The Alaska Supplemental Annuity Plan (SBS-AP) is a defined contribution plan governed by Section 401(a) of the Internal Revenue Code . The Alaska Statutes related to the SBS-AP plan are under AS 39.30, Article 4; AS 39.30.150 - 180 . Regulations are 02 AAC 37.125 - 190 . A portion of your wages and a matching employer contribution are made pre-tax to this Plan instead of contributions to Social Security. These contributions, plus any change in value (interest, gains and losses), are payable to you or your beneficiary at a future date.

Employees of the State of Alaska and 23 political subdivisions that have elected to be in the plan are eligible. If you work for an eligible employer, your employment status will determine whether you are required to contribute to this plan. Although the SBS-AP is a supplemental plan, all eligible employees are automatically enrolled in the SBS-AP plan on the date of their hiring.

Learn more about the SBS-AP plan in the Supplemental Annuity Plan Information Handbook

Plan Administrator

Empower Retirement Services processes all payments for the PERS/TRS Defined Contribution Retirement (DCR) plan, the Supplemental Annuity (SBS-AP) plan and Deferred Compensation Plan (DCP).

Plan Expenses

There are no front-end loads for investment. Expenses are charged to your account in order to cover the cost of administration of the Plan. There are two types of fees: a monthly fee, based on a 0.1275% annual rate on assets (0.001275 / 12 x month-end asset balance), plus a fixed fee (charged annually) of $35 for actively contributing participants, or $25 for non-contributing members. The plan may also charge fees for using specific plan features.

In addition, the funds have annual investment expenses that vary depending on the funds you choose. The returns are net of these costs. For more detailed information, please read the corresponding Investment Option Detail Sheet available on the Empower Retirement Services website.

If you are an employee of the state or one of the 20 political subdivisions that have elected to be in the Plan, your employment status will determine whether you are required to contribute to this Plan. Your SBS-AP account is credited with a gross contribution that consists of a reduction to your wages of 6.13% and a matching employer contribution of 6.13%. The total contribution is 12.26% of your payroll up to the current Social Security maximum wage base. This wage base changes yearly.

You’ll receive a comprehensive statement of your account each quarter. If you prefer to receive your statements electronically, you can sign up to use the Online File Cabinet® for your account at the Empower Retirement Services website .

Social Security Maximum Wage Base
Year	Amount
2025	$176,100
2024	$168,600
2023	$160,200
2022	$147,000

Past Contribution Amounts

The amount of taxes you pay, and when you pay them, is determined by whether you take payment directly or make a rollover to a traditional IRA or other qualified plan. Your payment will be taxed in the current year unless you roll it over. However, if you receive a lump-sum payment before age 59 ½, you also may have to pay an additional 10% tax penalty. Direct transfers to Roth IRAs are reported as taxable income but are not subject to the additional 10% tax penalty.

SBS-AP is a participant-directed Plan. This means that you choose from the investment options offered by the Plan. The providers of these investment options are selected by the Alaska Retirement Management Board. Investment options are described in detail in the Plan Information Booklet and in the individual Fund Overviews, which are available on the Empower Retirement Services website by selecting "Investment information" under the "Investing" menu.

Initially, your contributions made to the SBS-AP account are automatically invested in one of the Alaska Target Retirement Trust or Alaska Balanced Trust funds based on your year of birth. This is the default option. You can move all or a portion of your existing balances among investment options and change how your contributions are invested. You may transfer among existing fund options and make changes to the allocation of your future contributions once a day. There is no extra charge for daily changes. Funds may impose redemption fees, and/or transfer restrictions, on certain transfers, redemptions or exchanges if assets are held for less than the period stated in the fund’s prospectus or other disclosure documents. For more information visit the Empower Retirement System website or call Empower's KeyTalk toll-free. Until you change how your future contributions are allocated, your money will continue to be invested the initial trust fund. Changes may be made through Empower's website, by telephone via KeyTalk, through a client service representative, or in writing.

Learn more about Alaska Target Retirement Trusts

Existing Investment Funds

The plan provides many investment options. Carefully consider the investment objectives, risks, fees and expenses before investing. Contact Empower Retirement for a prospectus, a summary prospectus and disclosure document, as available, containing this information. Read them carefully before investing.

• Russell 3000 Index Fund
• S&P 500® Index Fund
• S & P SmallCap 600 Equity Index F
• Environmental, Social and Governance Fund
• Mid Capitalization Equity Index Fund J
• U.S. Small-Cap Trust
• World Equity Ex-US Index
• International Equity Fund
• FIAM Core Plus CIT C1 H
• Passive US Bond Index Fund
• Stable Value Fund
• State Street Inst Treasury Money Market
• Alaska Balanced Trust
• Alaska Long-Term Balanced Trust
• BlackRock Strategic Completion NL F
• Alaska Target Date Retirement 2010 Trust
• Alaska Target Date Retirement 2015 Trust
• Alaska Target Date Retirement 2020 Trust
• Alaska Target Date Retirement 2025 Trust
• Alaska Target Date Retirement 2030 Trust
• Alaska Target Date Retirement 2035 Trust
• Alaska Target Date Retirement 2040 Trust
• Alaska Target Date Retirement 2045 Trust
• Alaska Target Date Retirement 2050 Trust
• Alaska Target Date Retirement 2055 Trust
• Alaska Target Date Retirement 2060 Trust
• Alaska Target Date Retirement 2065 Trust

Generally, the asset allocation of each target retirement trust will gradually become more conservative as the trust nears the target retirement date. The date in a target retirement trust’s name is the approximate date when investors plan to start withdrawing their money (generally assumed to be at age 65). The principal value of the trust(s) is not guaranteed at any time, including at the time of the target date and/or withdrawal.

