Saturday, April 27, 2013
How is UCRS and/or TCP-1 pension cpi adjustment calculated?
A question about the UCRS and/or TCP-1 pension cpi adjustment calculation.
How is it done?
I vaguely remember that it averages the BLS all-urban CPI data for LA and SF from Feb to Feb and that it is applied to pensions adjusted the following July.
But I can't get the 2012 numbers to work. After recent Rogoff's Excel fiasco, I figured I should verify simple matters for myself.
My 2012 adjustment was 1.8% in July 2012. The BLS all-urban seasonally-adjusted all-item deflators for the
period are listed as;
for LA
Feb 2011 229.729
Feb 2012 234.537
Feb 2013 239.753
LA(2012/2011) = 234.5/229.7 = 1.0209
For Sf
Feb 2011 229.981
Feb 2012 236.88
Feb 2013 242.677
SF(2012/2011)= 236.88/229.98 = 1.03
Therefore the average of the CPI increase in LA and SF from 2011 t0 2012 is (.03+.0209/2 = 2.54% not 1.8%.
Do you know what the difference is from?
By the way using current data the new CPI adjustment in July should be 2.3%
Thanks in advance. Parney if you are reading, help out here.
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8 comments:
Both UC and TCP1 do not provide a COLA when CPI is between 2% and 4%.
They match it up to 2% and when it exceeds 4% they match 75% of that inflation maxing out at 6%.
Between 2% and 4%, well that's what that your 403B/401k was for.
That doesn't explain why they gave 1.8% when they should have given the maxed out 2%.
Can anybody provide a pointer to where this approach is actually written down? I'm not familiar with this part of TCP-1.
[April 29, 2013]
University of California Retirement Plan (UCRP) and UC-PERS Plus 5 Plan benefit recipients will receive a cost-of-living adjustment (COLA) effective July 1, 2013. The increase will appear in benefit checks paid at the end of July.
The July 1, 2013 COLA rates will be as follows:
Retirement Date COLA
On or before July 1, 2006 2.00%
July 2, 2006 – July 1, 2008 2.34%
July 2, 2008 – July 1, 2012 2.00%
The COLA applies to all UCRP benefits recipients, including those receiving survivor and UCRP disability income. The COLA formula for the UC-PERS Plus 5 Plan is the same as that used for UCRP.
How the COLA is calculated
The 2013 COLA is based on the 2.34 percent average increase in the Consumer Price Index (CPI) measured February 2012 to February 2013 for the Los Angeles and San Francisco metropolitan areas.
The COLA formula generally matches the cumulative increase in the CPI up to 2 percent annually. This year members who retired between July 2, 2006 and July 1, 2008 will receive slightly larger than 2 percent COLAs. The larger COLAs help those benefit recipients retain more of their purchasing power by partially making up for earlier years when the CPI increases were less than 2 percent.
[April 29, 2013]
University of California Retirement Plan (UCRP) and UC-PERS Plus 5 Plan benefit recipients will receive a cost-of-living adjustment (COLA) effective July 1, 2013. The increase will appear in benefit checks paid at the end of July.
The July 1, 2013 COLA rates will be as follows:
Retirement Date COLA
On or before July 1, 2006 2.00%
July 2, 2006 – July 1, 2008 2.34%
July 2, 2008 – July 1, 2012 2.00%
The COLA applies to all UCRP benefits recipients, including those receiving survivor and UCRP disability income. The COLA formula for the UC-PERS Plus 5 Plan is the same as that used for UCRP.
How the COLA is calculated
The 2013 COLA is based on the 2.34 percent average increase in the Consumer Price Index (CPI) measured February 2012 to February 2013 for the Los Angeles and San Francisco metropolitan areas.
The COLA formula generally matches the cumulative increase in the CPI up to 2 percent annually. This year members who retired between July 2, 2006 and July 1, 2008 will receive slightly larger than 2 percent COLAs. The larger COLAs help those benefit recipients retain more of their purchasing power by partially making up for earlier years when the CPI increases were less than 2 percent.
Very clear. Thanks. Typical UC. Clear, thorough, fast, employee oriented.
Let's see if either Charlie or Parney have someone answer the question for LLNL and LANL TCP-1.
This is a typical example of the superiority of UC management vs. the LLCs. LLCs are lazy, mediocre and unwelcome compared to the dynamism of UC.
Bodman, Pryzbylek and D'Agostino made the wrong decision and strangled the labs.
Yes, the worst difference between being managed by LLNS vs. UC is the way LLNS treats employees.
LLNS learned mismanaging employees from Bechtel, whose brilliant personnel policies drove their designers into unions 30 years ago. Both Russo and Soderstrom were/are brutally bad leaders.
This is cool!
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