Tier 5 Pension Plan Information

Tier 5 Pension Plan Information

January 1, 2002 – June 30, 2011

Tier 5 is a “defined benefit” plan that provides pension benefits based upon final average pay and years of service. This plan includes service, disability, and survivor pension benefits as well as retiree health insurance subsidies to eligible sworn members and certain qualified survivors. When you participate in this plan, you do not contribute to or earn Social Security credit.

Review the information below for key provisions of your Tier 5 benefits. For additional information, review your Tier 5 Summary Plan Description (SPD) or active member newsletters.

Plan Details

How much do I contribute to the plan?

When you graduate from the Police Academy or Fire Department Drill Tower, you begin to contribute 8% of your pre-tax pay each pay period. However, if the plan is not 100% actuarially funded, you will contribute 9% of your pay.

Your contributions are automatically deducted from your paycheck. While you are an active member, your contributions will earn interest every six months (paid on June 30 and December 31).

Once you attain 33 years of service, you no longer contribute to the plan.

How is my benefit determined?

Your benefit is based on a formula that takes into account your Final Average Salary and years of service. 

How is my Service Pension calculated?

Follow these steps to calculate your service pension:

  1. Calculate Your Final Average Salary
    Your Final Average Salary equals the average monthly pay you received in the last 12 consecutive months prior to retirement. Upon, retirement, you may also have the option to designate which consecutive 12-month period you want to use to calculate your Final Average Salary. Please consult your Tier 5 Summary Plan Description (SPD) for additional information.
  2. Calculate Your Years of Service Pension Percentage
    You receive 50% of your Final Average Salary at 20 years of service, plus 3% for each additional year of service; except in the 30th year you receive 4%. The maximum percentage payable is 90% of your Final Average Salary at 33 or more years of service. Use the table below to locate your Years of Service Pension Percentage. 
  3. Calculate Your Service Pension
    Multiply your Final Average Salary by your Years of Service Pension Percentage to determine your estimated monthly benefit.

How is my benefit paid?

Your benefit is a guaranteed monthly payment for life and may allow you to provide continuing income to a qualified survivor.

What happens if I leave the Fire, Harbor, or Police Department before I can retire?

Your contributions and accrued interest will be refunded to you.

If you have 20 or more years of service and terminate before age 50, for any reason other than disability, you are eligible for a deferred service pension, which is calculated using the lower Tier 3 retirement percentages.

If you elect to receive a deferred service pension and die before age 50, your qualified survivors will not receive a pension. Instead, your designated beneficiary will receive a refund of your contributions and accrued interest.

When am I eligible to retire?

You are eligible to apply for a service pension when you are at least age 50 with 20 years of service. Learn how to apply for a service pension.

Will I receive cost of living adjustments (COLA)?

Yes, you will receive cost of living adjustments (COLA) on your benefit. Review the Tier 5 COLA Overview.

Am I eligible for disability benefits?

If you are unable to work due to injury or illness, you may be eligible for a disability pension. Learn more about your disability benefits.

What happens if I die?

  • If you are an active member with no qualified survivors entitled to a benefit, your contributions and interest will be refunded to your designated beneficiaries. Complete a Tiers 3 – 6 – Beneficiary Designation Form if you wish to update your beneficiary information.
  • If you are retired, an allowance may be paid to your qualified survivors.
  • If you are retired and there are no qualified survivors entitled to a benefit, there is no refund of contributions and your pension benefits cease.