North Carolina 2025-2026 Regular Session

North Carolina Senate Bill S701 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		GENERAL ASSEMBLY OF NORTH CAROLINA
2	2		SESSION 2025
3		-	S 1
4		-	SENATE BILL 701
	3	+	S D
	4	+	SENATE BILL DRS15281-MRap-17B
	5	+
5	6
6	7
7	8		Short Title: Bring Back Our Heroes. (Public)
8	9		Sponsors: Senators Britt, B. Newton, and Johnson (Primary Sponsors).
9		-	Referred to: ~~Rules and Operations of the Senate~~
10		-	~~March 26, 2025~~
11		-	~~S701 -v-1~~
	10	+	Referred to:
	11	+
	12	+	DRS15281 -MRap-17B
12	13		A BILL TO BE ENTITLED 1
13	14		AN ACT TO ALLOW FOR THE CONTINUATION OF RETIREMENT BENEFITS FOR 2
14	15		CERTAIN LAW ENFORCEMENT OFFICERS AND TO PROVIDE AN ADDITIONAL 3
15	16		SPECIAL SEPARATION ALLOWANCE OPTION FOR STATE AND LOCAL LAW 4
16	17		ENFORCEMENT OFFICERS WITH AT LEAST THIRTY YEARS OF CREDITABLE 5
17	18		SERVICE. 6
18	19		The General Assembly of North Carolina enacts: 7
19	20		8
20	21		PART I. ALLOW FOR THE CONTINUATION OF RETIREMENT BENEFITS FOR 9
21	22		CERTAIN LAW ENFORCEMENT OFFICERS 10
22	23		11
23	24		IN SERVICE RETIREMENT ALLOWANCE DISTRIBUTIONS FOR CERTAIN LAW 12
24	25		ENFORCEMENT OFFICERS 13
25	26		SECTION 1.1.(a) Article 1 of Chapter 135 of the General Statutes is amended by 14
26	27		adding a new section to read: 15
27	28		"§ 135-5.6. In service distributions; certain State law enforcement officers. 16
28	29		(a) Notwithstanding any provisions of this Article to contrary, both of the following shall 17
29	30		apply to a member who is an employed or retired law enforcement officer: 18
30	31		(1) If the member is in service as a law enforcement officer who has reached 59.5 19
31	32		years of age, the member may elect to receive any retirement allowance for 20
32	33		which the member is otherwise eligible if the member has not separated from 21
33	34		service as a law enforcement officer with the employer under which the 22
34	35		member will begin receiving the retirement allowance. 23
35	36		(2) If the member is a retired law enforcement officer, after a bona fide separation 24
36	37		from service of not less than six months, the member may return to service as 25
37	38		a law enforcement officer with the employer under which the member began 26
38	39		receiving a retirement allowance and continue to receive that retirement 27
39	40		allowance. 28
40	41		(b) If a member in service elects to begin receiving a retirement allowance under this 29
41	42		subsection, then member is required, at the time of the election to begin receiving the allowance, 30
42	43		to make any elections and creditable service purchases that a member would be required to make 31
43	44		at, or prior to, retirement. This includes the election to begin making contributions to the retiree 32
44	45		death benefit under G.S. 135-5 and the election to transfer Supplement Retirement Income Plan 33
45		-	benefits under G.S. 143-166.30(d). 34 General Assembly Of North Carolina Session 2025
46		-	Page 2 Senate Bill 701-First Edition
	46	+	benefits under G.S. 143-166.30(d). 34
	47	+	FILED SENATE
	48	+	Mar 25, 2025
	49	+	S.B. 701
	50	+	PRINCIPAL CLERK General Assembly Of North Carolina Session 2025
	51	+	Page 2 DRS15281-MRap-17B
47	52		(c) A member receiving a retirement allowance in accordance with this subsection shall 1
48	53		not accrue any additional membership service for any employment while the member is receiving 2
49	54		the retirement allowance. 3
50	55		(d) Notwithstanding any requirement in this Article requiring a member to make 4
51	56		employee contributions, once a member elects to begin receiving a retirement allowance under 5
52	57		this section, and while receiving that retirement allowance, the member will stop making 6
53	58		employee contributions to the Retirement System and the employer will be required to make 7
54	59		payments to the Retirement System in an amount equal to (i) the employer contributions required 8
55	60		under this Chapter, and (ii) the employee contributions the member would have otherwise been 9
56	61		required under this Article to make to the Annuity Savings Fund. The gross salary or wage paid 10
57	62		to a member who is receiving a retirement allowance under this section shall be reduced as if the 11
58	63		member was making the employee contribution otherwise required under this Article. 12
59	64		(e) A member receiving a retirement allowance under this section is not eligible to 13
60	65		participate in the Disability Income Plan of North Carolina under Article 6 of Chapter 135 of the 14
61	66		General Statutes. If the member becomes mentally or physically incapacitated and unable to 15
62	67		further perform duties of the member's employment while receiving a retirement allowance under 16
63	68		this section, then that member will continue to receive the retirement allowance that they had 17
64	69		elected to receive under this section. 18
65	70		(f) A member receiving a retirement allowance under this section is not eligible for State 19
66	71		contributions to the Supplemental Retirement Income Plan under G.S. 143-166.30(e). All State 20
67	72		contributions to the member's Supplemental Retirement Income Plan shall cease upon the 21
68	73		member's election to receive a retirement allowance under this section. 22
69	74		(g) A member receiving a retirement allowance under this section is eligible for benefits 23
