Guide to OGS (Other Governmental Service)

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IMPORTANT NOTE
   This is an informational guide only. All benefits are paid only in accordance with the terms of the Water and Power Employees' Retirement Plan. If there are any conflicts, real or apparent, between this guide and the Plan, the terms of the Plan will prevail. Therefore, before taking any action which will affect your future welfare, we advise you to consult the Retirement Plan Office for the specific terms of the Plan in any situation.

Other Governmental Service (OGS) allows Water and Power Employees' Retirement Plan (Plan) members to purchase eligible prior governmental service credit including military service. OGS was negotiated by Department management and the unions and is similar to the program that is in place for Los Angeles City employees.

This Page Describes

 

Do I qualify to purchase OGS?

   In order to purchase OGS you must be a contributing member of the Plan and must have at least six (6) months of continuous full-time eligible prior governmental service.

   You will not qualify for an OGS purchase if you are eligible for a retirement benefit with another governmental agency and/or retirement system.

   If you are currently eligible for benefits from another governmental agency and/or retirement system and have left your contributions on deposit, do not withdraw them at this time. (see How much will OGS cost me? below)

 

What kind of OGS may I purchase?

   For all types of OGS, the OGS must be full-time, paid, and at least six (6) continuous months. It must have been with a governmental agency, such as:

  • U.S. Federal Government
  • U.S. Armed Forces
  • U.S. Postal Service
  • State, City or County Government (within the U.S.)
  • RTD
  • MTA

   The following types of services do not qualify for purchase under OGS:

  • Part-time employment.
  • Full-time employment that was less than six (6) continuous full months.
  • Military reserve service (unless the tour of duty was at least six (6) months of continuous active service).
  • Employment that was paid through a government contract or grant. You must have been paid directly by the governmental agency for the time to be eligible to purchase.

 

Do I have to buy all of the OGS service credit that I am eligible to purchase?

   No. You may purchase any number of whole months from within the period of your eligible service as long as you buy at least six (6) months of service credit.

 

Should I round up or down for part of a month's service credit?

   You must round down to the nearest whole month. Example: If you have 8-1/2 months of eligible service, you will be able to purchase 8 months. If you have 5 months and 28 days of OGS, it will be rounded down to 5 months. You will not be eligible to purchase this time because it is less than 6 months.

 

How much will OGS cost me?

   For most of our members, the following formula will give an estimate of the cost of OGS.

  1. Multiply the earnings for 80 hours shown on your paycheck stub by 2.175 to get your monthly salary.
  2. Multiply your monthly salary by your retirement contribution rate.
  3. Multiply that dollar amount by the number of whole months you will purchase.

Example

Monthly Salary X Contribution Rate X Number of Months = Cost
$4,000 6%* 30 $7,200

* Employees who were hired before 12/01/1983 should use the % for your entry age when you became a Plan member.

   The formula applies whether or not contributions were made to another governmental agency and/or retirement system for the period you wish to purchase. The formula also applies to Plan members who withdrew contributions after terminating from their previous governmental agency and/or retirement system.

   The actual cost of OGS will be based on your monthly salary as of the date your lump sum payment or signed contract to pay is received by the Retirement Office. Any retroactive adjustments to your monthly salary will affect the cost. Monthly salary includes base salary and most "add ons." Monthly salary does not include over-time and other types of payments that you do not get paid when you are on vacation.

   For those members who made contributions to another governmental agency and/or retirement system, but did not withdraw the contributions, the funds still on deposit with the other agency may be used to purchase OGS. That is why it is very important that you do not withdraw any contributions you may have on deposit with another government retirement plan. The Retirement Office will work with you to make sure that you are able to take advantage of this alternative way of buying OGS if it is beneficial to you.

 

What is the value of purchasing OGS?

   The value of purchasing OGS is the additional service credit that will be added to your years of Department service. If you purchase OGS, your retirement benefit will increase.

   Service credit is one of the factors used to calculate your retirement allowance. The more service credit you have, the larger your retirement allowance when you retire.

   To estimate how much larger your retirement allowance would be if you purchase your OGS, multiply your current monthly salary by the retirement factor of 2.1% (0.021) and by the number of years of OGS to be purchased.

