Questions

Questions & Answers About SCERA and Your Retirement Benefits

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DISCLAIMER

The following information is not intended as legal or tax advice.  You may wish to consult with an attorney or tax advisor on these matters.

SCERA: Defined Benefit Plan

What is the difference between a Defined Benefit Plan and a Defined Contribution Plan?

A defined benefit plan such as SCERA’s is a plan that is designed to provide eligible participants with a specified benefit at retirement based on a special formula. General and Safety member plans are designed to pay each member a lifetime benefit based upon a formula which includes the following three factors:

  • Member’s age at retirement
  • Member’s length of credited service
  • Member’s final compensation.

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A defined contribution plan on the other hand is a retirement plan that provides an individual account for each participant and benefits are based solely on (1) the amount contributed to the participant’s account (either by the employer, employee or both), plus (2) any income, expenses, gains/losses and forfeitures that may be allocated to the participant’s account.

Is my retirement a lifetime benefit?

Yes. The Retirement plan is governed by the County Employees' Retirement Law of 1937, a division of the California Government Code.  SCERA benefits are paid as part of a defined benefit plan where the employer promises to pay a specific monthly benefit for the member’s lifetime based on pay, age and service at the time of retirement.

Plan Membership: Eligibility & Participation

Who is eligible?

All permanent employees working at least half time of a full-time position for the County or a participating District are eligible to participate.  All other employees working under contract or in temporary, seasonal, part-time (less than half time) or provisional positions are not eligible to participate in the Plan.

Is participation mandatory if I am eligible?

Yes, participation is mandatory for all eligible employees except in the following two cases. Participation is optional for:

  • Eligible elected officials
  • New employees hired on or after age 60.

Optional membership can be waived or elected only after meeting with Retirement staff.

Can I change my beneficiary?

Active employees may change their beneficiary designation(s) at any time by completing the form available at the Retirement Office. Once completed and submitted, the most recent beneficiary designation will be used to distribute your benefits in the event of your death. Changing your beneficiary(ies) with your Payroll Clerk will not change it in the Retirement System.
You should always keep your beneficiary designation up to date.

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Contributions to the Plan

Do I have to contribute to the Plan?

Yes. All participating members are required to contribute to the Plan. Your contributions are made through regular bi-weekly payroll deductions on a pre-tax basis.

Does my employer contribute to the Plan?

Yes. The employer contributes any amounts needed in addition to employee contributions to provide for current and future benefits. The amount of the employer contribution is determined annually after an actuarial study of the Plan. The employer's contribution is kept in a separate reserve account. You will benefit from your employer’s contributions only upon retirement.

How are my contributions determined?

Your contributions are a percentage of your bi-weekly salary, including most premium pay.  You do not pay contributions on overtime pay, nor are overtime hours counted as service credit.  Your contribution percentage rate is determined by your age at the time you enter the system and whether you are a General or Safety member. The younger you are when you begin participating, the longer you will contribute to the Plan before retirement and thus the lower the contribution rate.

Can my contribution rate change?

Yes. The Retirement System retains an actuarial firm to perform comprehensive studies of the system. Studies of this type are required at intervals not longer than three years. Based on the results of these studies and the recommendations of the actuaries, the Retirement Board may recommend adjustments to the contribution rates. The Board of Supervisors implements the recommendations.

Can my contributions stop?

Yes. If you are a Safety member and have credit for 30 years of continuous service, your normal contributions will stop. If you are a General member and were hired on or before March 7, 1973, normal contributions are stopped after having credit for 30 years service, provided you remained in continuous service until credited with 30 years service.  Any portion of contributions attributed to benefit enhancements will not be stopped.

Do my contributions earn interest?

Yes. Interest is credited to your contributions every June 30 (based on the prior December 31 balance); and on December 31 (based on the prior June 30 balance). The Retirement Board sets the rate at which interest is credited to your account after an actuarial review of the System.

How will I know my plan balance?

