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    BART Retirement Plans Common Questions and Answers

     

      • What is the BART 401(a) Money Purchase Plan?

        • BART's Money Purchase Pension Plan is a "tax-qualified" retirement plan under Section 401(a) of the Internal Revenue Code.
        • BART is required to make an annual contribution to each participant based on the participant's annual compensation. Please see the question below regarding conributions to the 401(a) Money Purchase Plan.
      • What are the objectives of the BART 401(a) Money Purchase Pension Plan?

        The purpose of the Money Purchase Pension Plan is to provide BART Employees with a savings and investment program for retirement. Contributions to the Plan and earnings on those contributions are not subject to current income taxes, but are taxed only when you receive a distribution from the Plan.

        The 401(a) Money Purchase Pension Plan will assist Employees in meeting individual objectives such as:

        • Accumulating tax-deferred retirement benefits
        • Accumulating tax-deferred earnings on those benefits
        • Supplementing retirement income
        • Enjoying the benefits of group investment power
        • Increasing financial independence
        • Self-directing retirement funds
      • How is the BART 401(a) Money Purchase Pension Plan different from the PERS pension plan?

        The PERS pension plan is a defined benefit plan. Participants in the PERS plan receive a benefit upon retirement which is defined by formula (see your PERS Summary Plan Description) [based on years of service and compensation] OR [promises a specified monthly benefit on retirement that is predetermined by a formula based on an employee's earnings history, years of service and age, rather than depending on investment returns]. The Employer's contribution varies each year in order to ensure that the benefit is adequately funded.

        The BART 401(a) Money Purchase Pension Plan, is a defined contribution plan. The amount of the Employer's contribution is specifically defined and is the amount that you will receive in benefits from this plan adjusted for any earnings or losses attributable to the investment of such amounts.

      • Does the BART 401(a) Money Purchase Pension Plan affect my PERS benefits?

        Your PERS benefits are not affected by your participation in the BART 401(a) Money Purchase Pension Plan.

      • How do I enroll in the BART 457 Deferred Compensation Plan?

        To become a Plan Participant, you must complete the BART 457 Deferred Compensation Enrollment Form and specify:

        • How much of your pay you wish to contribute
        • How you would like to invest the contribution amounts
        • Who will be the Beneficiary of your account once you are deceased
      • How can I change my deferral amount?

        You can change your deferral amount through Self-Service using these steps:

        1. Log in to WebBART,
        2. Go to SelfService>Benefits>Benefits Summary,
        3. Click on the Deferred Compensation link,
        4. Click the yellow Edit button,
        5. Enter a new dollar amount, and
        6. Click Save.

        Alternatively, if you would like to change your payroll deduction amount via mail, please complete the BART 457 Amount of Deferral Change Form and return it to the BART Benefits Office, 300 Lakeside Drive, 20th Floor, Oakland, CA 94612. You may also fax this form to BART Benefits Office at (510) 464-7618.

        Procedures are the same if you wish to stop your deferral. All changes are effective the first of the following month.

      • Is there a way that I can automatically increase my deferral amount?

        Yes, you can automatically increase your deferral amount with the BART 457 Plan Automatic Escalator Program. This feature works for you by automatically increasing your deferral amount by an additional 1% of your current base salary. If you choose to participate, the increase will take place with your very first paycheck in July and then increase annually. For example, if you elect to use the Automatic Escalator Program when you enroll and your pay rate is $25.00 per hour or $2,000.00 per pay period, the increase to your pay period deferral due to the auto-escalator would be $20.00 as of the following July 1st.

      • Is there a maximum amount that I can contribute to the BART 457 Deferred Compensation Plan?

        For 2014:

        • the normal maximum contribution limit is $17,500
        • the additional Age 50+ catch-up contribution limit is $5,500
        • the total contribution limit (including age 50+ catch up) is $23,000

        After 2014, limits are subject to increases in accordance with IRS rules.

      • How can I save more now that I am getting closer to retiring?

        BART offers two catch-up contribution provisions that allow participants to contribute an amount greater than the normal maximum contribution amount in effect for the year:

        "Age 50+" catch-up provision — for participants age 50 or older by the end of the year.

        The "Pre-Retirement" catch-up provision — allows you to make additional contributions to your BART 457 Deferred Compensation Plan in order to make up for years in which you did not contribute the maximum permissible amount. You can review the BART 457 Deferred Compensation Catch-up Provision Packet for details regarding this special provision. The packet will also have instructions on how to get started and who to contact for assistance.

        *Please review the BART 457 Deferred Compensation Plan Catch-up Provision Packet.

      • How do I enroll in the BART 401(a) Money Purchase Pension Plan?

