Chapter ETF 10

ETF 10.25(3) (3)  Earnings distributions. Earnings shall be distributed from the combined stock fund to the core retirement investment trust and the variable retirement investment trust according to the following:

ETF 10.25(3)(a) (a) The book value of all investments in the combined stock fund shall be adjusted to current market value as of the last day of each month. The appraisal gain or loss shall be recognized in the month incurred.

ETF 10.25(3)(b) (b) As of the last day of each month the combined stock fund shall distribute to the core retirement investment trust and the variable retirement investment trust all income recorded for that month including interest received, dividends received, gain or loss realized on the sale of investments and the unrealized gain or loss recognized on the adjustment of investment book value to market value. Following these distributions the unit value of shares in the combined stock fund shall be one dollar.

ETF 10.25(3)(c) (c) For any month, the distribution of income between the core retirement investment trust and the variable retirement investment trust shall be based on the ratio of the relative number of combined stock fund shares held by each trust as of the first day of that month to the total number of combined stock fund shares outstanding.

ETF 10.25(3)(d) (d) Monthly distributions from the combined stock fund to the core retirement investment trust resulting from gains or losses realized on the sale of investments or unrealized appraisal gains or losses shall be transferred to the transaction amortization account. Distributions resulting from all other sources shall be recognized as current income to the core retirement investment trust in the month of distribution.

ETF 10.25(3)(e) (e) All distribution to the variable retirement investment trust shall be treated as current income in the month of distribution.

ETF 10.25(4) (4)  Withdrawals. The core retirement investment trust or the variable retirement investment trust may withdraw funds from the combined stock fund as of the first day of any month. The withdrawal shall be accomplished by selling combined stock fund shares to the combined stock fund. Withdrawals made after the first day of any month shall be deemed to have been made on the first day of that month for purposes of distributing income at the end of that month.

ETF 10.25 History History: Cr. Register, October, 1985, No. 358, eff. 11-1-85; r. and recr. (1), r. (2) and (4) (a), renum. (3), (4) (intro.), (b) to (f) and (5) to be (2) to (4), Register, December, 1990, No. 420, eff. 1-1-91; CR 09-057: am. (intro.), (1) (a), (b), (2), (3) (intro.), (b), (c), (d) and (4) Register May 2010 No. 653, eff. 6-1-10.

ETF 10.30 ETF 10.30  Variable division participation.

ETF 10.30(1) (1)  Purpose. The purpose of this section is to interpret s. 40.04 (7), Stats. This section establishes the procedures for electing to participate, participating and electing to terminate participation in the variable division of the trust fund.

ETF 10.30(1m) (1m)  Definitions. In this section, “new participant" means any of the following:

ETF 10.30(1m)(a) (a) A person initially qualifying as a participant as defined by s. 40.02 (45), Stats., who has never previously been a participant in the Wisconsin retirement system or Wisconsin retirement fund or a member of the state teachers retirement system or Milwaukee teacher retirement fund.

ETF 10.30(1m)(b) (b) A person who was previously a participant but whose Wisconsin retirement system account was closed because of payment of a lump sum benefit under s. 40.25, Stats., and who returns to covered employment for the first time since the account closure. The term “new participant" does not include a person whose closed account is reestablished under s. 40.25 (5), Stats.

ETF 10.30(2) (2)  Eligibility for and effective dates of participation in the variable division.

ETF 10.30(2)(a) (a) An election to participate, or terminate participation, in the variable division shall be made on a form provided by the department. Except as provided in sub. (3), an election to participate in the variable division shall become effective for future contributions on the January 1 following receipt of the form by the department.

ETF 10.30(2)(b) (b) Participants who elected to terminate participation in the variable division effective before December 31, 1999 may elect to participate in the variable division as provided in this section.

ETF 10.30(2)(c) (c) Except as provided in par. (d), pursuant to s. 40.04 (7) (b), Stats., participants who elected to terminate participation in the variable division effective on or after December 31, 1999 may not re-elect to participate in the variable division.

ETF 10.30(2)(d) (d) A participant who elects to terminate participation in the variable division effective on or after December 31, 1999 may re-elect to participate in the variable division only if the participant ceases to be a participant by closing the participant's account through taking a benefit under s. 40.25, Stats., and subsequently becoming a new participating employee.

