Crediting Pease Corps And Vista Service

As far as Peace Corps and VISTA service goes, the references you will need are on the right here. There is also information in the CRS handbook. What we will do today is identify what this that is, what Peace Corps service is, understand how Peace Corps and VISTA service deposits are computed. For HR people, when employees come to you, you are really going to need under -- to understand how they are computed and how people get credit for Peace Corps and VISTA service. If you are an employee, this will give you information up front before you see your HR person as to how this whole process works and how the computation is done. We will also talk about the effect of not paying a Peace Corps and VISTA deposit. We are lumping these together, Peace Corps, VISTA. They are separate programs but we credit the service the same way. AmeriCorps VISTA is a national program designed specifically to fight poverty, authorized in 1964, founded as volunteers in service to America in 1965. Again, as federal employees, we love acronyms. Volunteers in service to America, VISTA. VISTA was incorporated in to the AmeriCorps network of programs in 1993. AmeriCorps VISTA members live and serve in some of our nation's poorest urban and rural areas. They create or expand programs designed to bring individuals and communities out of poverty. It is a great program. Again, this happens within the U.S.. Each VISTA member makes a year-long commitment to serve a specific program at either a nonprofit or a private -- public agency, and in return for their service, the AmeriCorps VISTA member receives a modest living allowance and health benefits while providing the service and while they are enrolled in their commitment to serve. That is VISTA. As far as Peace Corps those, in 1961, President Kennedy established the Peace Corps to promote world peace and friendship. The Peace Corps mission has three goals -- helping people of interested countries in meeting their need for trained men and women, helping promote a better understanding of the Americans on the part of people served, and helping promote a better understanding of other peoples on the part of the Americans. VISTA deals with service within the U.S.. The Peace Corps is actually an international program. A are dealing with other countries. -- we are dealing with other countries. VISTA deals within the U.S.. When a Peace Corps or VISTA volunteer becomes enrolled in a federal civilian position after working in a violent -- as a volunteer, volunteer service that is satisfactory is creditable under our old retirement system, CSRS under the same conditions that apply for non-deduction service, which we covered in a prior webcast on service credit information. VISTA satisfactory volunteer service performed at any time prior to separation, if a deposit has been made for the service, is generally creditable for the new retirement system, FERS, as well. Service is not allowed for training prior to actual enrollment. I'm talking about performance any time prior to accreditation. I said it is treating the non-deduction service. Generally speaking, non-redemption service under the new retirement service, FERS, is not credible, however VISTA is. This is important for employees to know. You can get credit for your Peace Corps or VISTA time regardless of when it occurred. Again, the one thing that is not allowed is for periods of training prior to actual enrollment. Now, as far as crediting the service, the deposits required to obtain service credit for VISTA volunteer service -- when you chose to receive educational award in lieu of a stipend. When you become a volunteer, you will get paid, generally speaking, a living expense, which is a stipend. It is a small amount. Some VISTA volunteers will elect to receive an educational award in lieu of the stipend. If you do that, you can still get credit for the service. The deposit amount that you will have to pay is going to be based on the amount of the stipend you would have received had you not elected to receive the educational award instead. Now, in the past, if employee, whether survivors were required to Social Security benefits, Peace Corps and VISTA service would have been eliminated from the annuity computation once the person became eligible for Social Security, even if a person paid a deposit for the service. Now, that will change with Public Law 103 .82, prior to that was when we ran into the issue of eliminating the service. The title of the lies the national and community service trust act of 1993, and the domestic volunteer service act amendments of 1993 specifically. It modified the treatment of Peace Corps and VISTA volunteer service that is similar to the way we treat military service. I know up until now I have been stating that it is treated like non-deduction service. Peace Corps and VISTA is one of those things that is like a weird hybrid of non-deduction service and military service. I will highlight how they are similar and how they are different throughout