Each spring, you will receive a statement showing your balance in the Plan as of December 31 of the preceding year, as well as an estimate of retirement benefits if you are currently eligible to retire on or before age 60.

Can I lose or forfeit my contributions?

No. Your contributions plus the interest credited to your account belong to you and cannot be forfeited. However, in the event of a divorce, with the filing of a joinder and Domestic Relations Order (DRO) or other court order, part of your contributions and interest (or benefit) may be assigned.

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Earning Service Credit

What is service?

Service refers to the amount of time you have been participating in the Plan. Service, sometimes referred to as service credit, is used to determine when you are eligible to retire and how much your benefit will be. A year of service is earned for every 2,087 hours of paid service (excluding overtime).

How is service earned?

Service is earned in a number of ways. The most common way of accumulating service is by working for a participating employer in an eligible position. However, there are other sources of service credit:

PDF DocumentWhat happens if I take a leave of absence?

How do I find out how much it costs to buy back time?

Please request an PDF Documentestimate.

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Payment for Additional Service Credit

How can I pay for additional service credit?

If you choose to purchase service credit, you have the followingPDF Document payment options:

  1. Lump sum payment
  2. After-tax payroll deduction plan
  3. Pre-tax payroll deduction plan
  4. Rollover or trustee-to-trustee transfer from a tax qualified plan (such as deferred compensation)
  5. Any combination of the above.

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Termination of Employment Before Retirement

What happens to the employer contributions?

The employer contributions are retained in the Retirement Fund. The member realizes benefits from employer contributions only upon retirement.

What happens to my contributions?

Today’s workforce is much more mobile than that of the past.  Our Plan, while rewarding long-term service and commitment to public service, allows individuals who leave employment prior to retiring a means of preserving or reinstating earned service credit.
At the time of termination, you should receive from your department payroll clerk a PDF DocumentDistribution of Retirement Contributions Election Form whereby you elect what you wish to do with your retirement contributions.  These forms are also available from the Retirement Office.  The options are:

  • Withdrawal of your contributions

If you terminate employment, you may withdraw your contributions plus accumulated interest. If you are married or have domestic partner relationship, your spouse/state-registered domestic partner’s signature is also required.  Refund processing takes from six to eight weeks following your final payroll. Refund checks are mailed on the last working day of the month.

Currently, retirement contributions are made on a pre-tax basis.  Therefore, your pre-tax contributions and earned interest will be subject to income tax withholding at the time of withdrawal. If you have made any contributions on an after-tax basis (prior to January 1, 1987, January 1, 1988, or July 1, 1988, depending on your bargaining unit) or have purchased service credit using after-tax funds, that amount will not be subject to income tax withholding at the time of withdrawal. If you elect to withdraw your funds, the Retirement Office will issue a 1099-R the following January for tax purposes.

You are also eligible to roll pre-tax contributions into a tax-qualified retirement account, thereby deferring the tax liability.
If you continue to work for the County or a participating employer, but in an ineligible position, your contributions may not be withdrawn. You should contact the Retirement Office for details.

You may have the opportunity to redeposit previously withdrawn contributions with SCERA if you are a former member currently in service with a reciprocal employer and your principal duties consist of “active law enforcement or firefighting and prevention service.” A former County probation officer would not qualify for redeposit with SCERA unless he or she is subsequently employed by a reciprocal agency in an active law enforcement or firefighting capacity.

  • Leave your funds in on deposit with SCERA (non-vested members)

Members who have less than five years of service and terminate employment can choose to leave their funds on deposit and earn interest based on the current interest assumption rate.
An election to allow accumulated contributions to remain in the retirement fund may be revoked by the member at any time except:

  • While the member is employed by a participating employer in an ineligible position;
  • While the member is in service as a member of a public retirement system supported, in whole or in part, by state funds; or
  • If you have established reciprocity with another California retirement system and your funds remain on deposit in the retirement fund.

Failure to make an election shall be deemed an election to leave accumulated contributions on deposit in the retirement fund.

