(By authority conferred on the public school employees' retirement board by section  
25(2) of 1980 Act 300, MCL 38.1325(2).  
R 38.1101 Definitions.  
Rule 101. As used in these rules:  
(a) "Act" means Act No. 300 of the Public Acts of 1980, as amended, being  
S38.1301 et seq. of the Michigan Compiled Laws.  
(b) "Applicant" means a person, member, retirant, or reporting unit claiming  
benefits under the act.  
(c) "Benefits" means any provision in the act dealing with maintenance of the  
member's account or the computation of the allowance or eligibility therefor, and  
includes any and all procedures, policies,  
proceedings applicable to such  
(d) "Board" means the Michigan public school employees' retirement board as  
provided for in the act.  
(e) "Full-time student" means a person who is carrying 12 or more semester  
hours or its equivalent in any semester or equivalent instructional unit at a junior  
college, community college, college, or university.  
(f) "System" means the Michigan public school employees' retirement system  
as provided in the act.  
History: 1985 AACS.  
R 38.1102 Place of meetings.  
Rule 102. All meetings of the board, unless otherwise ordered by the president,  
shall be held in Lansing in the building where the offices of the public school  
employees' retirement system are situated.  
History: 1985 AACS.  
R 38.1103 Regular meetings; time.  
Rule 103. Regular meetings of the board shall be held at such times as the needs  
of the board may require and subject to the provisions of Act No. 261 of the Public  
Acts of 1976, as amended, being S15.267 et seq. of the Michigan Compiled Laws.  
Page 1  
History: 1985 AACS.  
R 38.1104 Annual meeting; election of officers.  
Rule 104. The annual meeting of the board shall be held in July. A president  
and vice-president shall be elected at the annual meeting and shall take office  
immediately upon election and serve until their successors are elected.  
History: 1985 AACS.  
R 38.1105 Special meetings.  
Rule 105. Special meetings of the board may be held at any time consistent  
with Act No. 267 of the Public Acts of 1976, as amended, being S15.261 et seq. of the  
Michigan Compiled Laws, on call of the president or on written request to the secretary  
by the majority of the members of the board. Unless by unanimous consent, a special  
meeting shall not be held without 3 days' written notice to each member of the board.  
History: 1985 AACS.  
R 38.1106 Quorum.  
Rule 106. (1) A majority of the board shall constitute a quorum for the transaction of  
business at a meeting of the board.  
(2) When only 5 members of the board are present for a meeting, not less than 4  
concurring votes shall be necessary for a decision.  
History: 1985 AACS.  
R 38.1107 Order of business.  
Rule 107. The order of business at all regular meetings shall be as follows:  
(a) Roll call.  
(b) Approval of minutes.  
(c) Public comment.  
(d) Consideration of financial report.  
(e) Action on allowance applications.  
(f) Unfinished business.  
(g) New business.  
(h) Special reports.  
(i) Public comment.  
(j) Adjournment.  
History: 1985 AACS.  
R 38.1108 Declaratory rulings.  
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Rule 108. (1) A person requesting a declaratory ruling from the board regarding  
a statute, rule, or order administered by the board shall submit, in duplicate, a  
sworn petition to the board setting forth all of the following information:  
(a) The nature and purpose for the request.  
(b) The statute, rule, or order administered by the board to which the request  
(c) The person's involvement, interest, or relationship to that statute, rule, or order.  
(d) The exact subject of the ruling required.  
(2) Requests for more than 1 declaratory ruling regarding the same or different  
statute, rule, or order shall be submitted separately.  
(3) When the board proposes to make a declaratory ruling, it will provide  
public notice and schedule a time for consideration at a regularly scheduled meeting of  
the board. The board shall provide public notice of declaratory rulings.  
History: 1985 AACS.  
R 38.1109 Consideration and disposition of declaratory ruling requests.  
Rule 109. Within 90 days after receipt of a complete petition for a declaratory  
ruling, the board, after consultation, if necessary, with staff and the attorney general  
will act on the petition. A declaratory ruling shall receive a majority concurrence of  
the board members present and voting before it is issued to the interested person.  
History: 1985 AACS.  
R 38.1110 Reporting unit; employee reports.  
Rule 110. In reporting service credit for all employees, the reporting unit shall  
include the hours worked along with such other information, as determined by the  
retirement system, as is necessary to determine eligibility for, and the amount of,  
retirement benefits. The reports shall be submitted in accordance with the schedules  
published in the Michigan public school employees' retirement system instruction  
History: 1985 AACS.  
