Section 411-104-3 - APPLICATION OF THE 5% AND 10% CAP LIMITATIONS1. When regular earnings for Year 1 of the AFC period are subject to the cap limitation, the earnable compensation for this AFC year must equal the uncapped earnable compensation for Year 1 of the AFC period.2. When regular earnings for Year 2 of the AFC period are subject to the cap limitations, the earnable compensation for this AFC year must equal the lower of the following: A. the uncapped earnable compensation for Year 2 of the AFC period; orB. 105% of the earnable compensation of Year 1 of the AFC period.3. When regular earnings plus any amount payable pursuant to 5 M.R.S.A. §17001(13)(B)(1) for Year 3 of the AFC period are subject to the cap limitations, the earnable compensation for this AFC year must equal the lower of the following: A. the uncapped earnable compensation for Year 3 of the AFC period determined by adding the amount of any payment allowable pursuant to 5 M.R.S.A. §17001(13)(B)(1) to the regular earnings for Year 3 of the AFC period;B. 105% of the capped earnable compensation used for Year 2 of the AFC period; orC. 110% of the earnable compensation for Year 1 of the AFC period.4. If AFC Years 2 and 3 are the only AFC years subject to the cap limitations, the capped earnable compensation for each year shall be determined as in subsections 2 and 3 above. If AFC year 3 is the only AFC year subject to the cap limitations, the capped earnable compensation for that year shall be determined as in subsections 3(A) and (B) above. If none of the regular earnings for an AFC year are subject to the cap limitation, then the uncapped earnable compensation for each such AFC year is the earnable compensation used for determining average final compensation. If only part of the regular earnings in an AFC year is subject to the cap limitations, the earnable compensation for that AFC year shall be determined as in subsections 2 or 3 above and the increase limitations shall be applied only to that period subject to the cap limitation.5. If, based on subsections 1 through 4, earnings would be excluded as a result of a cap limitation, earnings increases during the AFC period for the member's primary position that are the result of a collectively bargained salary or wage increase or a promotion must be determined. These earnings increases are added to the 5% and 10% cap limits in the corresponding years, resulting in increased cap limitations. Earnings are excluded only to the extent that the increased cap limitations are exceeded.6. A member who has earnings excluded as a result of a cap limitation after application of subsection 5 may, within 60 days of receiving notice of the exclusion, provide MainePERS with proof that excluded earnings for a position other than a primary position resulted from a collectively bargained salary or wage increase or a promotion. If the member does so, these earnings increases are added to the 5% and 10% cap limits in the corresponding years, resulting in increased cap limitations. Earnings are excluded only to the extent that the increased cap limitations are exceeded.7. The amount of earnable compensation for each AFC year shall be determined by the usual procedures followed by the System for converting earnable compensation first into an average daily rate and then into allowable annual earnable compensation.8. Member contributions in any AFC year that have been paid on earnable compensation that has been excluded from the benefit calculation by operation of this section shall be refunded to the member.94-411 C.M.R. ch. 104, § 3