The university has approved a one-time opportunity for former employees (referred to as "terminated") who are vested members of a university retirement plan that includes a defined benefit (either the Defined Benefit (DB) Plan or the Hybrid Plan) and have not drawn a benefit.
What is the Optional Terminated Vested Buyout Program?
Former employees vested in the Defined Benefit Plan or the defined benefit component of the Hybrid Plan who have not made an election to receive a benefit will have an opportunity to receive an increased lump sum benefit, if they elect such a benefit payment, during a one-time election window starting on October 17, 2023, and ending on December 1, 2023.
Individuals who select to take the enhanced lump sum distribution will gain control of their own benefit and investment decisions and will no longer be members in the Defined Benefit Plan or the defined benefit component of the Hybrid Plan after receipt of their lump sum benefit. Distributions to members will occur no later than April 2024.
Eligible members will receive a personalized statement in September 2023 that compares the value of the enhanced lump sum benefit to the value of their benefit without the enhancement to help such members decide what is best for them.
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Who is eligible for the Optional Terminated Vested Buyout?
Eligible members included in this offer will be former employees who:
- Terminated employment on or before April 1, 2023, and are no longer working for the university
- Were vested in the Defined Benefit Plan or the defined benefit component of the Hybrid Plan as of their termination date
- Have not made an election to receive their vested benefit
- Are living at the time of the one-time election window
- If the member is deceased, the beneficiary should contact the Office of Human Resources regarding eligible death benefits
Members not included in the offer will be:
- Retirees who are currently receiving a monthly payment
- Members who previously took a distribution as a final satisfaction of their benefits
- Deferred retirees who terminated employment with the university after reaching eligibility for early retirement but did not commence benefits
- Active employees currently working for the university (including those in a part time or limited capacity)
- Members who terminated employment between 09/01/86 and 09/30/97 who:
- Elected an optional derivative benefit, and
- Have a named joint annuitant still living*, and
- Did not revoke their optional derivative benefit election prior to 03/31/98
*Special rules exist in the case of divorce.
- Terminated members who are over the full benefit age of 65
What is the timeline?
- May 2023 - Eligible members received a general announcement about the optional one-time enhanced lump sum election window
- September 2023 - Eligible members received personalized statements comparing the value of their enhanced lump sum benefit to the value of their benefit without the enhancement
- October 2023 - Eligible members received election kits with decision guides
- October 17, 2023 - Election window opens
- December 1, 2023 - Election window closes
- No later than April 2024 - Lump sum distributions paid out to those eligible members who elected a lump sum distribution
Why is the university offering this option?
This optional program can be a benefit to both employees and the university and is a common practice for defined benefit plans. Lump sum payments to former employees allows those employees to consolidate their retirement accounts and manage their funding in a more consolidated manner.
The university's pension plan (and future beneficiaries) will benefit from the offer as the plan’s overall liability will be reduced. The pension plan gains the benefit of having fewer participants with smaller balances to track over time and reduces the investment risk within the plan through a smaller liability.
What is the financial status of the current Defined Benefit Plan?
The Plan is in good health. Members can count on receiving the benefits they’ve earned. The Board of Curators and 澳门六合彩官网开奖 administrators have been and continue to be committed to the sound fiscal management of the university’s pension plan.
Every year an independent actuary calculates how much the university must contribute into the plan to fully fund all benefits due under the plan. The university makes this contribution every year. We take our fiduciary responsibility very seriously and will never waiver from that commitment.
Reviewed 2023-11-07
