HB278 Summary

• Reestablishes the Deferred Retirement Option Plan (DROP) for members of the Teachers' Retirement System and Employees' Retirement System, allowing new participants after April 1, 2011.

• Removes limits on interest paid to DROP accounts, allowing them to earn interest at the same rate as active member accounts.

• Eligibility requires at least 25 years of creditable service, age 55 (or 52 for state police), service retirement eligibility, and annual salary of $99,000 or less.

• Participants may elect to participate in increments of 1-5 years (minimum 3 years) and may participate only once; early voluntary termination within the first three years results in forfeiture of the retirement allowance portion (but not member contributions or attributable interest).

• Effective on the first day of the third month following passage and approval by the Governor.