ETF 10.30(2)(e) (e) An election to participate in the variable division received by the department from a participant who is not a participating employee, and who ceased to be a participating employee before January 1, 2001, shall become effective on the January 1 on or after the date on which the participant again becomes a participating employee.

ETF 10.30(2)(f) (f) An election to participate in the variable division received by the department after the participant's date of death is invalid.

ETF 10.30 Note Note: The form for electing to participate in the variable division, “Election to Participate in the Variable Trust Fund," ET-2356, can be obtained at no charge by writing to: department of employee trust funds, P.O. Box 7931, Madison, WI 53707-7931, or by calling: [phone] or toll free at [phone]. The form is also available on the department's website: etf.wi.gov.

ETF 10.30(3) (3)  Variable division participation for new participants.

ETF 10.30(3)(a) (a) An election to participate in the variable division filed by a person who becomes a new participant on or after January 1, 2001 shall become effective as follows:

ETF 10.30(3)(a)1. 1. Retroactive to the date on which the person becomes a participant, providing that the department receives the form no later than 30 calendar days after the date on which the person became a participant.

ETF 10.30(3)(a)2. 2. Elections to participate in the variable division that are received by the department more than 30 calendar days after the date on which the person becomes a participant shall become effective on the January 1 following receipt of the form by the department.

ETF 10.30(3)(b) (b) The department shall accept elections to participate in the variable division up to 90 calendar days before the date on which a participant becomes a participating employee. Elections received by the department within this 90-day period or within the next 30 days after the person becomes a participating employee shall become effective on the date on which the person becomes a participating employee. Elections to participate in the variable division received by the department more than 90 calendar days before the date on which a person becomes a participant are invalid.

ETF 10.30(4) (4)  Retroactive contributions.

ETF 10.30(4)(a) (a) Retroactive interest credited to contributions for late-paid earnings shall be credited at the core effective rates as provided in s. 40.06 (5), Stats.

ETF 10.30(4)(b) (b) Late-paid and other retroactive contributions shall be deposited in the core and variable trust accounts according to the participant's variable participation status at the time the contributions are deposited, regardless of the participant's variable participation status in the annual earnings period to which the contributions may be attributed for other purposes.

ETF 10.30(5) (5)  Terminating participation in the variable division.

ETF 10.30(5)(a) (a) A participant may elect to terminate participation in the variable division and transfer the participant's variable division contributions to the core division on one of the following bases:

ETF 10.30(5)(a)1. 1. For future contributions only: Effective as of the December 31 after the date on which the department receives an election to terminate participation in the variable division, all future contributions shall be deposited in the core division.

ETF 10.30(5)(a)2. 2. An unconditional basis: Effective as of the December 31 after the date on which the department receives an election to terminate participation in the variable division, all future contributions shall be deposited in the core division and all variable contributions and accrued gain or loss shall be transferred to the core division.

ETF 10.30(5)(a)3. 3. A conditional basis:

ETF 10.30(5)(a)3.a. a. For annuities, effective on the first January 1 after the department receives the election when the condition under s. 40.04 (7) (a) 1., Stats., is satisfied.

ETF 10.30(5)(a)3.b. b. For all accounts from which an annuity is not being paid, effective on the first January 1 after the department receives the election when the condition under s. 40.04 (7) (a) 2., Stats., is satisfied. As of the first January 1 after the Department receives the election, all future contributions shall be deposited in the core division. As of the first January 1 when the condition under s. 40.04 (7) (a) 2., Stats., is satisfied, all variable contributions and accrued gain or loss shall be transferred to the core division.

ETF 10.30 Note Example 1: A participant, alternate payee, named survivor or beneficiary who is receiving an annuity from the Wisconsin retirement system, and who also has an account from voluntary additional contributions from which no annuity is being paid, is not an annuitant under s. 40.04 (7) (a) with respect to the additional contributions.

ETF 10.30 Note Example 2: An alternate payee who was also a participating employee in the Wisconsin retirement system and who is receiving an annuity only from the alternate payee account is not an annuitant with respect to the separate account established as a participating employee.

