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Washington Administrative Code
Title 415 - Retirement Systems, Department ofChapter 415-02 - General provisions
ACTUARIAL FACTORS AND SCHEDULES
Section 415-02-360 - What is the optional cost-of-living adjustment (COLA) for PERS Plan 1 and TRS Plan 1?

Wash. Admin. Code § 415-02-360

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Current through Register Vol. 24-12, June 15, 2024
Section 415-02-360 - What is the optional cost-of-living adjustment (COLA) for PERS Plan 1 and TRS Plan 1?
(1) PERS Plan 1 and TRS Plan 1 members can choose to receive an initially reduced retirement benefit in order to receive an annual cost-of-living adjustment in the future. With this optional COLA, the member's monthly retirement benefit is actuarially reduced at the time of retirement. Thereafter, the monthly benefit of the member (and subsequently their beneficiary) is adjusted annually, based on changes in the consumer price index (CPI) for the Seattle-Tacoma-Bremerton, Washington area, up to the statutory maximum. For more information, see:

PERS Plan 1: RCW 41.40.188(1)(c); WAC 415-108-326

TRS Plan 1: RCW 41.32.530(1)(d); WAC 415-112-504

(2)Examples
(a) Ernie is a member of TRS Plan 1. He retires at age 55 with 30 years of service and chooses the Single Life Option (no survivor beneficiary). His average final compensation (AFC) is $4,295.33 per month.
(i) If he does not choose the optional COLA, his monthly benefit will be $2,577.20 (2% x 30 x $4,295.33).
(ii) If he does choose the optional COLA, his initial monthly benefit will be reduced to $1,909.19, based on the factor in the table in subsection (3) of this section (.7396 x $2,577.20). This monthly amount may increase each year with changes in the CPI.

Regardless whether or not Ernie chooses the optional COLA, he will begin to receive the uniform COLA at age 66, consistent with all statutory requirements.

(b) Tina is a member of PERS Plan 1. She retires with 30 years of service credit at age 52 and 8 months. Because she has 30 years of service, there is no reduction for an early retirement. Tina chooses the Single Life Option (no survivor beneficiary). Her average final compensation (AFC) is $3,825.00 per month.
(i) If she does not choose the optional COLA, her monthly benefit will be $2,295.00 (2% x 30 x $3,825.00).
(ii) If she does choose the optional COLA, her initial monthly benefit will be reduced to $1,692.56, based on the factor in the table in subsection (3) of this section (.7375 x $2,295.00). This monthly amount may increase each year with changes in the CPI.

Regardless whether or not Tina chooses the optional COLA, she will begin to receive the uniform COLA at age 66, consistent with all statutory requirements.

(3)Table.

Use these factors to convert monthly benefit payments (any retirement option) without the optional COLA to the same retirement option with the optional COLA. The following factors are effective September 1, 2010.

Plan 1 Optional COLA Factors

Age

PERS 1

TRS 1

Age

PERS 1

TRS 1

20

.6636

.6664

61

.7713

.7648

21

.6650

.6675

62

.7760

.7693

22

.6665

.6687

63

.7807

.7739

23

.6680

.6698

64

.7855

.7786

24

.6695

.6710

65

.7904

.7833

25

.6711

.6722

66

.7953

.7881

26

.6727

.6734

67

.8003

.7930

27

.6743

.6746

68

.8054

.7980

28

.6760

.6759

69

.8105

.8030

29

.6777

.6772

70

.8157

.8081

30

.6794

.6786

71

.8210

.8133

31

.6811

.6800

72

.8263

.8185

32

.6828

.6815

73

.8317

.8238

33

.6845

.6831

74

.8370

.8291

34

.6862

.6847

75

.8425

.8344

35

.6879

.6864

76

.8479

.8398

36

.6897

.6881

77

.8533

.8452

37

.6915

.6900

78

.8588

.8506

38

.6934

.6918

79

.8642

.8560

39

.6954

.6938

80

.8696

.8614

40

.6975

.6959

81

.8750

.8668

41

.6997

.6980

82

.8803

.8722

42

.7020

.7002

83

.8856

.8775

43

.7045

.7024

84

.8907

.8828

44

.7071

.7048

85

.8957

.8879

45

.7099

.7073

86

.9006

.8929

46

.7129

.7098

87

.9053

.8978

47

.7161

.7125

88

.9098

.9025

48

.7194

.7153

89

.9141

.9070

49

.7229

.7183

90

.9181

.9113

50

.7264

.7214

91

.9218

.9153

51

.7300

.7247

92

.9253

.9191

52

.7337

.7282

93

.9286

.9226

53

.7375

.7319

94

.9316

.9258

54

.7414

.7357

95

.9343

.9288

55

.7454

.7396

96

.9369

.9316

56

.7494

.7435

97

.9392

.9342

57

.7536

.7476

98

.9415

.9365

58

.7579

.7518

99

.9436

.9388

59

.7623

.7560

60

.7668

.7604

Wash. Admin. Code § 415-02-360

Statutory Authority: RCW 41.50.050(5). WSR 10-16-086, § 415-02-360, filed 7/30/10, effective 9/1/10. Statutory Authority: RCW 41.50.050(5) and chapter 41.45 RCW. WSR 08-20-068, § 415-02-360, filed 9/25/08, effective 10/26/08; WSR 02-18-048, § 415-02-360, filed 8/28/02, effective 9/1/02.