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11.8 Second-Tier Retirement Plan

Unit 9 members may participate in the Second-Tier retirement plan as prescribed by Government Code Section 21070.5.

  1. Second Tier members first employed by the State and subject to CalPERS membership prior to January 1, 2013 are subject to the Pre-PEPRA Second Tier retirement formula.
  2. Employees who are brought into CalPERS membership for the first time on or after January 1, 2013 and who are not eligible for reciprocity with another California public employer as provided in Government Code Section 7522.02(c) shall be subject to the “PEPRA Retirement Formula.” As such, the PEPRA changes to retirement formulas and pensionable compensation caps apply only to new CalPERS members subject to PEPRA as defined under PEPRA.
  3. The table below lists the Second Tier age/benefit factors for the Pre-PEPRA and PEPRA retirement formulas.
    Age at
    Retirement    		 Pre-PEPRA Formula
    (1.25% at age 65)    		 PEPRA Formula
    (1.25% at age 67)
    Employees first hired and subject to CalPERS Membership prior to January 1, 2013 Employees eligible for CalPERS Membership for the first time on and after January 1, 2013
    50 0.500 N/A
    51 0.550 N/A
    52 0.600 0.650
    53 0.650 0.690
    54 0.700 0.730
    55 0.750 0.770
    56 0.800 0.810
    57 0.850 0.850
    58 0.900 0.890
    59 0.950 0.930
    60 1.000 0.970
    61 1.050 1.010
    62 1.100 1.050
    63 1.150 1.090
    64 1.200 1.130
    65 1.250 1.170
    66 1.250 1.210
    67 1.250 1.250
  4. Employee Retirement Contribution

    As stated in Government Code Section 20683.2, effective July 1, 2013, Second Tier members, including ARP members, shall contribute one and one-half percent (1.5%) of monthly pensionable compensation for retirement, and will increase by 1.5% points annually.  The final annual increase in the contribution rate shall be adjusted as appropriate to reach fifty percent (50%) of normal cost.

  5. Final Compensation

    Final Compensation for an employee, who is employed by the State for the first time and becomes a member of CalPERS prior to January 15, 2011, is based on the highest average monthly pay rate during twelve (12) consecutive months of employment.

    Final Compensation for an employee, who is employed by the State for the first time and becomes a member of CalPERS on or after January 15, 2011, is based on the highest average monthly pay rate during thirty-six (36) consecutive months of employment.