SB68ENROLLED
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KJMJUA-2
By Senator Chambliss
RFD: Finance and Taxation General Fund
First Read: 21-Mar-23
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Enrolled, An Act,
To amend Sections 36-27-1, 36-27-16, as last amended by
Acts 2022-184 and 2022-351, 2022 Regular Session, and 41-27-7,
Code of Alabama 1975, relating to retirement benefits for
employees who are members of the Employees' Retirement System;
to reopen the State Police Tier II Plan to any employee of the
Alabama State Law Enforcement Agency who is certified by the
Alabama Peace Officers' Standards and Training Commission and
performs law enforcement duties; to modify the Tier II
benefits received by all State Police Tier II members; and to
clarify that employees of the Alabama State Law Enforcement
Agency are state policemen for retirement purposes.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Sections 36-27-1, 36-27-16, as last amended
by Acts 2022-184 and 2022-351, 2022 Regular Session, and
41-27-7 of the Code of Alabama 1975, are amended to read as
follows:
"§36-27-1
When used in this article, the following terms shall
have the following meanings, respectively, unless the context
clearly indicates otherwise:
(1) RETIREMENT SYSTEM. The Employees' Retirement System
of Alabama as defined in Section 36-27-2.
(2) EMPLOYEE. Any regular employee of the State of
Alabama whose salary is paid by state warrant by the state,
except a member of the Legislature of the state, a person who
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is covered or eligible to be covered under the Teachers'
Retirement System of Alabama or any other retirement system to
which contributions are made by the state, an elective
official of the state government, and a temporary employee or
person engaged under retainer or special agreement. In all
cases of doubt the Board of Control shall determine who is an
employee within the meaning of this article. The term shall
include any regular employee of the Alabama state hospitals
and Partlow State School and Hospital and the Alabama State
Port Authority, however paid.
(3) EMPLOYER. The State of Alabama or any department,
commission, institution, or any other agency of and within the
state by which an employee is paid, including employers as
provided in Section 36-27-6.
(4) MEMBER. Any employee included in the membership of
the system as provided in Section 36-27-4.
(5) BOARD OF CONTROL. The board provided for in Section
36-27-23 to administer the retirement system.
(6) MEDICAL BOARD. The board of physicians provided for
in Section 36-27-23.
(7) SERVICE. Service as an employee paid for by an
employer.
(8) PRIOR SERVICE. Service rendered prior to the date
of establishment of the retirement system for which credit is
allowable under Section 36-27-11.
(9) MEMBERSHIP SERVICE. Service as an employee rendered
while a member of the retirement system and on account of
which contributions are made.
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(10) CREDITABLE SERVICE. "Prior service" plus
"membership service" rendered since last becoming a member.
(11) BENEFICIARY. Any person in receipt of a pension,
an annuity, a retirement allowance or other benefit as
provided by this article.
(12) REGULAR INTEREST. Interest compounded annually at
the rate determined by the Board of Control in accordance with
subsection (f) of Section 36-27-25.
(13) ACCUMULATED CONTRIBUTIONS. The sum of all the
amounts deducted from the compensation of a member credited to
his or her individual account in the Annuity Savings Fund,
together with regular interest thereon, as provided in Section
36-27-24.
(14) EARNABLE COMPENSATION. The full rate of
compensation that would be payable to an employee if he or she
worked the full normal work-time. In cases where compensation
includes maintenance, the Board of Control shall fix the value
of that part of the compensation not paid in money. Earnable
compensation shall not exceed the limitations imposed by
Section 401(a)(17) of the Internal Revenue Code for public
pension funds, except that any employee who was a member of
the Employees' Retirement System before the first plan year
beginning after December 31, 1995, shall not be subject to the
earning limitations set forth in Section 401(a)(17). For Tier
I plan members, the term earnable compensation for retirement
purposes shall not include subsistence payments that are made
to a member and shall include overtime payments that are made
to a member; however, earnable compensation shall not exceed
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120 percent of any members' annual base compensation as
certified by the employer. For Tier II plan members, earnable
compensation shall include overtime payments that are made to
the member but shall not include subsistence payments that are
made to the member and shall not exceed one hundred
twenty-five percent (125%) of the member's annual base
compensation, as certified by the employer.
