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<p class="MsoNormal"><span style="font-size:12.0pt">Payroll & HR Partners, <o:p></o:p></span></p>
<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt">We are continuing to keep you informed about SB1049 and how the changes will impact your work. I have attached the message from November 2019 that outlined all the changes associated with SB1049. If you are
not familiar with SB1049, this is a good place to start. This communication is specifically addressing
<b>#4 IAP redirect</b>, and <b>#5 True-Up Deduction (now referred to as Voluntary Contributions)</b>.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Starting July 1, 2020, employees earning more than $2,500 a month, will have a portion of their 6% IAP contribution redirected by PERS to an account called the "Employee Pension Stability Account" (EPSA).
For Tier 1&2 employees this redirect amount is 2.5%, for OPSRP .75 %. This account will be used to help fund future pension benefit payments. To be clear, beginning July 1, 2020 most employees will no longer receive the full 6% that is withheld from their
wages in their IAP account.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Employees earning more than $2,500 a month, and impacted by the IAP redirect, will have the option of making a voluntary contribution to their IAP account to bring the contribution back to 6%. This means they
are able to contribute the same amount of 2.5% for Tier 1 &2 or .75% for OPSRP. These voluntary contributions will be in addition to the 6% withheld from their wages. Employees will make this election online through their PERS Online Member Services account
(OMS). PERS is currently working to implement this system functionality. While the redirect will begin July 1, 2020, PERS does not anticipate having system functionality in place for employees to make voluntary contributions until September 2020.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">OSPS & CPERS are currently working to create a deduction code in OSPA for the voluntary contribution; however, we will not be able to set up employee deductions until PERS has system functionality in place
for employees to make the election in OMS. At that point there will be a need for retroactive adjustments for employees that chose to begin the voluntary contribution retroactively to July 1, 2020.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">We are still working out the details but here is a step by step overview of how we anticipate this process to flow:
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">In approximately September 2020 employees earning more than $2,500 a month can access their PERS OMS account and elect for voluntary contributions.
</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">Employees can choose to start voluntary contributions with the next pay cycle after CPERS receives notice from PERS, or retroactively back to July 1, 2020.
</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:.75in;text-indent:-.25in;mso-list:l0 level2 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:"Courier New""><span style="mso-list:Ignore">o<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">(Note- the retro option will only be available through October 2020. Beginning 11/1/2020, all elections must be prospective.)</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">Once the election is made CPERS will receive notification from PERS after the next report load (payroll run).
</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">CPERS will notify the agency payroll office that the deduction needs to be added to the payroll system.
</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">Agency payroll will set up the P070 deduction code with the percentage amount based on tier and make a manual dollar amount entry for any retroactive adjustments depending on the nature of the election.
The statute states that the voluntary contributions cannot be paid by the employer.</span><o:p></o:p></p>
<p class="MsoNormal" style="margin-left:27.0pt;text-indent:-.25in;mso-list:l0 level1 lfo2;vertical-align:middle">
<![if !supportLists]><span style="font-size:10.0pt;font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman"">
</span></span></span><![endif]><span style="font-size:12.0pt">Ongoing deduction and retro adjustment if applicable will be deducted from the employee's next check and ongoing.
</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">You will receive additional communication from OSPS & CPERS about this process closer to October. <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">PERS has published a great deal of information on SB1049. Please see the second attachment in this email for links to recent communications from PERS.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Please contact DAS CPERS or OSPS if you have questions.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Sincerely, <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#993366"><o:p> </o:p></span></p>
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