PURCHASING ARC
Additional Retirement Credit (ARC) provides a way to increase your years of service credit. It is not based on actual employment.

Adding years of service credit by purchasing ARC will increase your total years of service credit. Since years of service credit is one of the factors used to calculate your retirement allowance, increasing your service credit through ARC will increase your monthly retirement allowance.*

*In certain circumstances, this may not apply to a service-connected disability. For more information, call 1-800-786-6464.

WHO IS ELIGIBLE TO PURCHASE ARC?
If you are an active County employee in any LACERA retirement plan and you have at least five years of actual County service credit, you are eligible to purchase ARC.

County service may include:

• All LACERA retirement plans
• Dual account service (safety and general)
• PERS transfer credit

Reciprocal service and purchased temporary time are not included. ARC is not available to deferred members.

LIMITATIONS
ARC is added to your total service credit only for the purpose of calculating your retirement. ARC is not applied:

• To meet the minimum eligibility requirements for a service or disability retirement (disability retirement is not available to Plan E members)
• When calculating additional LACERA-administered retiree health care benefits, or other benefits based on total years of service credit
• Toward a cancellation of contributions for members who attain 30 years of service credit

MINIMUM/ MAXIMUM PURCHASE
The minimum purchase of ARC is one year. Additional months may be purchased in addition to the one or more full years has been completed. The maximum purchase is a total of five years under any plan or combination of plans. You may choose the length (payment period) of your ARC contract; contracts range from one month to a maximum of ten years (120 months).

DIFFERENCES IN APPLYING ARC: CONTRIBUTORY PLANS and PLAN E

PROVISIONS	PLAN A, B, C, D	PLAN E
Cost-of-living (COLA) adjustments*	Applied to a retiree's total monthly retirement allowance, which includes any ARC purchased.	Applied to Plan E ARC service credit and any Plan E service earned after June 4, 2002.
Maximum percentage of final compensation allowed for retirement allowance, regardless of ARC	100%	80%
Convertible to Plan D	N/A	No. Plan E ARC remains as Plan E service credit; if you transfer to Plan D, you will have double accounts.**

COST OF ARC
The cost of ARC is calculated using a "present value formula," which represents the value of the increased retirement income you will receive during retirement, computed in today’s dollars. In other words, the member pays the full actuarial cost of the additional future retirement benefit; by law, ARC cannot place any additional financial burden on the retirement system. The formula factors in your current age, retirement plan, and salary, along with actuarial assumptions for salary increases, age at retirement, and life expectancy.

ARC CALCULATOR
Whether you’re a member of a LACERA contributory plan or of non-contributory Plan E, you can get an idea of your cost to purchase ARC by using the ARC Calculator. The online calculator allows you to enter different determining figures to decide if you’d like to pursue an ARC purchase. To determine the exact cost of your ARC purchase, you must request an official Cost Notification from LACERA.

ACCEPTED PAYMENT METHODS
Under federal law, ARC may be purchased with any of these types of funds:

• Payroll deductions (using before- or after-tax dollars)
• Qualified Plans: 401(k)/KEOGH*
• 457 Plan fund transfer: In-Service or After Termination
• IRAs: Non-Roth/Non-After Tax
• 403(b)
• After-Tax Dollars

LACERA does not accept termination pay for ARC purchases.

ARC FAQS
For answers to frequently asked questions regarding ARC, click here.

*Rollovers from the County 401(k) Savings Plan by active employees are limited by age, years in plan, and contribution type. To determine your eligibility, contact Great-West at 1-800-947-0845.

8/12/09