SUBCHAPTER 2B ‑ TEACHERS' AND STATE EMPLOYEES'
RETIREMENT SYSTEM
SECTION .0100 ‑ GENERAL PROVISIONS
20 NCAC 02B .0101 GENERAL INFORMATION
The following is general information about the Teachers' and
State Employees' Retirement System:
(1) The chief officer is the Director of the Retirement
Systems;
(2) The mailing address is 325 North Salisbury Street,
Raleigh, North Carolina 27611.
(3) The office is located in the Albemarle Building,
325 North Salisbury Street, Raleigh, North Carolina.
History Note: Authority G.S. 135‑6(f); 150B‑10;
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0102 PURPOSES
20 NCAC 02B .0103 FORMS
History Note: Authority G.S. 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
SECTION .0200 ‑ ADMINISTRATION
20 NCAC 02B .0201 AVERAGE FINAL COMPENSATION
The term "consecutive calendar years" is defined
for the purpose of determining retirement allowances as a period of time
consisting of a number of calendar months of creditable service equal to 12
times the number of years specified by statute during which the highest total
compensation was earned, adjusted proportionally to the regular term of annual
employment.
History Note: Authority G.S. 135‑6(f); 135‑1(5);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0202 ACTUARIAL TABLES: RATES AND
ASSUMPTIONS
(a) Actuarial tables and assumptions will be adopted by the
board of trustees after the presentation of the recommendations of the actuary
by including the tables, rates, etc. in the minutes of the board with the
resolution adopting said tables, rates or assumptions.
(b) The director of the retirement systems shall maintain a
file of copies of all resolutions adopting tables, rates or assumptions and the
current version of all tables as amended by the board of trustees. The file
shall be open and readily available to the public during regular office hours.
(c) This Rule includes but is not limited to the following
actuarial tables and assumptions:
(1) interest rate assumptions;
(2) salary increase assumptions;
(3) required contribution rates;
(4) mortality assumptions;
(5) separation and retirement assumptions;
(6) joint and survivor tables;
(7) reserve transfer tables.
(d) Tables, rates and assumptions shall become effective on
the first day of the month following adoption, unless a specific effective date
is included in the adopting resolution. If the specific date is included, the
tables, rates or assumptions shall be effective as provided in the adopting
resolution.
History Note: Authority G.S. 135‑6(m); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Amended Eff. August 1, 1981.
20 NCAC 02B .0203 OFFICIAL MORTALITY TABLE
20 NCAC 02B .0204 ACTUARIAL CALCULATIONS
20 NCAC 02B .0205 RECOMMENDATIONS OF ACTUARY
20 NCAC 02B .0206 ACTUARIAL VALUATIONS
20 NCAC 02B .0207 RESERVE TRANSFER
History Note: Authority G.S. 135‑6(f); 135‑6(m);
135‑6(n); 135‑6(o); 135‑18.1;
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. August 1, 1981.
20 NCAC 02B .0208 DEATH OF RETIRED MEMBER
During the month a retired member dies, the legal
representative of the deceased shall be entitled to a full check for the month
in which the death occurred.
History Note: Authority G.S. 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0209 DISCLOSURE OF INFORMATION
The director is authorized, in his discretion, to release
lists of retired personnel to the public agencies, departments, and
institutions of the State of North Carolina and to non‑profit public
associations and organizations of retired personnel.
History Note: Authority G.S. 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Amended Eff. March 1, 1985.
20 NCAC 02B .0210 MEDICAL BOARD
In accordance with the authority contained in G.S. 135‑6(k)
membership of the medical board is increased from three to five physicians with
a quorum of three being required at meetings approving applications for
disability retirement.
History Note: Authority G.S. 135‑6(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0211 OPTIONAL RETIREMENT PROGRAM
An individual who is employed by a state university at a
rank or in a position which does not qualify him for participation in the
optional retirement program, as provided by G.S. 135‑5.1, and who later
is reclassified to the rank of instructor or above shall be permitted to
exercise the option of electing to withdraw from Teachers' and State Employees'
Retirement System and to begin participation in the optional retirement program
as though he were a new employee.
History Note: Authority G.S. 135‑5.1; 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0212 SURVIVOR'S ALTERNATE BENEFIT
With respect to eligibility for the survivor's alternate
benefit, any member who files an acceptable application for retirement while in
service will be deemed "in service" until he has cashed his first retirement
check.