ETF 10.30 Note Note: The form for electing to terminate participation in the variable division, “Election to Cancel Variable Participation," ET-2313, can be obtained at no charge by writing to: department of employee trust funds, P.O. Box 7931, Madison, WI 53707-7931 or by calling: [phone] or toll free at [phone]. The form also is available on the department's website: etf.wi.gov.

ETF 10.30(5)(b) (b) Except as provided in par. (c), an election to terminate participation in the variable division may be rescinded if the department receives a written request to rescind the election from an alternate payee, beneficiary, named survivor, or participant as defined in s. 40.02 (2m), (8), (41r) and (45), Stats., before the December 31 following the date on which the election to terminate participation in the variable division was received.

ETF 10.30 Note Note: No specific form exists for rescinding an election to terminate participation in the variable division. The written request must be dated and must make clear your intent and by including words to the effect of “I want to rescind my election to terminate participation in the variable division." Participants may send a letter or fax with this request to the following address: department of employee trust funds, P.O. Box 7931, Madison, WI 53707-7931 or fax [phone].

ETF 10.30(5)(c) (c) An election to terminate participation in the variable division received within 30 days after the date on which the person became a participant may be rescinded if the department receives the participant's written request to rescind the election no later than 30 days after the date on which the person became a new variable division participant as provided in sub. (3).

ETF 10.30(5)(d) (d) A rescinded election to terminate participation in the variable division shall be treated as if the election never existed.

ETF 10.30(5)(e) (e) When the department receives an election to terminate participation in the variable division more than 30 calendar days after the date on which a person became a new variable division participant as defined in sub. (3), the participant shall not be eligible to re-elect to participate in the variable division without meeting the requirements of sub. (2) (d).

ETF 10.30(5)(f) (f) For an account or annuity that includes additional contribution, when an election to terminate participation in the variable division pursuant to s. 40.04 (7) (a) 1. or 2., Stats., is made by an alternate payee, beneficiary, named survivor, or participant as defined in s. 40.02 (2m), (8), (41r) and (45), Stats., the determination of whether the variable contributions and accrued gain or loss shall be transferred to the core division shall be based on an evaluation of the combined total of the required and additional contributions and shall be effective as prescribed in this section.

ETF 10.30(5)(g) (g) An election to terminate participation in the variable division filed pursuant to s. 40.04 (7), Stats., shall be effective for all retirement contributions and benefits accrued as a participant except that for an annuitant who has variable accumulations from which no annuity is being paid, the effective date of an election shall be separately determined for the current annuity or annuities and for the variable division accumulations from which no annuity is being paid.

ETF 10.30(5)(h) (h) When multiple elections to terminate participation in the variable division for an account are received by the department, the last election received by the department shall supersede previous elections and shall be applied to the account if it is received before the December 31 on which the previous election to terminate variable division participation would become effective.

ETF 10.30(5)(i) (i) Any gains or losses at the effective date of a transfer pursuant to s. 40.04 (7), Stats., including subsequent interest credits, shall be reflected as an adjustment to the benefit at the time it is payable.

ETF 10.30(5)(j) (j) Participants may rescind elections to participate in the variable division under the following conditions:

ETF 10.30(5)(j)1. 1. If an election to participate in the variable division would become effective on a January 1 after it is received, as provided in sub. (2), the election shall be rescinded if the department receives an election to terminate participation in the variable division before the date on which the election would otherwise become effective.

ETF 10.30(5)(j)2. 2. If an election to participate in the variable division would become effective on the date on which the participant became a participating employee as provided in sub. (3), the election to participate shall be rescinded if the department receives an election to terminate participation in the variable division within 30 calendar days after the date on which the participant becomes a participating employee.

ETF 10.30(5)(k) (k) An election to terminate participation in the variable division received by the department after the date of death of the person making the election is invalid.

ETF 10.30(5)(L) (L) A person may be a participant, alternate payee, named survivor, beneficiary or combination thereof under the Wisconsin retirement system, and may have different accounts or annuities in each capacity. Except as otherwise provided in this paragraph, an election to terminate participation in the variable division applies to all of a person's accounts and annuities. A person may specify that an election to terminate participation in the variable division applies only to one or more of the following:

ETF 10.30(5)(L)1. 1. All accounts and annuities held in the capacity of a participant.

