Mark your calendars! HMEPS and the City of Houston Deferred Compensation Plan will hold the 2016 Fall Financial Retirement Employees Educational (F.R.E.E.) Summit on Friday, October 21, 2016. The F.R.E.E. Summit will be held at the Harris County Department of Education Conference Center, 6300 Irvington, Houston, Texas 77022 from 9:30 a.m. to 2:15 p.m.
HMEPS Chairman and Manager of Policy and Financial Planning Meet with Mayor Turner
HMEPS Chairman Sherry Mose and Manager of Policy and Financial Planning Steve Waas, along with the administrators of the Houston Police Officers’ Pension System and Houston Firefighters’ Relief & Retirement Fund, met with Mayor Turner to discuss pension matters.
HMEPS Posting Notice of Determination Letter Request to IRS
HMEPS is having a notice posted at City locations and on the HMEPS website regarding HMEPS’ application to the Internal Revenue Service (IRS) for a determination letter on the qualification of the HMEPS plan. Upon application, the IRS issues a so-called “determination letter” that assures that the plan meets the detailed qualification requirements contained in the Internal Revenue Code at the time the letter is issued. The determination letter process is handled by the Employee Plans segment of the IRS’s Tax Exempt and Government Entities Division.
A favorable determination letter indicates that the plan described in the written plan document meets Internal Revenue Code qualification requirements. HMEPS last received a favorable determination letter in November 2015. The IRS has a prescribed timetable for retirement plans to be submitted for an update of their determination letter, and this year is part of the window during which the IRS will accept updated submissions from governmental plans such as HMEPS. Accordingly, HMEPS is posting the notice as part of the determination letter request process.
2016 Pension Payment Schedule
The 2016 pension payment schedule is now available. Click here to download >>
DROP Interest Rate is 2.5% for Calendar Year 2016
The Deferred Retirement Option Plan (DROP) interest rate for calendar year 2016 will be 2.5%, effective January 1, 2016. The rate was approved by the HMEPS Board of Trustees at the October 2015 Board meeting.
Several DROP participants have asked how the DROP rate is determined. Under the Meet and Confer Agreement, the DROP interest rate for each calendar year is half (50%) of the HMEPS investment return for the prior fiscal year, with a maximum rate of 7.5% and a minimum rate of 2.5%. The HMEPS investment return for Fiscal Year 2015 was 3.38% so DROP participants in 2016 will receive 2.5% on their DROP accounts.
DROP is an optional retirement method for members who have reached their normal retirement eligibility (age and years of credited service) but do not want to retire. It is an alternative method of accumulating and receiving a pension benefit from HMEPS. To speak with a benefit counselor to learn more about DROP, please call the HMEPS office at 713-595-0100.