R 38.1111 Delinquent member or employer contribution.  
Rule 111. (1) A member shall not be entitled to a retirement allowance based  
upon creditable reporting unit service performed under the contributory plan until  
the member has contributed to the retirement system an amount equal to the amount  
the member  
contributed according to the schedule governing  
contributions in effect at the time the creditable service was performed, together with  
interest at such rate as the retirement board shall determine. If a member who made  
payment for service performed under this rule dies or withdraws from service before  
the member's retirement allowance becomes effective and there is no other person  
entitled to an allowance, the payment shall be refunded upon request to the  
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member, refund beneficiary, or, if none, a legal representative appointed by the  
(2) Delinquent contributions  
noncontributory plan shall be the responsibility of the reporting unit where the  
service was performed and subject to penalties and interest as determined by the  
retirement board and statute.  
History: 1985 AACS.  
R 38.1112 Board-determined rate of interest.  
Rule 112. The rate of interest for purposes of repayment of a refund, purchase of  
out-of-system public education service and other creditable service, and crediting  
individual member accounts shall be at such rate as the retirement board from time to  
time determines. For these purposes, the board may determine a rate of interest,  
hereafter referred to as the "board-determined rate of interest (BDRI)," which shall  
not exceed the assumed actuarial rate of return.  
History: 1985 AACS.  
R 38.1113 Granting of service credit.  
Rule 113. The board shall grant a year of service credit to any member who has  
been employed during the school fiscal year from July 1 to June 30 for 170 days of not  
less than 6 hours per day. A maximum of 30 hours per week shall be accrued. The  
board may allow a year of service credit if the member was employed for a minimum  
of 150 days when it is needed to qualify a member or beneficiary for a monthly  
allowance in the final year of service. This minimum may also be used when the  
employing school agency's full-time employee's term of employment is less than 170  
History: 1985 AACS.  
R 38.1114 Fractional year of service.  
Rule 114. Where a member serves less than a school fiscal year, such time shall  
be credited as a fractional part of a school fiscal year in the proportion which the  
number of days actually served bears to the number of days that constitutes full-time  
service credit.  
History: 1985 AACS.  
R 38.1115 Part-time employees; service credit.  
Rule 115. Part-time employees shall receive service credit for full-time service on  
the basis of 30 or more hours per week and proportionate credit for less than 30 hours  
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on the basis of 30 hours for full-time credit in the proportion which the hours  
employed in the school fiscal year bear to 1,020 hours.  
History: 1985 AACS.  
R 38.1116 Hours of employment for part-time instructors employed at  
institutions of higher education; service credit.  
Rule 116. Where a member is employed on less than a full-time basis to teach at  
an institution of higher education, the reporting unit shall report hours worked to the  
retirement system in the proportion that the member's class hours of credit taught bear  
to the class hours of credit taught that is required for similarly assigned full-time  
instructors at that reporting unit. This procedure shall be applicable whether or not the  
instructor is paid on the basis of credit or semester hours taught or on a per class basis.  
History: 1985 AACS.  
R 38.1117 Credit for excluded employment.  
Rule 117. Service credit shall not be given except as authorized by the act for  
reporting unit employment which was specifically excluded from membership by  
statute or administrative directive, which includes, but is not limited to, all of the  
(a) A retirant of the retirement system.  
(b) A student in a reporting unit.  
(c) An enrollee in a neighborhood youth corps program which is operated with  
funds from the office of economic opportunity or a person enrolled in a comparable  
youth training program designed to prevent high school dropouts and rehabilitate  
high school dropouts which is operated by an intermediate school district, except  
for such employment which is creditable as provided by the act.  
(d) An independent contractor.  
(e) An enrollee in a national youth administration program.  
(f) A member of the optional retirement program provided by Act No. 156 of the  
Public Acts of 1967, as amended, being S38.381 et seq. of the Michigan  
Compiled Laws.  
(g) A student teacher or similar training experience required for certification  
or degree purposes, unless that person also received compensation which was  
reasonably commensurate with  
beginning compensation paid to a person  
already trained for the same position. In that event, the member shall be subject to the  
certification provisions provided by R 38.1111 and R 38.1119,  
(h) A person employed under Act No. 69 of the Public Acts of 1983, being  
S409.221 et seq. of the Michigan Compiled Laws, and known as the Michigan Youth  
Corps Act.  