(15) AVERAGE FINAL COMPENSATION. For any Tier I plan
member, the average annual compensation of the member, with
respect to which he or she had made contributions pursuant to
subsection (b) of Section 36-27-24 during the three years, in
his or her last 10 years of creditable service for which the
average is highest or during his or her entire period of
creditable service if less than three years; except, that for
any period prior to November 1, 1959, the compensation used in
computing the average shall include compensation in excess of
the maximum amount with respect to which members were required
to contribute. For any Tier II plan member, the average annual
compensation of the member, with respect to which he or she
has made contributions pursuant to subsection (b) of Section
36-27-24 during the five years, in his or her last ten 10
years of creditable service for which the average is highest
or during his or her entire period of creditable service if
less than five years.
(16) ANNUITY. Payments for life derived from the
"accumulated contributions" of a member. All annuities shall
be payable in equal monthly installments.
(17) PENSION. Payments for life derived from money
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provided by the employer. All pensions shall be payable in
equal monthly installments.
(18) RETIREMENT ALLOWANCE. The sum of the "annuity" and
the "pension."
(19) RETIREMENT. Withdrawal from active service with a
retirement allowance or optional benefit in lieu thereof
granted under this article.
(20) ANNUITY RESERVE. The present value of all payments
to be made on account of any annuity or benefit in lieu of any
annuity computed upon the basis of the mortality tables
adopted by the Board of Control and regular interest.
(21) PENSION RESERVE. The present value of all payments
to be made on account of any pension or benefit in lieu of any
pension computed upon the basis of the mortality tables
adopted by the Board of Control and regular interest.
(22) ACTUARIAL EQUIVALENT. A benefit of equal value
when computed upon the basis of the mortality tables adopted
by the Board of Control and regular interest.
(23) STATE POLICEMAN. An employee in the classified
service under the Merit System Act approved by the State
Personnel Board to perform the duties of highway patrolman or
a beverage control agent or a crime investigator. The term
includes any employee hired by of the Alabama State Law
Enforcement Agency after January 1, 2015, who is certified by
the Alabama Peace Officers' Standards and Training Commission
and performs law enforcement duties. Such an employee of the
Alabama State Law Enforcement Agency shall pay the same
employee contribution rate as and receive the same benefits as
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Tier II law enforcement officers, as defined by Section
36-27-59(a)(3). The term shall not include a member employed
as a policeman under Section 36-27-6.
(24) TIER I PLAN. The defined benefit pension plan
provided by the Retirement System to Tier I plan members.
(25) TIER II PLAN. The defined benefit pension plan
provided by the Retirement System to Tier II plan members.
(26) TIER I PLAN MEMBER. Any member of the Retirement
System who had service for which he or she received credit in
the Employees' Retirement System or in the Teachers'
Retirement System prior to January 1, 2013.
(27) TIER II PLAN MEMBER. Any member of the Retirement
System who first began eligible employment with an Employees'
Retirement System or a Teachers' Retirement System
participating employer on or after January 1, 2013, and who
had no eligible service in the Employees' Retirement System or
the Teachers' Retirement System prior to January 1, 2013."
"§36-27-16
(a)(1) RETIREMENT, ETC., OF EMPLOYEES GENERALLY;
ELIGIBILITY FOR SERVICE RETIREMENT BENEFITS.
a. Any Tier I plan member who withdraws from service
upon or after attainment of age 60 and any Tier II plan member
who withdraws from service upon or after attainment of age 62
may retire upon written application to the Board of Control
setting forth at what time, not less than 30 days nor more
than 90 days subsequent to the execution and filing thereof,
he or she desires to be retired; provided, that any such
member who became a member on or after October 1, 1963, shall
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have completed 10 or more years of creditable service;
provided further, that a Tier I or Tier II plan member
employed as a state policeman shall be eligible to file
application for service retirement upon attaining age 52 and a
Tier II plan member employed as a state policeman or employed
as a correctional officer, firefighter, or law enforcement
officer as defined in Section 36-27-59 with at least 10 years
of creditable service as a correctional officer, firefighter,
or law enforcement officer shall be eligible to file
application for service retirement upon attaining age 56.
b. Any Tier I plan member who has attained age 60, or
age 52 in the case of a state policeman and any Tier II plan
member who has attained age 62, or age 56 52 in the case of a
state policeman, or age 56 in the case of a correctional
officer, firefighter, or law enforcement officer as defined in
Section 36-27-59 who has at least 10 years of creditable
service as a correctional officer, firefighter, or law
enforcement officer, and has previously withdrawn from service
may retire upon written application to the Board of Control
setting forth at what time, not less than 30 days nor more
than 90 days subsequent to the execution and filing thereof,
he or she desires to be retired; provided, the member shall
have at the time of his or her withdrawal from service
completed the age and service requirements established by the
Board of Control for eligibility for deferred benefits;
provided, that the minimum number of years of creditable
service shall not be less than 10 years nor more than 25
years.