History Note: Authority G.S. 135‑19; 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0213 DISABILITY RETIREMENT ALLOWANCE
DEFINED
A member shall be deemed to have been "entitled to
receive a disability retirement allowance" if a proper application for
disability retirement allowance was received before his death, if he had five
or more years of creditable service, if the medical board, after a medical
examination of such member pursuant to G.S. 135‑5(c), shall certify that
such member was mentally or physically incapacitated for the further
performance of duty, that such incapacity was incurred at the time of active
employment and was continuous thereafter, that such incapacity was likely to be
permanent, and that such member should be or should have been retired, and if
all other requirements for disability retirement pursuant to G.S. 135‑5(c)
had been met except that the member need not live to the actual date of
retirement.
History Note: Authority G.S. 135‑5(1)(3);
Eff. October 29, 1979.
20 NCAC 02B .0214 RETROACTIVE MEMBERSHIP SERVICE
(a) A member omitted from contributing membership through
error may within three years of such omission be allowed membership service,
after clear and convincing evidence of the error is submitted to the director,
by payment of the employee and employer contributions which would have been
paid during the period of time omitted plus interest on both equal to the
average yield of the pension accumulation fund during the period of time
omitted.
(b) A member omitted from contributing membership through
error may after three years of such omission be allowed membership service,
after clear and convincing evidence of the error is submitted to the director,
by payment of the full actuarial liability for the additional service in the
same manner prescribed in 20 NCAC 2B .1200, Delayed Purchase Of Service
Credits.
History Note: Authority G.S. 135‑3(1); 135‑6(f);
Eff. June 1, 1984.
SECTION .0300 ‑ BENEFICIARIES
20 NCAC 02B .0301 DESIGNATION
Any beneficiaries designated, other than the estate of a
member or a trustee named by and acting for the member, must be living persons
at the time the designation is made. If it is desired that the estate be
beneficiary, this should be indicated on the form.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0302 PRINCIPAL BENEFICIARY
More than one principal beneficiary may be named to share
equally. In the event of the death of any so named, those surviving shall
share equally in the total benefits.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0303 CONTINGENT BENEFICIARY
A principal beneficiary may be named with the stipulation
that should he predecease the member, payment of the amount due, if any, will
be made to a designated contingent beneficiary. It is permissible to name more
than one contingent beneficiary. In the event of the death of any so named,
those surviving shall share equally in the total benefits. If more than one
principal beneficiary is named, the naming of a contingent beneficiary or
beneficiaries will not be permitted.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0304 NO LIVING BENEFICIARY
If no named beneficiary, whether principal or contingent, is
living at the time of the member's death, payment of the amount due, if any,
will be made to the estate of the member.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0305 BENEFICIARY WHO IS A MINOR
Payments to beneficiaries who are minors will be made to a
duly appointed guardian or to the clerk of superior court in the county in
which they reside to the extent that such payment may be authorized by law.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0306 CHANGE IN STATUS
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
20 NCAC 02B .0307 CHANGE IN BENEFICIARY
Prior to retirement, the member has the right at any time,
and from time to time, to change any beneficiaries designated without the
knowledge or consent of the beneficiaries. Any such change must be submitted
to the board of trustees.
History Note: Authority G.S. 135‑5(g); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0308 SPECIAL RULE: BENEFICIARY BEFORE JULY
1, 1967
In the event of the death of a person who became a member
before July 1, 1967, the return of a member's contributions shall be paid to
such person as the member intended to receive his return of contributions and
whom he designated as beneficiary for the death benefit as if the member had
properly designated such person for the return of contributions if the
following conditions are met:
(1) the member had properly designated one person for
the death benefit at a time when there were separate forms for designation of
beneficiary for return of contributions and designation of beneficiary for the
death benefit;
(2) the person designated as beneficiary for the death
benefit is living at the time of the member's death;
(3) any previously designated beneficiary for the
return of contributions who is living at the time of the member's death or, if
such previously designated beneficiary dies between the time of the member's
death and the time of determination of payment of the return of accumulated
contributions, the legatee(s), heirs at law, successors or assigns of such
beneficiary, waives all claims to or interest in the return of the member's
contributions;
(4) the member did not designate any other person for
the return of contributions after making a designation of beneficiary for the
death benefit; and
(5) clear and convincing evidence is presented to the
retirement system showing that the member thought he had or intended to have
designated for the return of contributions the same person whom he designated
as beneficiary for the death benefit.
In such cases, the beneficiary shall be entitled to receive
the survivor's alternate benefit pursuant to G.S. 135‑5(m) to the same
extent that he would have been entitled to receive the survivor's alternate
benefit under G.S. 135‑5(m) if the member had actually designated such
beneficiary for the return of contributions in a duly executed and filed form
for the designation of beneficiary for return of contributions.
History Note: Authority G.S. 135‑5(m);
Eff. October 29, 1979.