  • Deferred retirement (vested members)

If you terminate employment after earning five or more years of service credit in the Plan (including reciprocal time, if you have established reciprocity), you may choose to leave your contributions on deposit and defer your retirement to a later date. This election will give you the option of receiving a monthly retirement benefit when you would have otherwise been eligible to retire had you remained in full-time eligible employment. Per County policy, if you retire from a deferred status you will not eligible for any post-employment insurance benefits. You may subsequently withdraw your funds any time prior to retirement. If you make no election, and you have five or more years of service, your funds will automatically be deferred six months after termination.

  • Transfer to a reciprocal retirement system

Reciprocity is a benefit that recognizes the mobility of the work force. This benefit allows you to move from one California public service agency to another, under certain conditions, without jeopardizing your earned retirement service credit.
The benefits of reciprocity are:

  • Both systems will consider your combined service credit for the purposes of vesting and eligibility for retirement.
  • Your age of entry into retirement will be the age of entry into the first system. This lower age could result in a lower contribution rate in the later system.
  • Each system will provide you with a benefit based on the service credit in that system, the system’s own benefit formula and your highest salary from either retirement system.

To be eligible for reciprocity, you must meet the following criteria:

  • The other system must be a California public service agency that is one of the following:
    • a county with a retirement system established under the County Employees Retirement Law of 1937
    • a CalPERS member agency
    • another California public retirement system having reciprocity with CalPERS. (The University of California Retirement System does not allow reciprocity with SCERA.)
  • There must be no more than six months elapsed time between the termination of the prior employment and membership in the next retirement system.
  • There can be no overlapping time. In other words, the termination date from the first system must pre-date the start date in the following system.
  • You must make an election with the system you leave to establish reciprocity.

Remember, reciprocity is not automatic. You must contact the system you are leaving to elect to have reciprocity established. If reciprocity is established, you must retire from the reciprocal systems on the same day. According to County policy, if you retire from a deferred or transferred status, you are not eligible for post-retirement health insurance benefits.

Concurrency exists with the California State Teachers Retirement System (CalSTRS). Because this is a very complex issue, you should contact CalSTRS or the Retirement Office for information.

What if I return to an eligible position?

  • Non-vested members:

If you leave your funds in the retirement system and return to the Plan within six months, your earlier service credit would remain intact and your contribution rate would be your original age of entry into the system. If your absence from the Plan exceeds six months, your age of re-entry into the system will be used to determine your contribution rate.

  • Vested members:

If you left your funds in the retirement system your earlier service credit is intact and your contribution rate is based on your original age of entry into the system regardless of elapsed time.

  • All members:

If you withdrew your funds from the system, you may redeposit your previously withdrawn contributions, plus the interest your funds would have earned had you left them on deposit. You would be credited with your prior service only after the redeposit was paid in full. Or, you could keep your previously withdrawn contributions and use only your subsequent service and contributions in determining your future retirement benefit.

What if I become disabled before I retire?

The two types of disability retirement benefits available are described below.

  • Service connected disability retirement

If you are found by the Retirement Board to be permanently physically or mentally unable to continue active performance of your duties as a result of accident, injury or illness arising out of and in the course of your employment, you will be eligible for a service connected disability retirement allowance regardless of your age or length of service.
The service connected disability retirement benefit will be equal to one-half of your final compensation or your regular service retirement benefit whichever is greater.

  • Non-service connected disability retirement

If you have five years eligible service and you are found by the Retirement Board to be permanently unable to perform your duties due to physical or mental disability that did not arise from or in the course of your employment, you will be eligible for a non-service connected disability retirement.
The non-service connected disability retirement benefit will be based on the non-service connected disability formula or, if you are age 62 or over, equal to your regular retirement benefit.

Please contact the Retirement Office for additional information. 

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What if I die before I retire?

Several options are available to your designated beneficiary in the event of your death before retirement. In all cases, your contributions plus interest can be distributed to your designated beneficiary. A spouse/state-registered domestic partner or minor child(ren) overrides any beneficiary designation. The various payment options are described below.

