Or. Admin. R. 459-007-0230

Current through Register Vol. 63, No. 8, August 1, 2024

Section 459-007-0230 - Crediting Earnings for a Deceased Tier Two Active or Inactive Member

Upon the death of an active or inactive Tier Two member, earnings from the date of death to the date of distribution shall be credited as specified in this rule.

(1) Definitions. For purposes of this rule:

(a) "Death benefit amount" means the sum of the member's regular account and variable account as of the first of the month of the member's death and held by PERS for the beneficiary or beneficiaries of a deceased member until benefits are distributed.

(b) "Effective date of request" means the first of the month in which PERS receives a valid request for distribution of the death benefit amount.

(2) For members whose date of death is on or after January 1, 2000, earnings shall be credited to the member's regular account as follows:

(a) If earnings for the calendar year before the date of the member's death have not yet been credited, earnings shall be applied for that year based on the latest year-to-date calculation for that year.

(b) Earnings for the calendar year of the member's death shall be credited based on the latest year-to-date calculation for that year as of the first of the month of the member's death.

(3) If the member was participating in the Variable Annuity Account, earnings shall be credited to the member's variable account as follows:

(a) If earnings for the calendar year before the member's death have not been credited, earnings for that year shall be based on the latest year-to-date calculation available for that year.

(b) Earnings for the calendar year of the member's death shall be applied based on the latest year-to-date calculation for that year as of the first of the month of the member's death.

(4) After earnings have been credited in accordance with sections (2) and (3) of this rule, the value of the member's variable account shall be added to the value of the member's regular account and the sum shall constitute the death benefit amount as of the first of the month of the member's death.

(5) Earnings on the death benefit amount from the first of the month of the member's death to the end of that calendar year shall be credited based on the Tier Two annual rate less the Tier Two latest year-to-date-calculation as of the first of the month of the member's death.

(6) Earnings on the death benefit amount for calendar years following the year of the member's death and before the year funds are requested shall be credited in accordance with OAR 459-007-0005 for Tier Two regular accounts.

(7) Earnings on the death benefit amount from January 1 of the year funds are requested to the effective date of request shall be based on the Tier Two latest year-to-date calculation.

(8) Earnings from the effective date of request to the date of distribution shall be based on the average annualized rate prorated for that period.

(9) If the member's date of death is before January 1, 2000, earnings shall be credited in accordance with the rules applicable to Tier Two members in effect up to January 1, 2000. As of January 1, 2000, the deceased member's account shall be converted to a death benefit amount. Earnings on the death benefit amount from January 1, 2000 to the date of distribution shall be credited in accordance with sections (5) through (8) of this rule.

(10) If a beneficiary elects a monthly payment, earnings shall be credited to the death benefit amount from the first of the month of the member's date of death to the effective date of the monthly payment, which is the first of the month following the member's date of death, as follows:

(a) Subtract the latest Tier Two regular account year-to-date calculation available as of the first of the month of the member's death from the latest Tier Two regular account year-to-date calculation available as of the effective date of the monthly payment.

(b) Multiply the beneficiary's death benefit amount by the Tier Two rate calculated in subsection (a) of this rule.

(11) The provisions of this rule apply to requests for distribution received on or after March 15, 2005.

Or. Admin. R. 459-007-0230

PERS 7-1998, f. & cert. ef. 5-22-98; PERS 26-2004, f. 11-23-04, cert. ef. 3-15-05; PERS 3-2009, f. & cert. ef. 4-6-09

Stat. Auth.: ORS 238.650

Stats. Implemented: ORS 238.390, 238.430 & 238.435