SECTION .0400 ‑ EMPLOYER CONTRIBUTIONS
20 NCAC 02B .0401 REFUNDS
The retirement system will make no refunds of employer
contributions in cases of erroneous employee deductions except those which are
corrected by the employing unit on a subsequent payroll within the calendar
year in which the errors occur. The only exception to this Rule is that an
error occurring in December may be corrected (without loss of the employer
contribution) by submission of a revised payroll with checks for the correct amount
before January 31 of the following year.
History Note: Authority G.S. 135‑8(f); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0402 FORWARDING OF EMPLOYER CONTRIBUTIONS
All units should forward to the retirement system the
employer's contributions monthly at the same time the employee's contributions
are forwarded.
History Note: Authority G.S. 135‑8(f)(1); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0403 CONTRIBUTION RATE
History Note: Authority G.S. 135‑6(f); 135‑6(m);
Eff. September 21, 1977;
Repealed Eff. August 1, 1981.
20 NCAC 02B .0404 DUE DATE OF CONTRIBUTIONS
Both the employee and employer contributions are due in the
Raleigh offices of the Retirement System no later than the fifth State
government working day of the month succeeding the month for which the contributions
are required. Contributions received after the fifth State government working
day of the month are delinquent.
History Note: Authority G.S. 135‑6(f); 135‑8(f);
Eff. March 1, 1992.
SECTION .0500 ‑ TYPES OF RETIREMENT
20 NCAC 02B .0501 DISABILITY RETIREMENT EXAMINATION
The director is authorized to conduct examination in
doubtful cases of disability to determine the condition of the disability,
paying the expense of the same from the pension accumulation fund.
History Note: Authority G.S. 135‑5(c); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0502 DISABILITY RETIREMENT REPORTS
When the medical board, subsequent to a disability
retirement, reports that the retired member is engaged in, or is able to engage
in a gainful occupation, any adjustment required by G.S. 135‑5(e)(1) will
be made prospectively only and will not relate back so as to require any refund
to the state of payments made during the period before a report is made
indicating changed status.
History Note: Authority G.S. 135‑5(e)(1); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0503 FEES: INDEPENDENT MEDICAL EXAMS‑DISABILITY
RETIREMENTS
Physicians employed upon the recommendations of the Medical
Board to examine and report on special cases of disability retirement
applicants and re‑examination of disability beneficiaries shall be paid
fees commensurate with usual, customary and reasonable charges for such tests,
examinations, procedures and reports as the Medical Board might request; and,
the amounts of such fees shall be predetermined by mutual agreement between the
director and the physicians so employed, with the advice of the Medical Board
as to the amounts, provided that no fee for any one applicant or beneficiary
shall exceed the sum of one hundred and fifty dollars ($150.00).
History Note: Authority G.S. 135‑6(f); 135‑6(k);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Amended Eff. August 1, 1981.
20 NCAC 02B .0504 INTEREST CREDITS
When members on disability retirement are reinstated to
active service, no interest shall be allowed on their accounts during the year
of reinstatement.
History Note: Authority G.S. 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0505 EARLY RETIREMENT
20 NCAC 02B .0506 SERVICE RETIREMENT
20 NCAC 02B .0507 PERSONNEL EMPLOYED
History Note: Authority G.S. 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
20 NCAC 02B .0508 FAILURE TO RESPOND
If a member fails to respond in any way within 90 days after
preliminary option figures and Form 6‑E, Election of Benefits, are
mailed, the Form 6, Application for Service, Early or Disability Retirement,
will be null and void; the retirement system will not be liable for any
benefits due on account of the voided application and a new application must be
filed establishing a subsequent effective date of retirement. If an applicant
for disability retirement fails to furnish requested additional medical
information within 90 days following such request, the application will be
declared null and void under the same conditions outlined above, unless the
applicant is eligible for early or service retirement in which case the
application will be processed accordingly, using the same effective date as
would have been used had the application for disability retirement been
approved.
History Note: Authority G.S. 135‑5(a)(1); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
Pursuant to G.S. 150B-33(b)(9), Administrative Law Judge Melissa
Owens Lassiter declared Rule 20 NCAC 02B .0508 void as applied in Burton L.
Russell v. Department of State Treasurer, Retirement Systems Division (03 DST
1715).
20 NCAC 02B .0509 RETIREMENT ALLOWANCE
History Note: Authority G.S. 135‑18.1; 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. December 1, 1981.
20 NCAC 02B .0510 PENSIONS
Payment of a full month's benefit shall be made for the
month in which death occurs, regardless of the date, with no further benefits
to be paid thereafter.
