R-9.3, r. 1 - Regulation respecting the application of the Act respecting the Pension Plan of Elected Municipal Officers

Updated to 12 December 2023

This document has official status.

chapter R-9.3, r. 1

Regulation respecting the application of the Act respecting the Pension Plan of Elected Municipal Officers

Act respecting the Pension Plan of Elected Municipal Officers

(chapter R-9.3, s. 75).

DIVISION I ESTABLISHMENT OF RATES OF INTEREST

O.C. 1742-89, Div. I; O.C. 20-2007, s. 1.

§ 1 . — Rate of interest based on the rates of return of certain funds

O.C. 20-2007, s. 1.

1. For the purposes of the second paragraph of section 54.1 of the Act respecting the Pension Plan of Elected Municipal Officers (chapter R-9.3), the annual rate of interest is determined by computing the geometric mean of the annual rates of return for the 3-year period ending on 31 December of the year preceding the reference year, according to the formula in Schedule I. The first rate of interest determined applies from 1 August 2004 and, thereafter, as of 1 June of each year.

The annual rate of return is the rate determined by the Caisse de dépôt et placement du Québec on 31 December of each year for the specific fund of the Pension Plan of Elected Municipal Officers, after deduction of the management expenses.

O.C. 1742-89, s. 1; O.C. 663-94, s. 1; O.C. 1009-2005, s. 1; O.C. 20-2007, s. 2.

§ 2 . — Rate of interest based on an external index

O.C. 20-2007, s. 3.

1.1. For the purposes of the third paragraph of section 54.1 of the Act, the annual rate of interest is established as at 1 June of each year by computing the arithmetic mean, for the 12-month period ending on 31 December of the preceding year, of the nominal rates on Government of Canada marketable bonds (3-5 years) as compiled by Statistics Canada and published in the Bank of Canada’s Banking and Financial Statistics (CANSIM Series V122485).

O.C. 20-2007, s. 3.

DIVISION II COMPUTATION OF THE INTEREST

2. The employer and employee contributions refunded under the second paragraph of section 4 or the first paragraph of section 15 of the Act bear interest on the first day of the month following the month in which they were paid to Retraite Québec and on the first day of each subsequent month.

O.C. 1742-89, s. 2.

3. The amount paid to a pension plan by participants whose service is transferred to the Pension Plan of Elected Municipal Officers under sections 59 and 63 of the Act bear interest from the date of the transfer.

O.C. 1742-89, s. 3.

4. For interest computation purposes and except in the cases referred to in sections 2 and 3, any amount paid to the Pension Plan of Elected Municipal Officers is deemed to have been received at the mid-point of the year of the payment.

O.C. 1742-89, s. 4.

5. Interest, compounded annually, is computed at the rate established each year in accordance with section 1 until the date on which the refund application is received by Retraite Québec, at the rate established as provided in section 1.1 and in force on that date, as of the day following that date until the date on which the refund is made.

Despite the first paragraph, if the event giving entitlement to the refund is the death of the member, the period of application of section 1.1 begins on the day following the date of death and if the event is the death of the beneficiary or the surviving spouse, the period begins on the first day of the month following the date of death.

O.C. 1742-89, s. 5; O.C. 20-2007, s. 4.

DIVISION III FACTOR USED TO ESTABLISH THE PROVISIONAL CONTRIBUTION

6. The factor used to establish the provisional contribution required of the municipality under section 26 of the Act is 3.37 times the amount of the participant’s contribution.

O.C. 1742-89, s. 6; O.C. 885-92, s. 1.

DIVISION III.1 SPOUSE’S WAIVER

O.C. 1036-2009, s. 1.

6.1. The notice referred to in the third paragraph of section 54.2 of the Act must, in addition to containing the waiver or revocation required by that paragraph, be dated and state the name and address of the person who participates in the plan, of the person who ceased to participate in the plan or of the pensioner, as the case may be, and the name and address of the spouse.

O.C. 1036-2009, s. 1.

DIVISION IV REDEMPTION OF YEARS OF SERVICE

7. After receiving the notice provided for in the first paragraph of section 57 of the Act, Retraite Québec shall send the participant a redemption proposal in which it shall determine the amount of the contributions and interest relative to redemption of years of service that the participant must pay as at the date of the proposal and shall inform him that he may pay that amount in full or in periodic instalments.

The participant may, until the date of expiry of the redemption proposal, pay in full the amount of the contributions and interest relative to redemption of years of service.

Any amount not paid by the date of expiry of the redemption proposal bears interest, compounded annually, at the rate in force in section 1 on the date of receipt of the notice and interest is computed from the date of the proposal until payment is made in full.

O.C. 1742-89, s. 7.