  • Normal survivor benefits for active members

If you die before retiring, your beneficiary will be entitled to a death benefit equal to your contributions plus accumulated interest and a lump sum payment from the County equal to one month of your final salary for each year of service you completed to a maximum of six months pay.

  • Alternate survivor benefits

Under certain specific circumstances, the surviving spouse/state-registered domestic partner or unmarried minor children may choose an alternative form of the survivor benefit. The available options will depend upon the circumstances of the member’s death. The Retirement Office will provide full details of all available choices when appropriate. The alternatives are briefly described below.

  • If the deceased member was eligible for service retirement or would have been entitled to non-service connected disability retirement at the time of death, the member’s eligible surviving spouse/state-registered domestic partner or unmarried minor children may choose to receive, in lieu of the normal death benefit, a monthly benefit equal to 60% of the allowance the member would have received if the member had retired on the date of death. It is a lifetime benefit for the spouse/state-registered domestic partner. For the minor unmarried child(ren) it is available to the age of 18 or to the age of 22 if he/she remains unmarried and in school full time.
  • If the deceased member had completed ten years of service but had not reached the minimum retirement age at the time of death, the member’s eligible surviving spouse/state-registered domestic partner or unmarried minor children may choose, in lieu of receiving the normal death benefit, to leave the death benefit in the Plan until the earliest date on which the member would have reached the minimum retirement age and at that time to receive a monthly benefit equal to 60% of the allowance the member would have received if the member had retired on the first day of eligibility.
  • If the death of the member is the result of injury or disease arising out of and in the course of County employment, the member’s eligible surviving spouse/state-registered domestic partner or unmarried minor children may choose to receive, in lieu of the normal death benefit, an annual benefit payable in monthly installments equal to 50% of the member’s final compensation or the regular service retirement benefit, whichever is greater.

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Retirement Decisions

Is retirement counseling available?

Retirement counseling classes are available. These two-hour group sessions are designed to help you plan for your retirement.

When can I retire?

Your retirement date will depend on a number of factors, such as when you entered the Plan, your age and whether you are a General or Safety member. The guidelines for service retirement (i.e., non-disability) are provided below.

General Members are eligible to retire when they meet any one of the following requirements.

  • Complete 10 years of service and reach age 50, OR
  • Complete 30 years of service regardless of age, OR
  • Reach age 70 regardless of the years of service.

Safety Members are eligible to retire when they meet any one of the following requirements.

  • Complete 10 years of service and reach age 50, OR
  • Complete 20 years of service regardless of age, OR
  • Reach age 70 regardless of the years of service.

When can I retire from deferred status?

Deferred retirement is available to Plan participants who leave employment with at least five years of eligible service. The participant becomes eligible for a retirement benefit at any point in time when he or she could have retired had he or she remained employed in a full-time position. You should contact the Retirement Office several months prior to your retirement from deferred status to obtain a PDF Documentretirement application. Health insurance in retirement is not available to members who retire from a deferred status.

Note: Any member, who has held a position in County service for at least ten years and is currently employed in a temporary, seasonal, intermittent, or part-time position and has five full years of retirement service credit and has reached age 55, is eligible to retire. Health insurance coverage following retirement is not available in this circumstance.

When is the best time to retire?

  • The first day of a pay period;
  • Immediately following a birthday (or each quarter thereafter). This applies to Safety members retiring before age 50 and General members retiring before age 60.

How and when do I apply for retirement?

Once you have established an exact retirement date, the Retirement Office can accept your completed PDF Documentapplication no more than 60 days prior to that retirement date. The Retirement Office requests receipt of your retirement application at least 30 days prior to the retirement date in order to facilitate timely payment of your first retirement check.
You will be asked to provide the following documentation to complete your Application for Service Retirement:

  • Retiree Age Verification:
    Photocopy of your birth certificate or a photocopy of the front page of your passport. (An expired passport is acceptable.)
  • Beneficiary Age Verification:
    • Photocopy of birth certificate or passport of your spouse/domestic partner.
    • Photocopy of birth certificate or passport of any person you will name as a beneficiary to receive a continuance upon your death.