History Note: Authority G.S. 135‑14; 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
SECTION .0600 ‑ INVESTMENTS
20 NCAC 02B .0601 STOCK
20 NCAC 02B .0602 AUTHORIZATION
20 NCAC 02B .0603 VALUATION EQUITY RESERVE
History Note: Authority G.S. 135‑7.2; 135‑6(f);
Eff. February 1, 1976;
Repealed Eff. September 21, 1977.
SECTION .0700 ‑ LEAVES OF ABSENCE
20 NCAC 02B .0701 EDUCATIONAL LEAVES OF ABSENCE
(a) All members, who request approval to purchase
creditable service and who fulfill all of the requirements of law and the rules
of the board, shall be allowed to purchase the service in accordance with the
law and the rules of the board.
(b) Payments to be made for purchases on account of current
leave of absence shall be submitted on Form 224, Payment of Contributions for a
Current Leave of Absence, which shall be submitted as required by law. If the
employer will make the monthly contributions equal to the normal and accrued
liability contribution, the employer shall submit the total payment. If the
member will make the entire payment, the member shall submit the total
payment. In any case in which the employer continues to make salary payments,
in whole or part, the director may make an agreement with the employer on how
to make the payments which is not inconsistent with the law or the rules of the
board.
(c) Contributions for purchase of service shall not be
accepted unless the member has applied for permission to purchase the service
not later than the due date of the payment for the first month for which credit
is to be purchased. Applications after the last day of the first month for
which service is to be purchased and the due date thereof shall be accompanied
by a check in payment of the contribution for said month.
(d) Payment shall be deemed to have been made on the date
received by the board, provided that a payment made by mail which is clearly
postmarked on or before the due date shall be deemed paid when due.
(e) Purchases of service credit for leaves of absence prior
to July 1, 1981 shall be made in the same manner as prescribed in 20 NCAC 2B .1200,
DELAYED PURCHASE OF SERVICE CREDITS.
(f) A member, who is currently making contributions to
purchase service for an educational leave of absence, and whose position before
the leave of absence was paid on a less than 12‑month basis, shall make
the payment in the month after the regularly scheduled due date for payment of
salary and shall earn service credits for said contributions in the same manner
as he would if he was currently being employed in that last position.
History Note: Authority G.S. 135‑6(f); 135‑8(b)(5);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Amended Eff. March 1, 1982.
20 NCAC 02B .0702 REQUESTS TO CONTRIBUTE
20 NCAC 02B .0703 MANDATORY LEAVE OF ABSENCE
20 NCAC 02B .0704 MEMBER AGE SIXTY‑FIVE
20 NCAC 02B .0705 LIMITATION
History Note: Authority G.S. 135‑8(b)(5); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1982.
20 NCAC 02B .0706 WORKERS' COMPENSATION LEAVES OF
ABSENCE
(a) All members, who request approval to purchase
creditable service and who fulfill all of the requirements of law and the rules
of the board, shall be allowed to purchase the service in accordance with the
law and rules of the board.
(b) Purchases of creditable service for leaves of absence
prior to July 1, 1983 shall be made in the same manner as prescribed in 20 NCAC
2B .1200 DELAYED PURCHASE OF SERVICE CREDITS. A fee in the amount of twenty‑five
dollars ($25.00) for each payment will be assessed members at the time of
purchase as provided by law.
(c) Purchases of creditable service for leaves of absence
on and after July 1, 1983 shall be paid in the manner prescribed in law equal
to the sum of the total employer and employee percentage rates of contribution
in effect at the time of purchase multiplied by the annual rate of compensation
of the member immediately prior to the leave of absence applied to the period
of the leave commencing on the first day and ending on the last day before
return to service.
(d) Members who had leaves of absence which otherwise met
all requirements of law for purchase as creditable service except that the
leaves of absence interrupted membership in the Local Governmental Employees'
Retirement System or the Law Enforcement Officers' Retirement System and whose
membership service before and after the leaves of absence has become membership
service in the Teachers' and State Employees' Retirement System, may purchase
creditable service as in (b) of this Rule.
(e) Members may purchase creditable service for leaves of
absence only when they have membership service credits immediately prior to and
immediately after the leaves of absence and such membership service is
creditable service at the time of purchase.
History Note: Authority G.S. 135‑4(r); 135‑6(f);
Eff. December 1, 1983;
Amended Eff. August 1, 1988.