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c. In addition to any law or part of law relating to
service retirement under the Employees' Retirement System of
Alabama, any Tier I plan member of the Employees' Retirement
System or Tier II plan member employed as a state policeman
who withdraws from service after completion of not less than
25 years of creditable service, or any Tier II plan member who
withdraws from service after completion of not less than 30
years of creditable service, may retire without a reduction in
retirement allowance upon written application to the Board of
Control of the Employees' Retirement System setting forth the
first day of which month, not less than 30 days or more than
90 days subsequent to the execution and filing thereof, he or
she desires to be retired, provided that no person whose
employer participates in the Employees' Retirement System
under Section 36-27-6 shall be entitled to the benefits
provided in this paragraph for Tier I members unless the
employer elects to come under the provisions of the paragraph.
Any employer making this election must bear the cost of the
benefit.
(2) AMOUNT OF SERVICE RETIREMENT ALLOWANCE.
a. Upon retirement from service, a Tier I plan member
shall receive a service retirement allowance which shall
consist of:
1. An annuity which shall be the actuarial equivalent
of his or her accumulated contributions at the time of his or
her retirement; except, that in the case of a state policeman
who has completed 20 years of creditable service as a state
policeman who retires after age 56 but prior to age 60, the
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annuity shall be equal to the annuity that would have been
payable upon service retirement at age 60 had the member
continued in service to age 60 without change in compensation;
2. A pension which shall be equal to the annuity
allowance at age of retirement, but not to exceed an annuity
allowable at age 65, computed on the basis of contributions
made prior to attainment of age 65; except, that in the case
of a state policeman who has completed 20 years of creditable
service as a state policeman who retires after age 56 but
prior to age 60, the pension shall be equal to the annuity
that he or she would have received had he or she contributed
to age 60 without change in compensation; and
3. An additional pension, if he or she has a prior
service certificate in full force and effect, which shall be
equal to the annuity which would have been provided at the age
of retirement, but which shall not exceed an annuity allowable
at age 65 by twice the contributions which he or she would
have made during the period of prior service with which he or
she is credited had the system been in operation and had he or
she contributed thereunder; except, that in case of a state
policeman who has completed 20 years of creditable service as
a state policeman who retired after age 56 but prior to age
60, an additional pension, if he or she has a prior service
certificate in full force and effect, which shall be equal to
the annuity which would have been provided at age 60, but
which shall not exceed an annuity allowable at age 60 by twice
the contributions which he or she would have made during the
period of prior service with which he or she is credited had
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the system been in operation and had he or she contributed
thereunder.
b. Notwithstanding the provisions of subparagraphs 1.,
2., and 3. of paragraph a. of this subdivision, a state
policeman who is a Tier I plan member and who has completed 20
years of service as a state policeman who retires after age 52
but prior to age 56 shall receive:
1. An annuity which shall be equal to the annuity that
would have been payable had the member continued in service
for four years without change in compensation;
2. A pension which shall be equal to the annuity that
he or she would have received had he or she contributed for
four years without change in compensation; and
3. An additional pension, if he or she has a prior
service certificate in full force and effect, which shall be
equal to the annuity which would have been provided at the age
of retirement, but which shall not exceed an annuity allowable
at the age of retirement plus four years by twice the
contributions which he or she would have made during the
period of prior service with which he or she is credited had
the system been in operation and had he or she contributed
thereunder. In lieu of a determination of the actual
compensation of a member that was received during that prior
service, the Board of Control may use for the purpose of this
article the compensation rate which, if it had progressed with
the rates of salary increase shown in the tables as prescribed
in subsection (n) of Section 36-27-23, would have resulted in
the same average salary of the member for the five years
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immediately preceding the date of establishment as the records
show the member actually received.
c. The annual service retirement pension payable to a
Tier I plan member not employed as a state policeman retiring
on or after October 1, 1975, shall not be less than an amount
which, when added to his or her annuity, is equal to the
greater of the following two amounts:
1. Two and one-eightieth percent of the member's
average final compensation multiplied by the number of years
of his or her creditable service; or
2. If he or she became a member before October 1, 1965,
seventy-two dollars ($72) multiplied by the number of years of
his or her creditable service not in excess of 25 years.
