To all employees currently active in the Virginia Retirement System: Beginning January 1, 2014, there will be some significant changes to the Virginia Retirement System (VRS) as the result of legislation approved by the Virginia General Assembly and signed by the Governor. All new VRS-eligible (i.e., full-time) employees, except for those classified as hazardous duty, will be enrolled in the new VRS Hybrid Plan, unless they have active VRS service prior to that date. Hybrid Plan members will contribute the same five percent of their pre-tax salary as our current VRS-eligible employees do, but their contributions will be allocated in a different manner.

Currently, the five percent an employee contributes to VRS is deposited into a defined benefit plan managed by the VRS Board of Trustees. Under the Hybrid Plan, four percent of an employee’s pre-tax contribution will go into a defined benefit plan and one percent will go into a defined contribution plan. In a defined contribution plan, the employee, rather than VRS, chooses how that one percent will be invested, and there will be many investment options available. An employee in the Hybrid plan also can contribute up to another four percent of their pre-tax salary into the defined contribution plan, and the school division will match as much as 3.5 percent of the employee’s contribution.

Current employees now in VRS Plan 1 or Plan 2 will have the option to switch over into the Hybrid Plan between January 1 and April 30, 2014. For those who opt into the Hybrid Plan, the change would become effective July 1 (although 10/11-month employees would not see this change until the September 2014 payroll). The decision to opt in or opt out is irrevocable; employees will never be able to change this decision after April 30, 2014—even if they change employers in the future. Human Resources will schedule Hybrid Plan information sessions at every school to ensure that employees are informed about their options. There will also be other sessions scheduled in both County office buildings for those who wish to attend.

Unlike the current VRS plans, the Hybrid Plan will not offer the option of disability retirement. Instead, Hybrid Plan members will receive mandated employer-paid short-term and long-term disability coverage. We evaluated proposals from five vendors, looking at their customer service offerings, experience and qualifications. At the December 12, 2013 meeting of the School Board and Board of Supervisors, Standard Insurance was approved to provide our short- and long-term disability coverage.

Because the newly mandated benefits will create some inconsistencies between our current leave programs and those we must follow for Hybrid Plan members, we currently are assessing how best to administer benefits to all employees, regardless of which VRS plan may apply.

So, what do I need to do?

Be informed!

• Attend a Hybrid Plan information session or watch a VRS webinar (available Jan. 1).
• Visit the VRS website to learn more and view their posted resources.
• Make sure you can log into your own myVRS account (see below).

How do I assess my options?

VRS has provided an easy to use calculator to estimate your retirement benefits under both the current Plan 1/Plan 2 option and the Hybrid Plan option using real time data from your personal VRS account. This calculator will be available to you as of January 1. In order to access the calculator, you MUST access your personal member account through myVRS. You can find the log-in/registration page on the myVRS website. If you haven’t previously created an account through myVRS, please visit the About myVRS web page to learn more.

How do I opt in?

You must first log in to your personal myVRS account. Once there, you’ll see the “Explore Opting into the Hybrid Plan” button. Once you click on this button, you’ll be asked to answer a few questions that will result in the creation of two estimates: one for retirement benefits under your current VRS plan, and another for projected benefits under the Hybrid Plan. If you decide you want to opt in to the Hybrid Plan, you’ll be prompted to download a form that you must print, sign and return to VRS by April 30, 2014. Creating this estimate or merely downloading the opt-in form does NOT obligate you to join the Hybrid Plan. You MUST sign, date and return the form to VRS in order to opt-in to the Hybrid Plan. Remember: The decision to opt-in is irrevocable and cannot be changed after April 30, 2014.

How do I opt out?

You do not have to opt out. If you do not print, sign and return the opt-in declaration form to VRS by April 30, 2014, you will remain in your current VRS plan. This decision, too, cannot be changed after April 30, 2014.

We will continue to provide updates on this important information. Remember, the VRS calculator will not be available until January 1, 2014. We do encourage you to set up your account now, so that when information is available, you can quickly assess your options.