Iowa Code 97B.49A – Monthly payments of allowance — general calculation
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1.
Definitions.
For the purposes of this section:
a. “Applicable percentage” means sixty percent or, for each active or inactive vested member retiring on or after July 1, 1996, sixty percent plus, if applicable, an additional one-fourth of one percentage point for each additional calendar quarter of membership and prior service beyond thirty years of service, not to exceed a total of five additional percentage points.
b. “Fraction of years of service” means a number, not to exceed one, equal to the sum of the years of membership service and the number of years of prior service divided by thirty years.
Terms Used In Iowa Code 97B.49A
- Abolished system: means the Iowa old-age and survivors' insurance system repealed by sections 97. See Iowa Code 97B.1A
- Accumulated contributions: means the total obtained as of any date, by accumulating each individual contribution by the member with interest plus interest dividends as provided in section 97B. See Iowa Code 97B.1A
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
- Contributions: means the payments to the fund required herein, by the employer and by the members, to provide the benefits of the retirement system. See Iowa Code 97B.1A
- Employer: means the state of Iowa, the counties, municipalities, agencies, public school districts, all political subdivisions, and all of their departments and instrumentalities, including area agencies on aging, other than those employing persons as specified in subsection 8, paragraph "b" subparagraph (7), and joint planning commissions created under chapter 28E or 28I. See Iowa Code 97B.1A
- Final average covered wage: means the greater of the following:a. See Iowa Code 97B.1A
- Inactive vested member: means an inactive member who was a vested member at the time of termination of employment. See Iowa Code 97B.1A
- Member: means an employee or a former employee who maintains the employee's or former employee's accumulated contributions in the retirement system. See Iowa Code 97B.1A
- Membership service: means service rendered by a member after July 4, 1953. See Iowa Code 97B.1A
- Prior service: means any service by an employee rendered at any time prior to July 4, 1953. See Iowa Code 97B.1A
- Retirement: means that period of time beginning when a member who has filed an approved application for a retirement allowance has survived into at least the first day of the member's first month of entitlement and ending when the member dies. See Iowa Code 97B.1A
- Service: means service under this chapter by an employee, except an elected official, for which the employee is paid covered wages. See Iowa Code 97B.1A
- System: means the Iowa public employees' retirement system. See Iowa Code 97B.1
- Vested by service: means a member who meets one of the following requirements:(1) Prior to July 1, 1965, had attained the age of forty-eight and completed at least eight years of service. See Iowa Code 97B.1A
- Vested member: means a member who has attained through age or sufficient years of service eligibility to receive monthly retirement benefits upon the member's retirement. See Iowa Code 97B.1A
- wages: includes amounts that can be received in cash in lieu of employer-paid contributions to such plans, if the election is uniformly available and is not limited to highly compensated employees, as defined in section 414(q) of the Internal Revenue Code. See Iowa Code 97B.1A
- year: means twelve consecutive months. See Iowa Code 4.1
- Years of prior service: means the total of all periods of prior service of a member. See Iowa Code 97B.1A
2.
Entitlement to monthly allowance.
Each member, upon retirement on or after the member’s normal retirement date, is entitled to receive a monthly retirement allowance determined under this section. For an inactive vested member the monthly retirement allowance shall be determined on the basis of this section and section 97B.50 as they are in effect on the date of the member’s retirement.
3.
Calculation of monthly allowance.
For each active or inactive vested member retiring on or after July 1, 1994, who is vested by service, a monthly benefit shall be computed which is equal to one-twelfth of an amount equal to the applicable percentage of the final average covered wage multiplied by a fraction of years of service. However, if benefits under this section commence on an early retirement date, the amount of the benefit shall be reduced in accordance with section 97B.50.
4.
Alternative calculations.
a. For each active member employed before January 1, 1976, and retiring on or after January 1, 1976, and for each member who was a vested member before January 1, 1976, with four or more complete years of service, a formula benefit shall be determined equal to the larger of the benefit determined under this paragraph and paragraph “b” of this subsection, as applicable, the benefit determined under subsection 3, or the benefit determined under section 97B.49G, subsection 1. The amount of the monthly formula benefit for each such active or vested member who retired on or after January 1, 1976, shall be equal to one-twelfth of one and fifty-seven hundredths percent per year of membership service multiplied by the member’s average annual covered wages. In no case shall the amount of monthly formula benefit accrued for membership service prior to July 1, 1967, be less than the monthly annuity at the normal retirement date determined by applying the sum of the member’s accumulated contributions, the member’s employer‘s accumulated contributions on or before June 30, 1967, and any retirement dividends standing to the member’s credit on or before December 31, 1966, to the annuity tables in use by the system with due regard to the benefits payable from such accumulated contributions under sections 97B.52 and 97B.53.
b. For each member employed before January 1, 1976, who has qualified for prior service credit in accordance with section 97B.43, subsection 1, a formula benefit shall be determined equal to the larger of the benefit determined under this paragraph and paragraph “a” of this subsection, as applicable, the benefit determined under subsection 3, or the benefit determined under section 97B.49G, subsection 1. The amount of the monthly formula benefit under this paragraph shall be equal to eight-tenths of one percent per year of prior service credit multiplied by the monthly rate of the member’s total remuneration not in excess of three thousand dollars annually during the twelve consecutive months of the member’s prior service for which that total remuneration was the highest. An additional three-tenths of one percent of the remuneration not in excess of three thousand dollars annually shall be payable for prior service during each year in which the accrued liability for benefit payments created by the abolished system is funded by appropriation from the Iowa public employees’ retirement fund.
c. For each active and vested member retiring who cannot have a benefit determined under the formula benefit of paragraph “a” or “b” of this subsection, subsection 3, or section 97B.49G, subsection 1, a monthly annuity for membership service shall be determined by applying the member’s accumulated contributions and the employer’s matching accumulated contributions as of the effective retirement date and any retirement dividends standing to the member’s credit on or before December 31, 1966, to the annuity tables in use by the system according to the member’s age and contingent annuitant’s age, if applicable.