Current through Register Vol. 56, No. 6, March 18, 2024
(a) A shared-cost purchase is one in which the member pays only the employee's share and not the employer's share of the purchase. A member may purchase all or a portion of such eligible service. A shared-cost purchase will be calculated on the basis of the actuarial purchase factor established for the member's age at the time of the purchase request times the higher of either the member's current annual base salary or highest fiscal year base salary. The following types of purchases are shared-cost purchases:
1. Former membership credit in a New Jersey State-administered retirement system;
2. Former service with any other employer which was not certified for membership but which would have qualified on an optional or a compulsory basis at the time the service was rendered;
3. Continuous temporary service without interruption, substitute service, or intermittent service immediately preceding enrollment is eligible for purchase provided the following conditions are met:
i. Continuous temporary service without interruption must be employment without a break in service. For an employer that reports on a monthly basis, a break in service is defined as no salary earned by an employee during a month. For an employer that reports on a biweekly basis, a break in service is defined as no salary earned by an employee during a biweekly pay period;
ii. Substitute service is eligible provided the employment immediately precedes enrollment in the PERS. Immediately preceding enrollment is defined as employment rendered during the month or biweekly pay period prior to the date of enrollment. The period(s) of substitute service that a member can request to purchase must meet the following criteria:
(1) A year of substitute service wherein a 10-month employee worked an average of 10 days per month and an aggregate of 100 days during a regular work year. A 12-month employee is required to have worked an average of 10 days per month and an aggregate of 120 days per year;
(2) Substitute service for a period of less than one year immediately preceding enrollment is eligible for purchase provided the member works a minimum average of 10 days per month for each month of substitute service; and
(3) When more than one year of substitute service is requested for purchase, each year of substitute service rendered prior to enrollment is reviewed and each year is required to meet the criteria set forth under the provisions of (a)3ii(1) above; and
iii. Intermittent service, as defined by 17:2-2.3(a)8 must result without interruption in permanent employment with the same employer. The intermittent service must have been in a position which satisfied the job's requirement for experience needed to qualify for the permanent title;
4. Leaves of absence without pay:
i. The period of the leave for personal reasons, which does not exceed 93 days. Child care is considered leave for personal reasons. Union leave after January 12, 2007 is considered leave for personal reasons;
ii. The period of the leave up to two years for personal illness. The Division may require proof from the employer that the illness existed for the length of the leave;
iii. Maternity leave may consist of a personal illness component and a personal reasons component (for childcare). Members who apply to purchase any period of a maternity leave as personal illness must provide certification from their physician, verifying that the member was disabled during the requested purchase period, due to pregnancy or childbirth. Absent physician certification, three months is the maximum allowable period of purchase for maternity leave for personal reasons; and
iv. A leave of absence shall be deemed to have ended upon resignation, termination or return to covered payroll;
5. Members may purchase continuous service subsequent to the date their employer adopted the PERS, provided the service was with the same employer to the date of enrollment;
6. Non-veterans hired prior to July 1, 1966, whose employers have not adopted the PERS and are otherwise eligible for enrollment, may enroll any time and purchase continuous service retroactive to July 1, 1966, provided the service was with the same employer to the date of enrollment;
7. Eligible out-of-State public employment, up to a total purchase of 10 years, provided the member is not receiving or eligible to receive a retirement benefit from any other system for the same period of time.
i. As provided in 43:15A-42, out-of-State service cannot be used to qualify for an ordinary disability retirement.
ii. For purchase applications received November 1, 2008 or later, out-of-State purchases cannot be used to qualify for post-retirement medical benefits; and
8. Non-concurrent TPAF service if a dual member of TPAF and PERS pursuant to P.L. 2001, c. 6 (43:15A-14 ). All or a portion of non-concurrent service in the PERS from an expired or withdrawn account may be purchased.
(b) The types of purchases indicated in (b)1 through 3 below are considered to be full-cost purchases. A member may purchase all or a portion of such eligible service. The lump sum purchase cost shall be calculated on the basis of the actuarial purchase factor established for the member's nearest age at the time of the purchase request times the higher of either the member's current annual base salary or highest fiscal year base salary. The computed lump sum purchase cost shall then be doubled to establish the full cost to the member. This cost is calculated in this manner as N.J.S.A. 43:15A-73.1 provides that the employer shall not be liable for any costs of purchasing this service; therefore, the member must pay both the employee and employer share.
1. Active duty military service prior to enrollment. Active military service that is eligible for purchase means honorable full-time duty in the active military service of the United States, which is the same as the Federal definition found at 10 U.S.C. §
101. Such term includes full-time training duty, and attendance, while in the active military service, at a school designated as a service school by law or by the Secretary of the military department concerned. It cannot include periods of service of less than 30 days. It does not include weekend drills or annual summer training of a national guard or reserve unit nor does it include periods when the member was on-call. It also does not include time spent in the Reserved Officers Training Corps or as a cadet or midshipman at one of the service academies. Military service before enrollment cannot be used to qualify for an ordinary disability retirement. Members must serve a minimum of 17 days active duty within a month for that month to be eligible for purchase of service credit;
2.Employment with the Federal government, provided the member is not receiving or eligible to receive a retirement benefit from the Federal retirement system for the same period of time.
i. Pursuant to N.J.S.A. 43:15A-42, only New Jersey service (public service earned at employing locations in the State of New Jersey) may be used to qualify for an ordinary disability retirement; and
ii. For purchase applications received November 1, 2008 or later, U.S. Government purchases, military purchases, and out-of-State purchases cannot be used to qualify for post-retirement medical benefits, pursuant to N.J.S.A. 43:15A-73.1; and
3. Service established under a local municipal or county retirement system within the State of New Jersey.
(c) A member shall be eligible to purchase an aggregate of up to 10 years of out-of-State public employment, military service, and Federal employment, provided that the member is not receiving, nor is entitled to receive, a retirement allowance for such service from any other public retirement system and provides proof to the Division that the member has withdrawn from such other system. A qualified veteran shall be eligible to purchase an additional five years of military service rendered during periods of war for an aggregate of 15 years of such service.
(d) Rules concerning the purchase and/or conversion of Class A credit include the following:
1. The cost of Class B service credit is based on the actuarial factors, and such factors provide a retirement benefit which is one-sixth greater than service credited as Class A. If Class A credit is purchased, the cost will be six-sevenths of the amount computed for a Class B purchase. The computation is based on the member's present salary or highest fiscal year base salary multiplied by the actuarial purchase factor for the member's age at the time of purchase with regular interest.
2. If a Class A member converts to Class B, the member will contribute an additional one-sixth of the total contributions that would have been payable based on the member's full Class A contribution rate with regular interest.
