DEPARTMENT OF EDUCATION
SUPTS. MEMO NO. 009
October 31, 2008
Patricia I. Wright
Superintendent of Public Instruction
Robert P. Schultze
Employment of Retirees in Critical Shortage Areas
51.1-155 of the Code of Virginia provides that a retired member of the VRS may be hired by a school division to fill a vacancy in a critical shortage area and continue to receive the retirement allowance during such employment if specified conditions are met. This memorandum provides the requirements for designating critical shortage areas and hiring retired individuals for critical shortage positions in school divisions.
Critical Shortage Certification
The VDOE will continue to be responsible for overseeing the designation of areas that meet the criteria for statewide critical shortage teaching endorsement areas. VRS will begin receiving, reviewing, and tracking the eligibility of retirees in critical shortage positions using a new reporting procedure. This VRS procedure includes new forms that replace those currently used to report critical shortage positions to VDOE. Copies of the new VRS forms are attached, and directions to submit the forms to VRS are included in this memorandum.
VRS also is available to consult with you and your
personnel regarding the criteria governing the hiring of VRS retirees for
critical shortage positions in accordance with the Code of
Critical Shortage Designations
As required under the 2008 Acts of Assembly, the VDOE reports annually to the General Assembly on critical shortage teaching endorsement areas. Positions eligible to be considered for a critical shortage designation include instructional personnel, principals, and assistant principals requiring a valid license issued by the Virginia Board of Education with the appropriate endorsement.
In addition to the endorsement areas identified as statewide critical shortages, a critical shortage may be designated by the school division for any position vacancy for which a school division receives three or fewer qualified candidates (licensed or eligible for a license issued by the Virginia Board of Education with an endorsement corresponding to the appropriate assignment).
In preparing the annual report to the General Assembly, the Superintendent of Public Instruction surveys all school boards to identify the top ten critical shortage teaching endorsement areas. To assist in this effort, you should review your critical shortage areas annually to determine whether the shortage still exists.
As provided in 51.1-155 of the Code of Virginia, VRS retirees who hold a valid license issued by the Virginia Board of Education and meet the bona fide break-in-service criteria may continue to receive their retirement benefits while working full time in a designated critical shortage area (51.1-155). Although these positions are full time, retirees are not accruing VRS benefit eligibility at the same time they are receiving retirement benefits.
VRS members who have taken a refund of their member contributions or deferred their retirement are ineligible to participate in the critical shortage program. These individuals should be reported as active members. VRS retirees who do not hold a valid teaching license with the appropriate endorsement for the assignment issued by the Board of Education also are ineligible to participate.
Bona Fide Break in Service
In prohibiting in-service distribution of retirement benefits, the Internal Revenue Service (IRS) considers it essential that employees make a complete and good faith end to service when they retire, with no agreement or expectation of future employment. Retirement systems that allow members to retire without fully severing employment for a reasonable period of time could potentially lose the system's favored IRS tax-qualified status. This would have far-reaching tax consequences for the retirement systems' participating employers and members.
Therefore, VRS and VDOE, in consultation with the Joint Legislative Audit and Review Commission (JLARC), have determined that:
VRS retirees must have a bona fide break in service of at least 12 consecutive months between their retirement date and the date they wish to work in a full-time critical shortage position. This break in service precludes any full-time, part-time or temporary employment with any VRS-participating employer, including summer school or substitute teaching.
Employers may not make any verbal or written offer of
re-employment to employees who are preparing to retire.
Early Retirement Incentive Programs (ERIPs)
Early retirement incentive programs (ERIPs) seek to encourage early retirement by offering a benefit enhancement, such as an additional benefit or supplemental package. VRS members who participate in a school board's ERIP and retire with a reduced VRS benefit are ineligible to be employed under the critical shortage criteria outlined in this memorandum. However, if a VRS member participates in a school board's ERIP but retires with an unreduced VRS benefit, the member retains his or her eligibility for critical shortage provided all other eligibility requirements are met.
If you are employing retirees in critical shortage positions for the 2008-09 school year, please submit the Certification of Eligibility for Critical Shortage Teachers or Administrators (VRS-160) for each retiree this year by December 1, 2008. In future school years, please submit the form by November 1.
If you are not employing a retiree in a critical shortage position for the 2008-09 school year, submit the Certification of Non-Participation of Critical Shortage Teachers and Administrators (VRS-160A) for this year by December 1, 2008. In the future, please submit the form by November 1.
If you employ a retiree in a critical shortage position after submitting the forms, please send the VRS-160 for the retiree upon the effective date of his or her employment in the position.
Forms are available from the VRS website at www.varetire.org. Select Forms from the Employer tab.
As a reminder, the critical shortage legislation includes a sunset provision. Barring an extension by the General Assembly, the legislation will end effective July 1, 2010.
VRS has developed an e-learning course on critical shortage. This course, which takes less than an hour to complete, reviews the components of the critical shortage legislation, eligibility guidelines for positions and participating individuals, and the procedure to submit the VRS-160 and VRS-160A forms. The course will be available on the VRS website at www.varetire.org. Select Employer Training from the Employer tab.
In addition, the VRS and DOE sites will link to each other to make it easier for employers and retirees to learn more about critical shortage teaching designations and eligibility requirements. The DOE website address is www.doe.virginia.gov.
For questions regarding the critical shortage designations, contact Mrs. Patty S. Pitts, assistant superintendent for teacher education and licensure, at (804) 371-2522. For questions concerning a VRS retiree's eligibility for a critical shortage position, contact one of the following employer representatives for school divisions at the Virginia Retirement System:
Mrs. Gwyn Ciemniecki
Toll free: 1-888-827-3847, ext. 7765
Mrs. Carolyn Newton
Toll free: 1-888-827-3847, ext. 3196