  • Marriage License or California Certificate of Domestic Partnership: Photocopy of marriage license or California Certificate of Domestic Partnership, to determine eligibility for the unmodified option. You must be married, or registered with the State of California as domestic partners, for at least one year prior to retirement to be eligible for the unmodified continuance.
  • Social security number(s) and birth date(s) of your beneficiary(ies).
  • Voided Check or Savings Statement:
    Please submit a voided blank check for checking account direct deposit, or a copy of a savings statement for a savings account direct deposit.
  • Medicare cards:
    Retirees and dependents age 65 or over who are enrolled in County health plans must have or apply for Medicare Parts A and B and submit a copy of your Medicare Card or Medicare award letter. Any person under age 65 who has Medicare must provide a copy of the Medicare card in order to continue coverage.

When do I receive my first check?

Retirement benefits are paid monthly on the last working day of the month. Normally, your first retirement check will be six to eight weeks following your retirement date and will be retroactive to your retirement date.

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Retirement Benefits

How is my benefit determined?

Sonoma County Retirement is a defined benefit plan. This means that your monthly, lifetime retirement benefit is calculated using three factors: your highest annual compensation, your total service credit, and your age at retirement. The General member formula is commonly referred to as 3% @ 60. The Safety member formula is commonly referred to as 3% @ 50.

  • Final Compensation

Final compensation is defined as your highest one-year average salary (or 2,087 hours for part-time members) calculated on your base pay rate plus any employer-paid deferred compensation, eligible premium pays as determined by the Retirement Board, and eligible buy backs as specified by your MOU. Overtime pay is excluded from your final compensation calculation.

  • Service Credit

Service credit can be estimated by calculating the number of hours you worked in eligible positions. One year of service is earned for every 2,087 hours of service. Each completed bi-weekly pay period is equal to 80 hours of service for full-time employees. Part-time employees may accrue from 40 to 80 hours bi-weekly. Any purchased retirement service credit is included in calculating total service credit.

  • Age

Your age at retirement is measured to the completed quarter year. For example, if you are 52 years and 2.9 months, your retirement age is 52 years. If you are 52 years and 3.9 months, you are 52.25. See retirement age factors for specifics.

What are my benefit payment options?

At the time you retire, you will make an irrevocable selection of a benefit payment option. The various options determine the form and extent of benefits distributed during your retirement and upon your death. The option you select at retirement may not be changed in retirement.

  • Unmodified Allowance

The unmodified allowance is the highest allowance possible. When you die after retiring and provided you were married/registered for at least one year at the time you retired, your surviving spouse/registered domestic partner will receive a lifetime benefit equal to 60% of the benefit you were receiving upon your death. The County funds this continuance. If there is no spouse/registered domestic partner and there are unmarried minor children under age 18, or to the age of 22 if in school full time and not married, there is a 60% continuance available as long as they remain eligible.

  • Option 1

This option provides that after your death a lump sum payment of your remaining contributions will be paid to a beneficiary of your choosing. How much is left will depend on how long you had been retired. Each month when you receive your retirement benefit, a portion of it comes from your contributions. Therefore, the amount of your contributions available to a beneficiary after your death gets smaller each month. This option does not provide a continuance to your spouse/domestic partner or named beneficiary.

  • Option 2

This option allows you to reduce the amount of the benefit you will receive during retirement in order to provide the same benefit to a beneficiary of your choosing following your death. Under this option, the amount paid after your death will be the same as the amount paid to you during retirement. The amount of the benefit reduction is based on the life expectancy of the member and the designated beneficiary. Should your beneficiary predecease you, you will continue to receive the same amount. You will not be allowed to designate a new beneficiary.

