Purchasing Service Credit

Types of Purchasable Service Credit

Current & Past Leaves of Absence (Please note that this form is to be used for past leaves of absence only.)

Section 3307.77, Revised Code

This section outlines the requirements for STRS Ohio members to obtain Ohio-valued credit for:

• A current absence or leave (occurring within the last two years) by completing deposits directly with the employer at the time the absence or leave occurred, and
• A past absence or leave by completing deposits, plus interest, directly with STRS Ohio.

Completing deposits on a current or past leave may provide:

• Up to a full year of service credit for the school year, and
• The full salary that would have been earned had the absence or leave not occurred.

Eligibility Requirements
Below is a list of the basic eligibility requirements:

• The absence or leave must be from an STRS Ohio employer, not an out-of-state employer.
• You must be under contract during the period of absence or leave.
• A nonpaid professional leave of absence from a university, community college, technical college or institute must comply with the specific procedural requirements.

Maximum Credit
The maximum purchasable credit is two years for each period of absence or leave.

Type of Absence or Leaves of Absence
Board of Education Employer:

• Absence for a nonteaching period due to personal illness or injury.
• Partially paid professional leave (Section 3319.131, R.C.).
• A leave for any reason approved by the board of education (Section 3319.13, R.C.).

University Employer:

• Absence for a nonteaching period due to personal illness or injury.
• Partially paid professional leave (Section 3345.28, R.C.).

  Notification Form 3345.28 must be completed by all college or university faculty who are granted a sabbatical leave. See your employer to obtain and complete this form before the leave.

  If you were previously granted a partially paid leave of absence, please review your STRS Ohio Annual Statement of Account to determine if a full year of service credit was reported in error. If so, contact us immediately to correct the service credit. Information will be provided to complete full contributions.

Completing Deposits on a Current Absence or Leave
If a member changes employers, the employer responsible for determining the amount of contributions owed to STRS Ohio for the leave is the employer who granted the absence or leave.

A member can complete deposits directly with his or her employer:

• Within the year in which the absence or leave occurs, or
• Within two years following the year in which the absence or leave occurred.

Payment must be received by STRS Ohio no later than June 30 of the second year following the year in which the absence or leave ended.

Cost for Current Absence or Leave
The cost is based on the annual compensation that would have been received had the member remained in the position, multiplied by the STRS Ohio member contribution rate in effect at the time the absence or leave ended. This is the same amount the member would have contributed had he or she actually been employed during that period.

The employer who granted the leave is required to pay employer contributions on the annual compensation used in determining the member’s cost.

Purchasing a Past Absence or Leave

A member may purchase a past absence or leave by completing deposits, plus interest, directly with STRS Ohio.

An absence or leave of absence is considered “past” if payment is received in, or after, the third year following the year in which the absence or leave occurred.

The member pays directly to STRS Ohio the member contribution, plus interest on both member and employer payments.

The employer at the time of the absence, or the employer who grants the leave, is required to pay employer contributions on the base annual compensation used in determining the member’s cost.

Certification for Past Absence or Leave
To request a certification form for a past absence or leave, contact STRS Ohio toll-free at 1-888-227-7877.

Cost for Past Absence or Leave
The cost is determined by:

• Multiplying the annual compensation for the last year of service before the absence or leave by the member contribution rate in effect at the time the absence or leave began,
• Adding interest on both member and employer payments. Interest at 8% (subject to change) is compounded annually beginning with the third year following the year in which the absence or leave terminated and ending the last day of the month in which payment is made.

Example: 
Assume a member earned $22,000 and 1.00 year of STRS Ohio credit for teaching service during the 1990-91 school year, then took a leave of absence during the 1991-92 school year. The member returned to full-time STRS Ohio-covered teaching service on Aug. 27, 1992.

To estimate the cost to purchase 1.00 year of credit for a leave of absence:

Step 1:  Using the table below, find the STRS Ohio member contribution rate in effect at the beginning of the 1991-92 school year and multiply it by $22,000.