70	75		under Article 12A of Chapter 143 of the General Statutes provided that the member meets the 24
71	76		conditions for eligibility required under the Public Safety Employees' Death Benefits Act. 25
72	77		(h) If a member receiving a retirement allowance under this section dies without having 26
73	78		otherwise separated from service from the employer under which the member had begun 27
74	79		receiving the retirement allowance, then the member will be treated as retired for the purpose of 28
75	80		a death benefit under G.S. 135-5 and the member's designated beneficiaries will receive the 29
76	81		benefit as though the member had been retired at the time of death. 30
77	82		(i) If a member receiving a retirement allowance under this section separates from 31
78	83		service with the employer under which the member had begun receiving the retirement allowance 32
79	84		for reasons other than death, then that member will be treated as retired under the Retirement 33
80	85		System for all purposes on the date of separation. If the member returns to work with any other 34
81	86		employer, then all provisions of G.S. 135-3 apply. 35
82	87		(j) Any changes to the retirement allowances of beneficiaries under this Article shall 36
83	88		apply with equal force and effect to retirement allowances of members under this section, unless 37
84	89		otherwise specified by law. 38
85	90		(k) An election to receive a retirement allowance under subdivision (a)(1) of this section 39
86	91		may be revoked by the member only if the member has not yet separated from service from the 40
87	92		employer under which the member had begun receiving the retirement allowance. Upon 41
88	93		revocation, all of the following shall apply: 42
89	94		(1) G.S. 135-3(a)(8)(d). 43
90	95		(2) The employer is no longer responsible for making contributions in the amount 44
91	96		required under subsection (d) of this section. The employer remains 45
92	97		responsible making the employer contributions required under this Article. 46
93	98		(3) The member is entitled to make any elections a beneficiary would be entitled 47
94	99		to make when being restored to service as an employee. 48
95	100		(4) Any special separation allowance paid to the member under G.S. 143-166.41 49
96	101		shall cease." 50
97	102		SECTION 1.1.(b) G.S. 128-21 reads as rewritten: 51 General Assembly Of North Carolina Session 2025
98		-	~~Senate Bill 701-First Edition~~ Page 3
	103	+	DRS15281-MRap-17B Page 3
99	104		"§ 128-21. Definitions. 1
100	105		The following words and phrases as used in this Article, unless Unless a different meaning is 2
101	106		plainly required by the context, shall have the following meanings:all of the following definitions 3
102	107		apply in this Article: 4
103	108		… 5
104	109		(11d) "Justice Officer" is as defined under G.S. 17E-2. 6
105	110		(11e) "Law Enforcement Officer" means a full-time paid employee of an employer, 7
106	111		who possesses the power of arrest, who has taken the law enforcement oath 8
107	112		administered under the authority of the State as prescribed by G.S. 11-11, and 9
108	113		who is certified as a law enforcement officer under the provisions of Article 1 10
109	114		of Chapter 17C of the General Statutes or certified as a deputy sheriff under 11
110	115		the provisions of Chapter 17E of the General Statutes. "Law enforcement 12
111	116		officer" also means the sheriff of the county. The number of paid personnel 13
112	117		employed as law enforcement officers by a law enforcement agency may not 14
113	118		exceed the number of law enforcement positions approved by the applicable 15
114	119		local governing board. 16
115	120		…." 17
116	121		SECTION 1.1.(c) Article 3 of Chapter 128 of the General Statutes is amended by 18
117	122		adding a new section to read: 19
118	123		"§ 128-27.1. In service distributions; certain local law enforcement and justice officers. 20
119	124		(a) Notwithstanding any provisions of this Article to contrary, both of the following shall 21
120	125		apply to a member who is either an employed or retired law enforcement or justice officer: 22
121	126		(1) If the member is in service as a law enforcement or justice officer who has 23
122	127		reached 59.5 years of age, the member may elect to receive any retirement 24
123	128		allowance for which the member is otherwise eligible if the member has not 25
124	129		separated from service as a law enforcement or justice officer with the 26
125	130		employer under which the member will begin receiving the retirement 27
126	131		allowance. 28
127	132		(2) If the member is a retired law enforcement or justice officer, after a bona fide 29
128	133		separation from service of not less than six months, the member may return to 30
129	134		service as a law enforcement or justice officer with the employer under which 31
130	135		the member began receiving a retirement allowance and continue to receive 32
131	136		that retirement allowance. 33
132	137		(b) If a member in service elects to begin receiving a retirement allowance under this 34
133	138		subsection, then the member is required, at the time of the election to begin receiving the 35
134	139		allowance, to make any elections and creditable service purchases that a member would be 36
135	140		required to make at, or prior to, retirement. This includes the election to begin making 37
