(a)A member may, upon application for retirement, elect an option pursuant to this part that would provide an actuarially modified retirement allowance payable throughout the life of the member and the member’s option beneficiary or beneficiaries, as follows:
(1)Option 2.
The modified retirement allowance shall be paid to the retired member. Upon the retired member’s death, an allowance equal to the modified amount that the retired member was receiving shall be paid to the option beneficiary.
(2)Option 3.
The modified retirement allowance shall be paid to the retired member. Upon the retired member’s death, an
allowance equal to one-half of the modified amount that the retired member was receiving shall be paid to the option beneficiary.
(3)Option 4.
The modified retirement allow
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(a)
A member may, upon application for retirement, elect an option pursuant to this part that would provide an actuarially modified retirement allowance payable throughout the life of the member and the member’s option beneficiary or beneficiaries, as follows:
(1)
Option 2.
The modified retirement allowance shall be paid to the retired member. Upon the retired member’s death, an allowance equal to the modified amount that the retired member was receiving shall be paid to the option beneficiary.
(2)
Option 3.
The modified retirement allowance shall be paid to the retired member. Upon the retired member’s death, an
allowance equal to one-half of the modified amount that the retired member was receiving shall be paid to the option beneficiary.
(3)
Option 4.
The modified retirement allowance shall be paid to the retired member as long as both the retired member and the option beneficiary are living. Upon the death of either the retired member or the option beneficiary, an allowance equal to two-thirds of the modified amount that the retired member was receiving shall be paid to the surviving retired member or the surviving option beneficiary.
(4)
Option 5.
The modified retirement allowance shall be paid to the retired member as long as both the retired member and the option beneficiary are living. Upon the death of either the retired member or the option beneficiary, an allowance equal to one-half of the modified amount that the retired member was
receiving shall be paid to the surviving retired member or surviving option beneficiary.
(5)
Option 6.
The modified retirement allowance shall be paid to the retired member and upon the retired member’s death, an allowance equal to the modified amount that the retired member was receiving shall be paid to the option beneficiary.
(6)
Option 7.
The modified retirement allowance shall be paid to the retired member and upon the retired member’s death, an allowance equal to one-half of the modified amount the retired member was receiving shall be paid to the option beneficiary.
(7)
Option 8.
(A)
A member may designate multiple option beneficiaries. The member who has designated more than one option beneficiary shall elect an option
that the member is authorized to elect subject to subdivision (e) for each beneficiary designated that would provide an actuarially modified retirement allowance payable throughout the lives of the member and the member’s option beneficiaries upon the member’s death.
(B)
The modified retirement allowance shall be paid to the retired member as long as the retired member and at least one of the option beneficiaries are living. Upon the retired member’s death, an allowance shall be paid to each surviving option beneficiary in accordance with the option elected respective to that beneficiary. The member shall determine the percentage of the unmodified allowance that will be modified by the election of Option 2, Option 3, Option 4, Option 5, Option 6, or Option 7 within this option, the aggregate of which shall equal 100 percent of the member’s unmodified allowance. The election of this option is subject to approval by the board.
(C)
A member who is a party to an action for legal separation or dissolution of marriage and who is required by court order to designate a spouse or former spouse as an option beneficiary may designate his or her spouse or former spouse as a sole option beneficiary under subparagraphs (A) and (B). The member shall specify the option elected for the spouse or former spouse and the percentage of his or her unmodified allowance to be modified by the option, consistent with the court order. The percentage of the member’s unmodified allowance that is not modified by the option shall remain an unmodified allowance payable to the member. The aggregate of the percentages specified for the option beneficiary and the member’s remaining unmodified allowance, if any, shall equal 100 percent.
(b)
For purposes of this section, the member shall designate an option beneficiary on a properly executed
retirement application. Except as otherwise provided by this chapter, the option shall become effective on the member’s benefit effective date.
(c)
A member may revoke or change an election of an option at any time prior to the effective date of the member’s retirement under this part. A revocation or change of an option may not be made in derogation of a spouse’s or former spouse’s community property rights as specified in a court order.
(d)
(1)
A member may change the beneficiary designated pursuant to this section without penalty by designating a trust as beneficiary if all of the following requirements are met:
(A)
The trust conforms to the definition of trust in Section 22149.
(B)
The beneficiary of the trust is the same
person as the previously named option beneficiary.
(C)
The member files an application and any required documents in a form prescribed by the system.
(2)
If a trust is determined to be invalid or terminates after the system commences payment to the trust, beginning on the effective date of termination of the trust, the benefit shall be paid to, and all associated rights and responsibilities shall accrue to, the beneficiary of the trust so long as that beneficiary is eligible to receive a benefit pursuant to this section.
(e)
On or before July 1, 2004, the board shall evaluate the existing options and annuities provided pursuant to this section, Chapter 38 (commencing with Section 25000) of this part, and Part 14 (commencing with Section 26000) and adopt, as a plan amendment, any appropriate changes to the options and
annuities based on the needs of members, participants, and their beneficiaries, including, but not limited to, providing economic security for beneficiaries and reducing complexity in the election of options and annuities by members and participants. The changes to the options and annuities may have no net actuarial impact on the retirement fund, and the board may establish any eligibility criteria it deems necessary to prevent an adverse actuarial impact to the fund. The board shall designate the effective date of the plan amendment, which shall be at least 18 months after the amendment is adopted by the board, and notwithstanding any other provision of this section, the options and annuities available to members and participants eligible to retire pursuant to this part and Part 14 (commencing with Section 26000), after the effective date of the plan amendment made pursuant to this subdivision, shall reflect the changes adopted as a plan amendment pursuant to this subdivision.
(f)
Any member or participant who retired and elected an option or a joint and survivor annuity, or who filed a preretirement election of an option prior to the effective date of the plan amendment made pursuant to subdivision (d), may elect to change to a different option or joint and survivor annuity, as modified by the board as a plan amendment pursuant to subdivision (d), if the member or participant meets all the criteria established by the board to prevent a change in an option or joint and survivor annuity from having an adverse actuarial impact on the retirement fund, including, but not limited to, the effective date of a new designation or limitations on any changes if a member or participant, as the case may be, or beneficiary, or both, is currently not living or afflicted with a known terminal illness. The member or participant shall designate the change during the six-month period that begins with the effective date of the plan
amendment, on a form prescribed by the system. Any member changing an option election pursuant to this subdivision is not subject to the allowance reduction prescribed in Section 24309 or 24310 as a result of the election. If a member or participant elects to change his or her option or joint and survivor annuity under this subdivision, the member or participant shall retain the same option beneficiary or beneficiaries as named in the prior designation.
(g)
The Legislature reserves the right to modify this section prior to the effective date of the plan amendment made pursuant to subdivision (d) to prevent any actuarial impact to the fund.
(h)
Except as described in subdivision (e) of Section 24300.1, on or after January 1, 2007, a member may not make a new election for an option or joint and survivor annuity described in subdivision (a).
(i)
Any member with a retirement effective on or after January 1, 2007, shall elect an option from the options described in Section 24300.1. Any member making a new option election under the provisions of Section 24320, 24321, 24322, or 24323 shall elect an option from the options described in Section 24300.1 if the effective date of the new option election is on or after January 1, 2007.