Dear School District Superintendents, Directors, Business Managers, Payroll Officials, Town Treasurers, Charter School and Education Collaborative Directors,

As you know, pursuant to pension reform legislation enacted in November 2011, the interest rate charged on certain service purchases will double from “buyback” interest (currently, 4.125%) to “actuarial” interest (currently, 8.25%) as of April 2, 2013—which is rapidly approaching.

Many of you have reported being inundated with urgent requests to document members’ prior employment histories on our service purchase application forms. To help ease the administrative burden on you, and also accommodate any members who still wish to qualify for the current, lower “buyback” interest rate, our Board recently extended the time for members to submit the employer portion of their §3 service purchase application to October 2, 2013. Accordingly:

If members are unable to submit their fully completed §3 service purchase applications by April 2, 2013, they may still preserve their right to an initial invoice at the current, lower, “buyback” interest rate by submitting at least the completed “member portion” of their service purchase applications (generally, Part 1) to us so that it is postmarked on or before April 2, 2013, and then submitting the completed “employer portion” (generally, Part 2) no later than October 2, 2013.

When members receive their initial invoice—which may take up to 12 months—they will then have until 60 days from the date of that invoice either to pay for their purchase in full or to submit both their signed installment plan agreement and their first installment payment together. If they do not act by 60 days from the date of their invoice, or default on their installment agreement, and they later wish to purchase this service, they will be subject to the interest rate in effect at that time, which—after April 2, 2013—will be actuarial interest. (As a reminder, all purchases of service credit still must be completed prior to a member’s date of retirement.)

We will soon send a broadcast e-mail to our members for whom we have e-mail addresses to remind them of the interest rate increase and outline the new filing policy.

If you have any questions, please contact your Employer Services representative. As always, thank you for all that you do for us and our members throughout the year. We truly appreciate your efforts.