CSU Policy: Defined Contribution Plan

Policy Title: Defined Contribution Plan Category: Human Resources
Owner: Vice President for University Operations Policy ID#: 3-6004-009
Contact:
Human Resources
Web: http://www.hrs.colostate.edu/
Email: hr_service_center@mail.colostate.edu
Phone: (970) 491-6947

Also Contact:
Benefits Office
Web: http://www.hrs.colostate.edu/benefits/
Email: myhr@colostate.edu
Phone: (970) 491-6947
Original Effective Date: 5/5/2005
Last Major Revision: 4/15/2015
Print Version: Click Here to Print

PURPOSE OF THIS POLICY

All Academic Faculty, Administrative Professional Staff, Post-Doctoral Fellows and Veterinary Interns appointed on or after April 1, 1993 are required as a condition of employment under Colorado law, to participate in either the University's Defined Contribution Plan (DCP) for Retirement or, in very limited cases, in the Public Employees' Retirement Plan (PERA) of Colorado, a defined benefit plan.

Only those newly appointed employees with qualifying prior service in Colorado’s PERA retirement system may be eligible to elect to continue membership in that retirement plan. All other new appointees must enroll in the DCP.

POLICY STATEMENT

Participants are required to contribute 8% of Covered Earnings on a tax-deferred basis to either the DCP or PERA. Refer to PERA publication and rules for eligibility requirements. Tax-deferred means that W-2 income from the University for Federal and State income tax withholding and reporting purposes will not include 8% retirement plan contributions. “Covered Monthly Salary” includes all salary paid to a participant, including summer salary and supplemental pay, as those terms are defined or described in the Academic Faculty and Administrative-Professional Staff Manual. For PERA participants, “Covered Monthly Salary” does not include pre-tax: medical, dental and LTD premiums; FSA contributions, or parking permits.

Employer Contributions

DCP – The University will contribute an amount equal to 10% of the employee’s Covered Monthly Salary to the DCP accounts of Regular and Special appointees of half-time or greater from date of appointment, and Temporary Academic Faculty and Administrative Professionals, Post-Doctoral Fellows, Veterinary Interns, and Clinical Psychology Interns of half-time or greater appointment after one (1) year of continuous service at that level.

To complete one year of service, a 9-month employee must complete 2 consecutive semesters of continuous ½ time or greater employment (excluding summer term) and a 12-month employee must complete 12 months of ½ time or greater employment. Any interruption in continuous appointment requires the eligible employee to complete one year of service again before CSU will provide the employer match to the DCP.

For any DCP participant who is a PERA “retiree” (as defined by Article 51 of Title 24 of the Colorado Revised Statutes) as of the date of employment or reemployment or becomes a PERA “retiree” at any time thereafter, the employer contribution will be reduced by any amount CSU is required to contribute to PERA with respect to the employee, except that the reduction shall not apply to: tenured/tenure track faculty members hired prior to July 1, 2005, or to tenured faculty members on a transitional appointment that commenced prior to January 2, 2006.

PERA – You may be eligible to participate in PERA if you have at least 12 months of Public Employees’ Retirement Plan (PERA) of Colorado credited service; have money in a PERA membership account; and have not previously elected to participate in an Optional

Retirement Plan (ORP) at this or any other public college or university in Colorado, and have not received a retirement annuity from PERA. If you are now or have previously been a PERA annuitant (even if your annuity is now suspended), and you have not returned to “active” PERA service in a PERA covered position since you received your last monthly annuity payment, you may not enroll in PERA and must enroll in the DCP Plan.

NOTE: PERA is a separate and independent entity and has the authority to make determinations regarding eligibility for membership. CSU cannot mandate, nor it is responsible for, PERA’s determinations regarding eligibility.

If PERA determines that you are not eligible for membership at any time after you file a Retirement Plan Election selecting PERA as your retirement plan, the University must enroll you in the DCP. Please contact PERA to request a determination of your eligibility for membership in PERA. It is important for you to disclose to PERA if you are receiving or have ever received a PERA annuity. PERA’s website at www.copera.org contains information regarding eligibility as defined by PERA. If PERA determines you are eligible to participate in PERA, you must complete the Retirement Plan Enrollment form no later than 30 days from your appointment date. If this form is not received by this date, you will be defaulted into the DCP retirement option.

If you are eligible as determined by PERA, and choose to enroll in PERA, the University will contribute the percentage of Covered Salary required by state statute to PERA’s asset pool to fund retirement and other benefits provided by PERA. The University’s contributions to PERA are never vested; instead, you acquire a vested right to future benefits after five (5) years of PERA credited service if you do not request a refund of your contributions upon termination of employment with the University. Please refer to PERA publication and rules for specific details on eligibility and retirement plan features.

CSU Retirement Eligibility

At the May 5, 2005 CSU Board of Board of Governors Meeting, the following policy on retirement was adopted:

MOVED, that the Board adopt the following definition of “retiree” eligible for post-retirement honors, privileges and benefits made available from time to time to retired academic faculty, administrative professional, and state classified employees of Colorado State University:

A “retiree” from Colorado State University (“CSU”) shall be any academic faculty member, administrative professional or state classified employee who separates employment and who, at the time of separation, has attained the age of 55 with at least 20 years of service or who has attained the age of 60 with at least 5 years of service.

“Service” shall include those periods of employment with Colorado State University during which the academic faculty member, administrative professional, or state classified employee has received the “Employer Contribution” to the Colorado State University Defined Contribution Plan for Retirement ( as defined therein) or during which the University has made employer contributions to PERA for such person; had an appointment of ½ time or greater; and, was receiving, or was eligible to receive benefit pay or the state classified insurance(s) match. Periods of paid leaves, or unpaid leaves of one year or less during which the employee received, or was eligible to receive, benefit pay or the state classified insurance(s) match will be counted as “service”.

Periods of University employment do not need to be continuous to be counted as “service” except that an academic faculty member, administrative professional, or state classified employee must have at least 5 consecutive years of “service” in the period of employment immediately preceding the date of separation.

Any academic faculty member, administrative professional, or state classified employee may retire only once from the University and any subsequent period of service shall not result in any increase in postretirement honors, privileges or benefits for such employee.

The definition of “retiree” as outlined in this policy, shall apply to any academic faculty member, administrative professional, or state classified employee of CSU appointed or reappointed on or after July 1, 2005 and shall be used to determine eligibility for any honors, privileges or benefits extended from time to time to retirees from CSU to the extent that such honors, privileges or benefits are under the control of the Board or the University.

NOTE: This Board action did not change the retirement eligibility criteria for DCP participants, but rather imposed the same standards for PERA participants.

Complete printed information on the Defined Contribution Plan and the plan description are available from the Benefits Section of Human Resource Services.

REFERENCES

 

Print Version: Click Here to Print

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