MONTANA MUNICIPAL POLICE OFFICERS’ RETIREMENT SYSTEM
Deferred Retirement Option Plan (DROP)
Active MPORS member elects to participate in DROP-
- DROP account allows a member to begin accumulating a retirement benefit without terminating employment.
- A member must be at 20 years membership service to participate.
- Member elects timeframe in DROP: 1 month - 60 months.
- Monthly benefit calculation: Service Credit x Final Average Salary x 2.5%
- DROP account is created, separate from regular MPORS account.
- Member/Employer/State continue regular contributions to the MPORS pension fund.
- Member is not credited any service during DROP participation.
- Member receives 3% GABA annual adjustments after initial 12 month (Jan-Dec) period while in DROP.
- DROP account will be credited interest at the end of every fiscal year based on the actuarially assumed rate of return which right now is 7.65%
POST DROP Employment-
- When DROP period ends, a member may continue working or retire, see next section.
- Earn additional retirement benefit based on the calculation: Service Credit x Final Average Salary x 2.5%.
- Members are considered newly hired and immediately vested in MPORS.
- DROP account will earn an interest rate equal to the actuarial assumed rate of return, which is fixed at the end of the year.
- DROP benefit will not be recalculated and GABA ends during POST DROP employment.
Member elects to retire-
- Members must rollover DROP account within 60 days of termination to another eligible retirement plan as allowed by IRS.
- If a member does not designate a rollover within 60 days of termination date the DROP account balance will be paid to the member in a lump sum. (Federal and state taxes apply.)
- Pre-DROP monthly benefits are initiated for the member’s lifetime.
For more information regarding the MPORS DROP, contact MPERA.