2013 Maryland Code
STATE PERSONNEL AND PENSIONS
§ 23-307 - Eligibility service -- Purchase of service credit by members of Employees' Pension System


MD State Pers & Pens Code § 23-307 (2013) What's This?

§23-307.

(a) (1) Except as provided in subsection (b) of this section, in the year of retirement, a member of the Employees’ Pension System may purchase credit for eligibility service of up to 10 years for periods of employment described in paragraph (3) of this subsection for which the member is not otherwise entitled to service credit.

(2) To purchase service credit under this subsection, a member must:

(i) complete a claim for the service credit and file it with the Board of Trustees on the form that the Board of Trustees provides; and

(ii) pay to the Board of Trustees an amount equal to the annuity reserve and pension reserve required to fund the additional allowance.

(3) A member may only purchase service credit under this subsection for employment with:

(i) the State;

(ii) a political subdivision in the State;

(iii) an out-of-state school as a teacher;

(iv) the federal government;

(v) an out-of-state political subdivision;

(vi) a public or nonpublic school as a teacher; or

(vii) a postsecondary school as a teacher.

(b) (1) This subsection does not apply to an employee of a participating governmental unit or a former participating governmental unit that has withdrawn.

(2) In the year of retirement, a member of the Employees’ Pension System may purchase credit for eligibility service for periods of employment with the State for which the member is not otherwise entitled to service credit in a State system.

(3) Except as provided in paragraph (4) of this subsection, a member who purchases service credit under this subsection, may not purchase:

(i) more than a total of 10 years of service credit in the Employees’ Pension System;

(ii) service credit for any period of employment during which the member participated in the optional retirement program; or

(iii) more than a total of 5 years of service credit in the Employees’ Pension System for employment as a postsecondary school teacher.

(4) To purchase service credit under this subsection, a member must:

(i) complete a claim for the service credit and file it with the Board of Trustees on the form that the Board of Trustees provides; and

(ii) pay to the Board of Trustees an amount equal to one-half of the annuity reserve and one-half of the pension reserve required to fund the additional allowance.

(c) (1) A member of the Employees’ Pension System may purchase credit for eligibility service for previous service in a position described in § 23-204(a) of this title.

(2) To purchase the service credit, the member must pay in a single payment, the contributions, with interest, that the Board of Trustees considers appropriate.

(d) (1) A member of the Employees’ Pension System who is employed by a member of the State Senate or House of Delegates for at least 130 days per year as a legislative employee before becoming a member is considered to have been a permanent part-time legislative employee.

(2) A member described in paragraph (1) of this subsection may purchase credit for eligibility service for that period of legislative employment by paying to the Board of Trustees:

(i) for a period of employment on or before December 31, 1979, the sum of:

1. the amount that the member would have been required to contribute for that period of employment; and

2. interest on the member’s contributions, compounded annually; and

(ii) for a period of employment on or after January 1, 1980, the sum of:

1. the amount that the member would have been required to contribute for that period of employment;

2. the amount that the State would have been required to contribute for the member for that period of employment; and

3. interest on the member’s and State’s contributions, compounded annually.

(3) The rate of interest to be paid under this subsection is the average for the 5 years preceding the year of payment of the yearly rate of interest computed as the sum of the investment income and the realized gains and losses divided by the book value of the total investments.

§ 23-307 - 1. Contributory pension benefit -- Employees' Pension System

(a) Eligibility. -- This section applies only to a former member, member, retiree, or surviving beneficiary of the Employees' Pension System who, while a member, was an employee of a participating governmental unit that elected the contributory pension benefit for its employees under § 31-116 of this article.

(b) Purchase of credits. -- Except as provided in subsection (c) of this section, a member who is subject to the contributory pension benefit under Subtitle 2, Part II of this title may purchase credit for eligibility service for the period of employment from July 1, 1998, through the effective date of election of the member's participating employer, by paying to the Board of Trustees:

(1) on or before June 30, 2003, the amount the member would have been required to contribute for that period of employment; or

(2) on or after July 1, 2003, the amount the member would have been required to contribute for that period of employment plus regular interest compounded annually.

(c) Failure to to make payments; reduction of allowance payable. -- If the member fails to make the payment as provided under subsection (b) of this section, the Board of Trustees shall reduce actuarially the allowance payable to a former member, retiree, or surviving beneficiary of a deceased member, former member, or retiree.

§ 23-307 - 2. Frederick County members

(a) In general. -- This section applies only to a former member, member, retiree, or surviving beneficiary of the Employees' Pension System who, while a member, was an employee of Frederick County.

