Your benefit at retirement is based, in part, on your creditable service. Creditable service includes your years and months of membership service in which you contributed to LGERS and may also include prior service credit, sick leave credit, military service credit and certain types of purchased service credit.

Types of Purchased Service Credit

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If you were employed by your employer before its participation in LGERS, you may have received credit for your service before you became a member. Also, if you were a member of the former Law Enforcement Officers’ Retirement System and have completed 10 years as a contributing law enforcement officer, you may purchase credit for service performed as an officer after July 1, 1940.

The cost, which must be paid in a lump-sum payment, will cover the employee and employer funding, and will likely be lower if credit is purchased within 3 years from the date you become eligible. It is optional with your employer whether to share the cost with its employees.

Unused sick leave can be converted to additional retirement service credit at the time of your retirement if all of the following conditions are met:

  • Your sick leave was earned monthly under a duly adopted sick leave policy. 
  • You would receive full salary when using the sick leave if absent from work because of illness. 
  • You have not, and will not, receive any compensation for this sick leave. 
  • Your last day of service with your last participating LGERS employer is within 365 days before your LGERS effective date of retirement.

When you retire, you are allowed one month of credit for each 20 days of unused sick leave. For any part of 20 days left over, one additional month is allowed provided the remaining portion is at least one hour. 

A sick leave “day” is determined by your employer’s sick leave accrual policy and may or may not be equal to eight hours.

For example, assume John Smith earns one day of sick leave per month under his employer’s sick leave accrual policy while working an extended shift of 12 hours per day and he accrues 12 hours of sick leave each month. When his employer certifies his unused sick leave on his retirement application (Form 6), for each 12 hours of eligible unused sick leave, his employer should report one day of unused sick leave, rather than 1.5 days.

In another example, assume Mary Brown earns one day of sick leave per month while working 7.5 hours per day and accrues 7.5 hours of sick leave each month. When her employer certifies her unused sick leave on her Form 6, for each 7.5 hours of eligible unused sick leave, her employer should report one day of unused sick leave.

Sick leave is used to increase your creditable service, but it cannot be used to meet the minimum qualifications for a disability retirement benefit, deferred benefit or the Survivor’s Alternate Benefit. You may use your sick leave to complete 30 years of service regardless of age.

Your periods of active duty in the U.S. Military up to the time you were first eligible for a discharge that is not dishonorable count as creditable service at no cost to you if you were a teacher or state employee when you entered active duty and you returned to LGERS employment under one of the following circumstances:

  • Within two years after your earliest discharge date. 
  • At any time after your discharge and you complete at least 10 years of additional service as a contributing member. 

Your LGERS employer is required to pay the employer and employee contributions for the full period you were in active duty if you were a LGERS member immediately before your active-duty military service, and you return to LGERS membership service within two years after your military discharge date.

If you are ineligible for free credit (no cost), you may be eligible to buy credit for your first period plus later required periods of active duty by making a lump-sum payment. 

To be eligible to purchase military service credit, you must have contributed to LGERS for five years. Your cost will be equal to the full actuarial liabilities created from the additional credit purchased.

If your military service is creditable in another retirement system, generally you will not be eligible to purchase credit in LGERS.

If you have ever received a refund of your contributions from LGERS, TSERS, or the former Law Enforcement Officers’ Retirement System, you may be eligible to purchase, with a lump-sum payment, in LGERS, the amount of creditable service you lost when you received your refund.

Before you are eligible to pay for this service, you must be rehired and contribute to LGERS for five years or have a combination of five years of current membership service in CJRS, LRS, TSERS or LGERS

For purchases made through the end of 2021, your cost, which must be paid in a lump sum, will be equal to the amount of contributions withdrawn plus interest at 6.5 percent compounded annually from the year of withdrawal to the year of repayment. In addition, you will pay a $25 administrative fee.

If you ever received a refund of your contributions from CJRS, LRS or TSERS, you may be eligible to make a lump-sum payment to purchase the amount of withdrawn creditable service in the system from which it was withdrawn.

Before you are eligible to pay for this service, you must have five years of current membership service in LGERS or in CJRS, LRS or TSERS, or have a combination of five years of membership service in any of these systems. This type of purchased service may be used to determine your eligibility for benefits in LGERS. However, only your creditable service in LGERS will be used in computing the amount of your LGERS benefit.

Creditable service in any other system will be used to compute benefits from that system. Eligible withdrawn service you purchase in LGERS or TSERS counts as creditable service, not membership service.

Your cost, which must be paid in a lump sum, will be calculated using the withdrawn service purchase provisions in the System from which you are purchasing the service credit.

In addition to withdrawn service and military service purchases, you may be eligible to purchase credit for the following types of service:

Out-of-State ServiceService with the Federal Government
Temporary Local & State ServiceFederally Funded Public Community Service in North Carolina
Educational LeaveOmitted Service
Probationary or Waiting Period ServiceWorkers' Compensation Leave
Part-Time Local and State ServiceOther Service with a Local Government

 

Any service that was forfeited due to a felony conviction cannot be repurchased. For detailed information about the eligibility requirements for purchasing creditable service, please see the Credit Purchasing Forms on ORBIT.

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We will accept pre-tax money from an eligible retirement plan or an eligible IRA via rollover or in-service, plan-to-plan transfer to purchase creditable service. For more information and instructions, see Form 398 (Using a Distribution of Tax-Sheltered Savings to Purchase Retirement Credit), available in ORBIT.

This page was last modified on 09/10/2024