING Deferred Compensation plan.

If I leave the Police Department can I get a refund of my contributions to the Civilian Employees' Retirement System?

Upon termination of employment with the department you will be entitled to a refund of your member contributions to the Civilian Employees' Retirement System. If you are vested with 5 years of creditable service you may choose to leave your contributions in the retirement system and receive normal or reduced retirement benefits based upon your eligibility.

 

If you are not vested in the retirement system you will receive a refund of your member contributions. If you have more than one year of creditable service your refund will include interest calculated with applicable interest. As part of the sign out process we will review the amount of pre-tax and after-tax contributions you have made. Your after-tax contributions, those made prior to September 2003, can be refunded directly to you and are not subject to taxation. Taxable funds paid directly to you are subject to mandatory 20% federal withholding and may be subject to an additional 10% federal tax penalty for early distributions from a retirement plan. You can defer paying taxes, and possibly eliminate the additional 10% tax penalty, by rolling the taxable portion into an IRA or other qualified retirement plan like the department's Deferred Compensation plan.

When I get a refund, why don't I get any of the employer contributions made on my behalf?

The City and Police Department make employer contributions to KCPERS based on total salary for the pay period, not for specific individual members. The Civilian Employees' Retirement System, being a defined benefit plan, does not credit employer contributions to individual member accounts. Benefits are paid from the investment trust that includes contributions from the employees and employer and investment earnings on those contributions. A defined benefit plan requires all members to contribute the same percentage of pay and guarantees a specific benefit at retirement. A defined contribution plan would keep separate accounts for all contributions because the member can determine how much they want to contribute, within certain limits, the employer can determine how much they want to contribute and at retirement there is no guarantee of a specific benefit.

 

Back to Top

I am going through a divorce, why are the attorneys asking about my retirement benefits?

Retirement plans are treated as any other property or investment acquired during the marriage and when assets are divided between two people the court wants to look at all the assets of the marriage.

 

Attorneys will frequently call the retirement system office asking for information about the Civilian Employees' Retirement System benefits, the benefits for a specific member and the amount of their member contributions. We will not provide specific member information without a release of information to the Civilian Employees' Retirement System of Kansas City, Missouri that has been signed by our member.

 

If the court decides to divide your retirement benefit as part of a divorce decree, a Qualified Domestic Relations Order (QDRO) agreed to by you and your former spouse will be sent by the court to the Civilian Employees' Retirement System. A QDRO is an order from the court to divide your retirement benefit at the time of your retirement or upon termination of employment. Typically the QDRO will specify either a fixed dollar amount or a percentage of the retirement benefit payment will be paid to an ex-spouse and the remainder of the benefit to the member.

 

In an effort to ensure that we correctly administer each QDRO the retirement system has prepared a standard QDRO form that can be mailed or e-mailed to your attorney.

How can I purchase creditable service?

In order to purchase creditable service you must have qualifying service that is eligible for purchase.  Types of qualifying service that may be eligible include prior membership service in the Civilian Employees' Retirement System, other public employment in the state of Missouri, and service lost due to certain periods of unpaid military service.

 

If you were previously a member of the Civilian Employees' Retirement System and terminated employment with three or more years of creditable service, you are eligible to restore your prior service.  You must repay the amount of member contributions that were refunded to you plus an additional payment of interest equal to the amount of the actual net yield earned by the fund during the time the contributions were withdrawn.

 

If you have been employed in nonfederal public employment within the state of Missouri prior to becoming a member of the Civilian Employees' Retirement System, you may be eligible to purchase creditable service up to the actual amount of time spent in other public service. Qualifying service can be either time spent that was not covered by a retirement plan or, if covered by a retirement plan, you cannot be entitled to any future benefit for that period of service. You must provide verification of service and benefit status from your previous employer.  The cost under this option is calculated using factors provided by the retirement system actuaries based on your age, years of creditable service, and salary at the time of the purchase. This is the most expensive method of purchasing creditable service. You must have five years of creditable service in the Civilian Employees' Retirement System to be eligible under this option.

 

If you served in the U.S. military on active duty prior to becoming a member of the Civilian Employees' Retirement System, you may purchase up to two years of creditable service based on military service. You must provide us with appropriate documentation of your qualifying military service and the cost is calculated using actuarial factors as described above.

What about a military leave of absence?

We will always follow the provisions of federal USSERA laws when it comes to unpaid leave for active duty military service for our members. In addition to the federal law, the retirement system has provisions for providing creditable service for a military leave of absence under certain circumstances at no cost to the member. When you go on a period of unpaid leave for active military duty we'll need a copy of your orders. When you return from a military leave of absence we'll need the Member - 4 copy of your DD Form 214 which shows the dates of your active duty service and discharge status.

 

Back to Top

What happens if I get injured and cannot work?

In addition to providing retirement benefits, the retirement system also pays benefits to members who become disabled and, following rehabilitation, are totally and permanently disabled. Total and permanent disability is a condition which prevents the member from engaging in any occupation or performing any work for remuneration or profit for the rest of the member's life. The disability must not have been caused by the member's own negligence or willful self infliction.

 

Duty disability retirement benefits are paid to those members who become totally and permanently disabled due to and caused by actual performance of employment with the Police Department.

 

Non-duty disability benefits are paid to those members with 10 or more years of service whose total and permanent disability arises from any other cause than a duty disability.

 

Members with disabling injuries or illnesses are referred to the retirement system after the Police Department has determined that the member, following a full rehabilitation process, is totally and permanently disabled. The Police Department sends medical information about the member's condition to the retirement system along with an evaluation from the department doctor. This will be the first time the retirement system will know the member has a disabling injury or illness and we have a separate evaluation process that includes a medical board independent of the department's evaluation process. You will be asked to authorize the release of all your medical records to the retirement system Medical Board. A doctor from the Medical Board will review your records and examine you to complete the medical evaluation for the retirement system.

 

The findings of the Medical Board of the Retirement System are then sent to the Retirement Board who makes the decision to retire members of the Civilian Employees' Retirement System on either a duty or non-duty disability.

 

Once the Police Department has sent your file to the retirement system for a disability evaluation it usually takes two to three months to get medical records from your doctors, have your medical records reviewed by the Medical Board of the Retirement System, set and complete your appointment with the Medical Board doctor, have the Medical Board doctor complete the written evaluation, and then have the Retirement Board meet and reach a decision.

Where do I find the Missouri State Statutes or Summary Plan Description for the Civilian Employees' Retirement System?

You can find both the Missouri State Statutes and the Summary Plan Description on the KCPERS website. The state statutes that govern the Police Retirement System can be found in Sections 86.1310 to 86.1640 of the Revised Statutes of Missouri. The summary plan description provides a short explanation of plan benefits in a more readable format than the statutes. The Summary Plan Description covers Membership, Creditable Service, Contributions, Retirement Benefits, and the Retirement Board.

How can I get more information about the Police Retirement System?

You can always call or stop by the KCPERS office. Our phone number is 816 482-8138 or the toll free number outside Kansas City is 888 813-8138. Our office is in the Multipurpose Building at South Patrol Division, 9701 Marion Park Drive

 

Back to Top

 

 

 
Printer Friendly Format Printer Friendly Format    Send to a Friend Send to a Friend

  © 2011, Kansas City Police Employees' Retirement Systems. All rights reserved.