495—8.1(97B) Service eligible for purchase.
	8.1(1) Estimates and cost quotes. All service purchase estimates and cost quotes shall be calculated at actuarial cost. The following procedures and calculations shall apply:
	a. 	Service purchase estimate prior to retirement. Members who are vested by service may request a service purchase estimate by completing and submitting a service purchase application. Once the application is submitted, IPERS shall complete a cost estimate. This calculation is an estimate only and is not considered binding. The cost estimate shall be calculated as follows:
	(1)	IPERS will calculate the actuarial cost by capturing the projected baseline benefit attributes at the member’s anticipated retirement date without any service purchase quarterly credits including: average salary, years of service, the Option 2 benefit amount, accumulated member contributions and the calculated present-day reserve value. The present-day reserve value is a lump sum value calculated with actuarial tables provided by the system’s actuary which represents the lump sum value sufficient to pay the monthly benefits over the member’s expected life span.
	(2)	With each potential purchasable quarterly service credit, IPERS will recalculate the Option 2 benefit amount. A new present-day reserve value will also be calculated. The cost of each quarterly service credit will be the difference between the new reserve amount and the previous one.
	b. 	Final service purchase cost quote at retirement. On or before the date that a member’s first benefit payment is issued, a member who is vested by service may request a final service purchase cost quote by completing and submitting an application for retirement/disability benefit indicating the member’s desire to receive a final service purchase cost quote. After the completed application has been submitted, IPERS shall generate a final service purchase cost quote once all of the member’s wages are submitted to IPERS, which may be after the member’s first month of entitlement. The final cost quote shall be calculated as follows:
	(1)	IPERS will calculate the cost by capturing the baseline benefit attributes at the member’s first month of entitlement without any service purchase quarterly credits including: average salary, years of service, the Option 2 benefit amount, accumulated member contributions and the calculated present-day reserve value. The present-day reserve value is a lump sum value calculated with actuarial tables provided by the system’s actuary which represents the lump sum value sufficient to pay the monthly benefits over the member’s expected life span. With each potential purchasable service credit, IPERS will recalculate the Option 2 benefit amount. A new present-day reserve value will also be calculated. The cost of each purchasable quarter of service credit will be the difference between the new reserve amount and the previous one.
	(2)	The retired member will have six months from the date in which IPERS generates the final service purchase cost quote to purchase additional service.
	(3)	If the retired member purchases service within the six-month deadline, the increase in the retirement benefit shall be made effective with the month of the service purchase payment.
	(4)	Retired members who do not indicate their desire for a final service purchase cost quote on or before the date their first payment is issued or do not complete the purchase within the six-month deadline indicated on the final service purchase cost quote shall not be eligible to purchase additional credit.
	(5)	Retired members who selected Option 1 upon retirement may request the lump sum death benefit to be increased to take into account the additional contributions from making a service purchase. If the member requests an increase in the death benefit, the monthly benefit will be reduced to take into account the increased death benefit.
	c. 	Cost adjustments due to changes in the original retirement benefit. If an error in the service purchase cost is discovered or a retired member’s account is adjusted in any manner after a purchase is made, IPERS may rescind the service purchase, make adjustments to the service purchase cost, or adjust the retirement allowance to ensure the member paid the actuarial cost of buying additional service. In the event that a retired member overpays due to an adjustment, IPERS will issue a refund to the retired member directly or to the rollover institution.
	8.1(2) Service credit for other public employment.
	a. 	A member may make application to IPERS for purchasing credit for service rendered to another public employer. In order to be eligible, a member must:
	(1)	Have been a public employee in a position comparable to an IPERS covered position at the time the application for buy-in is processed. Effective July 1, 1990, “public employee” includes a member who had service as a public employee in another state, or for the federal government, or within other retirement systems established in the state of Iowa; and
	(2)	Submit verification of service for that other public employer to IPERS.
	b. 	A period of service is defined as follows: (1) if a member was continuously employed by an employer, the entire time is one period of employment, regardless of whether a portion or all of the service was covered by one or more retirement systems; and (2) if a member is continuously employed by multiple employers within a single retirement system, the entire service credited by that retirement system is one period of employment. A member with service credit under another public employee retirement system who wishes to transfer only a portion of the service value of the member’s public service in another public system to IPERS must provide a waiver of that service time to IPERS together with proof that the other public system has accepted this waiver and allowed partial withdrawal of service credit. Members are allowed to purchase time credited by the other public employer as a leave of absence in the same manner as other service credit. However, members wishing to receive free credit for military service performed while in the employ of a qualifying non-IPERS covered public employer must purchase the entire period of service encompassing the service time for that public employer or in the other retirement system, excluding the military time. Veterans’ credit originally purchased in another retirement system may be purchased in the same manner as other service credit.
	8.1(3) IPERS buy-back. Members may buy back previously refunded IPERS service credit under the methodology of subrule 8.1(1).
	8.1(4) Veterans’ credit. A member may make a service credit purchase for a period of active duty service in the armed forces of the United States if the member produces verification of active duty service in the armed forces of the United States.
	8.1(5) Legislative members.
	a. 	Active members. Persons who are members of the Seventy-first General Assembly or a succeeding general assembly during any period beginning July 4, 1953, may, upon proof of such membership in the general assembly, make contributions to the system for all or a portion of the period of such service in the general assembly.
	b. 	Vested or retired former members of the general assembly.
	(1)	The member shall submit to IPERS proof of membership in the general assembly for the period claimed.
	(2)	Upon determining a member eligible and receiving the appropriate contributions from the member, IPERS shall credit the member with the period of membership service for which contributions are made.
	c. 	Actuarial cost. Effective January 1, 2016, the member must be vested by service and must pay 40 percent and the Iowa legislature shall pay 60 percent of the actuarial cost of a service purchase, as certified by IPERS. In calculating the actuarial cost, IPERS shall apply the same actuarial assumptions, procedures and cost methods as those described in subrule 8.1(1).
	8.1(6) Employer-approved leaves of absence. Service credit for employer-approved leaves of absence that begin on or after July 1, 1998, may be purchased.
	8.1(7) Service credit for elective coverage positions—coverage not elected. Service credit for periods of time prior to January 1, 1999, when the member was employed in a position for which coverage could have been elected, but was not, may be purchased.
	8.1(8) Service credit for noncovered public employment in Iowa. A member who was previously employed in public employment for which optional coverage was not available, such as substitute teaching or other temporary employment, may purchase service credit for such employment subject to the requirements of Iowa Code section 97B.80C. Service credit may not be purchased under this subrule for periods in which the individual was performing services as an independent contractor.
[ARC 1887C, IAB 2/18/15, effective 3/25/15; ARC 2402C, IAB 2/17/16, effective 3/23/16; ARC 4337C, IAB 3/13/19, effective 4/17/19]