HOW TO: Exit DROP

For those members preparing to exit DROP, the following steps will aid in a smooth transition to retirement. Learn more about DROP.

Step 1

Make an appointment with your department’s retirement counselor 90 days prior to your desired DROP exit date. Your counselor will:

  • Provide you with information regarding the terminating requisites for your department and payment of unused sick, vacation and overtime balances.
  • Prepare your Letter of Intent to Exit DROP for submission to the Department.
  • You must decide how you wish to receive your DROP account balance:
    • Lump-Sum Payment: If you wish to receive your account balance in a lump-sum payment, complete the DROP Distribution Election Form (Lump-Sum Payment).
    • Rollover: If you wish to rollover your DROP account into a qualified account, complete the DROP Distribution Election Form (Rollover) and Rollover Information Form.
    • Combination Rollover and Lump-Sum Payment: You may choose a combination of lump-sum payment and rollover. If you choose this payment option, complete all distribution forms.
    • You may wish to consult with your tax and/or financial advisor so that you are aware of any financial consequences that could affect your distribution decision. We cannot advise you regarding your tax liability.
  • Prepare to receive your pension plan payments by completing the Income Tax Withholding Form and Direct Deposit Form.
Step 2

Deliver your completed forms to the Department by either:

  • Scheduling a DROP Exit appointment with a Retirement Services Section representative, at least 45 days prior to your desired DROP exit date, or
  • Mailing your completed forms to the Department.

Please make sure your completed forms reach our office at least by the first business day of the month of your DROP exit date. For example, if you wish to exit DROP on April 20, please be sure your forms reach us no later than April 1.

Step 3

Your DROP distribution will be mailed on the last business day of the month that your DROP exit date is effective — assuming all forms are completed correctly and received on time.

Late submission and/or changes to the member's DROP exit date or distribution election will delay distribution of your DROP account for an additional month. DROP balances do not accrue interest after the exit date.