Martinez Pet Parade circa 1939

 

CONTRA COSTA COUNTY
EMPLOYEES' RETIREMENT ASSOCIATION

  
A to Z Definitions
 
You may find the following terms helpful in understanding your benefits. The 1937 Act is a complicated statute with interrelated links to other laws; interpretations have been clarified by legal opinion and amendment since its inception. As public policy and procedures evolve, new elements and clarifications may be included that will affect your benefit structure. If you have questions as you plan your career and your retirement, be sure to verify your understanding of the regulations to provide the best benefit for yourself and your beneficiaries.
Accruals Amounts, such as accrued service credit, accrued benefits, or accrued contributions and interest, that are accumulated in an individual's retirement account, and form the basis of future benefits or refunds.
Actuary Professional consultants trained in the technical and mathematical calculations of projecting estimates of the amounts needed to fund pension benefits into the future.
 
After-Tax
Contribution 		Contributions taken from payroll amounts after income tax has been deducted. CCCERA does not take after-tax contributions for payroll amounts, but does receive after-tax funds for lump sum service purchases.
Age Factor See Retirement Age Factor
Alternate Payee The spouse, domestic partner (or former spouse/domestic partner) of a member, who is entitled by Domestic Relations Order (see below), to receive all or a portion of a lump sum settlement or retirement benefit division.
Beneficiary A person(s), trust or estate named by the member to receive benefits provided by the plan or assets remaining in the member's account, at the time of the member's death.
Cash Out A lump sum distribution (payout) to a terminating member of all contributions and interest accrued during his or her career. The cash out only includes the member's portion of the contributions, not the contributions made on his behalf by his employer.
Contribution Rate Percentage factors, calculated by actuarial valuation, used to determine the employer's and the employee's contribution amounts to fund benefits guaranteed by the retirement system.
Cost of Living Adjustment  (COLA)

An increase or decrease in pension benefits dependent on the rise or fall of the cost of living, as determined by the San Francisco Bay Area Consumer Price Index (CPI). Projected COL adjustments to future retirement benefits make up a portion of member and employer contribution rates. (Some retirement plans (other than CCCERA) do not include COLAs; after retirement these pensions can lose value without periodic adjustments to the actual cost of living.)

Death Benefit
Payments or benefits made to designated beneficiaries upon the death of a member.
Deferred Membership At termination of employment, the member chooses to leave his or her accrued contributions and interest with CCCERA until a later date. Contributions continue to earn interest until the member returns to active membership, takes a lump sum distribution, is eligible and retires, or reaches age 70, the age of mandatory distribution.
Defined Benefit Plan A pension plan in which retirement benefits are calculated by a specific formula, rather than by the amount of contributions and interest, or investment gains and losses, accumulated in a member's account. CCCERA is a defined benefit plan. The balance in one's account has no bearing on the amount of the benefit or the length of time benefits are paid, since the pension amount is determined by years of service credit, final average salary, and the retirement age factor.
Defined Contribution Plan A retirement plan in which benefits are determined by the amounts contributed to the account, and the income, gains, expenses, or losses. Defined contribution benefits draw down an individual member's account balance until funds are exhausted.
Differentials Additional pay items specific to certain classes of employment, such as bi-lingual pay or a uniform allowance. Some differentials are considered part of final compensation for retirement benefit calculations.
Domestic Partner As the definition pertains to the 1937 Act and CCCERA, domestic partners must be formally registered with the State of California. Registered domestic partners are eligible for the same benefits and rights of survivorship as are available to spouses. Persons of opposite sexes may not constitute a domestic partnership unless one or both of the partners are over the age of 62.
Domestic Relations Order (QDRO) A court ordered judgement that may include provisions for retirement account division. A DRO (or QDRO, Qualified Domestic Relations Order) may create or recognize an alternate payee, and may assign rights to that payee to receive all or a portion of a benefit.
Entry Age Normal Cost Method The present value of projected benefits for each individual, calculated as a level cost (contribution rate) over the years of service from employment entry until retirement.
Experience Study An actuarial analysis of the retirement system's demographics, including member salaries, service years, disability statistics, employee retention and other factors that impact the functioning and future trends of the fund.
Final Average Salary (FAS) Your base salary (plus differentials subject to retirement) for your highest 12 consecutive months (or 36 months for Tier 2 or Safety Tier C) of employment, divided by 12 (or 36, if applicable) to average in pay raises you may have received during this period.
Joinder CCCERA must be made a party in dissolution (divorce) cases, since retirement benefits are community property in California. A joinder is a form that must be filed with the court to legally include CCCERA in the dissolution action. CCCERA cannot accept a DRO without a joinder.
Normal Cost The percentage of payroll sufficient to fund benefits for members, from their entry into the system until their retirement date, under current benefit provisions.
Qualified Plan A retirement plan approved by the Internal Revenue Service that meets the requirements of both form and operation, as detailed in the appropriate section of the tax code. Example: 401(k) plans meet the requirements of section 401 of the IRS Code.
Reciprocity An agreement between two or more plans in which service credit earned in all plans is linked for purposes of accruing retirement benefits.
Retirement Age Factor A percentage expressed in decimal form, mandated by the '37 Act statute and adopted by your employer, that is multiplied by your age and years of service to calculate your benefit. For example: 2% at 55 means if you retire at age 55, your benefit will be calculated using 2% or .02.
Social Security Integration CCCERA members who pay into the Social Security System may be entitled to retirement benefits in both systems. Social Security benefits and CCCERA benefits are integrated by an offset formula during retirement benefit calculations that slightly decreases benefit amounts. The offset amount calculation depends on the member's retirement tier.
Social Security Retirement Age The age that unreduced Social Security Benefits are payable. This retirement age is variable depending on date of birth, from age 65 to age 67.
Spousal or Domestic Partner Waiver A signed, notarized statement by both the member and the spouse/domestic partner, declaring the spouse or domestic partner relinquishes 1937 Act rights to be the sole beneficiary of a retirement account, should the member die.
Vesting An employee's non-forfeitable (guaranteed) right to receive a pension benefit, after accruing a specific amount of service credit. In the case of CCCERA, a member is vested after accruing 5 full years of retirement service credit.