An investment in a Money Market Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Caution: Please consider the investment objectives, risks, fees and expenses carefully before investing. For this and other important information, your registered representative can provide you with a mutual fund prospectus for the State Street Treasury Money Market Fund – Inst. and disclosure documents for the investment options exempt from SEC registration. Read them carefully before investing.

A layoff separation is considered a termination of employment by the Supplemental Annuity Plan (SBS-AP) and allows you to withdraw your accounts once you have been separated from employment for 60 days. You are not required to remove your funds simply because you have separated. You may leave your contributions in the plan and continue your retirement savings in order to meet your goals for the future. Experts say most people will live on retirement benefits longer than they worked to earn them.

If you are planning on reinvesting your money by rolling into an outside plan, please be sure to compare the fees for the services you will receive. The SBS-AP management and administrative fees are very low compared to the private sector.

If you must withdraw your SBS-AP funds, you will need to consider the following:

• You may elect to maintain your account, rollover all or a portion of your account to another qualified plan, or elect one of the plan's payment options, which include full or partial lump sum withdrawals, periodic payments, and annuities.
• SBS-AP funds are taxable income as you receive them and the plan is required to withhold 20% for federal income tax on a lump sum payment. You may want to choose a method of payment that spreads your account balance across tax years. There is also a potential 10% tax penalty for early withdrawal prior to age 59 ½.
• You must wait 60 days from your separation date before you can access your funds. If you reemploy with an SBS-AP employer before the 60-day period is up you will not be able to access your funds.

Funds may be withdrawn at any age in the event of:

• Leaving employment (including retirement), provided you have a bona fide termination .
• Death (after which your beneficiaries will take the withdrawal)

You are not eligible to receive payment from your account until 60 days after you have been terminated from employment. If you are re-hired before the 60-day period has passed, the withdrawal request will be canceled, and a new 60-day period will begin at the next termination. Actual payment mailing occurs after you have been terminated 60 days, and the Plan administrator approves your distribution. The only exception to payment eligibility earlier than 60 days after termination is for a qualified hardship. In the event of your death, funds will be available to your beneficiary. Your money remains invested until your account balance is zero.

Withdrawals are made directly to you or your beneficiary or to another qualified plan on your behalf at your direction. There are only three recognized exceptions that would allow your account to be paid directly to another person or agency other than yourself. They are:

• An IRS Lien for unpaid taxes
• A Qualified Domestic Relations Order (QDRO) issued by a court of law
• An Order to Withhold and Deliver Property issued by the Child Support Services Division (CSSD)

Withdrawal Options

After you have met the 60-day termination of employment requirement, you are eligible to apply your account balance to the payment option you choose. The actual dollar amount you will receive depends on such factors as the amount of your contributions, how your investments performed, the payment option you select, and your life expectancy. Payment options include:

1. Do nothing

   and defer payment until you have obtained the age of Required Minimum Distribution

2. Lump Sum

   Partial lump sum withdrawals, or a full withdrawal of the entire account.

3. Periodic Payment

   A payout method that allows you to be paid monthly, quarterly, semiannually, or annually. You can make changes to the payment frequency or amount, or stop it. You may select a specific dollar amount or the number of years over which your account will be paid to you, or you may choose IRC Minimum Distribution payments.

4. Five-Year Period Certain Annuity

   Equal monthly payments for five years (60 months). If you die before receiving all 60 payments, your beneficiary will receive the remaining benefit payments.

5. Ten-Year Period Certain Annuity

   Similar to the five-year period certain but for ten years (120 months).

6. Fifteen-Year Period Certain Annuity

   Similar to the five-year period certain but for fifteen years (180 months).

7. Single Life Annuity

   Monthly payments for your lifetime. No payments are made to your beneficiary after your death.

8. Single Life Annuity with Ten-Year Period Certain

   Monthly payments for the rest of your life. If you die before the guaranteed 120 payments have been made, your beneficiary will receive the remaining guaranteed benefit payments.

9. Single Life Annuity with Fifteen-Year Period Certain

   Monthly payments for the rest of your life. If you die before the guaranteed 180 payments have been made, your beneficiary will receive the remaining guaranteed benefit payments.

10. 50% Joint and Survivor Annuity

    Monthly payments for your lifetime. After your death, your survivor will receive one-half of the monthly amount you were receiving for their lifetime. Your survivor does not have to be your spouse.

11. 100% Joint and Survivor Annuity

    Similar to the 50% Joint and Survivor but, after your death, your survivor would receive the same benefit amount you were receiving for their lifetime. Your survivor does not have to be your spouse.

