Reciprocity & Blended Membership

Reciprocity is an agreement among certain California public retirement systems, including SDCERS, which allows members to change jobs between “reciprocal” retirement systems in California and combine service credit in each system to meet vesting and eligibility requirements.
 
SDCERS has reciprocity with CalPERS and San Diego County, as well as most other public retirement systems in California – major exceptions include Judges’ Retirement Systems (JRS and JRS II), Legislators’ Retirement System (LRS), California State Teachers’ Retirement System (CalSTRS), University of California Retirement Plan (UCRP), and any federal retirement system. Please contact SDCERS to confirm if a specific California public agency has a reciprocal agreement with SDCERS. If you meet the requirements, you may establish reciprocity when leaving SDCERS for a reciprocal agency, or when entering SDCERS if coming from a reciprocal agency.

It is important to understand that SDCERS does not govern reciprocity for other retirement systems, and legislation can change the rules regarding reciprocity. Therefore, questions relating to the rights, benefits, and obligations under any other public retirement system should be addressed directly to that system. Please note that your SDCERS plan document contains specific rules surrounding reciprocity (e.g., your retirement date must be simultaneous at all reciprocal systems, you must submit your retirement application in advance of your retirement date, you cannot have any overlapping periods of employment, there must not be more than a 6-month break in between periods of employment, etc.), which must be followed in order for you to establish and maintain reciprocity - SDCERS does not have the authority to make any exceptions to these rules. 

Please note that if you are retiring with reciprocity, your first pension payment may be delayed. This is because SDCERS and the reciprocal agency have to communicate and share certain information before SDCERS can process your benefit payments. Sometimes it takes longer to receive this information from the reciprocal agency due to circumstances outside of SDCERS' control. However, your first pension payment will be retroactive to your retirement date. 

If you currently work for the City, Port, or Airport and are considering employment with a public agency that has reciprocity with SDCERS (outgoing reciprocity), or if you are thinking of coming to SDCERS from a reciprocal agency (incoming reciprocity), there are specific criteria you must meet to establish reciprocity with SDCERS.

• Ensure the other system participates in California’s reciprocity agreement.

• Begin employment with your new job in the reciprocal system within 6 months of your termination date at your previous job.

• Ensure that you do not overlap employment or service credit with SDCERS and the reciprocal agency.

  • SDCERS will not allow reciprocity if you have not terminated employment with an SDCERS plan sponsor prior to your start date with the new employer, or vice versa.

  • Do not use vacation leave in a way that would cause an overlap of service credit when you start your next job.

• Submit a request and be granted reciprocity by both agencies.

Outgoing Reciprocity
SDCERS will recognize outgoing reciprocity when all of the following are met:

• You must terminate employment with the City, Port, or Airport (note that going on leave is not equivalent to terminating);

• You must leave your pension contributions with SDCERS;

• You must begin employment (on payroll, not a job offer) with the reciprocal agency within 6 months of terminating membership with SDCERS;

• Your change of employment must eventually lead to membership in the reciprocal system; and

• You must submit a reciprocity request via your SDCERS Member Portal, unless SDCERS receives a reciprocity request from the reciprocal agency first.

Incoming Reciprocity
SDCERS will recognize incoming reciprocity when all of the following are met:

• You must begin working for an SDCERS plan sponsor within 6 months of terminating employment with the prior reciprocal agency;

• Your change of employment must eventually lead to membership with SDCERS; and

• You must leave your contributions on deposit with the retirement system you are leaving.

Note that while SDCERS may recognize reciprocity based on when you enter employment with a reciprocal system’s plan sponsor, some systems may require that you become a member of the reciprocal system within 6 months. Be sure to check with the reciprocal system for their requirements.

After SDCERS receives your reciprocity request, staff will contact the reciprocal agency you have listed to request the information needed to establish reciprocity. Once all data is received and processed, SDCERS will send you a letter stating whether or not reciprocity has been established. 