d. The annual service retirement pension payable to a
Tier I plan member employed as a state policeman retiring on
or after October 1, 1975, shall not be less than an amount
which, when added to his or her annuity, is equal to the
greater of the following two amounts:
1. Two and seven-eighths percent of the member's
average final compensation multiplied by the number of years
of his or her creditable service. Creditable service for any
state policeman under the age of 56 years who has completed 20
years of creditable service as a state policeman shall include
a bonus equal to four additional years. Creditable service for
a state policeman 56 years or older shall include a bonus
equal to the years or portion thereof remaining until the
member reaches age 60; or
2. If he or she became a member before October 1, 1965,
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eighty-six dollars forty cents ($86.40) multiplied by the
number of years of his or her creditable service not in excess
of 25 years; provided, however, that if the member has
completed 20 years of creditable service as a state policeman
and has not attained age 60 at the time of retirement, the
pension shall be determined as provided in this subparagraph
on the basis of the number of years of creditable service
which he or she would have had if he or she had remained in
service for four years, except that, in the case of those
state policemen retiring at age 56 or after, the number of
years in determining the pension shall not exceed the number
of years of creditable service which he or she would have had
if he or she had remained in service to age 60.
e. Upon retirement from service, a Tier II plan member
who is not employed as a state policeman shall receive a
service retirement allowance which shall consist of an annuity
which shall be the actuarial equivalent of the member's
accumulated contributions at the time of retirement and a
pension which, when added to the member's annuity, shall be
equal to one and sixty-five hundredths percent (1.65%) of the
member's average final compensation multiplied by the number
of years of creditable service. The service retirement
allowance for a member who retires with 30 years of creditable
service before reaching the age of 62 shall be reduced by two
percent (2%) for each year of the difference between age 62
and the age at retirement of the member. Notwithstanding the
foregoing, the service retirement allowance shall not exceed
eighty percent (80%) of the member's average final
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compensation.
f. Upon retirement from service, a Tier II plan member
who is employed as a state policeman shall receive a service
retirement allowance which shall consist of an annuity which
shall be the actuarial equivalent of the member's accumulated
contributions at the time of retirement and a pension which,
when added to the member's annuity, shall be equal to two and
three-eighths percent (2.375%) of the member's average final
compensation multiplied by the member's number of years of
creditable service. The service retirement allowance for a
member who retires with 30 years of creditable service before
reaching the age of 62 shall be reduced by two percent (2%)
for each year of the difference between age 62 and the age at
retirement of the member. Notwithstanding the foregoing, the
service retirement allowance shall not exceed eighty percent
(80%) of the member's average final compensation. Creditable
service for any Tier II plan member who is employed as a state
policeman shall include one year of hazardous duty time for
every five years of service as a state policeman.
g. Anything in this article to the contrary
notwithstanding, in the application of the foregoing
provisions of this subdivision to a member whose creditable
service includes a period of service as a state policeman and
a period of service in another employment classification, the
benefit rates applicable to a member employed as a state
policeman shall apply to all creditable service as a state
policeman, and the benefit rates applicable to a member not
employed as a state policeman shall apply to all creditable
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service, but in all other respects the pension under this
subdivision shall be determined on the basis of the member's
employment classification at the time of his or her withdrawal
from service.
h. The annual service retirement pension payable to any
state employee who had attained age 60 on or before October 1,
1945, who declined membership in the Employees' Retirement
System of Alabama in the manner prescribed in Section 36-27-4
and who retires as a state employee after completing a minimum
of 15 years' service shall be seventy-two dollars ($72)
multiplied by the number of years of his or her service not in
excess of 25 years.
(b)(1) RETIREMENT OF DISABLED EMPLOYEES; ELIGIBILITY
FOR DISABILITY RETIREMENT BENEFITS.
a. Upon application of a Tier I plan member in service
or of his or her employer, any member who has had 10 or more
years of creditable service who becomes disabled may be
retired on a disability retirement allowance by the Board of
Control not less than 30 nor more than 90 days next following
the date of filing of the application; provided, that the
medical board, after a medical examination of the member,
shall certify that the member is mentally or physically
incapacitated for the further performance of duty, that the
incapacity is likely to be permanent and that the member
should be retired. Upon the application of a Tier II plan
member in service or his or her employer, any member who has
had 10 or more years of creditable service may be retired by
the Board of Control on a disability retirement allowance not
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less than 30 nor more than 90 days next following the date of
filing the application; provided, that the medical board,
after a medical examination of the member, shall certify that
the member is totally and permanently mentally or physically
incapacitated from regular and substantial gainful employment,
and that member should be retired.
b. Without regard to the number of years of creditable
service, a member employed as a state policeman, a municipal
police officer or a deputy sheriff, or a member employed as a
state, municipal, or county firefighter who is not covered
through his or her current employer under the United States
Social Security Act, who as a result of his or her employment,
in the line of duty and not as a result of his or her own
misconduct, shall become permanently and totally disabled to
the extent that he or she cannot perform his or her duties or
duties of a less strenuous nature, as an employee of the State
of Alabama or as an employee of an employer participating
under the provisions of Section 36-27-6, shall be retired on a
disability retirement allowance, not less than 30 nor more
than 90 days next following the date of filing of the
application, provided that the medical board, after a medical
examination of the member shall certify that the member is
mentally or physically incapacitated for the further
performance of duty, that the incapacity is likely to be
permanent, and that the member should be retired.
