Additional Retirement Credit is No Longer Available
ARC Purchases Prohibited AS OF JANUARY 1, 2013
The California Public Employees' Pension Reform Act of 2013 (PEPRA), which became effective January 1, 2013, prohibits the purchase of ARC.
Please note: LACERA is not responsible for any decrease in your account balance resulting from financial market volatility. Consult a professional financial advisor to protect yourself from adverse market conditions.
Historical Overview of ARC
Prior to PEPRA, ARC (which PEPRA refers to as “nonqualified service credit”) was credit that could be purchased to increase your service credit total. It was not based on actual employment. Previous law permitted the purchase of up to five years of ARC by active LACERA members with at least five years of actual County service credit.
If You Have Already Purchased ARC
ARC purchased under any of the following conditions remains valid and is not affected by PEPRA:
- Purchases made prior to 2013
- Purchases resulting from ARC applications received by LACERA by December 31, 2012, regardless of the actual purchase date
- ARC contracts in effect prior to 2013
How ARC Affects You
When you retire, your retirement allowance will be calculated based on three factors: the amount of service credit you have accumulated, your age at retirement, and your final compensation.
ARC adds years to your service credit total for the sole purpose of calculating your retirement. By increasing the amount of service credit you have accumulated, ARC increases the amount of the monthly allowance you will be eligible to receive when you retire.
Limitations Of ARC
ARC does not count toward retirement eligibility, vesting, 30-year cancellation of contributions, retiree healthcare subsidy, or other benefits based on total years of service credit.
More information about ARC purchased prior to PEPRA can be found in ARC FAQs.