        BART employees are eligible to participate in the Money Purchase Pension Plan, as provided in their collective bargaining agreement or the non-represented employees' handbook.

        When you start your participation, you will be asked to complete the BART 401(a) Money Purchase Pension Plan Enrollment Form to indicate how you would like the funds deposited in your account invested and to designate who will be the beneficiary of your account in the event you die before receiving full distribution of your account. BART will make contributions on your behalf.

      • How much does BART contribute to my account on my behalf?

        The amount of the Money Purchase Pension Plan contribution made on your behalf will depend on the union, if any, to which you belong.

        Participants who are full-time or part-time employees and members of Amalgamated Transit Union ("ATU") Local 1555, American Federation of State, County and Municipal Employees ("AFSCME") Local 3993, participants who are not represented by any union; and full-time employees (but not part-time employees) who are members of the Service Employees International Union ("SEIU") Local 1021:

        BART will contribute an amount equal to 6.65% of "Compensation" up to a maximum annual contribution of $1,868.65. "Compensation" means the amount of a participant's compensation paid by BART for the plan year [(which begins on January 1st and ends on December 31st)] excluding the following:

        • All amounts in excess of $29,700;
        • The first $133.33 of the participant's pay each month (or $61.54 of bi-weekly pay - this $61.54 exclusion shows on your check as MPPP Special Accum Ded Calc); and
        • Any payment which would not be subject to FICA tax if the participant were covered by the federal Social Security system.

        The following groups are not currently eligible for contributions:

        • Participants who are members of the BART Police Officers Association or are members of the BART Police Managers Association, and part-time employees who are members of the SEIU Local 1021.
      • How can I contribute to the BART 401(a) Money Purchase Pension Plan?

        BART offers a Buy-Back program which allows eligible employees to contribute the after-tax value of sick, vacation and even holiday time into the BART 401(a) Money Purchase Pension Plan. You, of course, must be eligible to contribute. Eligibility is based on Union representation, or non-represented status, and criteria that are different for the 3 buy-back programs. Forms are available in the BART Benefits Office for more information.

        There are many advantages to participating in BART's Buy-Back Program. First, it allows you to put more money aside for your retirement without decreasing the amount of your take-home pay. Also, since buy back contributions are after-tax money, they are not taxed at the time that you request a distribution from your account. Another benefit to you is that the interest earned on the buy-back money grows tax-deferred until distributed.

      • Does the BART 401(a) Money Purchase Pension Plan affect my PERS benefits?

        Your PERS benefits generally are not affected by your participation in the Money Purchase Pension Plan.

      • When am I allowed to take a distribution from my BART Plans?

        You can take a distribution from your BART plans once you terminate employment with BART.

        You can also withdraw from the BART 401(a) Money Purchase Pension Plan while you are still employed and you are over age 59.5. You are permitted to utilize this feature twice per year.

      • What benefits are there to keeping money in the BART plans?

        You can continue to:

        • Allow your funds to grow
        • Receive tax advantages
        • Avoid potentially higher expenses and fees by transferring the money out to a retail plan such as an IRA

        Consider scheduling an appointment with a Retirement Plans Specialist to learn more about the benefits of remaining in the BART retirement plans.

      • How will my benefits be paid to me?

        You may elect to have your benefit distributed in a lump sum or a series of substantially equal installments of at least $50.00.

        If you chose a series of payments, you may additionally elect to have the installment distribution automatically adjusted annually for a cost-of-living increase. The installment pay-out period cannot exceed your life or life expectancy (or the joint life expectancies of you and your designated beneficiary).

      • What if I need money due to an unforeseeable financial hardship?

        You may request an emergency withdrawal from your BART 457 Deferred Compensation Plan. The BART Investment Plans Committee (“BART IPC”), which administers the BART plans, shall determine if a participant qualifies for a financial hardship withdrawal as defined in the BART 457 Deferred Compensation Plan document.

        An unforeseeable financial hardship generally means a sudden and unexpected illness or accident to you, your spouse, your dependents, or your primary beneficiary which was beyond your control (for example, a catastrophic illness, flood, fire, earthquake, death in the family, Employee disability) and which causes you a severe financial hardship.

        To the extent that the financial hardship can be lessened by other means such as insurance, suspension of deferrals under the BART 457 Deferred Compensation Plan or from the other assets, an unforeseeable financial hardship distribution may not be made.

        Expenses which could have been budgeted (such as taxes, a down payment on a house, the purchase of an automobile, or college expenses) will not qualify for an unforeseeable financial hardship distribution.

        More information can be found in the BART Emergency Withdrawal Form (Participant) and the BART Emergency Withdrawal Form (Beneficaries).

        Please note that emergency withdrawals are not allowed in the BART 401(a) Money Purchase Pension Plan.