136	141		contributions to the death benefit for retired members under G.S. 128-27 and the election to 38
137	142		transfer Supplement Retirement Income Plan benefits under G.S. 143-166.50(e). 39
138	143		(c) A member receiving a retirement allowance in accordance with this subsection shall 40
139	144		not accrue any additional membership service for any employment while the member is receiving 41
140	145		the retirement allowance. 42
141	146		(d) Notwithstanding any requirement in this Article requiring a member to make 43
142	147		employee contributions, once a member elects to begin receiving a retirement allowance under 44
143	148		this section, and while receiving that retirement allowance, the member will stop making 45
144	149		employee contributions to the Retirement System and the employer will be required to make 46
145	150		payments to the Retirement System in an amount equal to the total of (i) the employer 47
146	151		contributions required under this Chapter, and (ii) the employee contributions the member would 48
147	152		have otherwise been required under this Article to make to the Annuity Savings Fund. The gross 49
148	153		salary or wage paid to a member who is receiving a retirement allowance under this section shall 50 General Assembly Of North Carolina Session 2025
149		-	Page 4 ~~Senate Bill 701-First Edition~~
	154	+	Page 4 DRS15281-MRap-17B
150	155		be reduced as if the member was making the employee contribution otherwise required under 1
151	156		this Article. 2
152	157		(e) A member receiving a retirement allowance under this section is not eligible for 3
153	158		disability benefits under G.S. 128-27. If the member becomes mentally or physically 4
154	159		incapacitated and unable to further perform duties of the member's employment while receiving 5
155	160		a retirement allowance under this section, then that member will continue to receive the 6
156	161		retirement allowance that they had elected to receive under this section. 7
157	162		(f) A member receiving a retirement allowance under this section is not eligible for 8
158	163		employer contributions to the Supplemental Retirement Income Plan under G.S. 143-166.50(e). 9
159	164		All employer contributions to the member's Supplemental Retirement Income Plan shall cease 10
160	165		upon the member's election to receive a retirement allowance under this section. 11
161	166		(g) A member receiving a retirement allowance under this section is eligible for benefits 12
162	167		under Article 12A of Chapter 143 of the General Statutes provided that the member meets the 13
163	168		conditions for eligibility required under the Public Safety Employees' Death Benefits Act. 14
164	169		(h) If a member receiving a retirement allowance under this section dies without having 15
165	170		otherwise separated from service from the employer under which the member had begun 16
166	171		receiving the retirement allowance, then the member will be treated as retired for the purpose of 17
167	172		a death benefit under this Retirement System and the member's designated beneficiaries will 18
168	173		receive the death benefit under G.S. 128-27 as though the member had been retired at the time 19
169	174		of death. 20
170	175		(i) If a member receiving a retirement allowance under this section separates from 21
171	176		service with the employer under which the member had begun receiving the retirement allowance 22
172	177		for reasons other than death, then that member will be treated as retired under the Retirement 23
173	178		System for all purposes on the date of separation. If the member returns to work with any other 24
174	179		employer, then all provisions of G.S. 128-24 apply. 25
175	180		(j) Any changes to the retirement allowances of beneficiaries under this Article shall 26
176	181		apply with equal force and effect to retirement allowances of members under this section, unless 27
177	182		otherwise specified by law. 28
178	183		(k) An election to receive a retirement allowance under subdivision (a)(1) of this section 29
179	184		may be revoked by the member only if the member has not yet separated from service from the 30
180	185		employer under which the member had begun receiving the retirement allowance. Upon 31
181	186		revocation, all of the following shall apply: 32
182	187		(1) G.S. 128-24(5)(d). 33
183	188		(2) The employer is no longer responsible for making contributions in the amount 34
184	189		required under subsection (d) of this section. The employer remains 35
185	190		responsible making the employer contributions required under this Article. 36
186	191		(3) The member is entitled to make any elections a beneficiary would be entitled 37
187	192		to make when being restored to service as an employee. 38
188	193		(4) Any special separation allowance paid to the member under G.S. 143-166.42 39
189	194		shall cease." 40
190	195		SECTION 1.2.(a) G.S. 135-3 reads as rewritten: 41
191	196		"§ 135-3. Membership. 42
192	197		(a) The membership of this Retirement System shall be is composed as follows: 43
193	198		… 44
194	199		(b) Notwithstanding the provisions of sub-subdivsions c. and d. any provision of 45
195	200		subdivision (8) (a)(8) of this section to the contrary, a beneficiary who was a beneficiary retired 46
196	201		on an early or service retirement with the Law Enforcement Officers' Retirement System at the 47
197	202		time of the transfer of law enforcement officers employed by the State and beneficiaries last 48
