News

We have good news for Plan G and Safety C members! In March 2025, LACERA implemented a significant change to the final average compensation (FAC) calculation method for your plan.

Your FAC is one of the factors (along with retirement plan, age at retirement, and amount of service credit) used to calculate your monthly allowance at retirement. It is based on the average of your highest earnings over a consecutive 36-month period.

Until March, the FAC for Plans G and Safety C was calculated using actual take-home earnings rather than scheduled earnings, based on the interpretation of the Public Employees’ Pension Reform Act of 2013 (PEPRA). For PEPRA plan members with absences without pay within a pay period, this could lower their FAC calculation. The Board of Retirement changed the FAC calculation method after determining the fairest way to calculate FACs is by using scheduled earnings (your regular base pay, and what you receive if there are no periods of absence without pay within your pay period).

This change benefits:

• PEPRA plan members who retired before March 1, 2025 and had absences without pay that decreased their FAC
• Future PEPRA plan retirees whose calculations will not be affected by such absences

For more information on how your FAC is calculated, visit Compensation.

Updates for PEPRA Members Impacted by the Prior FAC Calculation

We have implemented corrective and retroactive measures to ensure you receive the full benefit to which you are entitled, as follows:

• If you retired on or after March 1, 2025: Your retirement benefits are based on scheduled earnings, beginning with the first payment.
• If you retired before March 1, 2025: LACERA is recalculating your FAC using scheduled earnings. If your FAC is higher than it was based on actual earnings and results in a higher retirement benefit, LACERA will correct your monthly benefit amount and pay you any retroactive benefits owed.
• If you elected to retire, and your first payment is pending (regardless of retirement date): Your retirement benefits will be based on scheduled earnings, beginning with the first payment.
• If you received a retirement benefit estimate from LACERA for a retirement date after January 1, 2025: LACERA will provide you a notification letter about the recent change to using scheduled earnings for FACs. If you fall into this category, you do not have to wait. You can use My LACERA to run a new estimate now (see below) or you can request a new estimate from LACERA. You should receive a notification letter in April or May 2025.

Prospective benefit adjustments and payment of retroactive benefits are scheduled for completion by June 30, 2025. All impacted members and beneficiaries will receive an explanatory letter.

LACERA sent letters with updated estimated benefit amounts to members whose payments started in March, providing an explanation of the previous and current FAC calculation methods. LACERA will send the same information to members whose payments are expected to start in April or later.

Updated My LACERA Retirement Benefit Estimate (RBE) Tool

Along with the FAC calculation change, we are excited to announce that we have updated the My LACERA RBE calculator, with your scheduled earnings programmed into the tool. If you have used the calculator before, you may recall it did not automatically provide an FAC amount.

The calculator now automatically provides your highest FAC based on your scheduled earnings. You can also manually enter a different amount to create estimates based on future retirement date, service credit, and salary scenarios.

Log in to My LACERA to try the RBE calculator now! From the dashboard, just click Estimate in the blue navigation bar to get started.