Example

Monthly Salary X Retirement Factor X Number of Years = Additional Allowance
$4,000 2.1% 2.5 $210/month

   In this example, the cost of OGS is $7,200 and the additional retirement allowance is $210 per month. The payback period would be about 35 months, or just under three years ($7,200 divided by $210 = 34+ months).

   Although the purchase of OGS increases your retirement benefit, it does not increase your actual employment with the Department or your seniority status.

 

What forms do I need to fill out?

   The Retirement Office has a form called "Certification of Other Governmental Service." These forms are available as shown below.

   If you had more than one OGS employer, or tour of duty in the military, or period of unpaid maternity leave, you must submit an OGS Certification Form and documentation, if needed, for each occurrence.

   The Certification Form has two sections. You will complete Section I.

   Section II does not have to be completed if you are purchasing military service. In all other cases, Section II of the OGS form must be completed by your former governmental employer's personnel department and/or retirement system. You are responsible for mailing the form to your previous governmental employer and/or retirement system and instructing them to return it to the:

   Water and Power Employees' Retirement Plan
   111 N. Hope Street, Room 357
   Los Angeles, CA 90051

 

Completing the OGS Certification Form

Section I

  1. You must complete all parts of Section I.
  2. Indicate your anticipated date of retirement as well as the name and address of your previous employer if required (see Table below).
  3. Sign and date Section I.

Section II - This section does not apply to military service.

  1. Forward the Certification Form to your previous governmental employer and/or retirement system in order to certify your dates of previous full-time employment and retirement history.
     
  2. The previous governmental employer and/or retirement system must complete and sign Section II and return the form to the Retirement Office of verification.
     
  3. If the previous governmental employer and/or retirement system indicates that they are unable to certify employment dates, retirement contribution balances, we will notify you by mail.

   After your service is confirmed and verified, you will receive, along with the yellow copy of the Certification Form, a letter that will explain the next step in the process and indicate methods of payment. If necessary, the Retirement Office will contact you to set up an appointment to discuss your contract.

   For military service, please submit the original or a certified copy of your DD214 (your discharge document). If you leave either of these documents with the Retirement Office, we will place them in your file. If you need the DD214 returned to you, we will make a copy and note that we saw the original or certified copy and place the copy in your file. Fill out Section I of "Certification of Other Governmental Service" and bring it along with your DD214 form to Room 357. If you do not have your DD214, you can pick up a form to request it from the Retirement Office in Room 357 or you can write to:

   National Personnel Records Center
   Military Personnel Records
   9700 Page Avenue
   St. Louis, MO 63132

   Indicate:

  1. Your military branch of service
  2. Your dates of service
  3. Your serial number
  4. Your Social Security number
  5. Your rank at the time you separated

   You may also contact:

   Veterans Administration
   11000 Wilshire Boulevard
   Los Angeles, CA
   (800) 827-1000

   We will accept certified copies of your DD214. Certified copies must be stamped and certified by either a Federal, State, or County Court Recorder or by the Veterans Administration. The stamp states that the information on the document is true and correct. It must be signed and dated by authorized personnel.

 

Documentation needed for each type of OGS eligible for purchase

Type of OGS Should you complete Section I? Does Section II apply? Documentation required
Military Service YES - (address of employer is not required) NO Original or certified copy of DD214
All Other types of OGS YES - (all information is required) YES - (all information is required) Your former employer and/or retirement system must certify your employment and retirement

 

How do I pay for OGS?

   If you decide to buy OGS, you may pay by:

  • Lump Sum
    Lump sum payments for amounts over $5,000 must be made by either a Credit Union Teller Check or a Cashier's Check. We will accept a personal check if the amount is $5,000 or less. All checks should be made payable to Water and Power Employees' Retirement Plan.
     
  • Contract
    If you choose to enter into a contract instead of making a lump sum payment, contributions will be deducted from your paycheck each pay period. The cost will be higher because the amount you pay will include interest. The amount deducted each pay period must be at least $5.00. Payments can be made for a period of up to 15 years as long as you are a contributing member of the Plan. Since the payments are made in after-tax dollars, your contributions will not be taxed when you withdraw them or retire and you may pay off the contract at any time.
     
  • Downpayment With Contract
    You can choose to make a down payment of any amount and enter into a contract to pay the remaining balance.
     