198	203		employed by the State to this Retirement System on January 1, 1985, and who also was a 49
199	204		contributing member of this Retirement System on January 1, 1985, shall continue to be paid his 50 General Assembly Of North Carolina Session 2025
200		-	~~Senate Bill 701-First Edition~~ Page 5
	205	+	DRS15281-MRap-17B Page 5
201	206		or her retirement allowance without restriction and may continue as a member of this Retirement 1
202	207		System with all the rights and privileges appendant to membership. 2
203	208		(b1) Notwithstanding any provision of subdivision (a)(8) of this section to the contrary, a 3
204	209		beneficiary who retired on an early service retirement as a law enforcement officer shall, upon a 4
205	210		return to service, continue to be paid the retirement allowance without restriction if the 5
206	211		beneficiary is eligible for distributions while in service under G.S. 135-5.6(a)(2). 6
207	212		… 7
208	213		(f) In order to satisfy the Internal Revenue Service requirements that a retirement is a 8
209	214		bona fide separation from service and to the protect the actuarial integrity of the Retirement 9
210	215		System, a bona fide separation is deemed to occur when a member has severed the employment 10
211	216		relationship with the employer and the Board of Trustees has received all applicable termination 11
212	217		notifications. In order to maintain this presumption of a bona fide separation, no later than 60 12
213	218		days from the date a beneficiary is reemployed with an employer, the employer and the 13
214	219		beneficiary shall file original sworn affidavits with Board of Trustees attesting to the following, 14
215	220		as applicable: 15
216	221		(1) Prior to the beneficiary's retirement, the employer and the beneficiary did not 16
217	222		have an explicit understanding that the beneficiary would be subsequently 17
218	223		employed by the employer. 18
219	224		(2) The employer and the beneficiary did not reasonably anticipate that, 19
220	225		subsequent to the beneficiary's retirement, the beneficiary would perform for 20
221	226		that employer more than twenty percent (20%) of the average level of bona 21
222	227		fide services performed by the beneficiary for that employer during the 22
223	228		36-month period immediately preceding the beneficiary's retirement." 23
224	229		SECTION 1.2.(b) G.S. 128-24 reads as rewritten: 24
225	230		"§ 128-24. Membership. 25
226	231		(a) The membership of this Retirement System shall be is composed as follows: 26
227	232		… 27
228	233		(5a)(b) Notwithstanding the any provisions of paragraphs c and d of the subdivision (5) (a)(5) 28
229	234		of this section to the contrary, a beneficiary who was a beneficiary retired on an early or service 29
230	235		retirement with the Law Enforcement Officers' Retirement System at the time of the transfer of 30
231	236		law enforcement officers employed by a participating employer and beneficiaries last employed 31
232	237		by a participating employer to this Retirement System on January 1, 1986, and who also was a 32
233	238		contributing member of this Retirement System on January 1, 1986, shall continue to be paid his 33
234	239		the retirement allowance without restriction and may continue as a member of this Retirement 34
235	240		System with all the rights and privileges appendant to membership. Any beneficiary who retired 35
236	241		on an early or service retirement allowance as an employee of any participating employer under 36
237	242		the Law Enforcement Officers' Retirement System and becomes employed as an employee by an 37
238	243		employer participating in the Retirement System after January 1, 1986, becomes subject to the 38
239	244		provisions of G.S. 128-24(5)c. and G.S. 128-24(5)d. on and after January 1, 1989. 39
240	245		(b1) Notwithstanding any provision of subdivision (a)(5) of this section to the contrary, a 40
241	246		beneficiary who retired on an early service retirement as a law enforcement or justice officer 41
242	247		shall, upon a return to service, continue to be paid the retirement allowance without restriction if 42
243	248		the beneficiary is eligible for distributions while in service under G.S. 128-27.1(a)(2). 43
244	249		(6)(c) Employees of a sending agency participating in an intergovernmental exchange of 44
245	250		personnel under the provisions of Article 10 of Chapter 126 shall remain members entitled to all 45
246	251		benefits of the System provided that the requirements of Article 10 of Chapter 126 are met; 46
247	252		provided further, that a met. A member may retain membership status while serving as an 47
248	253		assigned employee or employee on leave under the provisions of Article 10 of Chapter 126 for 48
249	254		purposes of receiving the death benefit regardless of whether he the member and his the employer 49
250	255		are contributing to his the member's account during the exchange period except that no duplicate 50
251	256		benefits shall be paid. 51 General Assembly Of North Carolina Session 2025
252		-	Page 6 ~~Senate Bill 701-First Edition~~
	257	+	Page 6 DRS15281-MRap-17B
253	258		(d) In order to satisfy the Internal Revenue Service requirements that a retirement is a 1
254	259		bona fide separation from service and to the protect the actuarial integrity of the Retirement 2
