Employers' Pensions and Benefits Administration Manual (EPBAM)
   

 

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Employer Payments
Billing and Annual Appropriations



TABLE OF CONTENTS
  Teachers' Pension and Annuity Fund
Public Employees' Retirement System
Police and Firemen's Retirement System
Dunning Notices
Consolidated Police and Firemen's Pension Fund
Delayed Enrollment Employer Liability (TPAF, PERS, and PFRS)
Pension Adjustment Annual Appropriation Liability (CPFRS)
Delayed Enrollments and Back Contributory GLI Premiums

Annual local employer appropriation billings are for the TPAF Early Retirement Incentive (ERI*) only, the PERS (normal contribution, accrued liability and ERI*) and the PFRS (normal contribution, accrued liability and ERI*). The bills are due April 1 of each year. There is a 30-day grace period and interest starts accruing at the statutory annual rate of 10% on May 1.

*ERIs of 1991, 1993

Teachers Pension and Annuity Fund Bill

School districts that adopted and filed a resolution with the Division of Pensions and Benefits to participate in the Early Retirement Incentive Program under Chapter 229 or 231, P.L. 1991, are liable for the additional pension and health benefits costs incurred, resulting from eligible employees in their district electing to take advantage of the program. The additional pension liability incurred as a result of eligible employees retiring under ERI 1 of the program is to be amortized over a period of 27 years as equal annual installments. The installments began 4-1-1995 and will end 4-1-2021.

School districts that adopted and filed a resolution with the Division of Pensions and Benefits to participate in the early retirement incentive program 2 (ERI 2) under chapters 138 and 163, P.L. 1993 are liable for the additional pension costs incurred resulting from a location's eligible employees electing to take advantage of the program. The additional pension liability incurred as a result of eligible employees retiring under ERI 2 will be billed in equal annual installments to each location beginning 4-1-1997, and every year thereafter based on the individual location's stated payment election.

Public Employees' Retirement System

Appropriation invoices are prepared upon receipt of the actuary's valuation and are normally mailed by November for payment on April 1 of the following year.

PERS Local Employer Pension Contributions Due April 1, 2012

In 2011, local employers (municipalities, counties, school boards, authorities, etc.) participating in the PERS will once again have an employer pension contribution due. Please recall that Chapter 108, P.L. 2003, which calls for the return of employer pension contributions on a phase-in basis, was enacted to assist employers with this returning obligation.

To get specific information about the 2013 employer contribution due for your location, click here.

To get specific information about the 2012 employer contribution due for your location, click here.

To get specific information about the 2011 employer contribution due for your location, click here.

For the specific 2010 employer contribution due for your location, click here.

In 2009, the amount due became 100% of the actuarially calculated employer contribution (full amount). To get specific information about the 2009 employer contribution due for your location, click here.

For 2008, the amount due will be 80% of the actuarially calculated employer contribution. To get specific information about the 2008 employer contribution due for your location, click here.

For 2007, the amount due was 60% of the actuarially calculated employer contribution. To get specific information about the 2007 employer contribution due for your location, click here.

For 2006, the amount due was 40% of the actuarially calculated employer contribution. To get specific information about the 2006 employer contribution due for your location, click here.

In 2005, the amount due was 20% of the actuarially calculated employer contribution. For specific information about the 2005 employer contribution due for your location, click here.

To view a Comparison of Required PERS Local Employer Contributions for State Fiscal Years Ending 2011 (actual) and 2012 (projected), click here.

Under the current funding method, the normal contribution and accrued liability are derived by taking the second quarter (calendar) report of contributions salaries from 2 years prior, which are annualized (example: for the bills due 4-1-2008, the calculation utilized the 2nd Quarter ROC Report of Salaries from 3-31-06). The annualized salaries are then multiplied by the applicable annual rates determined by an independent actuary.

The ERI 1 program is to be amortized over a 27-year period with an annual 6% increase per year. The first installment began 4-1-1995 and will end 4-1-2021.

The ERI 2 liability is being billed with an annual 6% increase per year on installments beginning 4-1-1997 and every year thereafter based on the individual location's stated payment election.

A listing of the history of PERS appropriations in recent years is available here.

Police And Firemen's Retirement System

Appropriation invoices are prepared upon receipt of the actuary's valuation and are normally mailed by November for payment on April 1.

Under the current funding method the normal contribution and accrued liability are derived by taking the second calendar quarter Report of Contribution salaries from three years prior. The second quarter salaries are annualized to provide the basis for assessment (example: for the bills due 4-1-2008, the calculation utilized the 2nd Quarter ROC Report of Salaries from 3-31-05).

The annualized salaries are then multiplied by the applicable annual rates determined by an independent actuary.

