The Texas County & District Retirement System (TCDRS) is a non-profit public trust providing pension and death benefits for eligible employees of participating subdivisions (counties and districts). The System is governed by a nine-member Board of Trustees and is managed by administrative staff in Austin. The TCDRS Act (Subtitle, F, Title 8 Texas Government Code) is the basis for administration of the System.
TCDRS membership is a condition of employment for Williamson County employees regularly and normally working at least 900 hours per year.
3. Why is my contribution 7%?
The TCDRS allows counties to establish employee contribution rates of 4-7% of the employee’s gross monthly compensation. Williamson County has elected the maximum contribution rate allowed by the TCDRS, which also maximizes the employee’s monthly pension payment at retirement. The employee contribution rate is subject to periodic review by Commissioners Court.
4. Are my contributions to the TCDRS taxed?
Since the TCDRS is a qualified pension plan under Section 401(a) of the Internal Revenue Code, your current contributions are not subject to federal income taxes until paid out by the System. Contributions are subject to Social Security withholdings.
5. What does Williamson County contribute to our retirement plan?
Williamson County uses the Annually Determined Contribution Rate (ADCR) Plan to finance the retirement plan and the cost is based on a number of factors, including the benefit options adopted by Commissioners Court and the results of an annual evaluation of liabilities to finance these options.
Vesting refers to your right to receive monthly retirement benefits from TCDRS once you satisfy the age requirement for retirement. After 8 years of credited service, you are vested and can receive lifetime monthly retirement benefits after other eligibility requirements have been satisfied. Once vested, you may terminate employment with Williamson County and still continue your membership with TCDRS and retain your right to future retirement benefits so as long as you do not withdraw your personal contributions.
7. Are there other forms of credited service; and can I get credit for Military Service?
If you have credited service in the Texas Municipal Retirement System, Employees Retirement System of Texas, Judicial Retirement System of Texas, Teacher Retirement System of Texas or City of Austin Employees Retirement System, you may combine such service with your TCDRS credited service to qualify for service retirement (does not qualify for disability retirement and death benefits). This is called the Proportionate Retirement Program.
You may also establish up to 60 months of credited service for military service performed prior to employment if you:
· Have earned at least 10 years of TCDRS-credited service;
· Are not currently receiving or eligible to receive a pension based on 20 or more years of active military duty (or it’s equivalent);
· Do not have credit in another Texas public retirement system for the same military duty; and
· Received an honorable discharge.
You can also receive current credited service for military service performed during a break in employment (upon meeting all eligibility requirements), which is awarded at the rate of one month of current credited service for each month of active duty military service or 12 months of inactive training in the National Guard or military reserve. Both military and Proportionate Retirement Program service allow credit for service only – not employee or employer contributions. Contact the Human Resources Department to apply for this credited service.
8. When am I eligible to receive monthly retirement benefits?
You are eligible to apply for a lifetime monthly pension if you satisfy any one of the following eligibility standards:
· Combined age and credited service (each rounded down to whole years) of 75 or more (Rule of 75). If you do not have any credited service as of 12/31/99, you must be vested with at least 8 years to qualify under the Rule of 75. If you have earned TCDRS credited service as of 12/31/99, you must have earned 4 years of credited service to qualify under the Rule of 75;
· 8 years of credited service at age 60;
· 30 years of credited service at any age.
9. What are my different payment options for my monthly retirement benefit?
You have several payment plans to select from, with all the plans paying you (the retiree) a monthly benefit for your lifetime. The plans offer a variety of choices to address your varying needs and concerns. You may not change the payment plan you elect at retirement once payments have started; therefore, long-term planning is important.
As an employee of Williamson County, your personal contributions are deposited monthly with the TCDRS with interest being credited each December 31 of the following year. Upon retirement, TCDRS credits this personal account balance an additional 250%, which is the “multiple matching credit” granted by Williamson County. The amount of your lifetime monthly retirement benefit is then actuarially determined based on this total personal account balance, interest earned on this balance during retirement, and your life expectancy. Depending on the payment plan you select at retirement, the monthly benefit may also be determined by the underlying guaranteed payment period (5, 10, or 15 years) for your beneficiary or the life expectancy of your beneficiary.
