Employer News | Quarterly Newsletter | Summer 2024

• BEARS Update
• Employer On-Behalf Funding for Fiscal Year 2025
• New Employee—What Retirement System  Do You Enroll New Hires In?
• Annual Census Audits
• Teachers' Retirement System 2024/2025 School Year Reporting—Remember to STAT Back Employees!

BEARS Update

The design and development of the Division of Retirement and Benefits (Division) new BEnefits And Retirement System (BEARS) is nearing completion. We anticipate transitioning to BEARS in late 2024 and are very excited about the possibilities and benefits of this new system.

As part of this transition, employers who import personnel and payroll data will need to develop new files for each retirement system they participate in (e.g., PERS, TRS, etc.). BEARS will require two files to be submitted for each pay period—a personnel file and a payroll file. We have been working with several employers to test file layouts and will be sending the information to all other employers before August 1.

Primary payroll contacts for each employer will receive an email with the file layouts, instructions for implementing the changes, and a memo with additional information regarding the change. We are requesting that all agencies have the changes implemented by October 15, 2024, so we can begin testing to ensure a smooth transition to BEARS. In August, we will be providing information about training sessions as well as more details about the Employer Self-Service (ESS) portal in BEARS. If you are an employer who prefers to manually enter or clone personnel and payroll data, detailed information will be provided on how to report through the ESS portal within the BEARS system.

If you have questions or comments regarding the BEARS system, please email us at DRB.BEARS.Communication@alaska.gov.

Employer On-Behalf Funding for Fiscal Year 2025

On-behalf funding for Public Employees’ Retirement System (PERS) and Teachers’ Retirement System (TRS) employers for Fiscal Year 2025 (FY25) is provided by House Bill (HB) 268 (Section 51). HB 268 passed during the 2024 legislative session and was recently signed into law. The bill provides a set amount of funding to reduce the PERS Employer Effective Rate to 22 percent and the TRS Employer Effective Rate to 12.56 percent for FY25.

The on-behalf funding is applied with the processing of each employer payroll. Employer on-behalf funding statements will be sent via email to payroll and finance contacts. For PERS and TRS on-behalf funding questions or statement copies please email doa.drb.accountants@alaska.gov.

For PERS and TRS employer on-behalf funding provided in HB 268, the Division of Retirement and Benefits will apply payments for complete payrolls through the pay period end date of June 30, 2025. Fiscal year 2025 (July 1, 2024, to June 30, 2025) complete payrolls must be received in our office by July 15, 2025, to be processed with HB 268 employer on-behalf funding.

A complete payroll is defined as a payroll that has all the elements needed to process the payroll. This includes the funds necessary to process the payroll, including a correct memo if the payment is a wire or push ACH. Additionally, the payroll summary and the employer payroll detail are part of a complete payroll.

For questions, please contact the Division of Retirement and Benefits, Accounting Unit at doa.drb.accountants@alaska.gov.

New Employee—What Retirement System Do You Enroll New Hires In?

Employers will need to verify what plan an employee should be enrolled in by accessing the Former Member Lookup Portal and the Employer Access New Member Lookup. These custom tools have been developed to assist employers in determining which retirement plan a new hire should be enrolled in.

Why Two Separate Portals?

In April 2022, the Alaska Supreme Court found that a former member’s ability to reinstate PERS or TRS Defined Benefit (DB) former tier status is an accrued benefit protected by Article XII, Section 7 of the Alaska Constitution. Employer Access has historically been the portal for an employer to look for a new hire to verify which retirement system to enroll the employee in. The Supreme Court decision mandates that a former member be provided a choice when rehiring into a PERS or TRS-eligible position. Since Employer Access is no longer supported and programming modifications could not be made, the Former Member Lookup Portal was developed to give employers the additional tools needed to properly onboard new employees and enroll them in the correct retirement system.

What is the Former Member Lookup Portal?

The Former Member Lookup Portal identifies if a newly hired employee is a former PERS or TRS DB Member. All former DB members who are rehired into PERS or TRS are required to make a one-time election to choose whether to participate in the DB or the Defined Contribution Retirement (DCR) system.

Who is Classified as a Former Member?

Any member who was previously enrolled in the DB retirement system and withdrew their PERS or TRS DB account balance after termination.

To verify if an employee you are hiring is required to complete the Former Member Election Form, follow these steps:

What is the New Member Lookup in Employer Access?

If the employee being hired is not a Former Member per the Former Member Portal search results, the New Member Lookup will confirm if the employee should be enrolled in the DB or DCR retirement system.

• An employee is enrolled in the DB plan if they were originally hired into the PERS or TRS DB plan before July 1, 2006, and the employee has not withdrawn their DB account balance.
  
  
• An employee is enrolled in the DCR plan if they are a new hire into PERS or TRS or were initially hired into PERS or TRS after June 30, 2006.

To verify if an employee you are hiring should be enrolled in the DB or DCR plan, follow these steps:

How Do I Obtain a Login ID for both Portals?

Human Resource staff, hiring managers, or payroll staff must have an Employer Services logon ID and password to access our reporting systems eReporting, Former Member Lookup portal, and Employer Access portal.

For staff to obtain access, they must complete the Logon ID Request form and have the form signed by the employer-authorized representative. Each person who needs to access the Former Member Lookup portal will need a separate logon ID and password. Logon IDs and passwords should never be shared.

Please reach out to your Retirement and Benefits Payroll contact if additional personnel need to be granted access to Employer Services and the Former Member Portal or if you have any questions regarding what plan a newly hired employee is to be enrolled in.

Annual Census Audits

The Division’s auditors, KPMG, are gearing up to start with this year’s employer GASB 68 and 75 census audits. The frequency of the census audits is based on the employer size and can occur every year, every five years, or every ten years. The Division’s external auditor chooses employers for a census audit around July of each year. Employers have received a notification that they’ve been selected and should expect to provide PERS- and TRS-related data to the external auditors within a specific timeframe. For questions regarding the census data audit and additional details about the requirements, please see the sample letter from the Division as well as the AICPA whitepaper.

To aid you in preparation for this process, it’s important for employers to keep detailed records of their transmissions to the Division and to ensure those transmissions reconcile with the employer payroll records. If you have questions related to the transmission and records, please contact your payroll contact.

Teachers' Retirement System 2024/2025 School Year Reporting

Remember to STAT Back Employees!

As the beginning of the school year approaches, it is time to revisit the beginning-of-year reporting procedures for the Teachers’ Retirement System (TRS).

All Teachers who were put on TSE at the end of the school year need a STAT event entered when they return to work.

Please report the following on your first payroll (pay period end (PPE) date on or after July 1, 2024) for school year (SY) 2025:

• Return to work date (STAT record) for each teacher for the new school year;
• Part-time teachers’ service percentage level (FTE of teacher’s SY25 contract) must be reported on their STAT record that returns them to work; and
• Personnel Change records: address changes, marital status changes, and birth date corrections, as needed.

If teachers were not put on TSE at the end of the school year, a TSE event will need to be entered as of the day after the last day worked for the school year or June 30, 2024. A STAT will need to be entered the day the employee returned to work for the 2024-2025 School Year. A TERM date should be entered for any employees who did not return for the 2024-2025 school year if not previously reported.

If you are hiring any teachers for the upcoming School Year, please see the above article entitled Employee—What Retirement System Do You Enroll New Hires In?

Questions? Please do not hesitate to contact your payroll contact or e-mail us at doa.drb.activepayroll@alaska.gov.