      • When am I required to withdraw money from my retirement plan account?

        Once you have separated from service and reached the age of 70½; your account(s) is subject to annual Required Minimum Distributions (RMDs) beginning in the year you reach age 70½. The first RMD may be delayed until April 1 of the following year. For more information on RMD(s), please refer to the BART 401(a) Money Purchase Pension Plan Withdrawal Packet and/or the BART 457 Deferred Compensation Plan Withdrawal Packet.

      • Can I take a withdrawal if I am still employed with BART?

        If you are over the age of 59½ and still actively employed, you are eligible to withdraw from your BART 401(a) Money Purchase Pension Plan. In-service withdrawals can be taken twice per calendar year. To do so, please complete the BART In-Service withdrawal Packet for Employees Over Age 59½. You can receive an in-service withdrawal from the BART Deferred Compensation Plan if it is an unforeseen emergency withdrawal. Please refer to the corresponding question above.

      • Are there any penalties for taking a distribution?

        401(a) Money Purchase Pension Plan assets are subject to the 10% early withdrawal penalty if withdrawn from your account prior to reaching age 59½. There are some exceptions which can be found in the BART 401(a) Money Purchase Pension Plan Withdrawal Packet. There is no 10% early withdrawal penalty in the 457 Deferred Compensation Plan.

      • What will happen to my Account if I die before I receive all of my benefits?

        The balance of your account will be paid to your designated beneficiary. If you have not designated a beneficiary, or if your designated beneficiary dies before you do, payments will be made to your estate or to persons who are generally entitled to your other property upon your death.

        You may change your designated beneficiary at any time. To be effective, your signed beneficiary designation must be received by the BART IPC or ICMA-RC prior to your death. Be sure to keep your Beneficiary designation up-to-date. For more information, please view the BART Beneficiary Designation Form and the Designation of Beneficiary(ies) Webinars.

      • What is a purchase of prior service credit?

        A purchase of prior service credit allows you to "buy" or increase the years of service used in calculating your final defined benefit plan benefits, such as the CalPERS plan. [You may have heard this referred to as the purchase of "airtime."] This amount of service is credited to your CalPERS account and is used as part of the formula to determine your retirement benefits. For more information on purchasing prior service credits, please review the BART Purchase of Service Credit Packet.

      • What happens to my account if I get a divorce?

        If a state court awards your spouse (or former spouse) an interest in your benefits through a Qualified Domestic Relations Order, a separate account will be established for your spouse (or former spouse) for the amount so awarded.

        He/she can make investment decisions with respect to that account but cannot receive a distribution earlier or later than the time distribution may be made to you under the BART Plans.
      • What is Asset Allocation?

        It is the allocation of investment dollars to different categories of assets. For example, an individual may want to put some of his or her funds into mutual funds comprised of bonds and some mutual funds which are equities.

        The BART IPC recommends that you carefully consider your investment goals and your risk tolerance as you decide how you wish to allocate your investment dollars to the various funds available through the BART Plans.

      • What is vesting and how do I become vested?

        A vested benefit is that part of your account balance which belongs to you unconditionally. It can never be taken away from you, even if you quit or are fired. You are 100% vested in your BART Plans at all times.

      • What if I enroll in either the BART Plans and forget to make an investment allocation before my deferrals start?

        In the absence of valid allocation instructions for your account, all assets will be invested in the default fund selected by your employer until additional instructions are received from you. BART has elected the age appropriate T. Rowe Price Target Date Retirement Fund as the default fund. More information regarding the default fund selected by your employer is available by contacting ICMA-RC's Investor Services at 1-800-669-7400.

      • How can I change my investment choices?

        There are two types of changes you can make to the investment of your accounts:

        • Changes to the investment of your current account balance (fund-to-fund transfers).
        • Changes to the investment of your future contributions (future allocation changes).

        You make changes to your accounts in Account Access or by calling ICMA-RC at 1-800-669-7400 for assistance with your transaction.

      • How can I invest in funds outside of the BART plans?

        Brokerage services are available and allow you to invest in mutual funds, fixed income securities, and stocks through your BART Retirement Plan account.

        Before you can open a brokerage account, you must have a total account balance across of your BART Plans combined of at least $6,000.

        Brokerage services are provided by TD Ameritrade, a registered broker-dealer and member of FINRA/SIPC/NFA.

        Please see the VantageBroker Highlights document.

      • Where should I go for assistance with my BART Plans?

        .

        Retirement Plans Specialist:

        Susan Chang (schang@icmarc.org) services BART's headquarters each week on Wednesday. She meets with active participants to discuss the differences between the 457 Deferred Compensation Plan and the 401(a) Money Purchase Pension Plan features, fund allocations, fund changes, contributions, consolidations, disbursements, and emergency withdrawal guidelines. She also conducts new employee orientation meetings and assists with the enrollment process.

