The Associated Press

SALEM - About 400 former public employees have applied to "cash out" their state pension accounts before they hit retirement age, part of a state law that took effect July 1.

Not all of them may be eligible though, David Crosley, spokesman for the Public Employees Retirement System, told The Salem Statesman Journal.

Under a law put in place by the 2003 Legislature, people who left PERS-covered jobs before 2000 can withdraw their accounts, and get a 50 percent bonus.

Those inactive PERS members have a two-year window to take advantage of the offer, if they made past contributions to PERS for five or more calendar years.

Still, labor advocates say that the deal isn't as enticing as it may sound.

"You get the money to use right away and (the government) gets to keep part of it," said Mary Botkin, who represents public employees in the American Federation of State, County and Municipal Employees Union.

Under the law, someone with $10,000 in a dormant PERS account would get to cash out with $15,000. But that wipes out their chance at building up their fund until retirement, when they get a guaranteed monthly pension based on their account balance.

A PERS actuary estimated that the law could shave PERS' long-term shortfall as much as $243 million.

There are now 48,622 former government workers with inactive PERS accounts, Crosley said, but it's not immediately clear how many qualify for the cash-out deal.