255	260		System, a bona fide separation is deemed to occur when a member has severed the employment 3
256	261		relationship with the employer and the Board of Trustees has received all applicable termination 4
257	262		notifications. In order to maintain this presumption of a bona fide separation, no later than 60 5
258	263		days from the date a beneficiary is reemployed with an employer, the employer and the 6
259	264		beneficiary shall file original sworn affidavits with the Board of Trustees attesting to the 7
260	265		following, as applicable: 8
261	266		(1) Prior to the beneficiary's retirement, the employer and the beneficiary did not 9
262	267		have an explicit understanding that the beneficiary would be subsequently 10
263	268		employed by the employer. 11
264	269		(2) The employer and the beneficiary did not reasonably anticipate that, 12
265	270		subsequent to the beneficiary's retirement, the beneficiary would perform for 13
266	271		that employer more than twenty percent (20%) of the average level of bona 14
267	272		fide services performed by the beneficiary for that employer during the 15
268	273		36-month period immediately preceding the beneficiary's retirement." 16
269	274		17
270	275		CONTINUATION OF SPECIAL SEPARATION ALLOWANCE 18
271	276		SECTION 2.1.(a) G.S. 143-166.41 reads as rewritten: 19
272	277		"§ 143-166.41. Special separation allowance.allowance for State law enforcement officers. 20
273	278		(a) Annual Special Separation Allowance. – Notwithstanding any other provision of law, 21
274	279		every sworn law-enforcement officer as defined by G.S. 135-1(11c) or G.S. 143-166.30(a)(4) 22
275	280		employed by a State department, agency, or institution who qualifies under this section shall 23
276	281		receive, receive an annual special separation allowance beginning in the month in which he 24
277	282		retires on a basic service retirement under the provisions of G.S. 135-5(a), an annual separation 25
278	283		allowance equal to eighty-five hundredths percent (0.85%) of the annual equivalent of the base 26
279	284		rate of compensation most recently applicable to him for each year of creditable service. The 27
280	285		allowance shall be paid in equal installments on the payroll frequency used by the employer. To 28
281	286		qualify for the allowance the officer shall:either of the following applies: 29
282	287		(1) Have (i) completed 30 or more years of creditable service or, (ii) have attained 30
283	288		55 years of age and completed five or more years of creditable service; andThe 31
284	289		officer retires on a basic service retirement under the provisions of 32
285	290		G.S. 135-5(a). 33
286	291		(2) Not have attained 62 years of age; andThe officer elects to begin receiving a 34
287	292		retirement allowance while still in service under G.S. 135-5.6(a)(1). 35
288	293		(3) Have completed at least five years of continuous service as a law enforcement 36
289	294		officer as herein defined immediately preceding a service retirement. Any 37
290	295		break in the continuous service required by this subsection because of 38
291	296		disability retirement or disability salary continuation benefits shall not 39
292	297		adversely affect an officer's qualification to receive the allowance, provided 40
293	298		the officer returns to service within 45 days after the disability benefits cease 41
294	299		and is otherwise qualified to receive the allowance. 42
295	300		… 43
296	301		(b) As used in this section, "creditable service" means the Definitions. – The following 44
297	302		definitions apply in this section: 45
298	303		(1) Allowance. – The annual special separation allowance for State law 46
299	304		enforcement officers provided for under this section. 47
300	305		(2) Creditable service. – The service for which credit is allowed under the 48
301	306		retirement system of which the officer is a member, provided that at least fifty 49
302	307		percent (50%) of the service is as a law enforcement officer as herein defined 50
303	308		or as a probation/parole officer as defined in G.S. 135-1(17a).member. 51 General Assembly Of North Carolina Session 2025
304		-	~~Senate Bill 701-First Edition~~ Page 7
	309	+	DRS15281-MRap-17B Page 7
305	310		(3) Law enforcement officer. – As defined in either G.S. 135-1 or 1
306	311		G.S. 143-166.30(a). 2
307	312		(4) Officer. – A law enforcement officer. 3
308	313		(b1) Eligibility for Allowance. – To be eligible for an allowance under this section, an 4
309	314		officer is required to meet all of the following criteria: 5
310	315		(1) The officer (i) has completed 30 or more years of creditable service or (ii) is 6
311	316		55 years of age or older and completed five or more years of creditable service. 7
312	317		(2) The officer is less than 62 years of age. 8
313	318		(3) The officer has completed at least five years of continuous service as a law 9
314	319		enforcement officer immediately preceding the officer's service retirement. 10
315	320		Any break in this required continuous service that is a result of disability 11
316	321		retirement or disability salary continuation benefits shall not adversely affect 12
317	322		an officer's qualification to receive an allowance under this subdivision so 13
318	323		long as the officer returned to service within 45 days after the disability 14
319	324		benefits had ceased and is otherwise qualified to receive the allowance. 15