SECTION .0800 ‑ MILITARY SERVICE (INCHOATE RIGHTS ONLY)
20 NCAC 02B .0801 FEE
A fee in the amount of twenty‑five dollars ($25.00)
for each payment will be assessed each individual at the time of payment to
help defray the expense of handling.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0802 QUALIFYING FOR CREDIT
In order to qualify, each individual must pay for the full
period of military service for which he is eligible.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0803 COMPUTATION OF COST
The cost of purchasing credit for military service is
calculated as follows:
(1) 1/12 of the annualized rate of compensation the
member earned when he first entered membership; times
(2) the employee contribution rate at that time; times
(3) the number of months of military service for which
credit is to be purchased; plus
(4) a factor equivalent to interest at the rate of six
and one‑half percent, compounded annually, from the initial year of
membership to the year of payment.
History Note: Authority G.S. 135‑4(f); 135‑6(f);
Eff. February 1, 1976;
Readopted September 21, 1977.
20 NCAC 02B .0804 CIVIL SERVICE PARTICIPATION
A member of the Teachers' and State Employees' Retirement
System whose employment in this state requires him to participate in the
Federal Civil Service Program in lieu of the social security program shall not
be barred from receiving military service credit for which he is otherwise
eligible in the retirement systems despite the fact that he may also receive
credit under civil service for the same period of military service, provided
that he makes the required payment.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0805 SERVICE CONNECTED DISABILITY
The exclusion, for purchase of service in the Armed Forces
of the United States as it pertains to credit in any other retirement system,
shall not include "service connected disability" benefits received
from the Veteran's Administration of the Federal Government except when such
benefits are a supplement of a "longevity retirement" benefit.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0806 RECALCULATION OF BENEFITS
For members already retired who avail themselves of these
provisions, any recalculation of benefits shall be based on the law in effect
at the time of the individual's retirement including the additional service
credit and effect shall be given for all benefit increases subsequent to the
date of retirement which shall be a part of the total cost of providing the
additional service credit.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0807 CHANGE IN BENEFITS
For members already retired, any change in benefits
resulting from these provisions shall become effective as of the first of the
month following receipt of the required payment.
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0808 EMPLOYER PORTION OF ANNUAL COST
20 NCAC 02B .0809 PAYMENTS
History Note: Authority G.S. 135‑4(f)(6); 135‑6(f);
Eff. February 1, 1976;
Readopted September 21, 1977;
Repealed Eff. March 1, 1985.
20 NCAC 02B .0810 RESTORING MEMBERSHIP
When a member on military leave has withdrawn all of his
contributions, he will be permitted to pay back the amount withdrawn, restore
his membership and receive credit for the period of his military leave.
History Note: Authority G.S. 135‑4(f); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0811 INITIAL PERIOD OF ACTIVE DUTY
The term "initial period of active duty," as used
in G.S. 135‑4(f)(6) is construed as including but not limited to any
active duty in the armed forces of the United States during the periods
beginning September 16, 1940 and ending December 31, 1946, and beginning June
27, 1950 and ending January 31, 1955.
History Note: Authority G.S. 135‑4(f); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
SECTION .0900 ‑ OUT‑OF‑STATE SERVICE
(INCHOATE RIGHTS ONLY)
20 NCAC 02B .0901 FEE
A fee in the amount of twenty‑five dollars ($25.00)
for each payment will be assessed each individual at the time of payment to
help defray the expense of handling out‑of‑state service credit.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0902 QUALIFYING FOR CREDIT
In order to qualify for out‑of‑state service
credit, each individual must pay for all or such portion in full years as he
desires of out‑of‑state service for which he is eligible.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0903 DEFINITION
"Other governmental subdivisions of the United
States," as used in G.S. 135‑4(l), shall mean a state or territory
and its subdivisions but not the United States government, except as
specifically provided by statute.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0904 COMPUTATION OF COST
The cost of purchasing credit for out‑of‑state
service is calculated as follows:
(1) the monthly compensation the member earned when he
first entered membership; times
(2) the employee contribution rate at that time; times
(3) the number of months of out‑of‑state
service for which credit is to be purchased; times
(4) two; plus
(5) a factor equivalent to interest at the rate of six
and one‑half percent, compounded annually, from the initial year of
membership to the year of payment.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0905 RECALCULATION OF BENEFITS
For members already retired who avail themselves of the
provisions for out‑of‑state service, any recalculation of benefits
shall be based on the law in effect at the time of the individual's retirement
including the additional service credit and effect shall be given for all
benefit increases subsequent to the date of retirement which shall be a part of
the total cost of providing the additional service credit.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0906 CHANGE IN BENEFITS
For members already retired, any change in benefits
resulting from the provisions for out‑of‑state service shall become
effective as of the first of the month following receipt of the required
payment.
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .0907 COST TO EMPLOYER
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Repealed Eff. September 21, 1977.