8. The following table shows the maximum periods during which participants may make payments:

 ___________________________________________________
|                         |                         |
| Service to be credited  |       Maximum period    |
|                         |    for making payments  |
|_________________________|_________________________|
|                         |                         |
| less than 1 year        |         2 years         |
|                         |                         |
| at least 1 year but     |         4 years         |
| less than 2 years       |                         |
|                         |                         |
| 2 years or more         |         5 years         |
|_________________________|_________________________|

O.C. 1742-89, s. 8.

DIVISION V ACTUARIAL VALUE

O.C. 1742-89, Div. V; O.C. 20-2007, s. 5.

9. For the purposes of this Division, the expression “CIA Standard” refers to section 3500 of the standards of practice of the Canadian Institute of Actuaries concerning pension commuted values in force on 1 February 2022.

O.C. 1742-89, s. 9; O.C. 1541-91, s. 1; O.C. 20-2007, s. 5; O.C. 954-2022, s. 1.

9.0.1. The actuarial value of the deferred annuity referred to in section 49 of the Act is determined using the following actuarial method and assumptions:

Actuarial method

The actuarial method is the “benefit allocation” method and the actuarial value corresponds to the sum of 70% of the actuarial value determined for a male and 30% of the actuarial value determined for a female.

Actuarial assumptions

(1)  Mortality rates:

The mortality rates are those taken from the mortality table promulgated by the Actuarial Standards Board of the Canadian Institute of Actuaries, whose date of coming into force is 1 October 2015.

(2)  Rate of interests:

For fully-indexed and non-indexed benefits:

The rate of interests are those determined in accordance with the CIA Standard.

For partially-indexed benefits:

The rate of interests are those determined according to the following formula:

((1+ rate of interest for a non-indexed benefit)/(1 + indexing rate for a partially-indexed benefit))- 1

The result must be rounded to the nearest multiple of 0.10%.

(3)  Indexing rate:

(a)  for a fully-indexed benefit according to the rate of increase in the pension index, the indexing rate is computed in the manner described in the CIA Standard;

(b)  for a benefit indexed according to the excess of the rate of increase in the pension index (PI) over 3%, the indexing rate corresponds to the excess of the indexing rate computed in the manner provided in subparagraph a over 3%.

In order to take into account the inflation rate variations, the following additions are made to the results of effective indexing formulas for actuarial value computation purposes.

Inflation level	Addition to the result of the PI–3% formula	Adjusted indexing rate
0	0.00	0.00
0.5	0.00	0.00
1.0	0.00	0.00
1.5	0.05	0.05
2.0	0.10	0.10
2.5	0.20	0.20
3.0	0.40	0.40
3.5	0.20	0.70
4.0	0.10	1.10
4.5	0.05	1.55

(4)  Turnover rate: Nil

(5)  Disability rate: Nil

(6)  Proportion of persons with a spouse at death:

Age	Male	Female
18-54	0.90	0.60
55-59	0.85	0.60
60-64	0.85	0.55
65-69	0.80	0.50
70-74	0.80	0.40
75-79	0.80	0.30
80-84	0.75	0.20
85-89	0.60	0.10
90-109	0.50	0.05
110 and older	0.00	0.00

(7)  Age difference between spouses at death:

— the male spouse of the member is assumed to be 1 year older;

— the female spouse of the member is assumed to be 4 years younger.

The economic assumptions are established based on the rates and returns of bond indexes, as described in the CIA Standard, applicable to the second calendar month preceding the month in which the evaluation took place, rather than those applicable to the preceding month.

O.C. 20-2007, s. 5; O.C. 954-2022, s. 2.

DIVISION V.1 REVISION OF RATE OF CONTRIBUTION

O.C. 103-2004, s. 1.

9.1. Effective 1 January 2021, the amount to be withheld provided for in section 23 of the Act is equal to 5.26%.

O.C. 103-2004, s. 1; O.C. 577-2004; O.C. 1259-2009, s. 1; O.C. 532-2021, s. 1.

DIVISION V.2 REDEMPTION OF YEARS OF SERVICE

O.C. 103-2004, s. 1.

9.2. A person may, for the purposes of Chapters VI.0.1, VI.0.2 and VI.0.3 of the Act, apply for redemption of service by sending Retraite Québec a written notice specifying the period to be redeemed. After receiving the notice, Retraite Québec must send the applicant a redemption proposal in which it determines the amount the applicant must pay.

For the purposes of Chapters VI.0.1 and VI.0.2 of the Act, the amount the applicant must pay is determined in accordance with Schedule II. For the purposes of Chapter VI.0.3 of the Act, that amount corresponds to the sum of the contributions the applicant would have paid under the plan in respect of the service the applicant wishes to redeem and the interest compounded annually, computed at the rate established each year in accordance with section 1 as of the midpoint of each year until the date on which the application for redemption is received.

