(a)General rule.--Upon termination of service, any full coverage member who is eligible to receive an annuity pursuant to the provisions of section 8307(a) or (b) (relating to eligibility for annuities) and has made an application in accordance with the provisions of section 8507(f) (relating to rights and duties of school employees, members and participants) shall be entitled to receive a maximum single life annuity attributable to his credited service and equal to the sum of the following single life annuities beginning at the effective date of retirement and, in case the member on the effective date of retirement is under superannuation age, multiplied by a reduction factor calculated to provide benefits actuarially equivalent to an annuity starting at superannuation age: Provided howe
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(a) General rule.--Upon termination of service, any full coverage member who is eligible to receive an annuity pursuant to the provisions of section 8307(a) or (b) (relating to eligibility for annuities) and has made an application in accordance with the provisions of section 8507(f) (relating to rights and duties of school employees, members and participants) shall be entitled to receive a maximum single life annuity attributable to his credited service and equal to the sum of the following single life annuities beginning at the effective date of retirement and, in case the member on the effective date of retirement is under superannuation age, multiplied by a reduction factor calculated to provide benefits actuarially equivalent to an annuity starting at superannuation age: Provided however, That on or after July 1, 1976, in the case of any member other than a Class T-G or Class T-H member who has attained age 55 and has 25 or more eligibility points such sum of single life annuities shall be reduced by a percentage determined by multiplying the number of months, including a fraction of a month as a full month, by which the effective date of retirement precedes superannuation age by 1/4%: Further provided, That on or after July 1, 2019, in the case of any Class T-G member who terminates service on or after attaining age 57 and has 25 or more eligibility points, such sum of single life annuities shall be reduced by a percentage determined by multiplying the number of months, including a fraction of a month as a full month, by which the effective date of retirement precedes superannuation age by 1/4%: Further provided, That on or after July 1, 2019, in the case of any Class T-H member who has 25 or more eligibility points and who terminates service on or after attaining age 55, such sum of single life annuities shall be reduced by a percentage determined by multiplying the number of months, including a fraction of a month as a full month, by which the effective date of retirement precedes superannuation age by 1/4%: Further provided, In no event shall a Class T-E, Class T-F, Class T-G or Class T-H member receive an annual benefit, calculated as of the effective date of retirement, greater than the member's final average salary:
(1) A single life annuity that is the sum of annuities determined separately for each class of service and calculated on the basis of the number of years of credited school service other than concurrent service.
(2) A standard single life annuity multiplied by the class of service multiplier and calculated on the basis of the number of years of concurrent service and multiplied by the ratio of total compensation received in the school system during the period of concurrent service to the total compensation received during such period.
(3) A supplemental annuity such that the total annuity prior to any optional modification or any reduction due to retirement prior to superannuation age shall be at least $100 for each full year of credited service.
(b) Present value of annuity.--The present value of the maximum single life annuity as calculated in accordance with subsection (a) shall be determined by multiplying the maximum single life annuity by the cost of a dollar annuity on the effective date of retirement. Such present value shall be decreased only as specifically provided in this part.
(c) Limitation regarding annual benefit under IRC § 415(b).--Notwithstanding any provision of this part to the contrary, no benefit shall be payable to the extent that such benefit exceeds any limitation under IRC § 415(b) in effect with respect to governmental plans, as such term is defined in IRC § 414(d), on the date the benefit payment becomes effective, provided that any increase in any limitation under IRC § 415 shall be applicable to all current and future annuitants and survivor annuitants.
(d) Coordination of benefits.--The determination and payment of the maximum single life annuity under this section shall be in addition to any payments a member may be entitled to receive, has received or is receiving as a result of being a participant in the plan.
(e) Special calculation for Class T-G and Class T-H.--For the calculation under subsection (a) for all Class T-G and Class T-H members who are under age 62 and have less than 25 years of credited service, the reduction factor used in the calculation for an annuity shall be determined so that a maximum single life annuity with an effective date of retirement before the member attains age 62 shall be actuarially equivalent to the maximum single life annuity the member would receive if the member had become a vestee and applied for an annuity with an effective date of retirement on the date the member attained age 62. For purposes of this subsection, the maximum single life annuity actually being received shall be actuarially equivalent to the maximum single life annuity with an effective date of attaining age 62 if the actual maximum single life annuity has the same present value as the maximum single life annuity at age 62, computed on the basis of interest at the rate as calculated by the board's actuary and the mortality tables adopted by the board.