Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF 2) is a defined-benefit retirement plan that provides a secure formula-driven income for retirement.
The Department of Retirement Systems (DRS) provides plan information in the LEOFF 2 Handbook. Here are the plan highlights:
Participation in the LEOFF 2 retirement plan starts on your first day of employment as a commissioned police officer. In this 401(a) defined benefit plan, you and the University contribute money that funds your retirement income. Once you retire, you will receive your retirement benefit based on a formula which includes your years of service credit and average final compensation. Here is how it works:
- You contribute 8.46% of your gross salary (effective September 1, 2009) and your contributions are tax-deferred. Both employee and employer rates are determined by the state.
- The WWU employer contribution is 8.62% of your gross salary (effective September 1, 2009). WWU contributions are invested in the Retirement Trust Fund by the State Investment Board. These monies are not credited to your account and cannot be withdrawn.
- The amount you and Western Washington University contribute is not a factor in computing your retirement benefit. LEOFF 2 is a defined benefit retirement plan that provides a secure formula-driven income for retirement.
Full-time commissioned WWU police officers are eligible to participate in LEOFF 2.
Your retirement benefits are calculated using this formula:
Monthly retirement income = service credit months ÷ 12 x 2% x final average salary.
You receive one service-credit month for each calendar month that you receive basic salary for 90 or more hours. Beginning September 1, 1991, you receive half a service credit month for any month that you receive basic salary for at least 70 hours but less than 90 hours. You receive a quarter service credit month for any month that you receive basic salary for less than 70 hours.
Your average final compensation is the monthly average of your 60 consecutive highest-paid service credit months.
For example, suppose you retire at age 55 with 30 years and 2 months (362 months) of service and your final average salary is $3,000. Your monthly retirement benefit will be $1,809. The formula used to arrive at this figure is: 362 months ÷ 12 x 2% x $3,000 = $1,809
This calculation results in the standard single-life-only benefit. It will be lower if you choose to continue benefits to a survivor upon your death.
- There is no percentage limitation on the amount of service credit that will count towards the size of your benefit.
- If you are a member of more than one State of Washington retirement plan, you may be able to combine service credit from all the plans to qualify for retirement.
- You are eligible for annual cost-of-living adjustments of up to three percent.
- Disability retirement and survivor benefits are available if you meet the requirements.
WWU police officers participate in LEOFF2 from the beginning of employment. Retirement plan participation is a condition of employment.
The LEOFF 2 enrollment form can be found in the Department of Retirement System (DRS) LEOFF 2 Handbook. Please contact the WWU Benefits Office for further information.
You can withdraw or transfer your employee contributions plus interest only if you end your employment as a law enforcement officer in the State of Washington. You are not eligible for a withdrawal if you enter into eligible employment with an employer covered by the same system before receiving the withdrawn money.
If you have 10 or more years of service credit in LEOFF, you may withdraw 150% of your accumulated contributions.
If you withdraw your contributions prior to retirement, you lose your right to future benefits. You can restore your contributions and reestablish your benefits under certain circumstances.
Processing a withdrawal may require 60 to 90 days. Your choices are:
- Leave your money in the retirement fund. When you have a minimum of five years of service credit, you have a vested right to a retirement benefit when you meet LEOFF 2 age requirements. Vesting means you have earned the right to a future benefit even if your covered employment ends. Your funds will continue to accrue interest. Your service credit will be preserved for you in the event you return to State of Washington employment.
- Transfer 100% or a designated amount of your money to a qualified retirement account. No withholding tax is required on funds that are directly transferred, nor does the 10% penalty apply.
- Withdraw your money plus interest. The IRS subjects withdrawals to a 20% withholding tax and may also require that you pay a 10% penalty.
If you withdraw your contributions before retirement, you lose your right to future retirement benefits. You can restore your contributions and re-establish your benefits under certain circumstances. Explore the LEOFF website for more information including member publications.
- LEOFF 2 Member Handbook
- Voluntary Investment Program (VIP)
- Washington State Deferred Compensation Program (WSDCP)
- Social Security Administration
- Department of Retirement Systems Comprehensive Annual Financial Report