$22,000 x 9.25% = $2,035

Member Contribution Rate & Salary Base
9/1/1920–8/31/1945	4.0% up to first $2,000
9/1/1945–8/31/1951	5.0% up to first $3,000
9/1/1951–8/31/1959	6.0% of total compensation
9/1/1959–6/30/1968	7.0% of total compensation
7/1/1968–12/31/1973	7.8% of total compensation
1/1/1974–6/30/1977	8.0% of total compensation
7/1/1977–12/31/1983	8.5% of total compensation
1/1/1984–6/30/1988	8.75% of total compensation
7/1/1988–6/30/1990	8.77% of total compensation
7/1/1990–6/30/1994	9.25% of total compensation
7/1/1994–6/30/2003	9.30% of total compensation
7/1/2003–Present	10.0% of total compensation

Step 2:  Using the table below, find the 8% annual compound interest factor for 13 years (1995 until 2008) and multiply it by the answer from Step 1.

2.72 x $2,035 = $5,535

Annual Compound Interest Factors by Years
Years	4%	8%
1	1.04	1.08
2	1.08	1.17
3	1.12	1.26
4	1.17	1.36
5	1.22	1.47
6	1.27	1.59
7	1.32	1.71
8	1.37	1.85
9	1.42	2.00
10	1.48	2.16
11	1.54	2.33
12	1.60	2.52
13	1.67	2.72
14	1.73	2.94
15	1.80	3.17
16	1.87	3.43
17	1.95	3.70
18	2.03	4.00
19	2.11	4.32
20	2.19	4.66
21	2.28	5.03
22	2.37	5.44
23	2.46	5.87
24	2.56	6.34
25	2.67	6.85
26	2.77	7.40
27	2.88	7.99
28	3.00	8.63
29	3.12	9.32
30	3.24	10.06

Step 3:  Using the table below, find the STRS Ohio employer contribution rate in effect at the beginning of the 1991-92 school year and multiply it by $22,000.

$22,000 x 14% = $3,080

(This is the employer’s cost.)

 

Employer Contribution Rate & Salary Base
9/1/1920–8/31/1923	5.57% up to first $2,000
9/1/1923–8/31/1924	4.70% up to first $2,000
9/1/1924–8/31/1926	3.70% up to first $2,000
9/1/1926–8/31/1927	3.60% up to first $2,000
9/1/1927–8/31/1930	3.57% up to first $2,000
9/1/1930–8/31/1938	3.45% up to first $2,000
9/1/1938–8/31/1939	3.82% up to first $2,000
9/1/1939–8/31/1941	4.44% up to first $2,000
9/1/1941–8/31/1945	4.00% up to first $2,000
9/1/1945–8/31/1946	5.00% up to first $3,000
9/1/1946–8/31/1947	4.75% up to first $3,000
9/1/1947–8/31/1948	5.75% up to first $3,000
9/1/1948–8/31/1949	7.50% up to first $3,000
9/1/1949–8/31/1951	7.25% up to first $3,000
9/1/1951–8/31/1952	8.50%
9/1/1952–8/31/1955	8.00%
9/1/1955–8/31/1958	9.25%
9/1/1958–8/31/1959	9.33%
9/1/1959–8/31/1964	10.41% up to first $18,000
9/1/1964–8/31/1965	11.00% up to first $18,000
9/1/1965–12/31/1965	11.00% up to first $25,000
1/1/1966–7/1/1968	11.50% up to first $25,000
7/2/1968–8/31/1969	11.50%
9/1/1969–12/31/1973	12.90%
1/1/1974–6/30/1977	12.55%
7/1/1977–12/31/1983	13.50%
1/1/1984–present	14.00%

Step 4:  Using the annual compound interest table in Step 2, find the 8% annual compound interest factor for 13 years (1995 until 2008) and multiply it by the answer from Step 3.

2.72 x $3,080 = $8,378

Step 5:  Subtract the employer contributions (calculated in Step 3) from the number calculated in Step 4.

$8,378 - $3,080 = $5,298

Step 6:  Add the answer from Step 2 to the answer from Step 5.

$5,535 + $5,298 = $10,833

In this example, the member cost to purchase 1.00 year of credit in June 2008 for a leave of absence is approximately $10,833.