DROP

Summary

The Deferred Retirement Option Program (DROP) is a retirement program within the FRS Pension Plan that allows you to retire and have your FRS benefits accumulate in the FRS Trust Fund earning interest while you continue to work for up to five years. Your participation in DROP does not change your conditions of employment. When the DROP period ends you will receive your accumulated DROP benefits and begin receiving your monthly retirement benefit. The University of South Florida pays the full cost of the plan. For additional information, visit the Division of Retirement’s web site.

Eligibility

As an eligible member of the FRS Pension Plan or Teachers Retirement System (TRS), you may participate in DROP when you are vested and have reached your normal retirement date. Your “normal retirement date” is the earliest date at which you become eligible for full, unreduced benefits based upon your age and/or service. In most cases, you reach your normal retirement date when you are vested and reach age 62, or when you complete 30 years of service, regardless of your age (age 55 or 25 years of service for Special Risk members).

• If you complete 30 years of service before you reach age 57, you may defer your DROP election and may elect to begin DROP participation at anytime between completing 30 years of service and reaching age 57 (FRS special risk members who complete 25 years of Special Risk Class service before age 52 may defer DROP to age 52).

• When determining your normal retirement date for purposes of establishing your DROP eligibility or participation period, you may choose to include or exclude any optional service credit you have purchased (for example, any credit you purchased for a leave of absence). Regardless of your choice, any optional service credit you buy will be included in your benefit calculation.

Election

If you wish to participate in DROP, you may make your election up to 6 months before the date you plan to begin participation, but the Division of Retirement must receive your election no later than the month you wish to begin DROP. You must make your election within a 12-month election window that begins when you first reach your normal retirement date unless you are eligible to defer your election as listed above. If you do not apply within your prescribed election window, you will lose your eligibility to participate.  Your 60 month (5 year) participation period starts on your 1^st month of eligibility, even though you are allowed 1 year to sign up for DROP, it does not extend your 60 month DROP enrollment period.

Example:

Eligible for DROP 7/1/05

DROP enrollment is from 7/1/05-6/30/10

You decide not to enroll in DROP until 6/1/06

Your DROP termination date would still be 6/30/10

How to Enroll

Contact the retirement office at (813) 974-5718 for an appointment. The following forms will be completed:

• Notice of election to participate in the DROP and resignation of employment - DP-ELE Form. A copy of the DP-ELE is sent to the immediate supervisor with a Drop Fact Sheet for Supervisors/Departments.

• Application of Service Retirement and the DROP – DP-11 form

• Option selection for FRS members – FRS-11o form

• Salary Certification form

• Attendance and Leave Certification form

Additional documents needed:

• Birth Certificate of employee

• Birth Certificate of Spouse (if select Option 3 or 4)

• Driver’s license – for notary

How to Retire

• Advise the USF Retirement office of your termination date approximately six to eight weeks in advance. The USF Retirement office will contact the Division of Retirement.  

• The Division of Retirement will send the DROP Termination Notification (DP-TERM), DROP Selected Payout Method (DP-PAYT), and Joint annuitant verification (DP-Joint – only if Option 4 was selected). These forms will be mailed to your home address.

• Once the forms are received, contact the Retirement office at (813) 974-5718 for an appointment. Bring the forms with you.