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Greenfield Community
Frequently Asked Questions
Q: Do member's contributions to the Retirement System earn interest?

A: Your contributions are placed in an individual annuity savings fund, which earns annual interest at a rate comparable to that of a passbook savings account. The interest rate is determined by the Public Employee Retirement Administration Commission and the Commissioner of Banks. This annual interest rate is independent of that earned on the Retirement System's investments.

Q: Does the amount of interest credited to your individual annuity savings fund affect overall retirement benefits?

A: No. The amount of money in your annuity account has no bearing on your future allowance. This is determined by a formula consisting only of your age, service, and three-year salary average.

Q: When is retirement an option?

A: You are eligible to retire at age 55 or older if you have at least ten years of creditable service. If you have 20 years of service, you can retire at any age.

Q: What is the retirement allowance based on? How is it calculated?

A: Because the Greenfield Retirement Plan is a defined benefit plan, your benefits are determined by a formula and are not affected by the amount of money in your annuity account at the time of retirement. The factors used to determine your benefit are: your age at the time of retirement, your amount of creditable service, your group classification, and an average of your three highest years of regular compensation.

Q: Can I purchase creditable service earned in another Massachusetts public retirement system?

A: If you were a member of another retirement system subject to the provisions of M.G.L., Chapter 32, and you withdrew your retirement funds, it is possible to buy back your prior creditable service. The Retirement office will verify your prior service, then calculate the amount of your buyback. You must repay the amount withdrawn, plus interest, to the date of repayment. You may complete a buyback as a lump-sum payment, pre-tax rollover, or through payroll deduction over a five-year period.

Q: Will prior creditable service affect my membership date or contribution rate in the Retirement System?

A: If you have retirement contributions from a previous public employer directly transferred to our system, you are entitled to maintain the level of contributions you were paying in your previous employment. Under current regulations, if you receive a refund of retirement contributions from your previous retirement system and later became a member of the Greenfield Retirement System, your contribution rate with Greenfield will be at the new member rate, regardless of what you were paying in your prior system. If you should later purchase your prior creditable service through a buyback, your contribution level will remain at the new member rate and will not be reduced to your previous rate.

Q: Is regular compensation the same as total compensation?

A: No. Regular compensation is the portion of your salary that is subject to retirement contributions. Over time, bonus pay, severance pay, any payments made for unused sick time, and several other payments, are not considered regular compensation, are not subject to retirement and cannot be used towards your three-year average for the purpose of determining your retirement allowance.

Q: Is membership mandatory for Greenfield employees?

A: Yes. Membership in the Greenfield Retirement System is required by law for all regularly employed employees who work at least 20 hours a week. Membership is also mandatory for the Greenfield Housing Authority and the Franklin County Technical School.

Q: How is my membership date determined?

A: For most employees, the date you were hired will be your membership date. (Technically, it's the date you first began making contributions from your regular compensation into the retirement system. If you have a period of employment in which you did not make retirement contributions, you may want to contact the Retirement Office to inquire about purchasing your prior employment as creditable service).

Q: How much do members contribute to the Retirement System?

A: The amount each employee is required to contribute to the retirement system each year is set by statute. If you began employment on or after July 1, 1996, you must contribute nine percent of your regular compensation to the Retirement System. If you were hired any time between January 1, 1984 and July 1, 1996 your contribution rate is set at eight percent. Members who joined the system any time between 1975 and 1983 contribute seven percent. Those employees who became members prior to 1975 are contributing five percent. The law also mandates that for members whose employment commenced on or after January 1, 1979, an additional two percent of regular compensation will be withheld on compensation over $30,000. This two percent is in addition to the seven, eight, or nine percent that is already being deducted from total regular compensation.