OAR 459-007-0005
Annual Earnings Crediting

(1) For purposes of this rule, “remaining earnings” means earnings available for distribution to a particular account or reserve after deduction of amounts required or authorized by law for other purposes.
(2) Except as otherwise specified in this division, earnings on all accounts and reserves in the Fund shall be credited as of December 31 of each calendar year in the manner specified in this rule.
(3) Health insurance accounts. All earnings attributable to the Standard Retiree Health Insurance Account (SRHIA), Retiree Health Insurance Premium Account (RHIPA) or Retirement Health Insurance Account (RHIA) shall be credited to the account from which they were derived, less administrative expenses incurred by each account, as provided in ORS 238.410 (Board may contract for insurance for retirees), 238.415 (Payment toward cost of pre-Medicare insurance) and 238.420 (Payment toward cost of Medicare supplemental insurance), respectively.
(4) Employer lump sum payments. All earnings or losses attributable to the employer lump sum payment accounts established under ORS 238.229 (Effect of lump sum payment to side account on contributions of pooled employer) shall be credited to the accounts from which they were derived.
(5) Member variable accounts. Earnings on the Variable Annuity Account shall first be used to pay a pro rata share of administrative expenses in accordance with ORS 238.260 (Variable Annuity Account)(6). If the annual earnings from the Variable Annuity Account are insufficient to pay for the pro rata share of administrative expenses, those administrative expenses shall be paid from earnings on other accounts within the Public Employees Retirement Fund (PERF), if available. If earnings from those accounts within the PERF are insufficient to pay for the administrative expenses, those expenses shall be paid from employer accounts as required by ORS 238.610 (Administrative expenses of system). All remaining earnings or losses attributable to the Variable Annuity Account shall be credited to the participants of that account, as provided under 238.260 (Variable Annuity Account)(6) and (7)(b).
(6) Individual Account Program accounts. Earnings on the Individual Account Program accounts established under ORS 238A.350 (Individual accounts established) shall first be used to pay a pro rata share of administrative expenses in accordance with ORS 238A.350 (Individual accounts established)(1). Losses on Individual Account Program target date funds shall be increased by a pro rata share of administrative expenses. After administrative expenses, each Individual Account Program account established under ORS 238A.350 (Individual accounts established) shall be credited with the earnings or losses of the specific target date fund to which the account is allocated, except for account balances allocated to the retirement installments fund, which shall be credited with earnings or losses on a monthly basis.
(7) Administrative expenses. Earnings attributable to Tier One regular accounts, the Tier One Rate Guarantee Reserve, Tier Two member regular accounts, judge member regular accounts, the OPSRP Pension Program reserve, Employee Pension Stability Accounts, employer contribution accounts, the Contingency Reserve, the Benefits-in-Force Reserve and the Capital Preservation Reserve shall first be used to pay the system’s remaining administrative expenses under ORS 238.610 (Administrative expenses of system).
(8) Contingency Reserve.
(a) In any year in which total earnings on the Fund equal or exceed the assumed rate, an amount not exceeding seven and one-half percent of remaining earnings attributable to Tier One regular accounts, the Tier One Rate Guarantee Reserve, Tier Two regular accounts, judge member regular accounts, the OPSRP Pension Program reserve, Employee Pension Stability Accounts, the Benefits-in-Force Reserve, employer contribution accounts, the Capital Preservation Reserve and the Contingency Reserve shall be credited to the Contingency Reserve to the level at which the Board determines it is adequately funded for the purposes specified in ORS 238.670 (Reserve accounts in fund)(1).
(b) The portion of the Contingency Reserve allowed under ORS 238.670 (Reserve accounts in fund)(1)(a) for use in preventing a deficit in the fund due to employer insolvency may only be credited using earnings attributable to employer contribution accounts.
(9) Tier One Member Rate Guarantee Reserve. All remaining earnings attributable to Tier One regular accounts, the Tier One Member Rate Guarantee Reserve, judge member regular accounts, the Benefits-in-Force Reserve, and the Contingency Reserve may be credited to the Tier One Member Rate Guarantee Reserve established under ORS 238.255 (Credits to regular accounts when earnings less than assumed interest rate)(1).
(10) Capital Preservation Reserve. Remaining earnings attributable to the Tier Two member regular accounts, judge member regular accounts, OPSRP Pension Program reserve, Employee Pension Stability Accounts, employer contribution accounts, the Benefits-in-Force Reserve, the Contingency Reserve and the Capital Preservation Reserve may be credited from those sources to one or more reserve accounts that may be established under ORS 238.670 (Reserve accounts in fund)(3) to offset gains and losses of invested capital.
(11) Tier One regular accounts. All remaining earnings attributable to Tier One regular accounts and the Tier One Rate Guarantee Reserve shall be credited to Tier One member regular accounts at the assumed rate in any year in which the conditions set out in ORS 238.255 (Credits to regular accounts when earnings less than assumed interest rate) have not been met. Crediting under this subsection shall be funded first by all remaining earnings attributable to Tier One regular accounts and the Tier One Rate Guarantee Reserve, then moneys in the Tier One Rate Guarantee Reserve.
(12) Judge member regular accounts. All remaining earnings attributable to judge member regular accounts shall be credited to all active and inactive judge member regular accounts at the judge member rate. Crediting under this subsection shall be funded first by all remaining earnings attributable to the judge member regular accounts and the Tier One Rate Guarantee Reserve, then moneys in the Tier One Rate Guarantee Reserve.
(13) Tier Two member regular accounts. All remaining earnings or losses attributable to Tier Two member regular accounts shall be credited to all active and inactive Tier Two member regular accounts under ORS 238.250 (Regular accounts).
(14) Employee Pension Stability Account (EPSA). All remaining earnings or losses attributable to the EPSAs shall be credited to all active and inactive EPSAs under ORS 238A.353 (Employee pension stability accounts established). For administrative expenses:
(a) EPSA accounts of Tier One and Tier Two members will be treated as Tier Two funds.
(b) EPSA accounts of OPSRP members will be treated as OPSRP Pension Program Reserve funds.
(15) OPSRP Pension Program Reserve. Remaining earnings attributable to the OPSRP Pension Program Reserve, the Contingency Reserve, and the Capital Preservation Reserve may be used to credit the OPSRP Pension Program reserve.
(16) Benefits-in-Force Reserve. Remaining earnings attributable to the Benefits-in-Force Reserve, the Contingency Reserve, the Capital Preservation Reserve and employer contribution accounts, in that order, shall be used, to the extent available, to credit the Benefits-in-Force Reserve with earnings up to the assumed rate for that calendar year in accordance with ORS 238.670 (Reserve accounts in fund)(2).
(17) Employer contribution accounts. All remaining earnings attributable to employer contribution accounts shall be credited to employer contribution accounts.
(18) Remaining earnings. Any remaining earnings shall be credited to accounts and reserves in the Fund at the Board’s discretion.