    Any annuity option is irrevocable. The money leaves your account, purchases the guaranteed income, and that is a done deal.

Empower Retirement Services processes all payments for the Supplemental Annuity Plan (SBS-AP). Contact Empower Retirement Services for disbursement forms, information on how to complete them, and for the status of pending payments. To contact Empower Retirement Services, call .

Hardship Withdrawals

There are strict provisions for hardship withdrawals. Only the following reasons are valid to obtain an early eligibility for payment of an account (you MUST be terminated in any case):

• medical care described in Code §213(d) incurred by the Participant, by the Participant’s spouse, or by any of the Participant’s dependents, or necessary to obtain such medical car.
• the purchase (excluding mortgage payments) of a principal residence for the Participant.
• the payment of post-secondary education tuition and related educational fees, for the next 12-month period, for the Participant, for the Participant’s spouse, or for any of the Participant’s dependents (as defined in Code §152).
• to prevent the eviction of the Participant from their principal residence or the foreclosure on the mortgage
• payments for burial or funeral expenses for the Participant’s deceased parent, spouse, children, or dependents (as defined in Code §152)
• any need prescribed by the Internal Revenue Service in a revenue ruling, notice or other document of general applicability which satisfies the safe harbor definition of hardship.

The Participant shall remain responsible for repayment to the plan of any excess amounts received pursuant to an early eligibility distribution should it be determined that such Participant is not entitled to the entire amount he or she was actually paid.

All hardship withdrawals are subject to the applicable requirements of the Internal Revenue Code and regulations.

Waiver of 60-Day Waiting Period Due to Financial Hardship form

The SBS Plan is a participant-directed plan. You choose from the investment options offered by the Plan. You can invest your contributions in any of the following ways, depending on your knowledge and comfort level with researching and selecting investments.

Keep Your Money Invested in an Alaska Target Retirement Trust Based on Your Planned Retirement Date and Risk Tolerance
Visit akdrb.com and click Investing for detailed information about the Alaska Target Retirement Trusts.

Build and Manage Your Own Portfolio
You can build and manage your own portfolio by investing in one or more of your Plan’s investment options. The Plan offers investments in a mix of asset classes to help you create a portfolio that suits your retirement goals and risk tolerance.

The Alaska Retirement Management Board has selected the Plan’s investment options, which are described in detail in the Plan Information Booklet and in the individual Fund Overviews, which are available at akdrb.com by selecting Investment information under the Investing menu.

On akdrb.com , you can also find a variety of online calculators and planning tools to help you. From there, you select the investment options and implement your own retirement savings strategy.

How can I make changes to my investment selections?

You can move all or a portion of your existing balances among investment options and change how your future contributions are invested by visiting the website at akdrb.com or by calling the voice response system toll free at . Until you change how your future contributions are allocated, your money will continue to be invested in your default investment option.

You can transfer assets among existing fund options and allocation changes for future contributions once a day at no charge. However, your chosen funds may impose redemption fees, and/ or transfer restrictions, on certain transfers, redemptions or exchanges if assets are held for less than the period stated in the fund’s disclosure documents. For more information, please refer to the fund’s disclosure documents at akdrb.com .

Carefully consider the investment option’s objectives, risks, fees and expenses. Contact Empower for a prospectus, summary prospectus for SEC registered products or disclosure document for unregistered products, if available, containing this information. Read each carefully before investing.

You could lose money by investing in a money market fund. Although the fund seeks to preserve the value of your investment at $1 per share, it cannot guarantee it will do so. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund’s sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.

Point in Time Advice

Our Point-in-time advice is a powerful, phone-based service delivered by Empower’s Workplace Planning & Advice (WPA) Group, acting as a fiduciary. Point-in-time advice can provide you with specific recommendations based on information you provide and intended to serve your best interest.

Your Alaska Retirement Plan Advisors are also available to work with you. Their focus remains on helping to educate you about your options, so you can make informed decisions to and through retirement. However, if you occasionally need someone to just tell you what to do, point-in time advice is now here to help fill that gap.

Included in the services offered by WPA:

• Assistance with how to invest your contributions from the options available in the State of Alaska fund lineup.
• Roll-in help for participants who wish to consolidate assets. Consider all your options and their features and fees before moving money between accounts.
• Advice determining how much to save in an optional plan, and whether you should contribute pre-tax or Roth.
• Robust advice and counseling around distributions from the State of Alaska plans once you’ve left employment.
• Help with your overall financial wellness and retirement readiness.

There is no additional cost for this advice. Call and schedule a meeting to talk about any of the above topics, so we can help you meet your retirement and financial goals.

The following transactions must be conducted through Empower Retirement Services:

• Inactive and Retired Employees: Changing your address or your name. (Active employees: Contact your employer to change your address or name.)
• Account Withdrawals: Empower Retirement Services processes all Plan payments. Empower Retirement Services should be contacted for information on how to complete disbursement forms and for the status of pending payments.
• Hardship withdrawals

The Division of Retirement and Benefits is responsible for the overall administration of this plan. To contact the Juneau Division of Retirement and Benefits office, call , or from Juneau.