(2) AMOUNT OF DISABILITY RETIREMENT ALLOWANCE.
a. Upon retirement for disability a member shall
receive a service retirement allowance based on age and
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service if he or she is a Tier I plan member and he or she has
attained age 60 or if he or she is a Tier II plan member and
he or she has attained age 62, or if any law or part of any
law pertaining to retirement under the Employees' Retirement
System of Alabama provides for service retirement after the
completion of 25 years of creditable service or 30 years of
creditable service without a reduction in the retirement
allowance and the member has completed 25 years of creditable
service or 30 years of creditable service, whichever is
applicable, or, in the case of a state policeman, if he or she
is a Tier I plan member and he or she has attained age 52 or,
in the case of a state policeman or a correctional officer,
firefighter, or law enforcement officer as defined in Section
36-27-59 with at least 10 years of creditable service as a
correctional officer, firefighter, or law enforcement officer,
if he or she is a Tier II plan member and he or she has
attained age 56 otherwise eligible to retire ; otherwise, he or
she shall receive a disability retirement allowance which
shall consist of:
1. An annuity which shall be the actuarial equivalent
of his or her accumulated contributions at the time of his or
her retirement;
2. A pension which shall be equal to the pension that
would have been payable under subparagraphs (a)(2)a.2. and
(a)(2)a.3. of this section upon service retirement at age 65
had the member continued in service to that age without change
in compensation.
b. The annual disability retirement pension payable to
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a Tier I plan member not employed as a state policeman
retiring on or after October 1, 1975, shall not be less than
an amount which when added to his or her annuity is equal to
the greatest of the following two amounts:
1. Two and one-eightieth percent of the member's
average final compensation multiplied by the number of years
of creditable service.
2. If he or she became a member before October 1, 1965,
fifty-four dollars ($54) multiplied by the number of years of
his or her creditable service not in excess of 25 years.
c. The annual disability retirement pension payable to
a Tier I plan member employed as a state policeman retiring on
or after October 1, 1975, shall not be less than an amount
which when added to his or her annuity is equal to the greater
of the following two amounts:
1. Two and seven-eighths percent of the member's
average final compensation multiplied by the number of years
of his or her creditable service. Creditable service for any
state policeman under the age of 56 years who has completed 20
years of creditable service as a state policeman shall include
a bonus equal to four additional years. Creditable service for
a state policeman 56 years or older shall include a bonus
equal to the years or portion thereof remaining until the
member reaches age 60; or
2. If he or she became a member before October 1, 1965,
sixty-four dollars eighty cents ($64.80) multiplied by the
number of years of his or her creditable service not in excess
of 25 years.
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d. The annual disability retirement allowance payable
to a Tier II plan member not employed as a state policeman
shall be equal to one and sixty-five hundredths percent
(1.65%) of the member's average final compensation multiplied
by the number of years of creditable service.
e. The annual disability retirement allowance payable
to a Tier II plan member employed as a state policeman shall
be equal to two and three-eighths percent (2.375%) of the
member's average final compensation multiplied by the number
of years of creditable service.
f. Anything in this chapter to the contrary
notwithstanding in the application of the provisions of this
subdivision to a member whose creditable service includes a
period of service as a state policeman and a period of service
in another employment classification the benefit rates
applicable to a member employed as a state policeman shall
apply to all creditable service as a state policeman, and the
benefit rates applicable to a member not employed as a state
policeman shall apply to all other creditable service, but in
all other respects the pension under this subdivision shall be
determined on the basis of the member's employment
classification at the time of his or her withdrawal from
service.
