The ORP is a defined contribution plan which provides benefits based on your account balance at retirement. Your ORP account is made up of contributions from the State and any accumulate investment earnings. You choose an investment vendor when you join the plan, and you can invest your account among that vendor's approved investment options. The growth of your account balance will determine the retirement you will receive.

Each year, the State contributes a certain percentage of your salary to your ORP account. IRS regulations limit the amount an employer can contribute in a plan year based on salary. Please contact the Employee Benefits Office (301-405-5654) for the current plan year salary limit. Currently, the State contribution rate is 7.25% of salary.

When you elect to participate in the ORP, you must choose one company to initially invest your ORP employer contributions. The names of the approved vendors are: Fidelity Investments, and TIAA-CREF.

Once your contributions are deposited with your selected vendor, you may elect to invest those contributions among the different investment options offered by that vendor that are approved for the ORP. The investment vendor will offer a variety of approved investment options. In some cases, you may also be able to transfer funds previously accumulated in the ORP among the vendors -- subject to certain restriction or charges. For more information including the prospectus, contact the investment vendors.

Your retirement benefits are determined by the amount of your ORP account at retirement. You can elect to receive your account in a lump-sum payment, periodic distribution or annuity. Your ORP account is based on State contributions and any investment gains or losses in the investment option you selected.

Before retirement benefits can begin, you or your surviving beneficiary will need to complete an application and submit it the applicable ORP vendor(s). An additional federal penalty tax may apply.

As with the retirement benefit, your early retirement benefits are determined by the amount of your ORP account at early retirement. You can elect to receive your account in a lump-sum payment, periodic distribution or annuity. Your ORP account is based on State contributions and any investment gains or losses.

Before retirement benefits can begin, you or your surviving beneficiary will need to complete an application and submit it to the applicable ORP vendor(s). An additional federal penalty tax may apply.

The ORP investment accounts do not provide disability benefits. However, if you become disabled, you may receive the full value of your current ORP account balance.

If you die after retirement, your beneficiary survivor benefit will be determined by the payment option you selected. If you die before retirement, your account balance -- including all State contributions and investment earnings -- is paid to your designated beneficiary(ies) or estate. You may change beneficiaries at any time before retirement by submitting the applicable change form to your investment vendor.

There are special rules governing the eligibility and cost for health benefits for retirees of an ORP. ORP retirees are eligible to participate in the State Employees Benefits program if they meet one of the criteria below:

• They retire directly from a Maryland State institution of higher education with service equal to at least five years of full-time employment with continuous contributions to a Maryland ORP account;


• They ended service with a Maryland institution of higher education when they were at least age 57and had service equal to at least 10 years of full time employment with continuous contributions to a Maryland ORP account;


• They ended service with a Maryland State institution of higher education with service equaling at least 16 years of full time employment with continuous contributions to an ORP account;

The Subsidy Amount for retirees is the following:

• Full subsidy for retirees: Must retire directly from a Maryland State institution of higher education and have service equal to at least 16 years but less than 25 years of full time service with continuous contributions to a Maryland ORP account;


• Partial subsidy for retirees: Must retire directly from a Maryland State institution of higher education and have service equal to at least five years but less than 16 years of full time service with continuous contributions to a Maryland ORP account;

NOTE: No State subsidy for ORP retirees who did not retire directly from a Maryland State institution of higher education;

• ORP retirees with 25 years or more full years of regular employment with the State, in any branch of government, may be eligible for the maximum State subsidy of the coverage for them and their spouse and dependents even if they didn't retire directly from a Maryland State institution of higher education.

NOTE: Service credit is based on actual time worked. For part-time employees, service credit is prorated to reflect the actual percentage of time worked.

The Subsidy Amount for dependents is the following:

• Retirees from a Maryland State institution of higher education must have 25 years of employment for a spouse and dependent children to receive the full subsidy for health benefits. There is no prorated health insurance subsidy for spouses and dependents.