ETF 10.30(5)(L)2. 2. All accounts and annuities held in the capacity of an alternate payee of a specified participant.

ETF 10.30(5)(L)3. 3. All accounts and annuities held in the capacity of a named survivor of a specified participant.

ETF 10.30(5)(L)4. 4. All accounts and annuities held in the capacity of a beneficiary of a specified participant.

ETF 10.30(5)(m) (m) The December 31 effective date for an election to terminate participation in the variable division means on December 31 after interest crediting under s. 40.04 (4) (a), Stats., has occurred.

ETF 10.30(6) (6)  Rights of beneficiaries, alternate payees, and named survivors.

ETF 10.30(6)(a) (a) An election to participate in the variable division received by the department from an alternate payee, beneficiary, or named survivor as defined in s. 40.02 (2m), (8), and (41r), Stats., is invalid.

ETF 10.30(6)(b) (b) A person receiving or eligible to receive benefits as the alternate payee, sole beneficiary, or named survivor of a participant as defined in s. 40.02 (2m), (8), and (41r), Stats., may elect to terminate participation in the variable division pursuant to s. 40.04 (7), Stats.

ETF 10.30(6)(c) (c) Except as provided in pars. (d) and (e), terminating participation or rescinding an election to participate in the variable division shall be determined pursuant to sub. (5).

ETF 10.30(6)(d) (d) If there is more than one beneficiary of an account from which no annuity is being paid, the multiple beneficiaries may jointly elect to terminate participation in the variable division pursuant to s. 40.04 (7), Stats. Participation in the variable division will be terminated effective on the December 31 following receipt of an election to terminate participation in the variable division from each of the multiple beneficiaries. Any one of the multiple beneficiaries may rescind his or her election to terminate participation in the variable division prior to the date it would otherwise have gone into effect, in which case the rescinded election to terminate participation in the variable division shall be treated as if the election never existed.

ETF 10.30(6)(e) (e) If there is more than one beneficiary of an account from which no annuity is being paid, and the beneficiaries do not all elect to terminate participation in the variable division pursuant to s. 40.04 (7), Stats., as provided in par. (d), an individual beneficiary's election to terminate participation in the variable division received by the department shall become effective on the December 31 on or after the effective date of the beneficiary's annuity from that beneficiary's portion of the participant's account, unless previously withdrawn.

ETF 10.30(6)(f) (f) A participant's election to terminate participation in the variable division received by the department before the participant's date of death shall become effective as provided in sub. (2), and shall apply to any accounts or annuities that are payable to the participant's beneficiaries unless the election is rescinded as provided in sub. (5).

ETF 10.30(7) (7)  Incomplete elections.

ETF 10.30(7)(a) (a) An election to participate in the variable division or an election to terminate participation in the variable division that does not contain the name, social security number and signature of the person making the election shall be deemed incomplete.

ETF 10.30(7)(b) (b) An election to terminate participation in the variable division received by the department from a beneficiary or named survivor as defined in s. 40.02 (8) and (41r), Stats., that does not include the participant's name and social security number in addition to the name, social security number and signature of the person making the election shall be deemed incomplete. For terminations, the election must include a cancellation type as specified in sub. (5) (a).

ETF 10.30(7)(c) (c) When the department receives an incomplete election, the election shall be returned by mail to the elector for completion. If a correctly completed election is received by the department within a grace period of 30 calendar days after the incomplete election was returned by mail to the elector, the original receipt date of the election shall be preserved for the purpose of determining the effective date of the election. The effective date for corrected elections that are not returned during the 30-day grace period shall be determined without regard to the original submission and based on the date a correctly completed election is received by the department.

ETF 10.30(8) (8)  Electronic receipt.

ETF 10.30(8)(a) (a) Subject to s. ETF 10.82 (2), the department may accept correctly completed elections to participate in the variable division, elections to terminate participation in the variable division and notifications to rescind elections to terminate participation in the variable division that are received by the department's facsimile machine or by electronic mail in a complete and legible form. The facsimile or electronic mail may be accepted as the original.

ETF 10.30(8)(b) (b) The deadline for submitting an election to terminate participation in the variable division that is effective December 31 is December 31 of that year.

ETF 10.30(8)(c) (c) The deadline for submitting an election to participate in the variable division that is effective January 1 is December 31 of the prior year.