  • "Roll Over"
    If your contributions are still on deposit with your former government employer and/or retirement system, the Retirement Office staff will contact you to discuss whether arranging a "rollover" of your contributions will be beneficial to you.

 

Important information about IRS benefit limits

   If you became a member of the Retirement Plan before July 1, 1990, please be advised that if you take advantage of OGS or any other new benefit, part of your benefits could be subject to limits set by the IRS. If you became a member of the Retirement Plan on or after July 1, 1990, your benefits are already subject to those IRS Limits.

   These IRS benefit limits are based on your age when you retire. For example, as of January 1, 1998, a person retiring at age 55 would have a retirement benefit limit of $77,044 per year. This limit gradually increases as the age at retirement increases. At a retirement age of 62, the limit is $130,000 per year, which is the maximum benefit under current IRS limits. The Retirement Office staff provides more information to those members whose benefits could be subject to IRS limits. The Retirement Board has adopted amendments to the Plan so that any benefits that exceed the IRS limits will be paid to you out of Department contributions made after you retire.

   Please also note that Federal tax laws that went into effect on January 1, 1998, changed the contribution limits that previously applied to payments made to buy OGS.

  • The contribution limit of 25% of compensation no longer applies to government retirement plans such as ours.
  • Contributions to buy OGS for service to another government plan within the State of California are no longer subject to any IRS contribution limits.
  • Up to 5 years of military service or other government service in states other than California can also be purchased without running into the IRS contribution limits even of the cost is more than $30,000.
  • If you are purchasing military service or other government service from an agency outside California and you want to purchase more than 5 years of service and the cost would be more than $30,000, the IRS rules may affect the benefits you would receive when you retire. This will apply to very few of our members. If you are one of those members, the Retirement Office staff will call you and set up an appointment to discuss this issue and how to deal with it.

   Your OGS contributions will be in already-taxed dollars. Therefore, your OGS contributions will not be taxed again when you retire or withdraw your money.

 

Will my OGS contributions earn interest?

   Yes. All the contributions you make toward retirement earn interest each month. that includes contributions to buy OGS. The current interest rate is 8%, the same rate that the Retirement Plan expects to earn on its investments over the long term. The 8% rate has been on effect since July 1, 1983.

 

Will the Department "match" my OGS contributions?

   Under the terms of the Retirement Plan, the Department will pay into the Plan 110% of the amount you pay to buy OGS if you make a lump sum payment. If instead of making a lump sum payment, you enter into a contract to buy OGS, the Department will not make "matching" contributions until you pay off your contract. If you terminate Department employment and withdraw your contributions, you will not receive the money in the Department "matching" account. If you terminate Department employment and leave your contributions in the Plan, you may qualify for a vested right allowance. If you qualify, the calculation of the monthly amount you receive will be based on all of your contributions plus interest and all of the contributions in the Department "matching" account plus interest.

 

If I purchase OGS, what will happen to my money if I leave the Department?

   Your OGS contributions are the same as other retirement contributions. If you terminate Department employment, your contributions will continue to earn interest until you choose to withdraw them or until you retire.

 

What will happen to my money if I die?

   If you die before retirement, your OGS contributions and interest will be paid to your designated beneficiary (or beneficiaries).

 

How safe is my money?

   All of your contributions, including OGS contributions, are held in trust for your benefit. Your contributions cannot be used by the Department or the City to pay their debts. The City Attorney has made it clear that employee contributions and all the other assets of the Retirement Plan cannot be touched by the Department's creditors nor can they be transferred back to the Department. They can only be used to pay benefits to our members.

 

Where can I get the OGS Certification Forms?

  1. See your supervisor or contact your division's administrative office/supervisor. The Retirement Office freely provided copies of the OGS Certification Forms.
  2. Call 213-367-1712
  3. Come to:

    Retirement Plan Office
    Room 357
    111 N. Hope Street
    Los Angeles, CA

  4. Write to:

    Water and Power Employees' Retirement Plan
    111 N. Hope Street, Room 357
    Los Angeles, CA 90051

 

  
Although this document discusses the Plan in some detail, if there are any conflicts, real or apparent, between this document and the City Charter or the Plan, the terms of the Charter and the Plan will at all times be the final authority. Therefore before relying on provisions described in this document or taking any action which will affect your future welfare, you and your beneficiaries are urged to consult the Retirement Plan Office for the specific terms of the Plan in any situation.