(3) REEXAMINATION OF BENEFICIARIES RETIRED ON ACCOUNT
OF DISABILITY. Once each year during the first five years
following the retirement of a member on a disability
retirement allowance and once every three-year period
thereafter, the Board of Control may, and upon his or her
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application shall, require any disability beneficiary who has
not yet attained age 60 if the beneficiary is a Tier I plan
member or age 62 if the beneficiary is a Tier II plan member
to undergo a medical examination, the examination to be made
at the place of residence of the beneficiary or other place
mutually agreed upon by a physician or physicians of or
designated by the medical board. Should any disability
beneficiary who has not yet attained age 60 , if the
beneficiary is a Tier I plan member or age 62 , if the
beneficiary is a Tier II plan member , refuse to submit to the
medical examination, his or her allowance may be discontinued
until his or her withdrawal of the refusal, and, should his or
her refusal continue for one year, all his or her rights in
and to his or her pension may be revoked by the Board of
Control; provided, that these requirements relative to the
medical examination shall not apply in the case of a state
policeman retired for disability and who has attained age 52
if he or she is a Tier I plan member or in the case of a state
policeman or a correctional officer, firefighter, or law
enforcement officer as defined in Section 36-27-59 with at
least 10 years of creditable service as a correctional
officer, firefighter, or law enforcement officer retired for
disability who has attained age 56 if he or she is a Tier II
plan member. Should the medical board report and certify to
the Board of Control that a disability beneficiary who is a
Tier I plan member is engaged in or is able to engage in a
gainful occupation paying more than the difference between his
or her retirement allowance and his or her average final
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compensation and should the Board of Control concur in the
report, then the amount of his or her pension shall be reduced
to an amount which, together with his or her annuity and the
amount earnable by him or her, shall equal the amount of his
or her average final compensation. Should his or her earning
capacity be later changed, the amount of his or her pension
may be further modified; provided, that the new pension shall
not exceed the amount of the pension originally granted nor an
amount which, when added to the amount earnable by the
beneficiary, together with this annuity exceeds the amount of
his or her average final compensation.
Should the medical board report and certify to the
Board of Control that a disability beneficiary who is a Tier
II plan member has the capacity to engage in regular and
substantial gainful employment, the Board of Control shall
discontinue the beneficiary's retirement allowance until the
beneficiary is otherwise eligible for service retirement.
(c) Disposition of contributions and allowances upon
death, etc., of member.
(1) Should a member cease to be an employee except by
death or by retirement under the provisions of this article,
the contributions standing to the credit of his or her
individual account in the Annuity Savings Fund shall be paid
to him or her upon demand and, in addition to the payment,
there shall be paid five-tenths of the interest accumulations
standing to the credit of his or her individual account if he
or she shall have not less than three but less than 16 years
of membership service, six-tenths of the interest
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Page 21
accumulations if he or she shall have not less than 16 but
less than 21 years of membership service, seven-tenths of the
interest accumulations if he or she shall have not less than
21 but less than 26 years of membership service and
eight-tenths of the interest accumulations if he or she shall
have not less than 26 years of membership service.
(2) In case of the death of a member eligible for
service retirement pursuant to subsection (a), an allowance
shall be paid to the surviving spouse, if designated as the
sole beneficiary, in an amount that would have been payable if
the member had retired immediately prior to his or her death
and had elected Option 2, as set forth in subsection (d), or
to such other person who the member shall have designated, in
an amount that would have been payable if the member had
retired immediately prior to his or her death and had elected
Option 3, as set forth in subsection (d). Alternatively, if
the surviving spouse or other designee desires, he or she may
choose to receive, in lieu of the allowance provided under
Option 2 or Option 3, the accumulated contributions of the
member plus an amount equal to the accumulated contributions
of the member not to exceed five thousand dollars ($5,000) or
the accumulated contributions of the member plus the benefit
provided by Section 36-27B-3 if a benefit is payable under
that section;
(3) In case of the death of a Tier I plan member not
eligible for service retirement, after completion of 25 years
of creditable service, an allowance shall be paid to the
surviving spouse, if designated as the sole beneficiary, in an
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Page 22
amount that would have been payable if the member had retired
immediately prior to his or her death and had elected Option
2, as set forth in subsection (d), or to such other person who
the member shall have designated, in an amount that would have
been payable if the member had retired for disability
immediately prior to his or her death and had elected Option 3
as set forth in subsection (d). Alternatively, if the
surviving spouse or other designee desires, he or she may
choose to receive, in lieu of the allowance provided under
Option 2 or Option 3, the accumulated contributions of the
member plus an amount equal to the accumulated contributions
of the member not to exceed five thousand dollars ($5,000) or
the accumulated contributions of the member plus the benefit
provided by Section 36-27B-3 if a benefit is payable under
that section. For purposes of this subsection only, hazardous
duty time, as set forth in subdivision (b)(1) of Section
36-27-59, may be used in calculating the requisite years of
service for firefighters, law enforcement officers, and
correctional officers even if the member has not otherwise
attained 25 years of creditable service;
(4) Upon the death of a member on account of whom no
survivor allowance is payable under subdivisions (2) or (3) of
this subsection, the accumulated contributions of the member
plus an amount equal to the accumulated contributions not to
exceed five thousand dollars ($5,000) or the accumulated
contributions of the member plus the benefit provided by
Section 36-27B-3 if a benefit is payable under that section
shall be paid to his or her estate or to such person as he or
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Page 23
she shall have nominated by written designation duly executed
and filed with the Board of Control.
