2006 Louisiana Laws - RS 11:3005.1 — Deferred retirement option plan

§3005.1.  Deferred Retirement Option Plan

A.(1)  In lieu of terminating employment and accepting a service retirement allowance under R.S. 11:3005, any member of this system who has at least ten years of creditable service and who is eligible to receive a service retirement allowance may elect to participate in the Deferred Retirement Option Plan and defer the receipt of benefits in accordance with the provisions of this Section.

(2)  For purposes of this Section, creditable service shall not include service reciprocally recognized pursuant to R.S. 11:142.

B.  The decision to enter the plan shall be irrevocable.

C.  The duration of participation in the plan shall not exceed three years.

D.  A member may participate in the plan only once.

E.(1)  Upon the effective date of the commencement of participation in the plan, active membership in the system shall terminate.

(2)  Employer contributions shall continue to be payable by the employer during the member's membership and participation in the plan.  The payment of employee contributions shall terminate upon the effective date of the member's commencement of participation in the plan.  For purposes of this Section, compensation and creditable service shall remain as they existed on the effective date of commencement of participation in the plan.

(3)  Prior to entry in the plan, the member shall make an irrevocable election of any option provided for in R.S. 11:3007.  The monthly retirement benefits that would have been payable, had the member elected to terminate employment and receive a service retirement allowance, shall be paid into the Deferred Retirement Option Plan account.

(4)  Upon termination of employment, the deferred benefits shall be payable as provided by Subsection H of this Section.

F.(1)  A member who participates in the plan shall not be eligible to receive a cost-of-living increase from the retirement system while participating in the plan and shall not be eligible for such an increase until the member's employment has been terminated for at least one full year.

(2)  After a member who participates in the plan has terminated his participation, the member's individual account balance in the plan shall earn interest at the actual rate of return earned on the funds left on deposit with the system.  Such funds shall be invested in accordance with a policy adopted by the board of trustees.  Any such interest shall be credited to the individual account on an annual basis.

G.  The Deferred Retirement Option Plan account shall not be subject to any fees or charges of any kind or for any purpose.

H.(1)  Upon termination of employment at the end of the period of participation in the plan, the monthly benefits that were being paid into the Deferred Retirement Option Plan account during the period of participation shall begin being paid to the retiree.

(2)(a)  The participant in the plan shall also receive, at his option, any one of the following:

(i)  A lump sum payment from the account equal to the payments to the account; or

(ii)  A true annuity based upon his account, the terms of which shall be subject to approval by the board of trustees; or

(iii)  Any other method of payment if approved by the board of trustees.

(b)  Any choice of annuity payments made pursuant to this Paragraph shall be irrevocable.

I.(1)  If a participant dies during the period of participation in the plan, then a lump sum payment equal to his account balance shall be paid to his named beneficiary or, if none, to his estate.  Additionally, survivor benefits under the option selected, if applicable, shall be payable to survivors of retirees.

(2)  If a member becomes disabled during his period of participation in the plan, then he shall be considered as having retired on the date of commencement of disability.

J.(1)  If employment is not terminated at the end of the period for participation in the plan, then all of the following conditions shall apply:

(a)  Payments into the Deferred Retirement Option Plan account shall cease; and

(b)  The member shall resume active contributing membership in the system; and

(c)  Payments from the account shall not be made until the member's employment is terminated and the monthly benefits that were being paid into the account during the period of participation shall not be payable to the member until his employment is terminated.

(2)  Upon termination of employment, the monthly benefits that were being paid to the plan account shall begin to be paid to the member pursuant to the option that he selected as provided for in Subsection E of this Section.

(3)  Upon termination of employment, the member shall receive an additional retirement benefit based on the additional service rendered after his termination of participation in the plan using the normal method of computing benefits, but subject to all of the following conditions:

(a)  The calculation of average compensation shall exclude the period of participation in the plan; and

(b)  The member shall not be eligible to change the retirement option selected as to the original retirement. However, upon termination of employment, the member shall be eligible to select any option set forth in R.S. 11:3007, but only applicable as to any additional benefits earned based on the service rendered after his termination of participation in the plan; and

(c)  In no event shall the additional benefit exceed an amount which, when combined with the original benefit, equals one hundred percent of the average compensation used to compute the additional benefit.

(4)  If the member dies or becomes disabled during the period of additional service, then he shall be considered as having retired on the date of death or commencement of disability.

K.  All payments into the Deferred Retirement Option Plan account shall be made from the member's annuity savings account until there are no longer any funds remaining in the member's annuity savings account.  All subsequent payments shall be made from the Employer's Accumulation Account.  If a member elects to receive funds in the Deferred Retirement Option Plan account in the form of an annuity, then funds shall be transferred from the Deferred Retirement Option Plan account to the Employer's Annuity Reserve Account.

Acts 2001, No. 875, §1, eff. June 26, 2001.