Q: Can the 7 percent interest rate on New York State Teachers' Retirement System loans ever change?

A: The interest rate charged on system loans is set by statute. Consequently, it would require legislation to change the rate. Please note the interest rate attached to a TRS loan (7 percent for Tier 3/4) may be higher than that available through a private lender. But Tier 3/4 members are really paying only 2 percent. That's because TRS is still paying 5 percent interest on the borrowed money as if it were in the account. Please note that due to Internal Revenue Service regulations, there could be severe tax consequences when a member has an outstanding loan and borrows additional funds.

Q: I am a Tier 2 member. Am I able to take a loan against my retirement funds?

A: Only Tier 3 and 4 members have had to contribute to their retirements. Tiers 1 and 2 are non-contributing tiers, so members have none of their own monies to borrow from. You cannot borrow from contributions made by your employer.

Q: Our contract expired last June and we are still in negotiations. I plan to retire at the end of the school year. Someone said the district must give retroactive money to retirees who were employed during negotiations. Our union representative says that the district does not have to give retirees retroactive salary if the contract is settled after they retire. Is there any state law compelling school districts to give retirees retroactive money if they retire when there is no new contract?

A: We are teacher-trustees on the TRS Board of Directors and as such respond to questions directly concerning the retirement system and our pensions. If members retire during a contract hiatus, the TRS will recalculate to include any raises that might have been awarded. However, your inquiry concerning whether a district MUST pay those who retired before the contract was settled is a legal question and should be directed to your local president and NYSUT labor relations specialist.