(i) A person engaged in some other type of employment not specifically included  
by statute or administrative directive.  
Page 5  
History: 1985 AACS.  
R 38.1118 Student employment during vacation periods; service credit.  
Rule 118. Service credit shall be granted for public school employment rendered  
during the extended vacation period in which the person was enrolled but not  
attending classes within the same school system if the employment is not excluded as  
provided in R 38.1117.  
History: 1985 AACS.  
R 38.1119 Proof of payment; documentation requirements; payment.  
Rule 119. (1) A member who requests service credit for public school  
employment which is provided for in R 38.1117, R 38.1118, or any other creditable  
reporting unit service, which was not reported to the retirement system shall  
submit at least 1 of the following proofs of service:  
(a) An affidavit completed by the present school officer which certifies the  
employment on the basis of official payroll records on file with the reporting unit.  
(b) If there are no official payroll records available, a member shall submit a  
missing record affidavit and either of the following proofs of service:  
(i) Three citizens' corroborative affidavits and either a W-2 statement or an income  
tax return.  
(ii) Other official school-produced records for the year or years in question.  
(2) One of the 3 corroborative affidavits shall be completed by a person whose  
employment with the same reporting unit can be certified from official records  
and whose position would have afforded day-to-day knowledge of the member's  
(3) The retirement board may permit other proofs of service in addition to those  
described in subrule (1) of this rule.  
(4) The missing record affidavit shall be a form prescribed by the retirement  
board for use by present school officers in those instances where official school  
records are not available from which to certify to a person's employment. The form  
shall require a statement as to why records are not available.  
(5) A citizen's corroborative affidavit shall be a form prescribed  
by the  
retirement board for corroborating a person's public school employment and shall  
contain a notarized statement as to why the person is qualified to attest to the  
employment being certified. The form shall also state the penalty for providing  
misinformation with intent to deceive.  
(6) The school officer's corroborative affidavit shall be a form prescribed by  
the retirement board for use by the present school officer in those instances where  
official school records are available from which to certify to a person's employment.  
The form shall require a statement identifying the records used for completing the  
History: 1985 AACS.  
Page 6  
R 38.1120  
Out-of-system public education and other creditable service;  
certification; payment procedure.  
Rule 120. (1) An active member may, after satisfying the requirements of the act,  
purchase out-of-system public education and other creditable service. The board  
shall allow credit for out-of-system public education service if similar service  
performed in a reporting unit would be creditable. Such service shall not be  
creditable until the member makes payment in full. Partial payments for service  
performed before July 1, 1974, will be accepted up to the time of the final payment,  
which shall be not later than the effective date of the member's retirement  
allowance.The minimum partial payment shall be established by the board.  
(2) The procedure for computing the compensation base for out-of-system public  
education and other creditable service which is performed after July 1, 1974, and  
payment procedure shall be the same as for the purchasing of nonintervening  
military service credit.  
(3) It shall be the responsibility of the member to furnish, on forms provided by  
the retirement office, certification of creditable out-of-system public education  
and other  
service. The certification shall be completed from official  
records in the possession of the educational agency, a public retirement system, or a  
governmental agency.  
(4) It shall be the member's responsibility to obtain completed certification of  
service, on forms prescribed by the retirement board, of the member's creditable out-  
of-system public education and other creditable service.  
(5) An original copy of the certification of service is required, which shall also  
include a list of the salaries received each school fiscal year of the member's service. It  
shall also contain a statement by the school officer completing the certification that  
his or her statements are based upon official school records on file.  
(6) If the support documents do not establish valid service credit, evaluation  
shall be based on annual composite summary listings.  
History: 1985 AACS.  
R 38.1121 Nonintervening military service credit; payment procedure.  
Rule 121. To be processed, an application for nonintervening military service  
credit shall be received in the retirement office before June 15 of the school fiscal year  
upon which payment is to be based.  
military payment received which is  
postmarked after the last date of the school fiscal year upon which the payment is to  
be based will be returned to the member. If the June 30 deadline is not met, the  
member shall reapply.  
History: 1985 AACS.  
R 38.1122 Eligibility to purchase other creditable service or repay a refund.  
Rule 122. The purchase of any service creditable by statute, excluding repayment  
of a refund, shall be made while an individual is a member of the retirement system,  
Page 7  
except that payment by a disability applicant shall be permitted if full payment is made  
before the effective date of the allowance.  
History: 1985 AACS.  
