Group D 1% Contribution to Cash Balance Account begins with February 2, 2018 pay date.
The 2017 Texas Legislature enacted legislation that included contribution and benefit changes for HMEPS participants. One of these changes is the introduction of a cash balance hybrid component for Group D members.
As explained in the June 2017 HMEPS Pension Press, if you were newly hired on or after January 1, 2008, then you are a Group D member and you will begin contributing 1% of your pensionable pay (base salary, longevity and shift differential, if any) to HMEPS effective with your February 2, 2018 pay date. The 1% contribution will be credited to a notional cash balance account in your name. This is in addition to your current member contribution of 2% of your pensionable pay to HMEPS.
What is the Cash Balance Account?
The cash balance account for Group D participants is a notional, or bookkeeping, account. If you are a Group D member, your cash balance account will be credited with your required 1% contribution. If you contribute to the cash balance account for at least one full year, your account will be credited with interest equal to half of the five-year average net investment return earned by HMEPS, and guaranteed to not be less than 2.5%, or greater than 7.5%. The balance in this account can be distributed to you when you leave employment with the City.
If you have any questions, contact HMEPS at 713-595-0100 and also refer to the HMEPS website for updates. Please note that representatives and employees from the City of Houston are not agents of HMEPS, and that you should contact HMEPS directly for information about your pension participation.