PROPOSED RULES
RETIREMENT SYSTEMS
Original Notice.
Exempt from preproposal statement of inquiry under RCW 34.05.310(4).
Title of Rule: What happens if I do not cash a warrant or check?
Purpose: The rule clarifies an internal DRS process by amending an unclear existing rule (WAC 415-02-060).
Statutory Authority for Adoption: RCW 41.50.050(5).
Statute Being Implemented: RCW 43.08.062, 41.50.055(5), 41.50.260.
Summary: The rule clarifies that members who request funds from a defined benefit plan will not receive interest on their funds once the department issues a warrant. The rule also clarifies that members who request funds from a defined contribution plan will have their investments sold and then transferred to a noninterest bearing account until their check is cashed. The rule also clarifies what happens when withdrawal checks and warrants are not cashed.
Reasons Supporting Proposal: The current rule is unclear and fails to accurately reflect steps that the department takes.
Name of Agency Personnel Responsible for Drafting: Merry A. Kogut, 6835 Capitol Boulevard, Tumwater, WA, (360) 664-7291; Implementation and Enforcement: Lucille Christensen and Mark Feldhausen, 6835 Capitol Boulevard, Tumwater, WA, (360) 664-7069.
Name of Proponent: Department of Retirement Systems, governmental.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: The rule clarifies an internal DRS process by amending an existing rule (WAC 415-02-060) that is unclear. The rule clarifies that members who request funds from a defined benefit plan will not receive interest on their funds once the department issues a warrant. The rule also clarifies that members who request funds from a defined contribution plan will have their investments sold and then transferred to a noninterest bearing account until their check is cashed. The rule also clarifies what happens when withdrawal checks and warrants are not cashed.
Proposal Changes the Following Existing Rules: The primary change is to change the rule into plain English. The secondary change is to ensure that the rule correctly reflects RCW 43.08.062 and current DRS business practices, as well as its contractual relationship with various third party record keepers.
No small business economic impact statement has been prepared under chapter 19.85 RCW. These amendments have no effect on businesses.
RCW 34.05.328 does not apply to this rule adoption. The Department of Retirement Systems is not one of the named departments in RCW 34.05.328.
Hearing Location: Department of Retirement Systems, 6835 Capitol Boulevard, Boardroom, 3rd Floor, Tumwater, WA, on March 27, 2001, at 10:00 a.m.
Assistance for Persons with Disabilities: Contact Rules Coordinator by seven days before hearing, if possible, phone (360) 664-7291, TTY (360) 586-5450, e-mail merryk@drs.wa.gov.
Submit Written Comments to: Identify WAC Numbers, Merry A. Kogut, Rules Coordinator, Department of Retirement Systems, P.O. Box 48380, Olympia, WA 98504-8380, e-mail Merryk@drs.wa.gov, fax (360) 753-3166, by 5:00 p.m., March 27, 2001.
Date of Intended Adoption: No sooner than March 28, 2001.
February 20, 2001
Merry A. Kogut
Rules Coordinator
OTS-4624.5
AMENDATORY SECTION(Amending WSR 00-10-016, filed 4/21/00,
effective 5/22/00)
WAC 415-02-060
((Refund of contributions -- Application.))
What happens if I do not cash a warrant or check?
((The
department will cancel a member's request for refund of defined
benefit plan member contributions if the refund warrant is not
cashed within one hundred eighty days of the date on the warrant.
There will be no earnings on returned contributions for the one
hundred eighty-day period that funds were held for distribution
to the member.
If the member does not cash a warrant for a distribution of defined contribution plan member contributions within one hundred eighty days of the date on the warrant, the contributions will be returned to the member's account with the same allocation as existed on the date of the warrant. There will be no earnings on returned contributions for the one hundred eighty-day period that funds were held for distribution to the member.)) (1) Warrant for defined benefit retirement allowance. A warrant for your monthly retirement allowance will be canceled if it is not cashed within the time frame set by RCW 43.08.062. If the warrant is canceled, the department will attempt to contact you for instructions. You will not earn interest on the warrant amount pending payment.
(2) Warrant for defined benefit withdrawal. When you request a withdrawal of some or all of your defined benefit accumulated contributions:
(a) Once the department issues the warrant you will stop receiving interest.
(b) Whether payable to you or to a qualified investment account, the warrant will be canceled if it is not cashed within the time frame set by RCW 43.08.062.
(c) After the department receives notice that the warrant has been canceled, the department will attempt to contact you and ask for further instructions.
(3) Check for defined contribution distribution. When you request a withdrawal of some or all of your defined contribution fund:
(a) The requested amount will be liquidated and the department's third-party recordkeeper will transfer the funds into a noninterest bearing account.
(b) You will not receive interest, earnings, or losses after the third-party recordkeeper processes your request.
(c) Whether you request that the refund check be sent directly to you or to a qualified investment account, the check will be canceled if it is not cashed within one hundred eighty days from the date on the check.
(d) If the check is canceled:
(i) The funds will continue to receive no interest, earnings, or losses while the recordkeeper waits to receive instructions from you; and
(ii) The department or the third-party recordkeeper will attempt to contact you and ask for further instructions.
[Statutory Authority: RCW 41.50.050. 00-10-016, 415-02-060, filed 4/21/00, effective 5/22/00. Statutory Authority: RCW 41.50.050(6) and 41.50.090. 78-03-023 (Order IV), 415-02-060, filed 2/15/78.]