Deferred Retirement Option Program (DROP)

As a DROP participant, you’ll:

Work full-time for FCPS

Receive a salary but you won’t contribute to the ERFC Legacy plan or add additional years of credited service to your ERFC pension

Make your ERFC pension benefit option elections when you enter DROP

Please Note: These elections cannot be changed on or after your DROP entry date, except for limited circumstances as permitted under the ERFC Plan.

Be eligible for promotions and pay increases

Be able to contribute to 457(b) and 403(b) plans

Enjoy health and life insurance benefits at employee rates

Earn leave at the same rate

Please Note: You can convert all of your sick leave balance at the time you enter DROP to service credit or hold back up to 40 hours. You’ll enter DROP with the 14 days of sick leave granted to you on July 1 at the start of the current fiscal year (if you haven’t used them), plus any sick leave hours you chose to hold back.

Any sick leave accrued during DROP is "use it or lose it." You will not be able to apply any unused sick leave accrued during DROP or any unused sick leave carried over from before the DROP period toward years of credited service. Your retirement benefit will not be re-calculated when you leave DROP.

Terminate employment and exit DROP at the end of the 5-year DROP period (or sooner if you choose)

Please Note:

- Participation in DROP does not guarantee continued employment. If your employment with FCPS is terminated or you move to an FCPS position that's not covered by ERFC, you must exit DROP.

- If you enter long-term disability or take a leave of absence (LOA), you must exit DROP.

- If you're on short-term disability or workers' compensation, your participation in DROP doesn't change.

The amount credited monthly into your DROP account will be the Legacy benefit formula calculation as of the date you enter DROP.

Your ERFC pension benefit will receive annual retiree cost-of-living adjustment increases and your DROP account will earn an annual 4% interest rate compounded monthly unless the Board of Trustees adopts a lower rate for a particular fiscal year. Interest on your DROP account will only be applied for full months, not partial months.

When you exit DROP after 5 years (or sooner if you choose), you’ll receive the amount in your DROP account and your monthly ERFC pension will start being direct deposited into your bank account. 

Please Note: Your retirement benefit will not be re-calculated when you leave DROP.

To help you decide, it's a good idea to run DROP estimates in ERFCDirect comparing these two scenarios:

• The ERFC pension benefit you would receive under DROP without earning additional service credit.
• The ERFC pension benefit you would receive if you continued working and earning additional service credit for the same time period, and then retired without participating in DROP.

Log in and click "Create Your Own Estimate" in the left menu.

• To run a DROP estimate, choose "DROP" in the "Type" dropdown.
• To run a regular estimate, choose "Retirement" in the "Type" dropdown.

ERFC cannot provide financial advice. If you have questions about your DROP estimates, please consult your financial advisor. 

After five years, you must exit DROP. You also have the option to exit any time before the mandatory date without facing any penalties. Once you exit DROP, your monthly ERFC pension will start being direct deposited into your bank account.

Submit the Application to Enter DROP (ERFC 41A) to Start the DROP Entry Process

1. Log in to ERFCDirect. 
2. Locate the Application to Enter DROP (ERFC 41A) under “Forms” in the left menu.
3. Complete the form and make sure your:
   - DROP entry date matches your ERFC retirement date
   - Supervisor signs the form
4. Submit ERFC 41A to erfcretirement@fcps.edu.

Please Note: You must exit DROP after exactly 5 years. For example, if you enter DROP on November 1, you must exit on October 31 five years later. Please consider this when choosing your DROP entry date.

Receive Confirmation Email

Once you submit your DROP entry form to ERFC, we'll review it and send an email confirming acceptance of your application. 

Submit DROP Entry Packet

After you receive email confirmation, log in to ERFCDirect and select "Correspondence" to access your DROP entry packet, which includes: 

• Application for Retirement Benefits - ERFC Plan (ERFC 22D)
• Beneficiary Designation (ERFC 1)

Please Note: If you're entering DROP, you should NOT submit an HR-2 at the time of entry. You'll submit your HR-2 in FCPS StaffConnect when you exit DROP. 

You may participate in DROP only once. Your election to enter DROP becomes permanent and cannot be reversed as of your DROP entry date. You can only rescind your election prior to your DROP entry date.

Receive DROP Award Letter

Once your entry packet forms are approved, we’ll send a letter confirming the benefit plan option you chose and the DROP amount that will be credited to your account for the first month (the amounts credited to your account in later months may be different as they may include a COLA). You can log in to your ERFCDirect account to track your DROP balance.

After five years, you must exit DROP. You also have the option to exit any time before the mandatory date without facing any penalties. Once you exit DROP, your monthly ERFC pension will start being direct deposited into your bank account.

Submit Your HR-2

Go to FCPS StaffConnect and submit the Retirement from FCPS (HR-2) Form.

Receive Confirmation Email

Once you submit your HR-2, we’ll send an email confirming that ERFC has received and is reviewing your HR-2.

Submit DROP Exit Packet

After you receive email confirmation that ERFC has approved your HR-2:

• Log in to ERFCDirect.
• Locate the DROP exit packet under “Correspondence” in the left menu and complete ERFC 41B, which must be received at least 60 days prior to your DROP exit date. Submit ERFC 41B to ERFC via hard copy or secure email (request a secure email at erfcretirement@fcps.edu). Remember to include:
  • A copy of your government-issued ID with your completed form
  • A copy of your voided check or bank authorization letter in Part B
  • Your completed Federal Tax Withholding W-4P in Part E
  • Your completed Virginia Tax Withholding VA-4P in Part F (if subject to Virginia tax withholding)

Insurance Reminders

Contact FCPS HR Benefits at 571-423-3200 (Option #3) or StaffConnect to make decisions regarding:

• Health Insurance
• Dental Insurance

Contact the Virginia Retirement System (VRS)to make decisions regarding life insurance.

When you exit DROP, you can do one of the following:

Lump Sum Payment

You can choose to receive your DROP account balance as a lump sum payment. This payment reflects the total value of your DROP account. We will withhold a mandatory 20% for federal income taxes (plus 4% for Virginia residents if applicable) from your payment.

Rollover

To avoid immediate tax liabilities, you can choose to roll over your DROP account balance into a tax-deferred retirement plan such as a traditional IRA or eligible employer plan.

Lump Sum Payment/Rollover

You can choose to have a certain percentage or dollar amount of your DROP account balance paid to you as a lump sum payment and a certain percentage or dollar amount rolled over.

Your designated beneficiary(ies) will be eligible to receive the balance credited to your DROP account at the time of your death.

Your designated beneficiary(ies) will be eligible to receive the balance credited to your DROP account at the time of your death.

If you enter DROP and have an ERFC-approved Domestic Relations Order (DRO) on file, the court-ordered portion of your benefits payable under ERFC assigned to your former spouse through the court-entered DRO will include the same portion of your DROP account balance unless otherwise stated in the court-entered DRO. If the DRO on file does not specifically address the assignment of benefits during DROP, you and your former spouse will receive a letter explaining how ERFC will apply the DRO regarding your DROP account balance. Please be aware, the date you enter DROP is your ERFC retirement effective date, and your pension benefits will be payable as of that date (although credited to your DROP account until you exit DROP).

During your participation in DROP, an amount equal to your monthly pension amount will be credited to your DROP account. You can only access the funds credited to your DROP account when you exit the program.