Includes members currently working for a PERS-participating employer from all programs:
-
Tier One and Tier Two – Hired
before August 29, 2003
-
OPSRP – Hired
after August 28, 2003
How does this bill impact me and my future retirement benefits?
First, remember that all active members have
two parts to their PERS
retirement:
- A pension – Tier One, Tier Two, or OPSRP
- An Individual Account Program (IAP) account
Active members may be impacted by one or more of the following:
-
Salary Limit changes
-
Member (IAP) Redirect
-
IAP Member Choice
-
Work After Retirement rule changes
-
OPSRP Withdrawal rule changes, if you are an OPSRP member and leave PERS-participating
employment and want to withdraw your IAP
Salary limit
Beginning January 1, 2020, SB 1049 changed the definition of “salary”* for PERS purposes and created new
limitations on annual and monthly “subject salaries.”
With PERS, your subject salary is used to determine member Individual Account Program (IAP) contributions, employer
contributions to fund the pension program, and the final average salary used in calculating retirement benefits
under formula methods.
Salary limits by year
|
Year
|
Salary limit**
|
| 2024 | $232,976 |
| 2023 | $225,533 |
| 2022 | $210,582 |
| 2021 | $197,730 |
| 2020 | $195,000 |
For full details about the SB 1049 salary limit, read our
SB 1049 Changes: Salary Limit webpage.
*Effective January 1, 2022, Senate Bill (SB) 111A (2021) made a number of updates to SB 1049. SB 111A:
-
Changed the definition of “salary” for OPSRP members to include salary that is or would be subject to
Oregon state income tax if the member were an Oregon resident. This allows members who are working for a
PERS-covered employer but physically out of state (e.g., if they live in Washington and are working from
home) to have contributions made on that salary.
-
Made the revised definition of salary retroactive to 2003 for Oregon Health and Science University and
charter schools. For all other employers, the revision was made retroactive to January 1, 2020.
**The limit is indexed annually to the Consumer Price Index [(CPI); [All Urban Consumers, West Region] to
keep pace with inflation. The limit also is prorated when members work fewer than 12 months in a calendar
year.
Member Redirect
As of July 1, 2020, if your gross pay in a month exceeds the
monthly salary threshold, a portion of your 6% IAP contribution is
redirected to your Employee Pension Stability Account (EPSA). EPSA will be used to pay for part of your future
pension benefit. The redirect to EPSA remains in effect when the PERS system is less than 90% funded***.
The portion of the 6% redirected to your EPSA depends on your membership type:
The remainder of your 6% is contributed to your IAP as usual.
More details about Member Redirect and opportunities to make additional, after-tax voluntary contributions, are
available online for
Tier One/Tier Two and
OPSRP members, including new animated videos that help
explain the changes.
***The latest actuarial valuation shows that PERS’ funded status is 73% as of December 31, 2022.
IAP Member Choice
Every September, you have the option to invest your IAP balance in an IAP Target-Date Fund (TDF) that
better reflects your retirement savings goals.
Your IAP is currently invested in a TDF based on your birth year. With Member Choice, you can stay in the fund
assigned to your birth year or voluntarily choose a different TDF for the upcoming year, based on your personal risk
tolerance.
Find full information about Member Choice on the
IAP Target-Date Funds webpage.
Working after retirement
If you decide to return to work for a PERS-participating employer after you retire, make sure you understand the
rules that were simplified under
SB 1049. Read more in the retirees section toward the end of this webpage.
OPSRP withdrawal
Withdrawal rules could impact you as an OPSRP member
after you leave PERS-participating employment and become an inactive member. For details, read the
OPSRP withdrawal webpage or the separate
section toward the end of this webpage.