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Proposed PERS Administrative Rules
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Proposed Administrative Rules

Membership Eligibility

Eligibility for the PERS Tier One, Tier Two, and OPSRP Programs are predicated on the employee being in a "qualifying position," which is generally defined as one where an employee is normally required to perform 600 or more hours of service in a full calendar year. Applying this standard is complicated when the employee is not employed over the full calendar year, or what we refer to as a partial year of employment (e.g., the employee is hired after the first of the year or separates from employment before the calendar year ends).

In those circumstances, PERS relies on the employer to designate whether the position is one where 600 or more hours of service are normally required in a calendar year. In reporting to PERS, the employer designates if the employee is in a qualifying or non-qualifying ("Q/NQ") position during a partial year of employment. OAR 459-010-0003 currently recognizes this presumptive designation, but also defines circumstances where the presumption may be overridden (e.g., when an employer reports a position is non-qualifying, but the employee does in fact work more than 600 hours in a calendar year).

The current rule addresses what happens when the employee separates before the end of the calendar year ("partial year of separation"). These proposed rule modifications also cover further scenarios for partial years when the member is hired after the first of the year ("partial year of hire") and for partial years due to a hire and separation in the same calendar year ("short segment").

Other proposed rule modifications clarify the terms "working days" and "business days." Certain membership eligibility determinations depend on these terms. A "working day" is a day the employer is open for business, and a "business day" is "a day Monday through Friday when PERS is open for business." Employers do not regularly report "working days" to PERS, and instances have occurred where the delay in obtaining "working day" information has deterred timely eligibility determinations. To address this concern, the rule amendments allow staff to use "business day" where "working day" information is not available to allow for more expeditious processing of eligibility and membership determinations, thereby improving PERS' overall administration.

Draft Rule
459-005-0001
459-010-0003
459-010-0010
459-010-0035
459-070-0001
459-075-0010

Employer Remittance of Contributions

PERS administers both a qualified pension plan under IRC 401(a) and a health insurance program under IRC 401(h). When electronic reporting and payment methods were instituted, OAR 459-070-0110 was adopted to allocate these employer contributions by the order of receivables' due dates, oldest first. In addition, the rule also established a priority order to the various "buckets" to which funds would be allocated if an employer made a partial payment of their employer contribution invoice and there were multiple receivables having the same due date. Internal Audit Reports on August 2009 and January 2013 raised concerns about whether this allocation structure was consistent with PERS' general responsibilities as a fiduciary and the IRS requirements that contributions be reasonable and ascertainable, and that those made for specific trusts or other purposes not be used for, or diverted to, any other purpose; suggested process improvements and other recommendations were also made in the Audit reports.
Consequently, the employer payment remittance process is being revised. Programming for the new employer contribution allocation procedure is being implemented in August 2014 to require that all employer contributions be designated and assigned to specific programs (i.e. employer contributions to their pension reserve accounts, to the PERS Health Insurance Program, or member contributions to the IAP). The rule's priority allocation structure, therefore, will become obsolete.

Sections (4) and (5) of the rule are to be removed because contributions made by the employers under the new programming will be clearly designated or identified as to specific programs and allocated as such. PERS will no longer co-mingle employer contributions and allocate them to receivables in the order of receivables' due dates or a pre-set priority list.

Draft Rule
459-070-0110

 
Rulemaking Schedule
 Updated August 14, 2014
OAR Title Notice to Board Notice to Public Public Hearing Public comment ends Expected adoption date
459-005-0001
459-010-0003
459-010-0010
459-010-0035
459-070-0001
459-075-0010
Membership Eligibility 7/25/14 7/1/14 8/19/14
2 p.m.
9/5/14 9/26/14
459-070-0110 Employer Remittance of Contributions 7/25/14 8/1/14 8/19/14
2 p.m.
9/5/14 9/26/14
459-035-0020
459-035-0070
PERS Health Insurance Program 9/26/14 10/1/14 10/21/14 10/30/14 11/21/14
459-050-0076
459-050-0120

Oregon Savings Growth Plan:

  • In-Plan Roth Conversion
  • Self-Directed Brokerage Option
9/26/14 10/1/14 10/21/14 10/30/14 11/21/14