Home
Prior Service Cost and Eligibility Periods
One-Year Eligibility Period
If you purchase prior service within one year of becoming eligible, your cost will be based on an approximate normal cost rate as a percentage of your compensation or average final compensation at the time of purchase, whichever is higher. The exceptions are VRS refunded service and no-cost military leave (see below). Normal cost is the average cost of one year of VRS service credit. The current normal cost rates are as follows:
| Type of Service | Rate |
|---|---|
| State employees, teachers and non-hazardous duty political subdivision employees | 9.4% |
| State police officers covered under SPORS, Virginia law officers covered under VaLORS and political subdivision employees covered under VRS who are eligible for enhanced hazardous duty coverage | 14.5% |
| Judges | 27.1% |
If you purchase service through a payroll deduction or salary reduction contract, your cost will be based on your compensation, even if your average final compensation is higher. See Payment Methods.
Your eligibility period begins upon employment in a covered position or following an eligible period of leave. If you do not purchase your prior service and leave your job, you will remain eligible to purchase it if you return to covered employment. However, your eligibility period will still be in effect. If you accrue eligible prior service after leaving covered employment and then return to covered employment, the eligibility period for this service will begin upon reemployment.
After the One-Year Eligibility Period
If you have not formally arranged with VRS to purchase prior service within one year of becoming eligible, your cost will be based on an actuarial equivalent rate. Actuarial equivalent cost is how much money is needed in today’s dollars to pay for the increase in your future retirement benefit or earlier retirement eligibility date resulting from purchasing prior service.
VRS Refunded Service
If you left covered employment and took a refund of your member contributions and interest, you can purchase up to the full amount of the service represented by the refund. The cost basis will be 5 percent of your compensation or average final compensation at the time of puchase, depending on the payment method you choose. If you have not purchased refunded service within three years of your rehire date, your cost rate will still be 5 percent, but you will be required to use a lump-sum payment. You do not have to purchase all of your refunded service at the same time as long as you purchase more than one month at a time. For more information, see Leaving Employment.
No-Cost Military Leave
You may receive service credit at no cost for each occurrence of leave from a covered position for active duty military service. You can apply at any time provided you are not dishonorably discharged, return to covered employment within one year of discharge and do not take a refund of your member contributions and interest. If you take a refund, you must purchase your refunded service if you would like to receive service credit for military leave at no cost.