320	325		(4) At least fifty percent (50%) of the officer's creditable service is as a law 16
321	326		enforcement officer, or for service prior to July 1, 2017, as a probation/parole 17
322	327		officer. 18
323	328		(b2) Allowance Amount. – The amount of the allowance under this section shall be 19
324	329		calculated as follows: 20
325	330		(1) For retired officers, the amount of the allowance is equal to eighty-five 21
326	331		hundredths percent (0.85%) of the annual equivalent of the base rate of 22
327	332		compensation most recently applicable to the officer for each year of 23
328	333		creditable service. 24
329	334		(2) For officers in service who have elected to receive a retirement allowance as 25
330	335		provided for under G.S. 135-5.6(a)(1), the amount of the allowance is equal 26
331	336		to eighty-five hundredths percent (0.85%) of the annual equivalent of the base 27
332	337		rate of compensation and years of creditable service applicable to the officer 28
333	338		at the time the officer makes the election to receive the allowance under 29
334	339		G.S. 135-5.6. 30
335	340		(c) Cessation of Payment. – Payment of the allowance to a retired officer under the 31
336	341		provisions of this section shall cease at the first of:occurrence of one of the following: 32
337	342		(1) The death of the officer;officer. 33
338	343		(2) The last day of the month in which the officer attains 62 years of age; orage. 34
339	344		(3) The first day of reemployment by any State department, agency, or institution, 35
340	345		except that this subdivision does not apply to an officer returning to State 36
341	346		employment in any of the following circumstances: 37
342	347		a. The retired officer is reemployed in a public safety position that 38
343	348		requires all of the following of the occupant: 39
344	349		1. The occupant possesses the power of arrest. 40
345	350		2. The occupant has taken the law enforcement oath administered 41
346	351		under the authority of the State as prescribed by G.S. 11-11. 42
347	352		3. The occupant is certified as a law enforcement officer under 43
348	353		the provisions of Article 1 of Chapter 17C of the General 44
349	354		Statutes or as deputy sheriff under the provisions of Chapter 45
350	355		17E of the General Statutes and exercises the authority of a law 46
351	356		enforcement officer or deputy sheriff. 47
352	357		b. The retired officer is reemployed in a position exempt from the North 48
353	358		Carolina Human Resources Act in an agency other than the agency 49
354	359		from which that officer retired. 50 General Assembly Of North Carolina Session 2025
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356	361		c. The retired officer has elected to receive distributions while in service 1
357	362		under G.S. 135-5.6(a)(2) upon the reemployment. 2
358	363		(4) If an officer in service has elected to receive a retirement allowance under 3
359	364		G.S. 135-5.6(a)(1), the revocation of that election. If an officer later retires 4
360	365		after a revocation of that election and if the officer otherwise qualifies for the 5
361	366		allowance under this section, then the officer shall be paid the separation 6
362	367		allowance under this section as though the officer had not previously received 7
363	368		the allowance. 8
364	369		(d) Impact of Other Benefits or Actions. – This section does not affect the benefits to 9
365	370		which an individual may be entitled from State, federal, or private retirement systems. The 10
366	371		benefits payable under this section shall not be subject to any increases in salary or retirement 11
367	372		allowances that may be authorized by the General Assembly for employees of the State or retired 12
368	373		employees of the State. 13
369	374		(e) Eligibility Determinations. – The head of each State department, agency, or institution 14
370	375		shall determine the eligibility of employees for the benefits provided herein.under this section. 15
371	376		(f) Transfer of Funds. – The Director of the Budget may authorize from time to time the 16
372	377		transfer of funds within the budgets of each State department, agency, or institution necessary to 17
373	378		carry out the purposes of this Article. section. These funds shall be taken from those funds 18
374	379		appropriated to the department, agency, or institution for salaries and related fringe benefits. 19
375	380		(g) Responsibility for Payment. – The head of each State department, agency, or 20
376	381		institution shall make the payments set forth in subsection (a) this section to those persons 21
377	382		certified under subsection (e) of this section from funds available under subsection (f).(f) of this 22
378	383		section. The allowance shall be paid in equal installments on the payroll frequency used by the 23
379	384		employer from which the officer retired." 24
380	385		SECTION 2.1.(b) G.S. 143-166.42 reads as rewritten: 25
381	386		"§ 143-166.42. Special separation allowances for local law enforcement officers. 26
382	387		(a) Annual Special Separation Allowance. – On and after January 1, 1987, every sworn 27
383	388		law enforcement officer as defined by G.S. 128-21(11d) or G.S. 143-166.50(a)(3) employed by 28
384	389		a local government employer who qualifies under this section shall receive, receive an annual 29
385	390		special separation allowance beginning in the month in which the either of the following applies: 30
