South Dakota Administrative Rules Title 62 - South Dakota Retirement System
South Dakota Administrative Rules Title 62 - South Dakota Retirement System (SDRS)
Title 62 of the South Dakota Administrative Rules (SDAR) provides the regulations and guidelines governing the South Dakota Retirement System (SDRS). The SDRS is a statewide retirement program that serves public employees in South Dakota, offering benefits for retirement, disability, and death, as well as providing survivors' benefits and a variety of other retirement-related services.
The rules under Title 62 outline how the system operates, eligibility criteria, benefit structures, member contributions, and the administration of the SDRS.
Here’s a detailed look at the key components of Title 62 – South Dakota Retirement System:
1. General Administration and Purpose (62:01)
Purpose: Title 62 governs the South Dakota Retirement System (SDRS) and sets forth the administrative rules that control the operation of the system. The SDRS is designed to provide retirement benefits to eligible public employees in South Dakota.
Administration: The SDRS Board of Trustees is the primary governing body responsible for overseeing the system’s operations, policies, and finances. The Board is composed of state officials, such as the governor or treasurer, and other appointed members.
Regulatory Authority: The South Dakota Department of Legislative Audit and the SDRS Board collaborate to ensure compliance with both state law and federal requirements (e.g., the Employee Retirement Income Security Act, or ERISA).
2. Membership and Eligibility (62:02)
Eligible Employees: Membership in the SDRS is typically available to state and local government employees, including teachers, public safety officers, and other qualified employees in South Dakota. Certain political appointees and employees may also be eligible, subject to specific criteria.
Membership Requirements: To become a member of the SDRS, individuals must be employed by a qualifying public employer, and they must meet the specific eligibility requirements set forth in state law and the SDRS regulations.
Enrollment Process: The rules detail the process for enrolling in the SDRS, including required documentation, timelines for registration, and employee responsibilities.
3. Contributions (62:03)
Employee Contributions: Employees participating in SDRS contribute a percentage of their earnings to the retirement system. The contribution rate is set by law and may vary depending on the type of employment (e.g., general employees, law enforcement, or public safety workers).
Employer Contributions: Employers are also required to make contributions to the SDRS on behalf of their employees. These contributions are typically a matching percentage of the employee’s contribution.
Contribution Rates: The specific percentage for both employee and employer contributions is detailed in the administrative rules and updated periodically to reflect actuarial valuations and funding requirements.
4. Benefits (62:04)
Retirement Benefits: Title 62 outlines how retirement benefits are calculated for members. The system typically provides a monthly annuity based on the member’s years of service, average salary, and age at retirement.
Early Retirement: Employees may be eligible for early retirement, with rules specifying when and how early retirement can be taken, and any reductions in benefits that may apply.
Disability Benefits: SDRS provides benefits to members who become disabled and are unable to continue working. The rules define eligibility for disability benefits and how they are calculated based on a member’s service and earnings.
Survivor and Death Benefits: If a member dies while active or after retirement, their beneficiaries may be entitled to survivor benefits. These rules specify how survivor benefits are calculated and what documentation is required to claim them.
5. Service Credit (62:05)
Service Credit Accumulation: Members accrue service credit for each year they participate in the SDRS. Service credit is the basis for calculating retirement benefits.
Transfer of Service Credit: The rules also provide guidance on how service credit is handled when a member changes employment within South Dakota’s public sector, including transferring credit between different retirement systems, if applicable.
Military Service Credit: Members who have served in the military may be eligible to purchase service credit for their military service, which can be added to their SDRS service credit to increase their future benefits.
Purchased Service Credit: Employees can also purchase additional service credit under certain circumstances, such as purchasing credit for prior service in a non-qualifying public job or for previous non-public employment.
6. Vesting and Retirement (62:06)
Vesting: Vesting refers to the process by which a member gains ownership of their retirement benefits. Title 62 defines the vesting schedule for the SDRS, typically based on the number of years of service worked. A member must be vested to qualify for retirement benefits.
Normal Retirement Age: The rules define the "normal retirement age," which is the age at which a member can retire with full benefits. In general, this is set at a certain age (e.g., 65) with eligibility for unreduced retirement benefits.
Retirement Options: When members retire, they may choose from several benefit payout options, including monthly annuities or lump-sum distributions. The rules outline the options available and the factors that affect the amount of retirement benefits paid.
7. Beneficiary Designations (62:07)
Designating a Beneficiary: Members of the SDRS are required to designate one or more beneficiaries to receive benefits in the event of their death. The rules describe how beneficiaries are designated, including the proper forms and any changes to beneficiary designations.
Changing Beneficiaries: Members have the option to change their designated beneficiaries at any time, subject to any administrative processes and requirements outlined in the rules.
Payment to Beneficiaries: The rules define how benefits are paid to surviving beneficiaries and the timeline for these payments.
8. Disability and Survivor Benefits (62:08)
Disability Benefits: This section provides more detailed rules for qualifying for disability benefits under SDRS, including the medical and service requirements for eligibility.
Survivor Benefits: If a member dies while in service or after retirement, their survivors may be entitled to survivor benefits, including widow/er benefits, children’s benefits, and other survivor-related benefits. The rules specify who qualifies as a survivor and how benefits are calculated.
9. Administrative Procedures (62:09)
Filing Claims: This section outlines the process for filing claims for benefits, including retirement, disability, survivor, and other benefits. It specifies the required forms, timelines, and documentation needed for each type of claim.
Appeals Process: If a member’s claim is denied or if they disagree with a benefit determination, they have the right to appeal the decision. The rules provide a formal appeals process, including timelines and required documentation for the appeal.
10. Fund Management and Investments (62:10)
Investment of Funds: The SDRS is a defined benefit plan, and the system’s assets are invested to ensure that there are sufficient funds to meet future benefit obligations. Title 62 outlines the policies for investing the funds, including the risk management and investment strategies employed by the SDRS Board.
Actuarial Valuation: The rules provide guidelines for how the SDRS fund is managed to ensure its solvency. This includes conducting regular actuarial valuations to assess the funding level of the system and making adjustments to contribution rates if needed.
11. Miscellaneous Provisions (62:11)
Administrative Fees: The rules may set forth administrative fees that are charged to members or employers for specific services, such as transferring funds or providing extra documentation.
Amendments: The rules also include provisions for updating and amending regulations as necessary, ensuring the system remains in compliance with state laws and federal guidelines.
Conclusion
Title 62 of the South Dakota Administrative Rules provides a comprehensive framework for the operation of the South Dakota Retirement System (SDRS). It covers everything from membership eligibility and contribution requirements to the details of benefit calculations, retirement options, and the processes for claims and appeals. The rules ensure that the SDRS functions efficiently, meets its financial obligations, and provides fair and transparent processes for all public employees eligible for benefits under the system.
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