IMPORTANT: SDCERS will not be able to confirm whether you will be eligible to establish reciprocity until you join the system, submit your reciprocity application, and SDCERS receives the requisite data from the reciprocal agency. This means if you are considering employment with an SDCERS plan sponsor and contact SDCERS to inquire about establishing reciprocity, SDCERS staff will only be able to tell you the requirements to establish reciprocity - we cannot guarantee that you will meet these requirements until you become a member in SDCERS' system and you apply for reciprocity via your Member Portal account. 

Establishing reciprocity allows you to preserve certain components of your retirement benefit when you move from one reciprocal system to another. There are several advantages that may come with reciprocity.

Entry Age - SDCERS determines your member contribution rate (how much you contribute toward your retirement from each bi-weekly paycheck) based on your age when you became an SDCERS Member. Once you establish incoming reciprocity, SDCERS will prospectively (from the date reciprocity was approved, moving forward) use your age when you first became a Member of the reciprocal agency, adjusted for any breaks in service.  Likewise, if you leave SDCERS membership for a reciprocal system, and that system also bases your retirement contribution rate on your age at entry, that system may determine its contribution rate using your age at the time you first entered SDCERS membership. This could benefit you, because typically contribution rates are lower for Members with lower entry ages.

Highest Final Average Compensation Used to Calculate All Benefits - When you receive your pension benefits from reciprocal systems, each system may use the highest final average compensation in any reciprocal system you were a member of to calculate your retirement benefit, as long as you retire on the same date from all systems. Systems generally use either a 12 or 36-month consecutive highest final average compensation, depending on what is allowed under each plan (calculation might be different for each system). Please note that if you have reciprocity with another system, the final average compensation that SDCERS will report to the reciprocal system is your final compensation used to calculate your pension benefit when you service retired or entered DROP – the final compensation SDCERS will report to the reciprocal agency will not be based on compensation received while you are participating in DROP.

Plan Tier - If you were hired by a reciprocal agency before 2013 and establish reciprocity with either the Port or Airport on or after January 1, 2013, you may be eligible to join the Port or Airport’s most recent non-PEPRA plan tier once reciprocity is established. “PEPRA” stands for the California Public Employees’ Pension Reform Act of 2013, which is a set of state laws intended to address structural concerns related to California public employee pensions and places limits on pensionable compensation for certain public employees hired on or after January 1, 2013. The Port and Airport’s PEPRA plan tiers generally have lower pension benefits compared to the non-PEPRA plan tiers, so joining the non-PEPRA plan tier may be more desirable. This concept may apply to outgoing reciprocity as well – if you were initially hired by an SDCERS plan sponsor before 2013 and subsequently establish reciprocity after 2013 at a public agency that is affected by PEPRA, you may be able to join that agency’s most recent non-PEPRA plan tier. However, you will need to contact the subsequent employer’s retirement system for more information on this subject. (Note: This concept does not apply to incoming reciprocity with the City, as the City is not governed by PEPRA – your plan tier with the City will depend on your initial hire date as a City employee, regardless of your hire date with a reciprocal agency.)

Meeting Vesting and Retirement Eligibility Requirements - Service credit earned under each reciprocal system may be used to meet each system’s vesting and retirement eligibility requirements. See the example below:

• You earn 7 years of service credit from SDCERS while working for the City of San Diego. You leave your job with the City of San Diego for a job with the County of Los Angeles and establish reciprocity. As a City Member, you must have at least 10 years of service credit to be eligible for a service retirement at a certain age. In this example, you only have 7 years of service credit when you leave City employment. However, after working another 13 years for the County of Los Angeles, that time will count toward the 10-year minimum or “vesting” requirement of SDCERS, and you will be vested in both systems, as you will have also met the County of Los Angeles’ service vesting requirement. Calculation of benefits for each system is not based upon the total 20 years of service credit, nor is there any transfer of funds or service credit between reciprocal systems. Instead, each monthly pension benefit is paid separately by each agency; SDCERS will pay you a pension benefit based on the 7 years of service credit you earned at the City, and the County of Los Angeles’ retirement system will pay you a pension benefit based on the 13 years you worked for the County of Los Angeles. Both benefits would be based on your highest final average compensation in either system. However, note that the two systems may have different calculations to determine your final average compensation used in their pension benefit formula.

