§2224. Optional allowances
A.With the provision that no optional selection shall be effective in case a retiree
dies within thirty days after retirement, and that such a retiree shall be considered as an active
member at the time of death; until the first payment on account of any benefit becomes
normally due, any member may elect to receive his benefit in an equal monthly retirement
allowance payable throughout life, or he may elect to receive the actuarial equivalent at the
time of his retirement in a reduced equal monthly retirement allowance payable throughout
life with the provisions that:
Option 1. If he dies before he has received in annuity payments the present value of
his annuity as it was at the time of his retirement, the balance shall be paid to his legal
representatives or t
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§2224. Optional allowances
A. With the provision that no optional selection shall be effective in case a retiree
dies within thirty days after retirement, and that such a retiree shall be considered as an active
member at the time of death; until the first payment on account of any benefit becomes
normally due, any member may elect to receive his benefit in an equal monthly retirement
allowance payable throughout life, or he may elect to receive the actuarial equivalent at the
time of his retirement in a reduced equal monthly retirement allowance payable throughout
life with the provisions that:
Option 1. If he dies before he has received in annuity payments the present value of
his annuity as it was at the time of his retirement, the balance shall be paid to his legal
representatives or to any person he shall designate in a written instrument acknowledged and
filed with the board of trustees; or
Option 2. Upon his death, his reduced retirement allowance shall be continued
throughout the life of and paid to any person he shall designate in a written instrument
acknowledged and filed with the board of trustees at the time of his retirement; or
Option 3. Upon his death, one-half of his reduced retirement allowance shall be
continued throughout the life of and paid to any person he shall designate in a written
instrument acknowledged and filed with the board of trustees at the time of his retirement;
or
Option 4. Upon his death, some other benefit in equal monthly payments designated
by him at the time of his retirement shall be paid throughout the life of and to any person he
shall designate in a written instrument acknowledged and filed with the board of trustees at
the time of his retirement, provided, such other benefit, together with the reduced monthly
retirement allowance, shall be certified by the actuary to be of equivalent actuarial value to
his retirement allowance, and approved by the board of trustees.
B. Provided further, that if the beneficiary of the retiree is not the spouse of said
retiree and the retiree dies with an eligible surviving minor child or children, the selection
of the optional beneficiary shall be void and the minor child or children shall receive the
benefits under R.S. 11:2220(B)(2).
C. If an option other than Option 1 as provided in Subsection A of this Section was
selected, and the retiree's spouse was designated as the beneficiary, and a judgment of
divorce is rendered with respect to the retiree and the spouse, and, in connection therewith,
the spouse, irrevocably, by court order, relinquishes the spouse's survivorship rights under
the option originally selected by the retiree, the originally selected option shall be considered
revoked and the retiree shall be considered as retired under the maximum benefit, subject to
reduction as hereinafter set forth. The benefits payable to the retiree shall be increased to the
amount the retiree would have received had the retiree selected the maximum benefit,
adjusted for any cost-of-living increase granted to the retiree, less any amount required as a
result of such change in retirement status to render the new benefit to be the actuarial
equivalent of the maximum benefit. The retiree or member who is or has participated in the
Deferred Retirement Option Plan may select an option other than Option 1 as provided in
Subsection A of this Section based upon the new benefit. The retiree shall be required to
reimburse the system, by way of a one-time deduction from the retiree's next benefit check,
the reasonable cost incurred by the system to have these calculations made. The retiree shall
be required to contractually hold the system harmless in the event that the former spouse ever
successfully asserts a property right relative hereto which has any adverse effect upon the
system. It shall be the responsibility of the retiree to notify the system of these
circumstances, to present satisfactory evidence of same, and to request the recomputation of
benefits. Adjustment of benefits under this Subsection shall not be retroactive, and shall be
effective on the first day of the next month following official approval of the application for
recomputation of benefits.
D. No change in the option elected by the member, other than as provided by
Subsection C of this Section, shall be permitted after the effective date of retirement.
E. A retiree cannot change the designation of beneficiary after the effective date of
retirement unless the retirement was approved under Option 1, other than as provided by
Subsection C of this Section.
F. Initial benefit option. (1) The initial benefit option provided in this Subsection
is available to a member who has not participated in the Deferred Retirement Option Plan
provided in this Chapter and who selects the maximum benefit provided in Subsection
A(introductory paragraph) of this Section, or Option 2, 3, or 4 thereof and, if this initial
benefit option is selected, the person shall thereafter be ineligible to participate in the
Deferred Retirement Option Plan under this Chapter.
(2) If a member selects the initial benefit option provided in this Subsection, the
member may receive an initial benefit plus a reduced monthly retirement allowance, provided
the initial benefit together with the reduced monthly retirement allowance shall equal the
actuarially equivalent amount of his maximum retirement allowance.
(3) The initial benefit, as determined by the member, shall not exceed an amount
equal to thirty-six payments of the member's maximum retirement allowance.
(4) At the option of the member, the initial benefit shall be paid as a lump-sum
payment or shall be placed in an account called an "initial benefit account", established in
accordance with the same procedures set forth in R.S. 11:2221, with interest credited thereto
and monthly payments made from the account in accordance therewith.
(5) The monthly retirement benefit received by the retiree and the beneficiary or
survivor shall be based on the amount otherwise payable under the retirement option selected
by the member, which shall be actuarially reduced by a prorated amount calculated to offset
the cost of the initial benefit payment.
(6) If a change in option selection is allowed under the provisions of Subsection C
of this Section, the monthly benefit payable under those provisions shall be actuarially
reduced by a prorated amount calculated to offset the cost of the initial benefit payment.
(7) A person who retires under the provisions of disability retirement may not select
the initial benefit option.
(8) Cost-of-living adjustments granted by the board of trustees to retirees who select
the initial benefit option shall be computed on the basis of each retiree's regular monthly
retirement benefit or on the basis of each beneficiary or survivor's benefit based on the option
selected as reduced and shall not be computed on the initial benefit received either as a lump
sum or paid pursuant to R.S. 11:2221.
G.(1) A member who is married under a community property regime shall provide
consent of his spouse or an affidavit of unknown location, as provided in Paragraph (2) of
this Subsection, before he can elect any of the following retirement options:
(a) The maximum benefit under the introductory paragraph of Subsection A of this
Section.
(b) Any other option under Subsection A of this Section naming someone other than
the member's spouse as the beneficiary.
(c) Any Deferred Retirement Option Plan annuity benefit approved by the board of
trustees naming someone other than the member's spouse as the beneficiary.
(2)(a) For purposes of this Subsection, consent of the spouse shall be in writing on
a form provided by the system and executed before a notary public.
(b) If the spouse cannot be located, the member shall submit an original affidavit
signed by the member before a notary public that evidences good faith efforts to locate the
spouse.
(3) The system shall establish the benefit as if the member had selected a fifty
percent joint and survivor annuity as provided in Subsection A of this Section for a member
who is married under a community property regime and who does not provide spousal
consent or affidavit of unknown location at the time of the member retirement.
(4) A married member is deemed to be married under a community property regime
unless the member submits to the system a valid and enforceable matrimonial agreement
establishing a marital regime of separate property. By furnishing such agreement to the
system, the member agrees to indemnify and hold harmless the state and the system from any
responsibility or liability based on the validity, enforceability, or effectiveness of the separate
property agreement and any benefits thereafter paid to the member. If the system's reliance
on an invalid or unenforceable separate property agreement causes the system to pay excess
benefits, the system shall reduce the future benefits payable to the member in an amount
necessary to completely offset such excess benefits.
H. A special needs trust may be named as an optional beneficiary.