The amount determined pursuant to the second paragraph is payable in cash not later than on the expiry date of the redemption proposal or by instalments spread over the maximum period prescribed by section 8. If the amount is paid by instalments, interest compounded annually is added at the rate established as provided in section 1.1 in force on the date on which the application for redemption is received and computed as of the expiry date of the redemption proposal made by Retraite Québec.

O.C. 103-2004, s. 1; O.C. 1009-2005, s. 2; O.C. 20-2007, s. 6.

9.3. A redemption proposal is valid for 60 days from the date on which it is issued by Retraite Québec.

The application for redemption is deemed never to have been made if Retraite Québec does not receive, before the expiry of the 60-day period, a notice stating that the person accepts the proposal.

The application is also deemed never to have been made if the cash payment of the redemption cost is not made before the expiry of the 60-day period, where the amount is payable as a result of the person’s choice. Where payment is to be made by instalments and the person fails to make a payment, the service shall be credited in proportion to the instalments paid by the person if the person does not pay the missing instalment within 30 days of the date of a notice sent by Retraite Québec to that effect.

Where Retraite Québec refuses the redemption of a pension credit and a decision to the contrary is made after re-examination or in arbitration on the basis of the data in the record at the time of refusal, the cost shall be determined on the date of the initial application for redemption.

Where Retraite Québec refuses the redemption of a pension credit and a decision to the contrary is made after re-examination or in arbitration on the basis of new information, the cost shall be determined on the date of the decision taking into account, for a redemption under under Chapter VI.0.1 or VI.0.2 of the Act, the value of the indexed pension credit and the age of the person on that date.

O.C. 103-2004, s. 1; O.C. 20-2007, s. 7.

DIVISION VI MISCELLANEOUS

10. Until 31 July 1992, the rate of interest provided for in section 1 is the same as that determined under the Regulation on the setting of the interest rate (O.C. 2507-83, 83-12-06).

O.C. 1742-89, s. 10; O.C. 570-92, s. 1.

11. (Omitted).

O.C. 1742-89, s. 11.

12. (Omitted).

O.C. 1742-89, s. 12.

SCHEDULE I

(s. 1)

COMPUTATION OF THE RATE OF INTEREST

The formula for the computation of the rate of interest for the reference year is the following:

iy = ((1 + Ty-1) ( 1 + Ty-2) ( 1 + Ty-3)) 1/3 - 1

where

Ty-1 is the rate of return for the year preceding the reference year

Ty-2 is the rate of return for the year preceding the reference year by 2 years

Ty-3 is the rate of return for the year preceding the reference year by 3 years.

O.C. 1742-89, Sch. I; O.C. 1009-2005, s. 3.

SCHEDULE II

(s. 9.2)

RATE APPLICABLE TO CERTAIN REDEMPTIONS UNDER SECTION 9.2

The redemption cost is established by multiplying the annual pension credit, indexed in accordance with section 30 or section 63.0.7 of the Act, as the case may be, up to the date of receipt of the application for redemption, by the factor corresponding to the age of the person on that date.

Age of the person on the date of receipt of the application for redemption	Factor
18	3.00
19	3.20
20	3.30
21	3.50
22	3.70
23	3.80
24	4.00
25	4.20
26	4.30
27	4.50
28	4.70
29	4.80
30	5.00
31	5.30
32	5.50
33	5.70
34	6.00
35	6.20
36	6.50
37	6.70
38	6.90
39	7.20
40	7.40
41	7.70
42	7.90
43	8.20
44	8.40
45	8.60
46	8.90
47	9.10
48	9.40
49	9.60
50	9.80
51	9.90
52	10.10
53	10.20
54	10.30
55	10.40
56	10.50
57	10.60
58	10.70
59	10.80
60	10.90
61	11.00
62	11.10
63	11.20
64	11.30
65	11.40
66	11.50
67	11.60
68	11.70
69	11.90

O.C. 103-2004, s. 2; O.C. 20-2007, s. 8; O.C. 954-2022, s. 3.

REFERENCES

O.C. 1742-89, 1989 G.O. 2, 4153

O.C. 1541-91, 1991 G.O. 2, 4566

O.C. 570-92, 1992 G.O. 2, 2477

O.C. 885-92, 1992 G.O. 2, 3183

O.C. 663-94, 1994 G.O. 2, 1916

O.C. 103-2004, 2004 G.O. 2, 1047

O.C. 577-2004, 2004 G.O. 2, 2023

O.C. 1009-2005, 2005 G.O. 2, 4834

O.C. 20-2007, 2007 G.O. 2, 542

O.C. 1036-2009, 2009 G.O. 2, 3479

O.C. 1259-2009, 2009 G.O. 2, 4085

S.Q. 2015, c. 20, s. 61

O.C. 532-2021, 2021 G.O. 2, 1295

O.C. 954-2022, 2022 G.O. 2, 1885