WV Teachers Get More Time to Make DB Switch

April 13, 2009 (PLANSPONSOR.com) - The West Virginia legislature has moved to give state educators more time to ensure they receive full pension benefits.

According to the Associated Press, legislation passed to Governor Joe Manchin on Saturday would loosen the deadline for so-called buyback payments into the West Virginia Teachers Retirement System’s defined benefit plan (see State Plan Sponsor of the Year: A Lesson in Funding ).

Nearly 15,000 teachers and other school workers took part in last year’s exodus from the 457 defined contribution program to the defined benefit alternative. However, participation in the 457 plan required a smaller participant contribution than does the defined benefit program. Consequently, those who transferred to the DB option must make up the difference to guarantee full benefits under the new plan.

The deadline for buyback payments is June 30. But several thousand enrollees don’t yet know how much they must pay. The bill gives them 90 days from the postmark on their final contribution calculation, according to the AP.