It is important to note that you must meet both systems’ vesting requirements in order to maintain reciprocity and retire simultaneously. Let’s look at another example demonstrating this requirement:

• You work for the City of San Diego for 2 years before moving to the County of Los Angeles and establishing reciprocity. In this example, let’s assume the plan tier you join with the County of Los Angeles only requires you to have 5 years of service credit in order to become service-vested. If you work for the County of Los Angeles for 5 years, you will have 7 years of service credit total. That is enough time to be vested with the County of Los Angeles, but not enough to be vested with the City of San Diego, which requires at least 10 years of service credit. If you retire with the County of Los Angeles after 5 years, you will break reciprocity with SDCERS, because you would not be able to retire from the City of San Diego simultaneously, as you would not be service-eligible under the City’s plan.

In the above example, we considered two systems with different service-vesting requirements; however, please note that age-eligibility requirements would have the same effect (e.g., if you retire from a reciprocal system with a lower age requirement before you have met your SDCERS plan sponsor’s higher age requirement, you would break reciprocity with SDCERS because you would not be age-eligible to retire from both systems simultaneously).

Retirement Date Must Be Same for All Reciprocal Systems - One requirement of reciprocity, as mentioned above, is that you retire from all reciprocal systems on the same day. You must apply for retirement from each system separately, completing each system’s unique application process. Failure to do so could result in breaking reciprocity, which could result in one or both systems retroactively recalculating your contribution rate throughout your career and owing increased contributions. (Note: For reciprocity purposes, if you plan to participate in DROP, you must retire from a reciprocal system on the same day as your DROP exit date, not your DROP entry date.)

Disability Retirement - If you receive a disability retirement from a reciprocal system, you will receive a reciprocal disability retirement benefit from SDCERS instead of a service retirement benefit. Be sure to contact SDCERS immediately if you have left SDCERS, established reciprocity, and are now applying for a disability retirement with your reciprocal agency.

Consequences of Breaking Reciprocity - If you have established incoming or outgoing reciprocity with SDCERS, you may be eligible for reciprocal benefits. However, if you withdraw your contributions from SDCERS or from the reciprocal agency, or fail to retire from the reciprocal agency(ies) concurrently, you will have “broken” reciprocity. Consequences of breaking reciprocity may include:

• Your compensation earned from the reciprocal agency will not be used to calculate your pension benefits from SDCERS. This can change your calculation of pension benefits from SDCERS.

• SDCERS cannot use the service credit you received from the reciprocal agency to determine eligibility for benefits from SDCERS. This can change or eliminate your eligibility to receive pension benefits from SDCERS.

• If you received a contribution rate reduction due to reciprocity, your contribution rate may be retroactively adjusted because of the loss of reciprocity, and you may be required to pay any underpaid contributions before you can receive any retirement benefits due to you.

SDCERS allows you to receive a refund of your contributions even if you have established reciprocity at a reciprocal agency. However, if you withdraw your contributions, you are no longer eligible for a pension benefit from SDCERS and will break reciprocity with the reciprocal agency.

NOTE: If you have established reciprocity between SDCERS and a reciprocal agency, and subsequently receive an industrial disability retirement benefit from the reciprocal agency, your SDCERS benefit will likely be reduced - please contact SDCERS in advance of applying for a disability retirement benefit from a reciprocal agency for more information. 

 

If you move from one California public agency to another whose pension benefits are administered by a different retirement system (e.g., from the County to the City), then you may establish reciprocity, as explained in this fact sheet. However, if you move between two agencies whose pension benefits are administered by the same retirement system, you would not establish reciprocity – instead, you would maintain SDCERS membership and begin accruing something termed “blended benefits.”
 
You become a “blended member” at SDCERS if any of the following apply:

• You were employed in a position eligible for membership with one SDCERS plan sponsor (the City, Port, or Airport), and subsequently become employed in a position eligible for membership with one of the other two plan sponsors; or

• You change job types under the same plan sponsor, such that you move to a different membership classification governed by the same plan document – e.g., you were initially a City General Member and subsequently become a City Safety Member, or vice versa.