386	391		(1) The officer retires on a basic service retirement under the provisions of 31
387	392		G.S. 128-27(a), an annual separation allowance equal to eighty-five 32
388	393		hundredths percent (0.85%) of the annual equivalent of the base rate of 33
389	394		compensation most recently applicable to the officer for each year of 34
390	395		creditable service. The allowance shall be paid in equal installments on the 35
391	396		payroll frequency used by the employer.G.S. 128-27(a). 36
392	397		(2) The officer elects to begin receiving a retirement allowance while still in 37
393	398		service under G.S. 128-27.1(a)(1). 38
394	399		(a1) Eligibility for Allowance. – To qualify for the allowance, the officer shall:shall meet 39
395	400		all of the following criteria: 40
396	401		(1) Have The officer has (i) completed 30 or more years of creditable service or 41
397	402		(ii) have attained is 55 years of age or older and has completed five or more 42
398	403		years of creditable service; andservice. 43
399	404		(2) Not have attained The officer is less than 62 years of age; andage. 44
400	405		(3) Have The officer has completed at least five years of continuous service as a 45
401	406		law enforcement officer as herein defined immediately preceding a service 46
402	407		retirement. Any break in the this required continuous service required by this 47
403	408		subsection because that is a result of disability retirement or disability salary 48
404	409		continuation benefits shall not adversely affect an officer's qualification to 49
405	410		receive the allowance, provided the officer returns to service within 45 days 50 General Assembly Of North Carolina Session 2025
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407	412		after the disability benefits cease and is otherwise qualified to receive the 1
408	413		allowance. 2
409	414		(4) At least fifty percent (50%) of the officer's creditable service is as a law 3
410	415		enforcement officer. 4
411	416		(b) As used in this section, "creditable service" means the service Definitions. – The 5
412	417		following definitions apply in this section: 6
413	418		(1) Allowance. – The annual special separation allowance for local law 7
414	419		enforcement officers provided for under this section. 8
415	420		(2) Creditable service. – The service for which credit is allowed under the 9
416	421		retirement system of which the officer is a member, provided that at least fifty 10
417	422		percent (50%) of the service is as a law enforcement officer as herein 11
418	423		defined.member. 12
419	424		(3) Law enforcement officer. – As defined in G.S. 128-21 or G.S. 143-166.50(a). 13
420	425		(4) Officer. – Law enforcement officer. 14
421	426		(b1) Calculation of Allowance Amount. – The amount of the allowance under this section 15
422	427		shall be calculated as follows: 16
423	428		(1) For retired officers the amount of the allowance is equal to eighty-five 17
424	429		hundredths percent (0.85%) of the annual equivalent of the base rate of 18
425	430		compensation most recently applicable to the officer for each year of 19
426	431		creditable service. 20
427	432		(2) For officers in service who have elected to receive a retirement allowance as 21
428	433		provided for under G.S. 128-27.1(a)(1), the amount of the allowance is equal 22
429	434		to eighty-five hundredths percent (0.85%) of the annual equivalent of the base 23
430	435		rate of compensation and years of creditable service applicable to the officer 24
431	436		at the time the officer makes the election to receive the allowance under 25
432	437		G.S. 128-27.1. 26
433	438		(c) Cessation of Payment. – Payment of the allowance to a retired officer under the 27
434	439		provisions of this section shall cease at the first of:occurrence of any of the following: 28
435	440		(1) The death of the officer;officer. 29
436	441		(2) The last day of the month in which the officer attains 62 years of age; orage. 30
437	442		(3) The first day of reemployment by a local government employer in any 31
438	443		capacity.except that this subdivision does not apply to a retired officer 32
439	444		returning to local government employment in any of the following 33
440	445		circumstances: 34
441	446		a. The retired officer is reemployed as the sheriff of a county or in a 35
442	447		public safety position that requires all of the following of the occupant: 36
443	448		1. The occupant possesses the power of arrest. 37
444	449		2. The occupant has taken the law enforcement oath administered 38
445	450		under the authority of the State as prescribed by G.S. 11-11. 39
446	451		3. The occupant is certified as a law enforcement officer under 40
447	452		the provisions of Article 1 of Chapter 17C of the General 41
448	453		Statutes or as deputy sheriff under the provisions of Chapter 42
449	454		17E of the General Statutes and exercises the authority of a law 43
450	455		enforcement officer or deputy sheriff. 44
451	456		b. The retired officer is reemployed in service to a county board of 45
452	457		elections on an election day or during the hours for early voting under 46
453	458		Part 5 of Article 14A of Chapter 163 of the General Statutes in a 47
454	459		capacity that complies with G.S. 128-21(19) and does not result in 48
455	460		cessation or suspension of the retiree's benefit from the Local 49