(d) Optional allowances. With the provision that the
election of an option shall be effective on the effective date
of retirement, any member may elect prior to retirement to
receive, in lieu of his or her retirement allowance payable
throughout life, the actuarial equivalent, at that time, of
his or her retirement allowance in a reduced retirement
allowance payable throughout life with the provisions that:
(1) OPTION 1. If he or she dies before he or she has
received in annuity payments the present value of his or her
annuity as it was at the time of his or her retirement, the
balance shall be paid to his or her legal representatives or
to the person as he or she shall nominate by written
designation duly acknowledged and filed with the Board of
Control;
(2) OPTION 2. Upon his or her death, his or her reduced
retirement allowance shall be continued throughout the life of
and paid to the person as he or she shall nominate by written
designation duly acknowledged and filed with the Board of
Control at the time of his or her retirement;
(3) OPTION 3. Upon his or her death, one half of his or
her reduced allowance shall be continued throughout the life
of and paid to the person as he or she shall nominate by
written designation duly acknowledged and filed with the Board
of Control at the time of his or her retirement; or
(4) OPTION 4. Some other benefit or benefits shall be
paid either to the member or to the person or persons as he or
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Page 24
she shall nominate; provided, that those other benefits,
together with the reduced retirement allowance, shall be
certified by the actuary to be of equivalent actuarial value
to his or her retirement allowance and shall be approved by
the Board of Control .; or
(5) OPTION 5. At the time of retirement, he or she
shall receive a partial lump sum distribution as a single
payment not to exceed the sum of 24 months of the maximum
monthly retirement allowance the member could receive. This
option may be elected in addition to the election of another
option under this subsection and the further reduced monthly
retirement allowance shall be calculated in accordance with
the selected option. This option shall not be available to a
member who is receiving a disability retirement.
(e) Effect of return to active service. Should any
beneficiary be restored to active service, his or her
retirement allowance shall be suspended until he or she again
withdraws from service and he or she shall not again become a
member of the retirement system nor shall he or she make
contributions; except, that should the beneficiary who has
been restored to active service continue in service for a
period of two or more years from the date of his or her
reentry into active service, he or she may request the Board
of Control to allow him or her to again become a member of the
retirement system. The Board of Control may grant the request
for restoration to membership; provided, that the beneficiary
whose retirement allowance has been suspended shall repay to
the system all monies received by him or her as benefits
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Page 25
during any periods subsequent to the date of his or her
reentry into active service and shall make a contribution
equal to the amount he or she would have contributed had he or
she been a member during the period of his or her restoration
to active service on a suspended allowance basis together with
the interest that would have been credited to the
contributions on account of the period of restoration up to
the date the contribution is made.
(f)(1) REDETERMINATION, ETC., OF CERTAIN ALLOWANCES.
All retirement allowance payments due on or after October 1,
1975, to members who retired prior to that date shall be
redetermined as if the provisions of this section in effect on
October 1, 1975, were in effect at the time the member
retired. Anything in this article to the contrary
notwithstanding, the annual retirement allowance of any member
not employed as a state policeman who retired on or before
January 1, 1956, shall not be less than seventy-nine dollars
twenty cents ($79.20) multiplied by the number of years of his
or her creditable service not in excess of 30 years in the
case of service retirement of fifty-nine dollars forty cents
($59.40) multiplied by the number of years of his or her
creditable service not in excess of 30 years in the case of
disability retirement. Any increase provided in the retirement
allowance payment under this subdivision for a member who
retired under the provisions of any optional benefit elected
pursuant to subsection (d) shall accrue only to the retired
member, and no person designated to receive any payments after
the death of a retired member under the provisions of any
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Page 26
optional benefit shall receive any increase in payments under
this subdivision. Notwithstanding, any member who retired
prior to October 1, 1975, and who chose either Option 2 or
Option 3 may elect to receive a reduced allowance and to
stipulate that the actuarial equivalent of the increase in his
or her retirement allowance, which became effective on that
date, be ascribed to his or her designated beneficiary;
provided, that the member shall clearly express this intention
by filing a written application to the effect with the
Secretary-Treasurer of the Employees' Retirement System of
Alabama prior to October 1, 1976.
