Section 88-283 - Election of retirement allowance option(a) Upon retirement, any member may elect to receive the maximum retirement allowance to which the member is entitled, computed in accordance with section 88-282, 88-284, or 88-285, and, if the member elects to receive the maximum retirement allowance, the member's beneficiary shall not be entitled to any benefit upon the member's death, except as provided in subsection (g). In lieu of the maximum retirement allowance, a member may elect to receive the member's retirement allowance under one of the options described below, which shall be actuarially equivalent to the maximum retirement allowance: (1) Option A: A reduced allowance payable to the member, then upon the member's death, one-half of the allowance, including fifty per cent of all cumulative post retirement allowances, to the member's beneficiary designated by the member at the time of retirement, for the life of the beneficiary. If the beneficiary dies prior to the retirant, all further payments shall cease upon the death of the retirant; provided that for members retiring after November 30, 2004, if the retirant's designated beneficiary dies at any time after the retirant retired, but before the death of the retirant, the retirant, upon the death of the retirant's designated beneficiary, shall receive a retirement allowance, including cumulative post retirement allowances, calculated as if the retirant had selected the maximum retirement allowance to which the retirant is entitled;(2) Option B: A reduced allowance payable to the member, then upon the member's death, the same allowance, including cumulative post retirement allowances, paid to the member's beneficiary designated by the member at the time of retirement, for the life of the beneficiary. If the beneficiary dies prior to the retirant, all further payments shall cease upon the death of the retirant; provided that for members retiring after November 30, 2004, if the retirant's designated beneficiary dies at any time after the retirant retired, but before the death of the retirant, the retirant, upon the death of the retirant's designated beneficiary, shall receive a retirement allowance, including cumulative post retirement allowances, calculated as if the retirant had selected the maximum retirement allowance to which the retirant is entitled; or(3) Option C: A reduced allowance payable to the member, and upon the death of the retirant within ten years of retirement, the same allowance, including cumulative post retirement allowances, paid to the retirant's designated beneficiary, or otherwise to the retirant's estate for the balance of the ten-year period. If the retirant returns to service requiring active membership in the system and the retirant is reenrolled as an active member, running of the ten-year period will be suspended until the member again retires. Only one beneficiary shall be designated under options A, B, and C. The beneficiary designated under option A or B shall be a natural person, and benefits under option A or B shall only be paid to a natural person. To receive benefits, the beneficiary shall have been designated by the member in the form and manner prescribed by the board.
(b) Upon a member's retirement: (1) The member's election of a retirement allowance option shall be irrevocable; and(2) The member's designation of a beneficiary shall be irrevocable if the retirement allowance option elected by the member is option A or B.(c) No election by a member under this section shall take effect unless: (1) The spouse or reciprocal beneficiary of the member is furnished written notification that: (A) Specifies the retirement date, the benefit option selected, and the beneficiary designated by the member;(B) Provides information indicating the effect of the election; and(C) Is determined adequate by rules adopted by the board in accordance with chapter 91;(2) The member selects option A or option B and designates the spouse or reciprocal beneficiary as the beneficiary; or(3) It is established to the satisfaction of the board that the notice required under paragraph (1) cannot be provided because:(A) There is no spouse or reciprocal beneficiary;(B) The spouse or reciprocal beneficiary cannot be located;(C) The member has failed to notify the system that the member has a spouse or reciprocal beneficiary, or has failed to provide the system with the name and address of the member's spouse or reciprocal beneficiary; or(D) Of other reasons, as established by board rules adopted in accordance with chapter 91. Any notice provided to a spouse or reciprocal beneficiary, or determination that the notification of a spouse or reciprocal beneficiary cannot be provided, shall be effective only with respect to that spouse or reciprocal beneficiary. The system shall rely upon the representations made by a member as to whether the member has a spouse or reciprocal beneficiary and the name and address of the member's spouse or reciprocal beneficiary.
(d) Each member, within a reasonable period of time before the member's retirement date, shall be provided a written explanation of:(1) The terms and conditions of the various benefit options;(2) The rights of the member's spouse or reciprocal beneficiary under subsection (c) to be notified of the member's election of a benefit option; and(3) The member's right to make, and the effect of, a revocation of an election of a benefit option.(e) The system shall not be liable for any false statements made to the system by the member or by the member's employer.(f) If a member dies after the date of the filing of the member's written application to retire, but prior to the retirement date designated by the member, and, if the member was eligible to retire on the date of the member's death, the member's designated beneficiary may elect to receive either:(1) An allowance that would have been payable if the member had retired and had elected to receive a retirement allowance under option B; or(2) The allowance under the option selected by the member which would have been payable had the member retired. The effective date of the member's retirement shall be the first day of a month, except for the month of December when the effective date of retirement may be on the first or last day of the month, and shall be no earlier than the later of thirty days from the date the member's retirement application was filed or the day following the member's date of death. The election may not be made if, at the time of the member's death, there are individuals who are eligible to receive death benefits under section 88-286(c) who have made a claim for the benefits; provided that, if the designated beneficiary is an individual eligible to receive benefits under section 88-286(c), the designated beneficiary may receive benefits pursuant to an election made under this section pending disposition of the claim for benefits under section 88-286(c). If death benefits are payable under section 88-286(c), the death benefits shall be in lieu of any benefits payable pursuant to this section.
(g) If the retirant dies within one year after the date of retirement, the retirant's designated beneficiary may elect to receive either: (1) The death benefit under the retirement allowance option selected by the retirant; or(2) The death benefit under option B, less the difference between the benefit that the retirant received and the benefit that would have been payable to the retirant had the retirant elected to receive a retirement allowance under option B; provided that if the retirant would not have been permitted by applicable law or the rules of the board to name the designated beneficiary as beneficiary under option B, the designated beneficiary may elect to receive the death benefit under option A, less the difference between the benefit that the retirant received and the benefit that would have been payable to the retirant had the retirant elected to receive a retirement allowance under option A.(h) The increase in the retirant's benefit under options A and B upon the death of the retirant's designated beneficiary shall be effective the first day of the month following the date of death of the designated beneficiary. The retirant shall notify the system in writing and provide a certified copy of the beneficiary's death certificate. The system shall make retroactive benefit payments to the retirant, not to exceed six months from the date the written notification and the certified copy of the death certificate are received by the system. The retroactive payments shall be without interest.(i) A claim under this section by a retirant's or member's beneficiary for benefits upon the death of a retirant or member shall be filed no later than three years from the date of the retirant's or member's death.L 1984, c 108, pt of §8; am L 1987, c 117, §6; am L 1988, c 8, §2; am L 1993, c 67, §2; am L 2001, c 101, §3; am L 2003, c 182, §2; am L 2004, c 179, §27; am L 2006, c 169, §29; am L 2007, c 215, §20 .