The BACKDROP option is effective January 1, 2013. Generally, the BACKDROP Option replaces the DROP program. Employees who have not attained Normal Retirement eligibility as of January 1, 2013, or were not vested by October 1, 2010, and all employees hired on or after January 1, 2013, will be eligible for the BACKDROP option, but not eligible for DROP. Any member eligible for the forward DROP remains eligible for the BACKDROP option upon attaining age 60 and 10 years of creditable service, age 55 and 30 years of service or Rule of 80 (age plus years equal 80, with minimum 10 years of creditable service). A member must work one year beyond eligibility date to elect the BACKDROP option.
An eligible member who elects the BACKDROP option shall receive a monthly retirement benefit payable on the employee’s actual retirement date (date of retirement & separation from employment) based on the benefit the employee would have received if he/she had left city employment and retired on an earlier date after attaining normal retirement eligibility.
The BACKDROP option provides for a lump sum payment equal to the retirement benefit that the member would have received during the period following BACKDROP through the actual retirement date, plus interest of three percent per year, compounded annually. All or portion of the lump sum payment under the BACKDROP option may be rolled over to an IRA in accordance with federal law. The eligible member may elect a minimum BACKDROP period of one year and maximum BACKDROP period of up to seven years.
The BACKDROP option must be selected within ten years of becoming eligible to retire. Eligible members who wish to elect the BACKDROP option must provide written notification to the department director and human resources director.