  • Option 3

This option allows you to provide a benefit equal to 50% of the benefit you receive during retirement to a beneficiary of your choosing. The reduction of the member’s benefit is based on the member’s and the beneficiary’s life expectancies. You will not be allowed to designate a new beneficiary.

  • Modified Allowance

This option gives you a larger benefit (based upon an actuarial equivalent of your Social Security estimate of benefits receivable at age 62) from the age you retire to age 62. However, at age 62, your benefit will be reduced by the Social Security estimate amount you provided at retirement. This option can give you a level payment for your life expectancy consisting of a combination of your Social Security benefit and Sonoma County retirement.
Each of these options will be explained to you in full as you prepare for retirement.

Will my benefit be adjusted for inflation?

On a regular basis, the Board reviews retirement benefits in light of economic factors. At its discretion, the Board of Retirement and Board of Supervisors may adopt cost of living adjustments (COLA). Cost of living adjustments are generally effective April 1.

Can I estimate my retirement benefit on-line?

You can run an estimate of your retirement benefit on-line by using the Benefit Calculator.

Post-employment Health Insurance

Does health insurance continue in retirement?

The County of Sonoma is responsible for health insurance in retirement. Continued health plan coverage may be available for members who retire directly from active service. Coverage and eligibility conditions vary. Contact Human Resources/Risk Management at 565-2942 with eligibility questions or for further information.

How do I pay for my portion of the health or dental insurance premiums?

All payments to the County for health and dental insurance will be deducted from the retirement benefit.

Are my premiums for health and dental insurance deducted from my retirement benefit on a pre-tax basis?

No, The IRS states (per IRC Section 402(a)) distributions used to purchase health coverage are includible in a retiree's income.  However, certain qualified members that meet requirements for Public Safety Officer from the Pension Protection Act of 2006 (PPA) may be able to deduct the cost of premiums paid on their personal tax filings.  A letter will be distributed to members by the end of the year 2007 communicating information about the Pension Protection Act of 2006. Additional information on the PPA may be found at http://www.irs.gov/retirement/article/0,,id=165131,00.html or http://www.dol.gov/EBSA/pensionreform.html.

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Will Social Security affect my Plan benefit?

SCERA is fully integrated with Social Security, which means that you continue to contribute to Social Security while you are contributing to the Plan. Therefore, your Social Security benefit is not offset by your retirement benefit. However, if you purchased any Service Prior to Membership service credit for which no Social Security was taken, there may be an offset. Please contact the Social Security office for information.
Your retirement benefit is adjusted based on your Social Security income only if you elect the Modified Option Allowance as described previously.

What happens upon my death after retirement?

Payment of any continuance or refund of contributions is determined by the option selected at retirement. Your beneficiary or other representative should contact the Retirement Office. A copy of the death certificate will be requested.

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Retired Member's Payroll

What do the words "Safe Harbor" mean when printed on my pay stub?

Safe harbor funds are that portion of your benefit that for which have already paid taxes (link to earlier that discusses this) At the end of the year these funds will not be included in your taxable earnings on your 1099-R.

Are taxes withheld from my benefit?

You do not have to have taxes withheld. This does not mean you do not owe taxes. At your request we will withhold federal and/or state tax. If you live outside of California we are not able to withhold state income tax. (Please consult with a tax advisor if you have questions that relate to your particular situation).

To initiate or change your withholding, please print, complete and send us the
PDF DocumentFederal W-4P or the PDF DocumentState DE 4P.

Why doesn't my monthly benefit equal the check I receive?

There are a variety of factors that may affect your monthly benefit check.

  1. Likely, you are having taxes withheld.
  2. If you are covered by one of the County's health insurance plans or dental plans there is a portion paid by you and deducted from your benefit proceeds.
  3. There may be other deductions such as life insurance, SCARE dues, etc.

When retired members are paying for Medicare Part B they can receive a reimbursement from the County for the monthly Medicare premium. The amount is adjusted annually by the Social Security Administration and the Board of Supervisors determines the amount every year.

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