Source: Rule 459-007-0005 — Annual Earnings Crediting, https://secure.­sos.­state.­or.­us/oard/view.­action?ruleNumber=459-007-0005.

459‑007‑0001
Definitions 459‑007‑0003
Determination of Tier One Year-to-Date Calculation 459‑007‑0005
Annual Earnings Crediting 459‑007‑0007
Assumed Rate 459‑007‑0009
Allocating Costs of Compliance with Generally Accepted Accounting Principles 459‑007‑0015
Interest Rate Applied to Underpayment of Estimated Benefits 459‑007‑0020
Statutory Limitation on the Crediting of Earnings 459‑007‑0025
Crediting Earnings to a Member Lump Sum Payment 459‑007‑0040
Crediting Earnings upon Withdrawal of a Tier One Member’s Account 459‑007‑0050
Crediting Earnings for a Deceased Tier One Active or Inactive Member 459‑007‑0060
Crediting Earnings to the Tier One Employer Death Benefit 459‑007‑0070
Crediting Earnings at Tier One Service or Disability Retirement 459‑007‑0080
Crediting Earnings at Tier One Service Retirement, Single Payment 459‑007‑0090
Crediting Earnings upon Tier One Service Retirement, Two or More Installment Payments 459‑007‑0110
Crediting Earnings at Tier One Loss of Membership 459‑007‑0160
Crediting Earnings to Loss of Membership Account for Periods of Active Membership 459‑007‑0220
Distribution of Earnings for Withdrawal of Member’s Account — Tier Two 459‑007‑0230
Crediting Earnings for a Deceased Tier Two Active or Inactive Member 459‑007‑0240
Crediting Earnings to the Tier Two Employer Death Benefit 459‑007‑0250
Crediting Earnings at Tier Two Service or Disability Retirement 459‑007‑0260
Crediting Earnings at Tier Two Service Retirement, Single Payment 459‑007‑0270
Crediting Earnings upon Tier Two Service Retirement, Two or More Installment Payments 459‑007‑0290
Crediting Earnings at Tier Two Loss of Membership 459‑007‑0300
Crediting Earnings to Police Officer and Firefighter Unit Accounts in the Fund 459‑007‑0320
Crediting Earnings for IAP Account Lump Sum Payments 459‑007‑0330
Crediting Earnings for IAP Account Installment Payments 459‑007‑0335
Crediting Earnings for IAP Account Pre-Retirement Death Benefit Payments 459‑007‑0340
Crediting Earnings for an OPSRP Pension Program Cash Out of Small Benefits or Withdrawal 459‑007‑0350
Crediting Earnings to the Employee Pension Stability Account at Retirement 459‑007‑0360
Crediting Earnings to the Employee Pension Stability Account at Death 459‑007‑0370
Crediting Earnings to the Employee Pension Stability Account on Withdrawal 459‑007‑0400
Crediting Earnings Upon Withdrawal of a Judge Member Account 459‑007‑0410
Crediting Earnings Upon the Death of a Judge Member 459‑007‑0420
Crediting Earnings at Judge Member Service or Disability Retirement 459‑007‑0510
Crediting Earnings to Employer Contribution Accounts 459‑007‑0530
Crediting Earnings To Employer Lump-Sum Payments 459‑007‑0900
Crediting Earnings To Integration Lump Sum Payments
Last Updated

Jun. 8, 2021

Rule 459-007-0005’s source at or​.us