What’s new

July 1, 2009
Pension Reform Bill becomes law

On June 16, 2009, the Governor signed Chapter 21 of the Acts of 2009, An Act Providing Responsible Reforms in the Pension System (the Act), which had been approved unanimously in the House and the Senate.

While this legislation addresses a number of issues affecting the administration of benefits across the Commonwealth’s 106 public retirement systems, its most significant impact for MTRS members is in its amendments to the definition of regular compensation.

The amended definition of regular compensation is intended to provide increased transparency, predictability, and uniformity in the calculation and determination of retirement benefits. In brief, the amendment:

• excludes indirect payments, in-kind payments, or any payments for such items as housing, lodging, travel, annuities, life or disability insurance premiums or other retirement benefits, and
• transitions the application of the amended definition by “grandfathering” certain existing contract provisions. Specifically, the Act allows members to include the provisions in their contracts that were deemed regular compensation as of May 1, 2009, and allows those provisions to continue to be deemed regular compensation for the term of that contract, but in no event later than July 1, 2012. However, this provision does not allow a member to add or increase any amounts to those that were in effect on May 1, 2009.

The MTRS will be updating our regulations as necessary and working with the Public Employee Retirement Administration Commission (PERAC) to implement the provisions of the new law. In the meantime, we hope you find the following helpful:

• The full text of the Act:
  http://www.mass.gov/legis/laws/seslaw09/sl090021.htm
• A section-by-section description of the Act issued by PERAC on June 22, 2009:
  http://www.mass.gov/perac/09memos/2409.html
• Frequently asked questions—and answers, issued by PERAC on June 26, 2009:
  http://www.mass.gov/perac/report/faqchapter21.pdf

June 17, 2009
Retirees: If you have returned your 2009 Benefit Verification form, thank you! If not, please watch for your “FINAL NOTICE” to arrive soon

If you have already returned your completed 2009 Benefit Verification form, thank you! If not, please watch your mailbox for your “FINAL NOTICE” to arrive soon—and be sure to return your completed form by Friday, July 10.

For more information, please see:

• How to read your 1099-R form (for retirees and beneficiaries)
• 1099-R Q&A for refund recipients (generally, former MTRS members who left the MTRS and withdrew their funds)
• The Benefit Verification Process (for retirees and beneficiaries)

June 1, 2009
Active and inactive members: Watch your mailbox for your 2008 Annual Statement to arrive soon!

Beginning on Wednesday, June 3, our vendor will be mailing this year’s Annual Statement of Annuity Savings Account to our more than 108,000 active and inactive members. Please note: For more information about your Statement, please see our FAQ page. If no beneficiary is listed on your Statement, or if you want to change your current beneficiary designation, please download a Beneficiary Designation—Active Member form (2 pages; pdf), and then mail your completed form to our Cambridge office. If you do not receive your Annual Statement by Monday, June 22, please request a duplicate Statement by calling us at 617-679-6895.

April 29, 2009
Retirees—take note:
The Federal Stimulus Bill may have lowered your federal tax withholding beginning with your April 2009 payment
If you are affected, you might want to request a change in your withholding amount

The American Recovery and Reinvestment Act (ARRA), known as the federal stimulus bill, lowered tax withholding rates for retirees beginning April 1, 2009 and continuing through 2010. Accordingly, if your federal income taxes are withheld from your monthly benefit payment based on:

• marital status and the number of exemptions claimed (the IRS tax tables), the net amount of your monthly benefit may have changed as a result of the new tax rates. The decrease in your federal tax withholding will result in a corresponding increase in your monthly payment. (In fact, the new tables may lower your taxes so much that no tax is withheld from your benefit payment.)
• a set dollar amount—including zero dollars, meaning that no taxes are withheld from your monthly payments—your benefit amount will not change as a result of the new tax tables.

If you would like to change your federal tax withholding amount or method, please submit a revised Substitute W-4P form (pdf, one page), and be sure to see The Federal Stimulus Bill: FAQ.

March 3, 2009
MTRS seeks owners of unclaimed funds

If you are:
• the executor or executrix, or
• the survivor or beneficiary
of a deceased MTRS retiree, the MTRS may have unclaimed funds on account for you. Please check our Unclaimed funds page for additional information.

NEW: 8 Things you should know as an active member: Test your knowledge of the basics with this quick True-or-False quiz!

October 2, 2008
Despite recent events in the financial markets,
please be assured that your retirement benefits are secure

While the recent events in the financial markets are of concern to all of us, we want to take a moment to reassure you: Regardless of fluctuations in investment markets, your MTRS retirement benefit is secure.

As you probably know, under the MTRS defined benefit plan, your retirement benefit is determined according to a set formula and the amount is guaranteed regardless of fluctuations in the pension fund’s performance. In other words, events in the stock market do not affect the formula or the amount of your benefit. Additionally, the funds that are used to pay your benefits are invested in a well diversified portfolio, managed by the Pension Reserves Investment Management Board (http://www.mapension.com), with a focus on long-term returns. Our pension fund has successfully endured ups and downs in the financial markets in the past, and it is designed to withstand even the extremes that we are experiencing today.

For more information, see How your MTRS benefits are funded.

Last modified: July 1, 2009