 
Blended Benefits, Breaks in Service, & Plan Tiers
Unlike reciprocity, with blended benefits there is not a requirement to terminate the initial employment and begin the subsequent employment within a certain time period. That being said, if you were hired by the City or Port prior to 2013 and subsequently begin employment with the Airport within 6 months of terminating your City or Port employment, you may be eligible to join the Airport’s most recent non-PEPRA plan tier (applicable to Airport employees initially hired between January 1, 2003 and January 1, 2013), which may offer higher pension benefits than the PEPRA plan tier. If there is more than a 6-month break between employments, then you would join the Airport’s PEPRA plan tier instead.
 
The same idea generally applies if you move from the City or Airport to the Port, or if you move to a position under a different category of membership within the Port (e.g., General to Safety, or vice versa). As long as your initial hire date was before 2013 and you begin the subsequent job within 6 months, you may be eligible to join the Port’s most recent non-PEPRA plan tier according to your category of membership. However, this concept only applies if you are moving to the Port or the Airport – it does not apply if you move from the Airport or Port to the City, because the City is not governed by PEPRA; so, regardless of whether or not there is a break in service between your Port or Airport employment and your City employment, your City Member plan tier would be determined according to your category of membership and initial hire date with the City, as discussed below.
 
Unless the exception described above applies, your plan tier with a subsequent plan sponsor will be based on your initial hire date with that plan sponsor – not your hire date with the first SDCERS plan sponsor:

• Example #1: If you became an Airport Member in 2000 and subsequently became a City General Member in 2010, you would belong to the City’s most recent General Member plan tier that applies to all City General Members initially hired on or after July 1, 2009.

• Example #2: If you became a Port General Member in 2015, you would join the Port’s Miscellaneous PEPRA plan tier; if you later begin employment at the Airport, you would belong to the Airport’s most recent PEPRA plan tier (assuming you had more than a 6-month gap in employment between the Port and the Airport).

However, if you become a blended member by virtue of moving to a position in a different category of membership under the same plan sponsor (e.g., you go from a City General Member to a City Safety Member or vice versa), then the plan tier you join when you move to the new category of membership will be determined based on your initial hire date in the first membership classification.

• Example #1: If you became a City Safety Member in 2008 and subsequently become a City General Member in 2022, you would join the City’s second General Member plan tier applicable to employees initially hired between July 1, 2002 and July 1, 2009.

• Example #2: If you became a Port General Member in 2005 and then moved to a Port Safety Member position in 2015 without a break in service, you would belong to the first Port Safety Member plan tier, applicable to Port Safety Members hired before 2010.

 
Blended Benefits & Member Contributions
Although a break in service does not affect your ability to become a blended member, you must have left your contributions on deposit with SDCERS at all times – as with reciprocity, if you withdraw your contributions at any point, you will lose the service credit you earned during your initial employment period and blended benefits will not apply.  
 
Upon becoming a blended member, your contribution rate applicable during your employment with the subsequent plan sponsor will be according to your new plan tier’s contribution rates, but based on your age when you initially became an SDCERS Member (adjusted for any breaks in membership), not your age when you are hired by the subsequent plan sponsor or move to a position in a different category of membership. This is the same concept applicable to reciprocity. For example, if you become an Airport Member at age 30, work for 5 years, and then become a City Member at age 35 (without a break in between), your City Member contribution rate will be based on an entry age of 30. However, if you took a year off in between the two jobs, your City Member contribution rate would be based on an adjusted entry age of 31.
 
Blended Benefits & Retirement Eligibility Requirements
As a blended member, your combined service credit earned during all periods of employment with an SDCERS plan sponsor will count towards your service credit vesting requirement. However, if your blended benefit is due to employment in different plan tiers within the same plan sponsor (e.g., City General to City Safety), then your most recent period of employment will determine your retirement eligibility requirements. For example, City General Members can retire as early as age 55 if they have at least 20 years of service credit, or age 62 if they have at least 10 years. City Safety Members have lower age requirements – they can retire as early as age 50 with 20 years of service, or 55 with 10. If you begin City employment in a General Member position and subsequently become a Safety Member, you can retire according to the earlier age requirements applicable to Safety Members, assuming you meet the corresponding service credit requirements. If the situation is reversed – you begin as a Safety Member and end as a General Member – then you cannot retire earlier than age 55, or age 62 if you have less than 20 years of combined service credit.
 