this presentation, OK? If you pay a deposit prior to retirement, Peace Corps and VISTA service is fully creditable for eligibility interpretation purposes under the old retirement system, CSRS, if it occurred prior to 10/one/82. If it is not paid prior to retirement, OPM will send a letter to the employee or the recent retiree, or the survivor, once we get the case and start working on it, to notify the employee that there is service in their record, and that they can make a deposit for it, and we will give them an opportunity to make a deposit. So, if you have not needed at your agency prior to retirement, whenever you go to retire, if OPM is aware the service exists, we will give you the opportunity to make a deposit for the time. Now, if the deposit is paid, of course, we will then credit for Peace Corps and VISTA service and it is including the competition. It will never be eliminated. It is always there. If an employee does not pay the Peace Corps and VISTA deposit and they are not at or within five months of Social Security eligibility, what is going to happen is the credibility is going to be given for eligibility of computation -- in reputation -- computation under CSRS. The annuity will be reduced by 10% of the deposit code. If it -- owed if it actually increases the annuity. OPM will check at age 62, because that is one must become benefit for Social Security benefits, and if the employee becomes eligible at 62, the Peace Corps and VISTA time will be eliminated if the deposit is not paid. That is pretty 10/1/1982. If the deposit is not paid and the annuity -- and the person retiring is or isn't within five months of Social Security eligibility, we will -- is within five months of Social Security eligibility, we will check, and if the retiree is eligible for social security benefits, we will not give credit for that service. If the retiree is not eligible for Social Security benefits, then we are going to reduce the annuity by 10% of the deposit owed, and leave the credit in for the Peace Corps and VISTA time if it actually increases the annuity. Now, it is a little bit simpler when we are dealing with service that occurred on or after 10/1/82. If the deposit is paid under CSRS for Peace Corps and VISTA on or after 10/1/82, you get full credit. If you do not pay the deposit for the Peace Corps and VISTA on or after 10/1/82, we do not include it in your annuity. I touched on this in a prior presentation, and I know for some of you you will see this on a regular basis -- these magic dates that keep coming up over and over again. One of the maggots date -- magic dates is 10/1/82, and people are always asking how is this date important, what happened on this date? For those in HR or work in benefits, October is the beginning of the fiscal year for the federal government, so October 1, 1982, it was the beginning of the fiscal year, when we -- one of the omnibus budget reconciliation act went into effect, and he changed the way we treated a lot of things, how we credited non-deduction time, and also how we computed interest among other things. There are a lot of things that happened, and usually see a date of 10/1/82 for some of these and that is why we are looking at that date as far as how we treat the service. Now, as far as the new retirement system, FERS, those, again, the rules are very similar to post-10/1/82 time. If you pay a deposit, you get credit. If you do not play -- pay a deposit, you do not get credit for it. As I mentioned before, normally for service credit cases, or purchasing non-deduction time, purchasing time when you did not pay into the retirement system, it is normally not creditable on or after one/one/89. The exception to that is Peace Corps and VISTA service. You can have Peace Corps and Vista Service in 2010, and to pay a deposit for it under the new retirement system, FERS, and get credit for that. Now, the deposit amounts are for CSRS people, under the old retirement system, it is 7% of whatever the earnings were. So, whatever stipend you were being paid, we take 7% of that, and that is the number of your deposit plus interest. For FERS people, it is 3% of the amount of earnings. For those of you familiar with service credit rules, you know that under CSRS, yes, the deposit is 7%. Under FERS, it is usually one point three percent. If you have viewed our webcast on military service, you will know that for CSRS people it is 7%, for FERS, it is numeral three percent. Up until now we had ventured it the same as non-deduction time. Here is where the military part comes in. The amount of the deposit, particularly under FERS is now at 3%, so it mirrors the military service in this aspect. Now, as far as computing the interest goes, here, again, we are getting into treating the way we calculate the deposit similar to the way we calculate military deposits. For both CSRS and FERS, there is a two-year grace period, after which interest is accrued and compounded annually at a variable interest rate. For employees first hired before 10/1/83, interest