(2) Any person who, prior to October 1, 1963, was in
receipt of a benefit pursuant to Act No. 376, approved
November 6, 1959, but was not a member of the system at the
time of retirement shall not be entitled to receive an annual
retirement allowance from the system, effective October 1,
1971, as follows:
a. If the person was retired on or before January 1,
1956, an amount equal to seventy-nine dollars twenty cents
($79.20) multiplied by the number of years of his or her
creditable service not in excess of 30 years.
b. If the person was retired after January 1, 1956, an
amount equal to seventy-two dollars ($72) multiplied by the
number of years of his or her creditable service not in excess
of 25 years.
(3) Prior to October 31, 1975, any beneficiary may
elect to leave on deposit with the system all or a specified
part of any increase in his or her monthly retirement
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Page 27
allowance payments arising in accordance with subdivisions (1)
or (2) of this subsection over the monthly allowance which he
or she was receiving prior to October 1, 1975. The portion of
each monthly payment left in the system in accordance with the
election shall be credited, together with regular interest
thereon, to the individual account of the beneficiary. Upon
the death of the beneficiary the total amount standing to his
or her credit, including regular interest to the date of
death, shall be paid in a lump sum to his or her legal
representatives or to such person as he or she shall have
nominated by written designation duly acknowledged and filed
with the Board of Control.
(g) Notwithstanding any other provisions of this
section to the contrary, when a designated beneficiary for a
member predeceases the member who is receiving a monthly
benefit allowance provided under Option 2, 3, or 4, the member
may designate a replacement beneficiary for the deceased
beneficiary to become effective two years after the date of
designation of the replacement beneficiary and an actuarial
adjustment in the monthly benefit allowance of the member to
cover any cost associated with designating a replacement
beneficiary shall be reflected thereafter in the monthly
benefit allowance received by the member, commencing with the
first benefit allowance check received by the member following
the date of designation of the replacement beneficiary.
(h) Notwithstanding any provision of this section to
the contrary, if a retired member who is receiving a monthly
benefit allowance provided under Option 2, 3, or 4 divorces
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Page 28
his or her designated beneficiary, the member may designate a
replacement beneficiary for the beneficiary to become
effective two years after the date of designation of the
replacement beneficiary and an actuarial adjustment in the
monthly benefit allowance of the member to cover any cost
associated with designating a replacement beneficiary shall be
reflected thereafter in the monthly benefit allowance received
by the member, commencing with the first benefit allowance
check received by the member following the date of designation
of the replacement beneficiary.
(i) Any future act to increase the retirement age for
Tier II plan members above the age of 62 shall require a
two-thirds vote of the elected membership of each house of the
Legislature."
"§41-27-7
(a) For the purposes of this article, the term "legacy
agency" means an existing agency, department, or division that
is being reorganized or abolished under this article.
(b) Unless otherwise provided in this article, all
positions created by this article shall be in the classified
service of the state Merit System.
(c) All persons employed on January 1, 2015, with a
legacy agency and transferred to the Alabama State Law
Enforcement Agency, Department of Public Safety, or State
Bureau of Investigations shall maintain his or her
classification and benefits under the legacy agency. A person
employed by a legacy agency on January 1, 2015, shall not
receive a decrease in salary, benefits, or seniority or
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otherwise receive a decrease in classification as a result of
the transfer to the Alabama State Law Enforcement Agency,
Department of Public Safety, or State Bureau of
Investigations.
(d) Any future change in classification shall not
result in any change in benefits an employee previously had at
a legacy agency.
(e) An employee of a legacy agency transferred to the
Alabama State Law Enforcement Agency, Department of Public
Safety, or State Bureau of Investigations under this article
shall remain in his or her current classification unless
appointed to the appropriate classification within the newly
created department according to state Merit System procedures.
(f) Any employee hired in or transferred into the
Alabama State Law Enforcement Agency after January 1, 2015,
who is certified by the Alabama Peace Officers' Standards and
Training Commission and performs law enforcement duties shall
be considered a law enforcement officer, as defined by Section
36-27-59(a)(3), but is a state policeman is not eligible for
the benefits specified in Section 36-26-35(d)."
Section 2. This act shall become effective on the first
day of the third month following its passage and approval by
the Governor, or its otherwise becoming law.
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________________________________________________
President and Presiding Officer of the Senate
________________________________________________
Speaker of the House of Representatives
SB68
Senate 06-Apr-23
I hereby certify that the within Act originated in and passed
the Senate.
Patrick Harris,
Secretary.
House of Representatives
Passed: 18-Apr-23
By: Senator Chambliss
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