R 38.1123 Evaluation of service credit; insufficient documentation.  
Rule 123. If support documents are insufficient to establish valid service  
credit, evaluation shall be based on composite summary listings compiled and  
maintained by the retirement system.  
History: 1985 AACS.  
R 38.1124 Repayment of refunds.  
Rule 124. A member, after satisfying the requirements for repaying a refund,  
may make payment in full or may elect to make installment payments. The  
minimum installment payment shall be established by the board.  
History: 1985 AACS.  
R 38.1125 Refunds; probate court orders.  
Rule 125. A written order by the judge of probate of the county of residence  
instructing the retirement board to make a refund to the administrator or executor  
of the estate of a deceased member or other qualified person designated by such  
judge of probate may be accepted in place of the written nomination of beneficiary  
if a valid written nomination of beneficiary is not on file with the system.  
History: 1985 AACS.  
R 38.1126 Application for retirement; cancellation.  
Rule 126. (1) Application for retirement shall be made on forms furnished by  
the retirement board and shall be filed with the secretary of the retirement board. A  
letter of inquiry relative to retirement is not an application for retirement.  
(2) A completed retirement application may be cancelled by the applicant if the  
retirement system has not processed the initial monthly payment.  
History: 1985 AACS.  
R 38.1127 Final average compensation.  
Rule 127. (1) Compensation means the remuneration received by a member, as  
defined in the act, and includes items of an economic value as specifically fixed  
by the retirement board. Only if the kind of remuneration or item of economic  
value received by a member is specifically authorized by either the retirement  
Page 8  
statute or by the retirement board shall it be included in computing the member's  
final average compensation.  
(2) All payments to a member, or made on the member's behalf,  
recognizable as compensation which were made under the noncontributory plan, but  
which were not reported to the retirement system at the time the payment was made,  
shall be verified from official reporting unit records and certified by the president and  
secretary of the board of control. The respective contribution shall be the responsibility  
of the reporting unit and is subject to penalties and interest as determined by the  
retirement board and statute.  
History: 1985 AACS.  
R 38.1128 Post-retirement employment.  
Rule 128. A retirant may, after 1 month immediately following his or her  
retirement allowance effective date, become employed in a reporting unit or with the  
state of Michigan in a position which is covered by Act No. 240 of the Public Acts  
of 1943, as amended, being S38.1 et seq. of the Michigan Compiled Laws, and earn  
as much as is permitted by the act.  
History: 1985 AACS.  
R 38.1129 Suspension of retirement allowance; health insurance  
Rule 129. (1) If a retirement allowance is suspended for any reason provided by  
statute, and if the person is enrolled in the retirement system's health insurance plan,  
the retirement system's subsidy shall also cease until the date the retirant again  
becomes eligible to receive a monthly allowance. During the period of suspension,  
the retirant shall be given the option to continue with the health insurance plan, but  
without retirement system subsidy, if applicable.  
(2) Instead of suspending a retirement  
excess post-  
retirement earnings are involved, the retirant may pay the retirement system, in a single  
lump sum, the total amount of the excess earnings, in which case the retirement  
allowance and health insurance subsidy shall not be discontinued. As an alternative, the  
retirant may choose to have his or her monthly allowance reduced over a period of not  
more than 12 months by an amount which will repay the system the excess earnings so  
received, if the reduced allowance is not less than 50% of the unreduced allowance.  
The retirement system's subsidy for the cost of the health insurance plan shall be  
continued during the period of reduced allowance payments.  
History: 1985 AACS.  
R 38.1130 Proof of dependency.  
Rule 130. When the act requires that a person be 50% or more financially  
dependent to be eligible to receive a retirement benefit, or to be designated as a  
Page 9  
potential retirement allowance beneficiary, a spouse or unmarried child under the age  
of 18 shall be presumed to be 50% or more dependent. For all other persons, proof of  
dependency shall be based upon a formula which recognizes all sources of income,  
including income derived from assets, plus all income received by the member or  
former member. The resulting sum thereof shall be divided by 4 to determine 50% of  
the person's own personal support. A financial statement and any other financial  
records deemed desirable shall be required for verifying eligibility.  
History: 1985 AACS.  
R 38.1131 Rescission.  
Rule 131. R 38.221 to R 38.235 and R 38.301 to R 38.308 of the Michigan  
Compiled Laws, appearing on pages 366 to 369 of the 1979 Michigan  
Administrative Code, are rescinded.  
History: 1985 AACS.  
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