20 NCAC 02B .0908 PAYMENTS
History Note: Authority G.S. 135‑4(l); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
SECTION .1000 ‑ PRIOR SERVICE
20 NCAC 02B .1001 PUBLIC SCHOOL TEACHERS
Public school teachers are eligible to receive credit for
service performed in private schools and orphanage schools where the state has
later provided public schools in lieu of such private schools, and has later
taken over and is currently operating such schools.
History Note: Authority G.S. 135‑4;
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .1002 SERVICE UNDER WPA
History Note: Authority G.S. 135‑4;
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
20 NCAC 02B .1003 PRIOR SERVICE WITH GENERAL ASSEMBLY
(a) Employees eligible under S.L. 1979, Ch. 698 to purchase
such service may make application to purchase prior service as a full‑time
employee of the General Assembly for which membership credit was not previously
allowed.
(b) The Legislative Services Officer shall certify to the
retirement system that the applicant was a full‑time employee during the
period for which the application is made. The said certification shall also
certify the total hours and salary paid in each month. Provided, however, if
the Legislative Services Officer certified that the monthly data is not
available, he may certify the data in the form in which it is available.
(c) If earnings and service are certified on a monthly basis,
compute the required contributions and earned service in the same manner as
would have been calculated if paid at that time.
(d) If earnings and service are not certified on a monthly
basis, compute the required contribution at the highest rate in effect during
the period for which certified. Allow one month of service for each 20 days.
To the extent possible, integrate periods of service to be purchased with
intervening periods of membership service.
(e) Fractional months of service for multiple service
period being certified shall be added together to determine the total allowable
service. Remaining fractional months in excess of one‑half shall be
considered to be a full month.
(f) Regular interest, as provided for in G.S. 135‑7(b),
shall be calculated and charged through the year of purchase.
(g) An administrative fee of $25.00 shall be collected at
the time application is made to purchase service.
(h) No person shall purchase less than the total service
for which they are eligible.
History Note: Authority G.S. 135‑4(j1); 135‑6(f);
Eff. October 29, 1979.
20 NCAC 02B .1004 TEMPORARY SERVICE PURCHASE
(a) A member eligible under G.S. 135‑4(p) to purchase
service for temporary State employment shall make the application on Form 222,
Application to Purchase Service Credits for Full‑Time Temporary State Employment.
Employer certification of temporary State employment and the compensation
received for such service shall be made on Form 222‑A, Employer
Certification of Full‑Time Temporary Service, and shall accompany the
application.
(b) Temporary State employment means employment under which
the member would have been unconditionally required to make contributions at
the time of employment if not classified at the time of employment as a
"temporary" employee.
(c) Since the actual cost to fund the liability created on
account of the purchase has a direct relationship to the purchasing member's
current level of compensation, the employer cost will be computed on the
member's level of compensation at the time of purchase. The employer cost,
therefore, shall be equal to the total employee and employer rates of
contribution at the member's level of compensation at the time of purchase and
for the period of service being purchased, less the required member
contribution.
(d) No purchases shall be allowed for 36 months or less.
History Note: Authority G.S. 135‑4(p); 135‑6(f);
Eff. March 1, 1982;
Amended Eff. March 1, 1985; September 1, 1982.
20 NCAC 02B .1005 TEMPORARY SERVICE PURCHASE: FULL
ACTUARIAL LIABILITY
(a) All members, who request approval to purchase
creditable service for temporary state employment and who fulfill all of the
requirements of law and the rules of the board, shall be allowed to purchase
the service in accordance with the law and rules of the board.
(b) Purchases of creditable service for temporary state
employment shall be made in the same manner as prescribed in 20 NCAC 2B .1200
DELAYED PURCHASE OF SERVICE CREDITS.
(c) Members requesting approval to purchase creditable
service shall make application on and acquire certification from the employer
of the temporary employment on Form 222‑B, Application to Purchase
Temporary State Employment.
(d) The phrase "temporary employment" as used in
G.S. 135‑4(s)(2) shall mean a period of continuous temporary employment
prior to membership, except when multiple periods of temporary employment were
interrupted by less than 90 calendar days or by the number of days between
consecutive academic/school years.
(e) The phrase "completed 10 years or more of
membership service" as used in G.S. 135‑4(q)(3) shall mean
membership service completed after the temporary state employment.
(f) A fee in the amount of twenty‑five dollars
($25.00) for each payment shall be assessed members at the time of purchase as
provided by law.
History Note: Authority G.S. 135‑4(s); 135‑6(f);
Eff. December 1, 1983;
Amended Eff. August 1, 1988; September 1, 1984.
20 NCAC 02B .1006 PART‑TIME SERVICE PURCHASE: FULL
ACTUARIAL LIABILITY
(a) Members requesting approval to purchase creditable
service shall make application on and acquire certification from the employer
of the part‑time employment on the form designated for this purpose.
