2006 Louisiana Laws - RS 11:3039.1 — Deferred retirement option plan

§3039.1.  Deferred Retirement Option Plan

A.  In lieu of terminating employment and accepting a service retirement allowance under R.S. 11:3037, any member of this system who has not less than twenty years of creditable service, or has ten years of creditable service and who is sixty years of age, or has twenty-five  years of service and who is fifty years of age 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.

B.  For purposes of this Section, creditable service shall include service credit reciprocally recognized under R.S. 11:142, but for eligibility purposes only.

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

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

E.  Upon the effective date of the commencement of participation in the plan, membership in the system shall terminate and neither employee nor employer contributions shall be payable.  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.  The monthly retirement benefits that would have been payable, had the member elected to cease employment and receive a service retirement allowance, shall be paid into the deferred retirement option plan account.  Upon termination of employment, deferred benefits shall be payable as provided by Subsection H of this Section.

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

(2)  After a person who participates in this program has terminated his employment which makes him eligible to be a member of this system, his individual account balance in the plan shall earn interest at a rate equal to the percentage rate of return of the system's investment portfolio, less the cost of administering the Deferred Retirement Option Plan program to be determined annually by the board of trustees, said interest to be credited to his individual account balance on an annual basis.

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

H.  Upon termination of employment at the end of the specified period of participation, a participant in the program shall receive, at his option, a lump sum payment from the account, or he may elect any other method of payment if approved by the board of trustees.  The monthly benefits that were being paid into the fund during the period of participation shall begin being paid to the retiree.

I.(1)  If a participant dies during the period of participation in the program, a lump sum payment equal to his account balance shall be paid to his named beneficiary or, if none, to his estate; in addition, normal survivor benefits payable to survivors of retirees shall be payable.

(2)  If a participant terminates employment prior to the end of the specified period of participation he shall receive, at his option, a lump sum payment from the account equal to the balance of the account, or he may elect any other method of payment if approved by the board of trustees.

(3)  The monthly benefits that were paid into the fund during the period of participation shall begin being paid to the retiree.

J.(1)  If employment is not terminated at the end of the period specified for participation, payments into the account shall cease.

(2)  Payment from the account shall not be made until employment is terminated, nor shall the monthly benefits being paid into the fund during the period of participation be payable to the individual until he terminates employment.

(3)  Upon termination of employment, a member shall receive, at his option, a lump sum payment from the account balance, or he may elect any other method of payment if approved by the board of trustees.

K.(1)  If employment is not terminated at the end of the period specified for participation, the member shall resume active contributing membership in the system.

(2)  Upon termination of employment, the monthly benefits which were being paid to the fund shall begin to be paid to the member.  He may not change the option which was originally selected.

(3)  Upon termination of employment, the member shall receive an additional retirement benefit based on his additional service rendered since termination of participation in the fund, using the normal method of computation of benefit, subject to the following:

(a)  If his period of additional service is less than thirty-six months, the average compensation figure used to calculate the additional benefit shall be that used to calculate his original benefit.

(b)  If his period of additional service is thirty-six or more months, the average compensation figure used to calculate the additional benefit shall be based on his compensation during the period of additional service.

(c)  The option used shall be that applicable to the original benefit.

(d)  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 figure used to compute the additional benefit.

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

Acts 1997, No. 1325, §1, eff. July 1, 1997.