SERP update

AFT met with administration yesterday morning about the SERP. We’ve clarified a few things. Here’s what we understand so far.

— The SERP amount is 65% of full-time base salary.

— There is no lump sum option. Payments can only be taken as an annuity over 5 or more years. We had previously been told there would be a way to take it as a lump sum. 

— The annuity interest rate varies depending the time period.  See the Q & A, below, for more details.

— You can resign from CCSF and take the SERP without retiring from STRS. However, you must retire from STRSwithin three years to protect your lifetime retiree medical benefits.

— Faculty on sabbatical leave who have completed their sabbatical by the end of Spring 2017 semester will be afforded an exception to their post-sabbatical service requirement. 

 Administration will continue to consult with AFT over implementation of the SERP including timing, deferrals, etc. 

Here are some important links:

Keenan’s website to sign up for an individual appointment or request an enrollment packet: http://keenanfinancialservicesccsf.setmore.com/

City College website for timelines and announcements:
http://www.ccsf.edu/en/employee-services/district-business-office/human-resources.html

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Here are answers to some common questions. We’ll update this as we get more information.

 Q. Who is eligible for the SERP?

A. You must be at least 55 years old and have at least 5 years of service as of 7/1/17You must be full-time faculty. This SERP offer is limited to 100 peopleAdministration will decide who is allowed to take the SERP based on program need and seniority. Administration may offer a “second round” in December if more than 100 people apply. 

Q. What are the dates?

A. The retirement date under the SERP is 7/1/17The full timeline is here: http://www.ccsf.edu/en/employee-services/district-business-office/human-resources.html

Q. What’s up with that interest rate on my annuity?

A. Annuity interest rates are all currently low. You can easily get a higher interest rate by taking the money in a short time-period and investing it somewhere else. However, if you take the payments in only 5 years, you will actually receive slightly less than your 65%.  AFT retiree committee members Ron Bixler and Doug Orr have done great work on this. We will post a spreadsheet soon that they put together with more details.

Q. What does “SERP” stand for, anyway?

A. Supplemental Employee Retirement Plan

Q. How can I tell if this is a good idea?

A. It’s not a good idea for everyone. The SERP gives you 65% of one year’s salary. Depending on your age, working another few years can help your STRS pension. Please come to AFT 2121’s retirement planning session for more information. We’ll discuss pro and cons of taking the SERP.

Q. Will CCSF replace faculty who leave under the SERP?

A. The only guarantee they have given us is that they will replace at least 50% of SERP positions with full-time hires within five years.

Q. How are the payments taxed?

A. The SERP is paid out as a 403(b). You can take the money and pay tax on it as part of your income, or roll it over into a tax-deferred account such as an IRA. District agrees to waive post-sabbatical service requirement for SERP faculty who complete their sabbatical by end of Spring 2017.

Posted in Benefits, Negotiations, Pay, Retiree Chapter

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