(b) The phrase "part‑time" as used in G.S.
135‑4(pl) shall refer to duties performed on less than a full‑time
basis.
(c) The phrase "completed 10 years or more of
membership service" as used in G.S. 135‑4(pl) shall mean membership
service completed after the "part‑time" state employment.
(d) The amount of part‑time service to be purchased
shall be computed as follows:
(1) Determine the ratio of the actual gross
compensation earned as a part‑time employee (numerator) to the gross
compensation that would have been earned as a full‑time employee
(denominator);
(2) Apply the ratio (quotient) determined in
(1) of this Paragraph to the period of service rendered in months.
(e) Purchases of creditable service for part‑time
state employment shall be made in the same manner as prescribed in 20 NCAC 2B
.1200.
(f) A fee in the amount of twenty‑five dollars
($25.00) for each payment shall be assessed members at the time of purchase as
provided by law.
History Note: Authority G.S. 135‑4(pl); 135‑6(f);
Eff. March 1, 1985.
20 NCAC 02B .1007 LOCAL GOVERNMENT SERVICE PURCHASE:
FULL ACTUARIAL LIABILITY
(a) Members requesting approval to purchase creditable
service shall make application on and acquire certification from the employer,
of the local government employment on the form designated for this purpose.
(b) The phrase "local government employment"
shall mean service while regularly employed as defined in 20 NCAC 2C .0802.
(c) The phrase "local government employer" shall
mean a local governmental entity as defined in G.S. 128‑21(11).
(d) The phrase "upon completion of 10 years of
membership service" as used in G.S. 135‑4(t) shall mean membership
service completed after the local governmental employment.
(e) Purchases of creditable service for local government
employment shall be made in the same amount as prescribed in 20 NCAC 2B .1200.
(f) A fee in the amount of twenty‑five dollars
($25.00) for each payment shall be assessed members at the time of purchase as
provided by law.
History Note: Authority G.S. 135‑4(t); 135‑6(f);
Eff. March 1, 1985.
SECTION .1100 ‑ VOLUNTARILY WITHDRAWN CONTRIBUTIONS
20 NCAC 02B .1101 FEE
A fee in the amount of twenty‑five dollars ($25.00)
for each payment will be assessed each individual at the time of payment for
voluntarily withdrawn contributions to help defray the expense of handling.
History Note: Authority G.S. 135‑4(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .1102 QUALIFICATION
In order to qualify for service credit, each individual must
restore all accounts previously withdrawn on a voluntary basis.
History Note: Authority G.S. 135‑4(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .1103 COMPUTATION OF COST
(a) The cost of repaying voluntarily withdrawn
contributions representing service by a member who left service prior to July
1, 1974 is calculated as follows:
(1) the amount of contributions withdrawn; plus
(2) a factor equivalent to interest at the rate
of six and one‑half percent compounded annually, from the year of
withdrawal to the year of repayment.
(b) The cost of repaying voluntarily withdrawn
contributions representing service by a member who left service after June 30,
1974 is calculated as double the amount calculated in Paragraph (a) of this
Rule.
History Note: Authority G.S. 135‑4(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Amended Eff. June 1, 1984.
20 NCAC 02B .1104 RECALCULATION OF BENEFITS
For members already retired who avail themselves of these
provisions, any recalculation of benefits shall be based on the law in effect
at the time of the individual's retirement including the additional service
credit and effect shall be given for all benefit increases subsequent to the
date of retirement which shall be a part of the total cost of providing the
additional service credit.
History Note: Authority G.S. 135‑4(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .1105 CHANGE IN BENEFITS
For members already retired, any change in benefits
resulting from these provisions shall become effective as of the first of the
month following receipt of the required payment.
History Note: Authority G.S. 135‑4(k); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977.
20 NCAC 02B .1106 EMPLOYER COST
20 NCAC 02B .1107 PAYMENTS
History Note: Authority G.S. 135‑4(m); 135‑6(f);
Eff. February 1, 1976;
Readopted Eff. September 21, 1977;
Repealed Eff. March 1, 1985.
20 NCAC 02B .1108 WILDLIFE PROTECTORS
Members who forfeited creditable service on account of the
transfer from this Retirement System to the Law Enforcement Officers'
Retirement System under Chapter 837 of the 1971 Session Laws and were further transferred
from the Law Enforcement Officers' Retirement System to this Retirement System
under Chapter 1034 of the 1983 Session (Regular Session, 1984) Laws, may
restore such creditable service by paying an amount calculated pursuant to this
Section.