        Randi Carmen (rcarmen@icmarc.org) is available to provide services to BART participants in the field. On a quarterly basis, she meets at field locations where her appointments are on a drop-in basis. She is available to discuss asset allocations, portfolio diversification, contribution changes, service credit purchases, beneficiary changes and account projections. Each quarter, a flyer is created with her schedule and posted on the BART IPC Web site and at the different locations.

        Financial Planning Manager:

        Bill Eagan, Certified Financial Planner TM, conducts monthly sessions at BART's headquarters where he meets with participants to discuss their financial plans. He also conducts periodic educational seminars for current and retired employees.

        To schedule an appointment with Bill, call him directly at 510-249-9233, or send him an email at beagan@icmarc.org

        BART Benefits:

        Any question can be addressed to the BART Investment Plans Assistant at (510) 464-6208 or addressed to the BART IPC directly in the public meeting either in person or in writing.

        BART Webinars:

        Educational webinars are available on the Seminars page of this web site. They cover topics such as:

        Beneficiary Designation, Strategies to help Save for Retirement, Account Access Tutorial, Seven Secrets for Smart Saving, and Roth IRA Contributions and Conversions.

        Retirement Planning Calculators:

        RealizeRetirement
        RealizeRetirement is your one-stop shop for retirement planning tools, calculators, brief videos and retirement savings tips.

      • What are the fees for administering the Plan Participants' Accounts?

        As a participant in the BART Plans, certain fees connected with plan administration are allocated to your account. These include fees for record-keeping, consulting, trustee and legal services, and the plan audits.

        The BART IPC administers the following plan fee:
        Effective March 2013, the fee is $2.00 per participant per plan.

        Below is a history of the BART Plan Fees which are charged on a monthly basis:
        January 2012 – February 2013: $4.00 per participant per plan type
        June 2011 – December 2011:  $3.00 per participant per plan type
        June 2010 – May 2011 – no participant fee charge
        February 1, 2010 – May 2010 – $1.00 per participant in the 401(a) Money Purchase Pension Plan
        February 2009 – January 2010 – $3.30 to $4.00 per participant in the 401(a) Money Purchase Pension Plan based upon the participant’s account balance.
        March 2008 – January 2009 – no participant fee

      • Who is responsible for the administration of the BART Plans?

        The BART 401(a) Money Purchase Pension Plan and the 457 Deferred Compensation Plan are administered by the BART IPC, which includes a representative from each of four employee unions and one representative from BART management.

        The BART IPC interprets and applies the terms and provisions of the BART Plans, receives claims for benefits, determines the eligibility of claimants for receipt of benefits and the amount of those benefits, authorizes benefit payments, and determines investment and administration policy. The actions taken by the BART IPC are final and binding on all Participants, beneficiaries, and their successors-in-interest.

        The BART IPC has contracted with the ICMA-RC to provide record keeping and other administrative services for the BART Plans.

      • Are there meetings at which issues relating to the Plans are discussed?

        The BART IPC meets once a month to discuss investments, policy and ongoing administrative issues relating to the BART Plans. The meetings are open to the public and participants are encouraged to attend.

        In addition to its monthly meetings, the BART IPC sponsors an annual meeting for the purpose of informing the BART Plans’ participants of any notable events or changes to the BART Plans and responding to participants' questions and concerns regarding the BART Plans. The annual meeting is held in October during National Save for Retirement Week.

      • What if I am reemployed by BART under the Uniformed Services Employment and Reemployment Rights Act (USERRA)?

        If you are reemployed by BART under USERRA, your military service will be deemed to constitute service with BART and you shall be allowed to make deferrals to the Deferred Compensation Plan. Payment of such deferrals must be made during the period beginning with the date of your reemployment with BART and whose duration is 3 times the period of your military service, but not more than 5 years. Please contact the BART Benefits Office regarding additional information about the special rules under USERRA.

    Education Resources

    As the new school year begins, remember that learning doesn't always have to take place in a classroom. You can sign up to learn more about your BART Retirement Plan account(s) at your convenience. Educational resources are available to help you develop and follow a financial strategy aligned with your retirement goals. ICMA-RC's Retirement Plans Specialists are available to meet with you individually. Susan Chang is on-site at the BART headquarters on Wednesdays and Randi Carmen visits the stations and yards. Please see her schedule of dates and work locations on the Seminars page of this web site. You can also receive assistance from your ICMA-RC Financial Planning Manager Bill Eagan, a CFP® professional. He is available to discuss a wide range of financial planning topics as well as your BART retirement plans.

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