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LASER'S Retirement Program Drop Summary
You should consider all aspects of DROP before choosing this retirement option, because you may find there are both advantages and disadvantages.
DROP is an optional method of retiring from LASERS. DROP is not an additional retirement benefit. When you enter DROP, your status in LASERS changes from active member to retiree, even though you continue working at your regular job. When you participate in DROP, you give up rights to survivor benefits provided for active members (except judges).
You can participate in DROP for up to thirty-six (36) months. During your DROP participation, you accumulate money in an individual account based on the amount you would have received as a monthly retirement benefit. You also continue to earn your regular salary. You can withdraw the money from your DROP account after you terminate state employment-either as a lump sum or a series of payments spread over time. Eligibility for DROP participation and other provisions were changed in the 1995 state legislative session. The new law applies to all members who are first eligible for regular retirement on or after January 1, 1996.
DROP application forms are available at your agency's human resources office. To ensure timely processing, you should apply in writing for DROP at least 30 days before the effective date of your participation. Your application is officially filed with LASERS when it is received at LASERS.
You may cancel your DROP application at any time before the effective date occurs. You cannot change your decision to participate in DROP after the effective date.
Most state employees must be eligible for regular retirement under R.S. 11:441 before participating in DROP. Regular members must meet one of the following three requirements:
- 30 years service at any age,
- 25 years service at age 55, or
- 10 years service at age 60.
DROP participation was changed effective January 1, 1996. Changes will be noted in each section, as appropriate, with the plan in effect on December 31, 1995, designated as "OLD-DROP" and the plan in effect on January 1, 1996, as "New-DROP."
Members who were eligible to retire on or before December 31, 1995, may join DROP under the provisions in effect on December 31, 1995. They may enter DROP at any time prior to retirement. These members may also elect to join New-DROP that became effective January 1, 1996.
Members who first become eligible to retire after December 31, 1995, will be eligible for New-DROP under provisions effective beginning January 1, 1996. Members should contact LASERS at least 3 months prior to retirement eligibility if you are interested in participating in New-DROP. This will allow sufficient time to determine the exact date your window of eligibility begins.
Election to Participate
- Time Period: You may participate in DROP only one and for no more than thirty-six (36) months. You must specify the exact length of participation on your application. Once effective, your decision to enter the programs is final.
- Old-DROP: You may participate in Old-DROP at any time after becoming eligible for regular retirement. You must designate your period of participation, not to exceed thirty-six (36) months. Participants may elect to end Old-DROP prior to the specified ending date without terminating employment.
- New-DROP: Members must enter or participate within a "window" of time. If you do not enter New-DROP within the Window, you lose your rights to participate in New-DROP. The "window" begins on your earliest eligibility date for regular retirement and continues for three years and sixty days from that date.
A member may enter New-DROP on the date you are first eligible for retirement. You do not have to wait 60 days to start. However, you can only participate in New-DROP for a maximum of three years and sixty days.
If a member waits to enter New-DROP on the date you are first eligibility begins, the length of time you can participate in New-DROP is reduced. For example, if you enter New-DROP one year after first becoming eligible, you can stay in New-DROP for 2 years and 60 days.
Participants cannot end New-DROP prior to the stated ending date unless terminating employment. The stated participation period cannot be extended.
Participants may elect to continue working after New-DROP participation. Calculation of the retirement benefit will be the same as in Old-DROP. DROP participation ends if you leave state employment before the end of the DROP period.