I am still making payments on my air time purchase. Under the new law, will my purchase be canceled or can I continue payments?
Prior to January 1, 2013 you may purchase up to five years of nonqualified service credit if you are a CalSTRS member with at least five years of qualified service credit. Nonqualified service credit is not connected to any specific prior employment. You cannot use the purchase of nonqualified service credit, or air time, to qualify for the career factor benefit enhancement or one-year final compensation, but you can use it to retire as early as age 50 by helping you reach 30 years of service credit.
Under the provisions of Assembly Bill 340, the California Public Employees’ Pension Reform Act of 2013, all purchases of nonqualified service credit will be prohibited beginning January 1, 2013. All purchases or requests for purchases received by CalSTRS and date stamped by 5 p.m. on December 31, 2012 will be honored even if full payment is not yet complete.
Any requests received and date stamped after 5 p.m. on December 31, 2012 will be denied.
Read more about AB 340.