North Carolina SB 1238: Withdrawn Retirement Service.

Bill Text

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2001

SESSION LAW 2002-153
SENATE BILL 1238

AN ACT TO ALLOW THE PURCHASE OF WITHDRAWN SERVICE IN THE
LOCAL GOVERNMENTAL EMPLOYEES' RETIREMENT SYSTEM, TO
CORRECT THE CALCULATION OF BENEFITS FOR MEMBERS OF THE
TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM WHO
PURCHASE WITHDRAWN SERVICE, AND TO INCREASE
APPROPRIATIONS TO THE RETIREMENT SYSTEMS DIVISION.

The General Assembly of North Carolina enacts:

SECTION 1. G.S. 128-26(i) reads as rewritten:
"(i) Notwithstanding any other provision of this Chapter, any person who
withdrew his contributions in accordance with the provisions of G.S. 128-27(f) or
135-5(f) or the rules and regulations of the Law Enforcement Officers' Retirement
System and who subsequently returns to service may, upon completion of 10 five years
of prior and current membership service, repay in a total lump sum any and all of the
accumulated contributions previously withdrawn with sufficient interest added thereto
to cover one half of the cost of providing such additional credit plus a fee to cover
expense of handling which shall be determined by the Board of Trustees and receive
credit for the service forfeited at time of withdrawal(s), provided that he left service
prior to July 1, 1975. interest compounded annually at the rate of six and one-half
percent (6.5%) for each calendar year from the year of withdrawal to the year of
repayment plus a fee to cover expense of handling which shall be determined by the
Board of Trustees, and receive credit for the service forfeited at time of withdrawal(s).
Any person who leaves service after June 30, 1975, and who withdraws his
contributions in accordance with G.S. 128-27(f) or 135-5(f) or the rules and regulations
of the Law Enforcement Officers' Retirement System and who subsequently returns to
service may, upon completion of 10 years of prior and current membership service,
repay in a total lump sum any and all of the accumulated contributions previously
withdrawn with sufficient interest added thereto to cover the full cost of providing such
additional credit plus a fee to cover expense of handling which shall be determined by
the Board of Trustees and receive credit for the service forfeited at time of
withdrawal(s). These provisions shall apply equally to retired members who had
attained 10 five years of prior and current membership service prior to retirement. Cost
as used in this subsection shall mean the amount of money required to provide
additional retirement benefits based on service credit allowed at the time any adjustment
to the service credit of a member is made. The retirement allowance of a retired member
who restores service under this subsection shall be increased the month following the
month payment is received. The increase in the retirement allowance shall be the
difference between the initial retirement allowance, under any optional allowance
elected at the time of retirement, and the amount of the retirement allowance, under any
optional allowance elected at the time of retirement, to which the retired member would
have been entitled had the service not been previously forfeited, adjusted by any
increases in the retirement accrual rate occurring between the member's date of
retirement and the date of payment. The increase in the retirement allowance shall not
include any adjustment for cost-of-living increases granted since the date of retirement."
SECTION 2. G.S. 128-26(k) reads as rewritten:

Page 2 Session Law 2002-153 Senate Bill 1238
"(k) Notwithstanding any language to the contrary of any provision of this section,
or of any repealed provision of this section that was repealed with the inchoate and
accrued rights preserved, all repayments and purchases of service credits, allowed under
the provisions of this section or of any repealed provision of this section that was
repealed with inchoate and accrued rights preserved, must be made within three years
after the member first becomes eligible to make such repayments and purchases. Any
member who does not repay or purchase service credits within said three years after first
eligibility to make such repayments and purchases may, under the same conditions as
are otherwise required, repay or purchase service credits provided that the repayment or
purchase equals the full cost of the service credits calculated on the basis of the
assumptions used for purchases of the actuarial valuation of the System's liabilities and
shall take into account the additional retirement allowance arising on account of such
additional service credit commencing at the earliest age at which such member could
retire on an unreduced retirement allowance as determined by the Board of Trustees
upon the advice of the consulting actuary. Notwithstanding the foregoing provisions of
this subsection that provide for the purchase of service credits, the terms "full cost",
"full liability", and "full actuarial cost" include assumed annual post-retirement
allowanc