Code of Massachusetts Regulations
807 CMR - TEACHERS' RETIREMENT BOARD
Title 807 CMR 23.00 - Effective Date Of Service Purchase Interest Rate
Section 23.01 - Types of Changes to Interest Rates

807CMR 23.00 governs the date on which the interest rate applicable to service purchases is determined. Service purchase interest rates may change, for example, due to changes in the actuarial assumed interest rate determined by PERAC (which in turn determines the statutory "buyback interest" rate) or action of the Legislature. When interest rates change, a member may be uncertain whether the interest rate that governs his or her service purchase is the one prevailing on the date of application for the service purchase, the date the member is invoiced for the purchase, or the date that the member pays for the purchase. When interest rates reduce, significant administrative inefficiency and delay may result from members withdrawing their outstanding applications and re-applying in order to take advantage of the lower rate.