Arkansas Administrative Code › Agency 088 - Arkansas Teacher Retirement System › Rule 088.00.10-002 - Policy 10-3 - TEACHER DEFERRED RETIREMENT OPTION PLAN (T-DROP)

Current through Register Vol. 49, No. 6, June, 2024
DEFINITIONS
1.
ATRS
means the Arkansas
		  Teacher Retirement System.
2.
Board
means the Board of Trustees of the Arkansas Teacher
		  Retirement System.
3.
DROP
means a deferred retirement option plan enacted by the
		  General Assembly and administered under ATRS or a reciprocal system.
4.
Participant
means a member
		  who elects to participate in T-DROP under A.C.A. § 24-7-1301 et seq. by
		  authorizing ATRS to make plan deposits, plan interest, or 10-year plus T-DROP
		  interest into a member's T-DROP account.
5.
Plan deposits
means the
		  deposits made to each participant's T-DROP account pursuant to A.C.A. §
		  24-7-1306.
6.
Plan
		  interest
means the rate per annum, compounded annually on June 30, as
		  the Board shall set and adopt at the end of each fiscal year, credited annually
		  in each T-DROP participant's T-DROP account. The interest rate shall be 2% less
		  than the System's average rate of return with a maximum of 6% and minimum of
		  2%. The Board will determine the interest rate for the following fiscal year
		  based upon the rate of return for the immediately preceding twelve-month period
		  ending March 31 prior to the start of such fiscal year. The initial calculation
		  of this rate shall begin March 31, 2005, for interest to be credited in the
		  2005-2006 fiscal year.
7.
T-DROP
means the Teacher Deferred Retirement Option Plan
		  established by ATRS under Act 1096 of 1995.
8.
10-year plus T-DROP interest
means the rate per annum, compounded annually, as the Board shall set and adopt
		  at the end of each fiscal year, credited on June 30 into a member's T-DROP
		  account that meets the following criteria:
A.
		  The member participated in T-DROP for ten (10) years and continued employment
		  with an ATRS covered employer; and
B. The member has not retired.
T-DROP
PARTICIPATION and ACCOUNT CREDIT
Effective July 1, 1995, in lieu of terminating employment and
			 retiring under A.C.A. § 24-7-701, an active member of ATRS may elect to
			 participate in T-DROP and continue to work for a covered employer. By
			 continuing covered employment, the participant defers receipt of retirement
			 benefits until a later date.
During participation in T-DROP, ATRS shall credit each
			 participant's T-DROP account with plan deposits and plan interest.
The plan interest rate determined by majority vote of the Board
			 is final and binding upon ATRS and shall not be adjusted based on any revised
			 rate of return reported after that date.
The 10-year plus T-DROP interest rate shall be set by the Board
			 at same meeting that the plan interest rate is set. The 10-year plus T-DROP
			 interest rate is limited to a maximum of six percent (6%) and a minimum of four
			 percent (4%). The 10-year plus T-DROP interest rate will be credited to the
			 participant's T-DROP account on June 30th of each
			 year.
The initial 10-year plus T-DROP interest rate for 2010 is set at
			 four percent (4%) and will be credited to the participant's T-DROP account on
			 June 30, 2010. The 10-year plus T-DROP interest rate shall be set prospectively
			 by the Board prior to the beginning of each fiscal year and that interest rate
			 shall be credited to the participant's T-DROP account June
			 30th of the following year.
The 10-year plus T-DROP interest rate for each year determined by
			 majority vote of the Board is final and binding upon the ATRS and shall not be
			 adjusted based on any revised rate of return reported after that date.