Legislation effective on July 1, 2003, (Chapter 108, P.L. 2003), reduces the normal and accrued liability contributions that local employers must make to the Police and Firemen's Retirement System (PFRS), for a period of four years.

Under the law, the State Treasurer will reduce local employer PFRS normal and accrued liability contributions to a percentage of the amount certified annually by the PFRS, as follows: 20 percent for payments due in State fiscal year 2004 (July 1, 2003 to June 30, 2004); not more than 40 percent for payments due in State fiscal year 2005 (July 1, 2004 to June 30, 2005); not more than 60 percent for payments due in State fiscal year 2006 (July 1, 2005 to June 30, 2006); and not more than 80 percent for payments due in State fiscal year 2007 (July 1, 2006 to June 30, 2007).

PFRS Local Employer Pension Contributions Due April 1, 2012

In 2011, local employers (municipalities, counties, and other local groups) participating in the PFRS once again had an employer pension contribution due. Please recall that Chapter 108, P.L. 2003, which calls for the return of employer pension contributions on a phase-in basis, was enacted to assist employers with this returning obligation (see above).

For specific information about the employer contribution due for your location in 2013, click here.

For specific information about the employer contribution due for your location in 2012, click here.

For specific information about the employer contribution due for your location in 2011, click here.

For specific information about the employer contribution due for your location in 2010, click here.

For specific information about the employer contribution due for your location in 2009, click here.

For specific information about the employer contribution that was due for your location in 2008, click here.

For specific information about the employer contribution that was due for your location in 2007, click here.

For specific information about the employer contribution that was due for your location in 2006, click here.

For specific information about the employer contribution that was due for your location for 2005, click here.

To view a Comparison of Required PFRS Local Employer Contributions for State Fiscal Years Ending 2011 (actual) and 2012 (projected), click here.

A listing of the history of PFRS appropriations in recent years is available here.

Dunning Notices

A reminder notice is sent in the middle of April to locations that have not made a payment for the appropriation bills due April 1st, stating that payment must be remitted by April 30. Three dunning notices are sent to locations that are delinquent as of May 1, June 1, and September 1.

Consolidated Police And Firemen's Pension Fund

The administrative costs of the fund shall be charged to the various employers in proportion to the number of their employees and beneficiaries covered by the fund. The bills for administrative fees are mailed in July and are due April 1 of the following year. Dunning notices are sent May 1 and June 1.

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Delayed Enrollment Employer Liability (TPAF, PERS and PFRS)

A delayed enrollment liability is generated when an employee is not enrolled in the pension system within one year after the compulsory enrollment date. When this occurs, the employer becomes liable for one-half of the pension contributions that the employee would have paid had he or she been enrolled in a timely manner.

The Delayed Enrollment billing is calculated as follows:

Delayed Enrollment

  • The employee's normal rate of contribution multiplied by the employee's salary = contribution dollar amount.
  • The contribution dollar amount multiplied by the number of pays the member should have been properly enrolled = the total amount of the liability.
  • The employer is responsible for one half of the liability amount; the other half is the responsibility of the employee.

  Delayed Appropriation

  • The employee’s salary multiplied by the number of pays delayed enrolled multiplied by the employer rate.

The salary reported on the ROC is used to calculate the annual employer appropriation billing (PERS and PFRS).

The employer liability for delayed enrollments is governed by Chapter 121, P.L. 1971 and NJAC 17:1-3.1.

Delayed Enrollment and Back Contributory Group Life Insurance Premiums

For new enrollees and transfers, the contributory insurance amount printed on the Quarter Report of Contributions represents all premiums due from the contributory group life insurance effective date (as shown on the Certification of Payroll Deductions) to the end of the quarter in which the member's name first appears on the Report of Contributions.

However, in cases where an employee's enrollment has been delayed for a period of more than a year, deductions for back contributory group life insurance premiums cannot be taken for more than a year's time.

Pension Adjustment Annual Appropriation Liability (CPFRS)

The Pension Adjustment Employer Liability provides cost-of-living increases to retired members in the Consolidated Police and Firemen's Fund and their eligible survivors.

These bills are system generated and are based on the Consumer Price Index.

Each bill is calculated by taking the retiree's allowance and multiplying it by the CPI rate that corresponds to the retiree's year of retirement, and then multiplying this amount by 12.

These bills are due on either March 30 or July 30, depending on the employer's fiscal year.

This liability is governed by The Pension Adjustment Act, Chapter 143 P.L. 1958, Chapter 139 P.L. 1971, and Chapter 306 P.L. 1977.

The law requires that interest at 6% per annum be levied on any unpaid balance if payment is not received within 30 days of the due date.

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Last Updated: September 24, 2010