11. Is there a limit to the amount of my potential monthly pension benefit?
At the present time, the answer to this question is yes. Section 415 of the Internal Revenue Code does limit the total dollar amount on annual pension benefits you can receive. This limitation is not exclusive to the TCDRS and applies to all qualified pension plans. It is important to note that very few individuals are affected by these limits, and the IRS indexes the limits annually. In addition, any portion of your benefit that is attributed to credited service prior to January 1, 1986 is not subject to this limit. You will be notified by the TCDRS if you are potentially affected by this limitation.
12. Will my monthly benefits ever increase during retirement?
TCDRS allows subdivisions to periodically authorize increased pension payments to retirees and beneficiaries through two types of Cost-Of-Living Adjustment (COLA) options. The first option was made available in 1995 and is known as a “Catch-up COLA”. It allows an increase based on a percentage of the Consumer Price Index (CPI) from the date of retirement. The second option, a “flat rate” COLA (for example 1%, 2%, etc.), was made available in 2000. Williamson County has authorized a 60% of the CPI adjustment for the last five years. This authorization must be approved each year by the Commissioner’s Court.
13. Can I take a lump-sum distribution from my TCDRS account at retirement?
There is no provision under the TCDRS to take a full lump-sum distribution equaling the sum of your total account balance and “multiple matching credit” at retirement. Effective in 2000, there is an optional plan provision that would allow “partial” lump-sum distributions. At this time, the County has not adopted this option. If Williamson County adopts this optional plan provision in the future, it would allow you to choose at service retirement a Partial Lump-Sum Distribution in any amount up to the entire balance of your personal account, excluding the “multiple matching credit”. As a result, your monthly retirement benefit would be reduced to a smaller amount based on the size of your lump-sum distribution.
14. What happens upon my death as a TCDRS member?
If you have four years of credited service (at any age), you qualify for the Survivor Annuity Death Benefit (SADB). Under the SADB, you can elect to designate in advance for your beneficiary to automatically receive a pension benefit under a specific payment plan in the event of your death, or you can leave it to your beneficiary to elect the payment plan upon your death. Contact the Human Resources Department to make this election.
If you have less than four years of credited service, your beneficiary or estate will receive a full refund of your personal contributions and interest, as no pension benefit will be payable and no further interest credited to your account.
If you are already receiving a TCDRS pension, your monthly retirement benefits terminate unless you chose a payment plan that pays a designated beneficiary upon your death. Your beneficiary or estate will receive, at minimum, a full refund of your personal contributions and interest.
15. What happens if my employment with Williamson County is terminated before I retire?
If your employment with Williamson County is terminated, you have the right to receive a refund of your contributions and earned interest unless you become employed with another TCDRS subdivision before the refund is generated. When you withdraw your personal contributions from TCDRS, you terminate your membership and forfeit all service credit and the right to any pension benefits based on your TCDRS service. It also results in a forfeiture of all deposits made by Williamson County on your behalf.
If vested, you may leave your personal contributions and earned interest with the TCDRS and receive a monthly retirement benefit once you satisfy one of the eligibility requirements. If you are not vested and have less than 48 months of credited service, you may leave your personal contributions and earned interest with the TCDRS for up to 60 months after the date of your last deposit. Interest will be credited to your account each December 31 of the following year. If you do not become employed with a TCDRS subdivision or a Proportionate Retirement Program within 60 months, your membership is terminated and you forfeit all service credit and no further interest will be credited to your account.
If you are not vested and have at least 48 months of credited service, you may be eligible to receive a monthly retirement benefit under the Rule of 75 provided you have any credited service prior to 01/01/00.
16. Who do I contact with my questions regarding my retirement?
If you have any general questions about your retirement or any other County benefits, please contact the Human Resources Department at 512-943-1533 or by e-mail at HR@wilco.org. In addition, you may contact TCDRS Customer Service directly with specific questions at (512) 328-8889 or 1-800-823-7782. You may also e-mail them at customerservice@tcdrs.org. Their website address is www.tcdrs.org.
17. Can I request an estimated retirement benefit statement at any time?
Yes, you may contact TCDRS Customer Service directly at (512) 328-8889 or 1-800-823-7782 or by e-mail at customerservice@tcdrs.org to request an estimated retirement benefit statement. You can provide them with a variety of retirement dates that you are considering and they can produce a customized statement that will provide you with the estimated retirement benefits you would be eligible to receive based on the different retirement dates.
03/08/2005