History Note: Authority G.S. 135‑6(f);
Eff. March 1, 1985.
SECTION .1200 ‑ DELAYED PURCHASE OF SERVICE CREDITS
20 NCAC 02B .1201 APPLICATION OF SECTION
This Section applies to purchase of creditable service
whenever a statutory provision prescribes that a payment by a member shall
equal the full liability/cost of the service calculated on the basis of the
assumptions used for purposes of the actuarial valuation of the Retirement
System's liabilities, and shall take into account the retirement allowance
arising on account of the additional service credit at the earliest age at
which a member could retire on an unreduced service retirement allowance. An
applicant shall be eligible to purchase creditable service under this Section
only after having met all requirements of eligibility for purchase as defined
by law and on rules duly adopted.
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Amended Eff. March 1, 1985.
20 NCAC 02B .1202 ACTUARIAL TABLES
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Repealed Eff. August 1, 1981.
20 NCAC 02B .1203 APPLICABILITY OF OTHER SECTIONS
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Repealed Eff. March 1, 1985.
20 NCAC 02B .1204 DEFINITIONS
The following words and phrases have the meanings indicated
when used in this Section, unless the context clearly requires another meaning:
(1) "earliest retirement date" is the first
date at which the applicant could retire with an unreduced benefit;
(2) "nearest age" is year and whole month of
the age of the member which is closest to the date specified;
(3) "estimated allowance (with purchase)" is
the estimated retirement allowance computed in the normal manner at the earliest
retirement date and the years of service the applicant would have if the
purchase is made;
(4) "estimated allowance (without purchase)"
is the estimated allowance computed in the normal manner at the earliest
retirement date and the years of service which the applicant would have at that
time if no purchase is made.
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Amended Eff. March 1, 1985; June 1, 1982.
20 NCAC 02B .1205 COMPUTATION OF COST
The cost of a delayed purchase of service credit is computed
as follows:
(1) Determine earliest retirement dates;
(2) Determine estimated average final compensation
(with purchase) and (without purchase) by multiplying the total compensation
actually paid for the period for which 12 months' service credit will have been
earned through the current month by the factor determined from the table of
Salary Factors using the member's nearest age on the last day of the current
month and at the earliest retirement date (with purchase) and (without
purchase). Provided that if the member is out of service but not retired, has
passed his 65th birthday, or has 30 years of service credit without the
purchase, the estimated average final compensation will be calculated in the
normal manner for the compensation and service recorded by the Retirement
System;
(3) Determine estimated allowance (with purchase);
(4) Determine required reserve on estimated allowance
(with purchase) by multiplying the estimated allowance (with purchase) by the
reserve factor found in the Table of Reserve Factors for the nearest ages at
purchase date and at earliest retirement date;
(5) Determine estimated allowance (without purchase);
(6) Determine available reserve on estimated allowance
(without purchase) by multiplying the estimated allowance (without purchase) by
the reserve factor for the nearest ages at purchase date and at earliest
retirement date;
(7) The cost of purchasing service credit is the
difference between the required reserve (with purchase) and the available
reserve (without purchase). Provided that if the difference between the
required reserve and the available reserve is zero, the cost of purchasing the
service credit is the estimated average final compensation (with purchase)
times the number of years service purchased, times the statutory service
factor, times the reserve factor for the nearest ages at the last day of the
last month for which the compensation used was recorded and at earliest
retirement date (with purchase).
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Amended Eff. June 1, 1982.
20 NCAC 02B .1206 SERVICE AS COURT REPORTER
History Note: Authority G.S. 135‑6(f);
Eff. October 29, 1979;
Repealed Eff. March 1, 1985.
20 NCAC 02B .1207 SPECIAL RULE FOR RETIRED APPLICANTS
The cost of a delayed purchase of service credit for a
person currently receiving a retirement allowance is computed as follows:
(1) Determine the estimated allowance (with purchase),
what is the monthly amount that the applicant would be receiving, if he had
retired at his original retirement date for his present option, with his
current creditable service plus the service to be purchased, by using the
factors applicable at his actual retirement date, and including all cost‑of‑living
and special percentage increases which he has actually received since his first
monthly retirement benefits.
(2) Determine the difference between his estimated
allowance (with purchase) and his present monthly retirement benefit.
(3) Determine the cost of purchasing the service credit
by multiplying the difference in monthly benefit by twelve, and then dividing
by the option factor from the Table of Option Factors for his current option
and then multiplying by the reserve factor from the Table of Reserve Factors
for his current age and retirement age.
History Note: Authority G.S. 135‑6(f); 135‑4(m);
Eff. March 1, 1982;
Amended Eff. March 1, 1985.