ETF 10.30(8)(d) (d) For the purposes of determining deadlines under this section, see s. 990.001 (4), Stats.

ETF 10.30 Note Note: Under s. 230.35 (4) (a), Stats., December 31 and January 1 are always legal holidays on which state offices are closed, as is the day following January 1 when January 1 falls on a Sunday. The department does not have duly established office hours on Saturday. Therefore, under s. 990.001 (4) (b), Stats., a December 31 deadline would be extended until the next date which is not a holiday, Saturday or Sunday. For example, the deadline of December 31, 2002, will be extended to Thursday, January 2, 2003. The deadline of December 31, 2004, will be extended to Monday, January 3, 2005. The deadline of December 31, 2005, will be extended to Tuesday, January 3, 2006.

ETF 10.30 History History: Cr. Register, December, 1980, No. 300, eff. 1-1-81; renum. from ETF 8.02 and am., Register, December, 1982, No. 324, eff. 1-1-83; CR 02-126: r. and recr. Register April 2003 No. 568, eff. 5-1-03; CR 04-104: am. (8) (a) Register July 2005 No. 595, eff. 8-1-05; CR 09-057: am. (4) (a), (b), (5) (a) 1., 2., 3. b. and (f) Register May 2010 No. 653, eff. 6-1-10.

ETF 10.50 ETF 10.50  Sick leave conversion credits. The amount of accumulated unused sick leave under s. 36.30, Stats., for all faculty and academic staff other than such faculty and staff appointed to work for either 52 or 39 weeks per year in the University of Wisconsin System convertible to credits to pay for health insurance premiums shall equal the number of days resulting from multiplying 0.0040708 times the number of hours per year appointed to work, as reported to the department, rounded off to the nearest tenth of a day. The maximum amount of such unused sick leave shall be limited to 8.5 days per year. The secretary of administration may waive this limitation under s. 40.05 (4) (bp) 2. and 3., Stats.

ETF 10.50 History History: Cr. Register, September, 1988, No. 393, eff. 10-1-88.

ETF 10.55 ETF 10.55  Joint instrumentalities; reporting participating employees, service and earnings.

ETF 10.55(1) (1)  Scope. This section applies to reporting and contributions with respect to employment by joint instrumentalities created by 2 or more units of government, when all of the following apply:

ETF 10.55(1)(a) (a) At least one of the units of government creating the joint instrumentality is, or subsequently becomes, a participating employer in the Wisconsin retirement system.

ETF 10.55(1)(b) (b) The joint instrumentality is not a separate and independent employer within the meaning of s. 40.02 (28), Stats., as determined by the department. A joint instrumentality which has not established itself as a separate unit of government for OASDHI purposes is not a separate and independent employer under this paragraph.

ETF 10.55 Note Example: A joint library district is not a separate and independent employer.

ETF 10.55(1)(c) (c) There are persons employed by the joint instrumentality. This section does not apply with respect to employees of a unit of government loaned or assigned to perform services for a joint instrumentality. Those individuals remain the employees of their employing unit of government which is subject to the usual reporting and contribution requirements.

ETF 10.55 Note Example: If a joint library district's library board hired a librarian but the library was located on the premises of one of the units of government establishing the joint library district, which assigned one of its janitors to the library, then this section would apply with respect to the librarian but not the janitor.

ETF 10.55(2) (2)  Purpose. With respect to the employees of joint instrumentalities subject to this section:

ETF 10.55(2)(a) (a) Each participating employer forming a joint instrumentality covered by this section shall be responsible for its share of the retirement benefits of the instrumentality's employees who meet the qualifications for participating employees as both the share and qualifications are determined under this section.

ETF 10.55(2)(b) (b) Nothing in this section prevents the units of government forming a joint instrumentality subject to this section from providing for their share of responsibility for the retirement benefits of the employees of the joint instrumentality in the agreement establishing the joint instrumentality. If they fail to expressly address the issue then the share of each participating employer shall be determined as provided in this section.

ETF 10.55(2)(c) (c) Whether an employee of a joint instrumentality covered by this section is a participating employee under s. 40.22, Stats., is not affected by the number of units of government which form the joint instrumentality.