begins accruing on 10/1/85. For those after, it is two years after the employee was employed. I am in OPM employee that gets tired in 2010, and prior to that I had Peace Corps or VISTA time. When I come on board at OPM, let's say January 1, 2010, four two years I will have an interest-free case -- grace period, so that third on January, 2013, I will start accruing interest on the amount that I know for that Peace Corps and -- that I owe for that Peace Corps and VISTA time. The date each year when accrued interest is added to the amount of the deposit is called the interest accrual date. The first interest accrual date is the date one year after the interest-free grace period ends. It follows on the anniversary where it is paid. To continue on with the example I gave, saying I came in in 2010, I have that grace period through 2012. Interest begins to accrue on January, 2013. It will accrue for that entire year, and on that anniversary, of that date, I will owe one year of interest on the deposit. Interest rates, again, are compounded on a calendar year basis, January 1 through January 31, and if the interest accrual rate is not January 1, the interest rate will affect a portion of the rate for the prior year, and a portion of the rate for the current year. This is exactly the same as we do for military deposits. For those that want detailed explanations of interest accrual dates, this is similar to the military deposits, and if you watch the military deposit webcast, and this sounds familiar to you, this is the same kind of thing. We have an interest accrual rate , and it depends on when you are hired with the agency. Now, a composite rate for interest is computed as follows. There are 30 days in a month. Let's say you have October through December, three months, three headed 60 days in a year, that would be .25 -- that fraction of interest in a calendar year posting would be one year -.25, which would be .75, so you have to look at is the portion of the year you are using in one year versus the portion you are looking at in another, so in this case, if you have October through December, interest for that would be one quarter of that year. Whatever your interest rate is for that year, you would take one quarter of that, and that would be that interest for that part of the year, and the next year you would credited for that one. Let's look at one of the examples. 1995, and he just rate for 1995, -- an interest rate for Nintendo five, seven percent times .25, you get 1.75, in 1996, is 6.875% because the interest accrual date is 10/1/1995. In 1996, they will get three quarters of the year credited at the 1996 rate, and one quarter at the 1995 rate. If we take three quarters of that 6.875% interest rate, we come up with five 11563%. We add the 1.75%. 5.1563%, and we come up with a total interest rate of 6.9063%. Excuse me. So, that is how you do it. You are basically prorating the interest rate in each calendar year for the number of months the interest rate applies to that employee based on their accrual date. To simplify the process, OPM has prepared a composite interest rate table, and the rates for each interest accrual date code now, -- date. now, as far as that goes, composite interest rate -- dates are published each year in our annual changes BAL that goes out, so we will -- you should have that. We will take questions in a minute. One thing I will touch on is up until now we have talked about how it parallels nine deduction service, and how it parallels military service. What I want to clarify with Peace Corps and VISTA is how you apply with this. With military service, you have to make a deposit for your military time to your agency before you separate. As you noticed in these other sites, he talked about that if you do not pay it before you retire, OPM will give you another shot. As far as making deposits for VISTA and VISTA time, -- and Peace Corps time, you completed the same lame to make it deposit or -- the same way to create a deposit. For FERS it is SF-3108, and you complete that form. You include a transcript of your Peace Corps and VISTA time with stipend rates, or OPM can get that in some cases, but it is best to include it to expedite the process. OPM will calculate the deposit AUO. You will -- that you ow. You will pay that the way you would a service credit -- nonproduction time, stuff like that. It is different than a military deposit in that sense. military deposits are paid directly to your agency and that agency forecast -- four was the money directly to OPM. -- four words the money likely to OPM. OPM computes the deposit amount. We send you a bill. Any employee can send the deposit to OPM. You can pay the a check, through pay.gov, which is what we actually suggest. Now, do we have any questions? >> Yes, here is the first one. If an employee wants to leave federal service, is eligible for FERS retirement, and go directly to Peace Corps, should they not retire until after the Peace Corps time is done, so they can get credit for it, or should they retire