(b) July 1, 1998 through July 1, 2000 period of eligibility service. -- Except as provided in subsection (d) of this section, a member who is subject to the contributory pension benefit under Subtitle 2, Part II of this title may purchase credit for eligibility service for the period of employment from July 1, 1998, through July 1, 2000, by paying to the Board of Trustees:

(1) on or before June 30, 2001, the amount the member would have been required to contribute for that period of employment; or

(2) on or after July 1, 2001, the amount the member would have been required to contribute for that period of employment plus regular interest compounded annually.

(c) Purchase of eligibility credit. -- Except as provided in subsection (d) of this section, a member who is subject to the Alternate Contributory Pension Selection under Subtitle 2, Part III of this title may purchase credit for eligibility service for the period of employment from July 1, 2006, through July 1, 2007, by paying to the Board of Trustees:

(1) on or before June 30, 2008, the amount the member would have been required to contribute for that period of employment; or

(2) on or after July 1, 2008, the amount the member would have been required to contribute for that period of employment plus regular interest compounded annually.

(d) Failure to make payment. -- If the member fails to make the payment as provided under subsection (b) or (c) of this section, the Board of Trustees shall reduce actuarially the allowance payable to a former member, retiree, or surviving beneficiary of a deceased member, former member, or retiree.

§ 23-307 - 3. Purchase of service credit by 40-year State employees

(a) Purchase authorized. --

(1) A member of the Employees' Pension System who as of July 1, 2001, has been employed by the State for at least 40 years on a full-time or part-time basis may purchase credit for eligibility service of up to 10 years for which the member is not otherwise entitled to service credit.

(2) This section does not apply to:

(i) an employee of a participating governmental unit or a former participating governmental unit that has withdrawn; or

(ii) any period of employment during which an individual participated in the optional retirement program.

(b) Requirements. --

(1) A member who purchases service credit under this section shall:

(i) complete a claim for the service credit and file it with the Board of Trustees on the form that the Board of Trustees provides; and

(ii) pay to the Board of Trustees the member contributions the member would have made for the period of employment for which service credit is being purchased plus regular interest to the date of payment.

(2) A member may pay the amount required by paragraph (1)(ii) of this subsection on an installment basis by contributing at least 2% of earnable compensation per year with the appropriate final adjustments being made in the year the member retires.

(3) A member may pay for service credit purchased under this section at any time before retirement.

(c) Limitations. --

(1) A member who purchases service credit under this section may not purchase more than a total of 10 years of service credit for periods of employment with the State.

(2) For service credit purchased under this section, a year or a part of a year of employment equals 1 year of service credit.

§ 23-307 - 4. Purchase of service credit by former employees of private vendors of child support enforcement services in Baltimore City.

(a) Applicability. -- This section applies only to a member of the Employees' Pension System who:

(1) was an employee of the State prior to November 1, 1996;

(2) as of November 1, 1996 was employed by a private vendor to provide child support enforcement services in Baltimore City; and

(3) resumed employment with the State as of November 1, 2002.

(b) Receipt of service credit. -- A member described in subsection (a) of this section shall receive service credit for the time the member was employed by a private vendor to provide child support enforcement services in Baltimore City prior to July 1, 1998.

(c) Requirements. --

(1) A member described in subsection (a) of this section is entitled to receive service credit for the time the member was employed by a private vendor to provide child support enforcement services in Baltimore City from July 1, 1998 through October 31, 2002.

(2) Prior to retirement, and subject to paragraph (3) of this subsection, a member who receives service credit under this subsection shall deposit in the annuity savings fund or other corresponding fund an amount of money equal to the contribution payments that the member would have paid had the member been a State employee, including regular interest on the contributions at the rate of 5% per year compounded annually.

(3) On retirement, the member's retirement allowance shall be reduced by the actuarial equivalent of the amount determined under paragraph (2) of this subsection if the member elects not to deposit this amount in the annuity savings or other corresponding fund.

§ 23-307 - 5. Alternate Contributory Pension Selection -- Purchase of service credit.

(a) Scope. -- This section applies only to a former member, member, retiree, or surviving beneficiary of the Employees' Pension System who, while a member, was an employee of a participating governmental unit that elected the Alternate Contributory Pension Selection for its employees under § 31-116.1 of this article.

(b) In general. -- Except as provided in subsection (c) of this section, a member who is subject to the Alternate Contributory Pension Selection under Subtitle 2, Part III of this title may purchase credit for eligibility service for the period of employment from July 1, 2006, through the effective date of election of the member's participating employer, by paying to the Board of Trustees:

(1) on or before June 30, 2007, the amount the member would have been required to contribute for that period of employment; or

(2) on or after July 1, 2007, the amount the member would have been required to contribute for that period of employment plus regular interest compounded annually.

(c) Failure to make payment; reduction of allowance payable. -- If the member fails to make the payment as provided under subsection (b) of this section, the Board of Trustees shall reduce actuarially the allowance payable to a former member, retiree, or surviving beneficiary of a deceased member, former member, or retiree.

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