13. Retirement Benefits:

Maryland State Retirement and Pension Systems (System):

The State contributes to the Maryland State Retirement and Pension Systems (System), an agent multiple-
employer public employee retirement system established by the State to provide pension benefits for State
employees (other than employees covered by the Mass Transit Administration Pension Plan described below) and
employees of 127 participating political subdivisions within the State. Additionally, the System provides benefits
for the Maryland Automobile Insurance Fund and the Injured Workers' Insurance Fund (neither of which are within
the State's reporting entity). The non-State entities that participate within the System receive separate actuarial
valuations in order to determine their respective funding rates and actuarial liabilities. Retirement benefits are paid
from the System's pooled assets rather than from assets relating to a particular plan participant. The System is
considered part of the State's financial reporting entity and is included in the State's financial statements as a
Pension Trust Fund.

Plan Description: |

The System, which is administered in accordance with Article 73B of the Annotated Code of Maryland, consists
of the following systems which are managed by the Board of Trustees for the System. All retirement and pension
systems discussed herein are included in the System. All State employees and employees of the participating
political subdivisions (including the Maryland Automobile Insurance Fund and the Injured Workers' Insurance
Fund) are covered by the systems.

"Retirement Systems" — retirement programs for substantially all State employees, teachers, State police and
judges who are not members of the State Pension System.

"Pension Systems" — retirement programs for employees and teachers hired after January 1, 1980, and prior
employees who have elected to transfer from the Retirement Systems.

As of June 30, 1994, membership in the System consists of the following:

		System
		(excluding participating
	System	political subdivisions)
Retirees and beneficiaries currently receiving
benefits and terminated employees entitled to
benefits but not yet receiving them:
Retirement Systems ....................................................	55,823	49,972
Pension Systems..........................................................	39,581	33,358
Current employees:
Vested:
Retirement Systems....................................................	34,004	31,569
Pension Systems..........................................................	94,062	79,818
Nonvested:
Retirement Systems....................................................	2,843	2,843
Pension Systems..........................................................	34,887	28,397
Total members. ....................................................................	261,200	225,957

The System provides retirement, death and disability benefits in accordance with State statutes. Vesting begins
after completing 5 years of service. A member terminating employment before attaining retirement age but after
completing 5 years of service, becomes eligible for a vested retirement allowance provided the member lives to age
60 (age 62 for the Pension Systems, age 50 for State Police) and does not withdraw his or her accumulated
contributions. Members of the Retirement System may retire with full benefits after attaining the age of 60, or after
completing 30 years of service credit regardless of age. A member of the Pension Systems may retire with full
benefits after completing 30 years of service credit regardless of age, or at age 62 or older with specified years of
service credit. State Police members may retire with full benefits after attaining age 50, or after completing 25 years
of service credit regardless of age.

The annual benefit for Retirement System members is equal to 1/55 of a member's high three-year average
salary multiplied by the number of years of service credit. A member may retire with reduced benefits after
completing 25 years of service, regardless of age. A member of the Pension System shall receive upon retirement
an annual service retirement allowance equal to 0.8% of the member's high three-consecutive-year average salary
multiplied by the number of years of service credit, with a provision for additional benefits for compensation
earned in excess of the Social Security wage base. A member may retire with reduced benefits after attaining age
55 and completing 15 years of service. The annual retirement allowance for a State Police member is equal to 1/45

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