and then enter the Peace Corps. >> Well, if you want to get credit for the service in your retirement, the Peace Corps time would then need to be followed, and I assume we are talking about Peace Corps volunteer time because if you are actually an employee of the Peace Corps in a federal position that is different than volunteer service. If you retire, and you go to work for the Peace Corps as a regular federal employee, you would be treated like a reemployed annuitant. If you volunteer, it is Peace Corps volunteer service, in order to get credit for that time, it would have to be followed by covered service in another federal position. >> The last part of the same question -- if the health care insurance they get due to this opinion Peace Corps comfortable? >> -- comparable? >> Yes, it should be. I would have to do research to find out how the affordable care act comes into play, and if that has changed anything. I am not aware that it has. >> The next is for VISTA AmeriCorps service -- one of the employee provides us with a statement of receiving a stipend of zero and no educational award. How does an employee make a deposit to have that service count? >> I would want to do a little more research on that, check with VISTA if this was actually violent -- satisfactory volunteer service and why a stipend was not paid. Generally speaking, a stipend is paid or they get a educational award, and we would to find out how much they would have received for the stipend and credit that appropriately. >> This is a follow on the same question, employees are providing an former hourly rates of earnings and stating they were paid full-time. Some also receive an educational award as a stipend. What is the preference for receiving supporting pay documentation for this type of service question mark >> We need the rates they would have gotten paid, again -- we need -- type of service? >> We definitely need the rates they would have paid. It could never heard by giving us as much information as possible so that we know we do not have to go back for anything . Anytime you are processing a case, and that is just good advice in general, more information you can provide so that we do not have to go back to whatever entity it is, and I'm talking here regarding military deposit, service credit deposits, anything like that. The more of a complete picture that you can give us regarding an employee, the better it is for everyone because then we do not have to go out to get information. Always error on the side of giving more information so that we can search through it, then giving us less information. >> How is Peace Corps and VISTA service treated for the new FERS systems? >> it is treated exactly the same as it is under FERS. Nothing has changed. Deposit rates are the same. Again, this is where we get into this paralleling military service because under FERS, military deposits are paying -- paid at a rate of 3%. Peace Corps in Vista Service, they are also three percent. Nothing changed with regard to that. >> Next question, they have an employee that accepted an award in the amount of $4233, and requested verification from AmeriCorps, and they replied saying the stipend was zero. This is been the point is not a for this -- does not paid for this time? >> OK, without seen the documentation -- we are getting into technical questions at without looking at a record, it will be more difficult. Questions like that, I would say what we need to do is first of all, I would referred them -- if you are an HR person in the field, the first thing you will want to do is escalated through your headquarters benefits officer, and then they will contact the appropriate liaison that OPM to work with you on this. I know some of these, when we start getting into specific case related issues, some of that I can answer. Some of that we will have to look at the case file to find out why the stipend is zero. If it is an award, my initial impression of the top of my head is that this is an educational award, so they elected the stipend of zero that was paid, and then we would need to know the stipend amounts of that we would know what to withhold off of that. That is my guess. Again, without seeing documentation, and without talking to AmeriCorps specifically, I cannot tell you. So, let's go to another question and try to keep the more general as far as not specific case-related. >> In the degree will have to handle the rest online because my system has gone down here. >> OK. Sorry. The system has gone down. Yes, wireless, you know. I am sure nobody watching has ever experienced this before, correct? Thank you very much. Again, anyone that has any questions, please forward them to benefits at OPM.gov. We would be happy to answer your questions. If it is a specific case-related question, we might need some documentation, so that we make sure we're giving you the correct answer rather than going by the general answer that we need more record -- we need to request more information from you. Thank you, and have a great day. . .