On the other hand, if your blended benefit is due to employment with multiple SDCERS plan sponsors, then you must satisfy the eligibility requirements for both plan sponsors in order to receive a pension benefit from each. For example, if you work for the most recent Airport plan tier for 5 years and then work for the City as a General Member for 3 years, you will have 8 years of total service credit. The most recent Airport plan tier allows you to retire at age 52 or older with at least 5 years of service credit. However, the City requires you to have at least 10 years of service credit in order to retire at age 62 at the earliest. In this example, you are eligible to retire from the Airport at age 52, but you do not meet the minimum eligibility requirements to retire from the City. Therefore, your only option is to retire from the Airport based on your 5 years of Airport service, at which time you can take a refund of your City contributions, or to continue working for the City for another 2 years so that you have 10 years of combined service credit between the two plan sponsors; in the latter case, you would have to wait until at least age 62 before you can retire from both the City and the Airport simultaneously. Please note that you generally cannot continue to work for one SDCERS sponsor while actively receiving an SDCERS pension benefit from another plan sponsor – so, in the above example, if you choose to retire from the Airport before becoming eligible to retire from the City, you may not be able to continue working for the City after your Airport retirement date.
 
How Blended Benefits Are Calculated
When you retire as a blended member, a portion of your pension benefit will be calculated according to the plan document of your initial plan tier, while the rest of your benefit will be calculated according to your most recent plan tier. In the example above, where you worked for the Airport for 5 years and then worked for the City for 5 years, half of your benefit (based on the 5 years of Airport service credit) will be determined according to your Airport plan tier’s retirement factors and final compensation calculation, and half will be determined using your City plan tier’s retirement factors and final compensation calculation.
 
Similarly, in the example where you started as a City General Member and later became a City Safety Member, your benefit would be calculated as follows: The service credit you earned as a General Member will be multiplied by your General Member plan tier’s retirement factors and final compensation calculation, and your Safety Member service credit would be multiplied by your Safety Member plan tier’s retirement factors and final compensation calculation. The combined amounts equal your initial base pension benefit.
 
Note that some plan tiers calculate your final compensation (as used in your pension benefit formula) differently than others – generally, it is calculated as your highest pensionable compensation averaged over either one or three years. If your blended benefit is due to employment with multiple plan sponsors, SDCERS will calculate your final compensation for each plan sponsor according to your pensionable pay and final compensation calculations, respectively; the final compensation calculation that yields the highest amount is what will be used to calculate your blended benefit for all periods of employment. For example, if you were hired by the Airport in 2007 and then became a City General Member in 2011, your Airport plan tier’s final compensation calculation is based on your highest pensionable salary averaged over one year, while your City final compensation calculation would be averaged over three years. SDCERS will calculate your highest one-year pensionable salary that you received at the Airport between 2007 and 2011, and then compare it to your highest pensionable salary that you received as a City employee averaged over three years. Whichever number is higher is what will be used to calculate both your Airport and City pension benefit. 
 
Blended Membership Considerations
Finally, as with reciprocity, you must retire simultaneously from all categories of membership. If you are considering moving between SDCERS plan sponsors or between categories of membership within the same SDCERS plan sponsor, be sure to review the retirement plan summary for the retirement plan tier that you are currently in, and note the differences compared to the plan tier you would join under your subsequent employment. You should review the contribution rates, the eligibility requirements, the retirement factors, benefit cap (if applicable), and the final compensation calculation in order to fully understand how your job change may affect your future pension benefit.

To submit a reciprocity request, log on to your secure Member Portal. Once you have accessed your personal Member Portal account, click on "Reciprocity" from the left menu, select the Reciprocal Agency Name and Reciprocity Direction from the drop-down menus, and click the Submit button. You will receive a letter via U.S. Mail stating whether your reciprocity has been approved or denied.

Note: You do not have to submit a reciprocity request (or do anything else) in order to establish “blended benefits.” If you become a “blended member,” our system will automatically recognize your blended membership and update your file accordingly.