456	461		Government Employees' Retirement System. 50 General Assembly Of North Carolina Session 2025
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458	463		c. The retired officer has elected to receive distributions while in service 1
459	464		under G.S. 128-27.1(a)(2) upon the reemployment. 2
460	465		(4) If an officer in service has elected to receive a retirement allowance under 3
461	466		G.S. 128-27.1(a)(1), the revocation of that election. If an officer later retires 4
462	467		after a revocation of that election and if the officer otherwise qualifies for the 5
463	468		allowance under this section, then the officer shall be paid the separation 6
464	469		allowance under this section as though the officer had not previously received 7
465	470		the allowance. 8
466	471		(c1) Notwithstanding the provisions of subdivision (3) of subsection (c) of this section, 9
467	472		payments to a retired officer shall not cease when a local government employer employs a retired 10
468	473		officer or any of the following: 11
469	474		(1) In a public safety position in a capacity not requiring participation in the Local 12
470	475		Governmental Employees' Retirement System. 13
471	476		(2) In service to a county board of elections on an election day or during the hours 14
472	477		for early voting under Part 5 of Article 14A of Chapter 163 of the General 15
473	478		Statutes in a capacity that complies with G.S. 128-21(19) and does not result 16
474	479		in cessation or suspension of the retiree's benefit from the Local Government 17
475	480		Employees' Retirement System. 18
476	481		(d) Impact of Other Benefits or Actions. – This section does not affect the benefits to 19
477	482		which an individual may be entitled from State, local, federal, or private retirement systems. The 20
478	483		benefits payable under this section shall not be subject to any increases in salary or retirement 21
479	484		allowances that may be authorized by local government employers or for retired employees of 22
480	485		local governments. 23
481	486		(e) Eligibility Determinations. – The governing body of each local employer shall 24
482	487		determine the eligibility of employees for the benefits provided herein.under this section. 25
483	488		(f) Responsibility for Payment. – The governing body of each local employer shall make 26
484	489		the payments set forth in subsection (a) of this section to those persons certified under subsection 27
485	490		(e) of this section from funds available. The allowance shall be paid in equal installments on the 28
486	491		payroll frequency used by the employer from which the officer retired." 29
487	492		30
488	493		CONTINUATION OF SHERIFFS ' SUPPLEMENTAL PENSION 31
489	494		SECTION 3.1. G.S. 143-166.84 reads as rewritten: 32
490	495		"§ 143-166.84. Eligibility. 33
491	496		… 34
492	497		(a3) A county sheriff who (i) has completed at least 10 years of eligible service as a sheriff, 35
493	498		(ii) is at least 55 years of age or who has attained at least 30 years of creditable service regardless 36
494	499		of age, and (iii) has elected to receive a retirement allowance while in service under 37
495	500		G.S. 128-27.1(a)(1) is eligible to receive to a monthly supplemental pension benefit under this 38
496	501		Article so long as the election to receive a retirement allowance while in service under 39
497	502		G.S. 128-27.1(a)(1) has not been subsequently revoked. 40
498	503		(b) Each eligible If a retired sheriff as defined in is eligible under subsections (a), (a1), 41
499	504		and (a2) of this section relating to age and service shall be entitled to receive a monthly pension 42
500	505		benefit under this Article beginning Article, then those monthly benefit payments shall begin 43
501	506		with the month immediately following the effective date of retirement. 44
502	507		(b2) If a sheriff who is in service is eligible under subsection (a3) of this section to receive 45
503	508		a monthly pension benefit under this Article, then those monthly benefit payments shall begin 46
504	509		with the month in which the officer elects to begin receiving the retirement allowance under 47
505	510		G.S. 128-27.1(a)(1). 48
506	511		…." 49
507	512		SECTION 3.2. G.S. 166-85 reads as rewritten: 50
508	513		"§ 143-166.85. Benefits. 51 General Assembly Of North Carolina Session 2025
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510	515		(a) An eligible A retired sheriff entitled to receive a supplemental pension benefit under 1
511	516		this Article shall be entitled to and receive an annual pension benefit, payable in equal monthly 2
512	517		installments, equal to an amount that, when added to a retired retirement allowance at retirement 3
513	518		from the Local Governmental Employees' Retirement System or to the amount he the retired 4
514	519		sheriff would have been eligible to receive if service had not been forfeited by the withdrawal of 5
515	520		accumulated contributions, is equal to seventy-five percent (75%) of a sheriff's equivalent annual 6
516	521		salary immediately preceding retirement computed on the latest monthly base rate, to a maximum 7
517	522		amount that does not exceed (i) one thousand five hundred dollars ($1,500) or (ii) the sheriff's 8
518	523		equivalent annual salary immediately preceding retirement computed on the latest monthly base 9
519	524		rate when the benefit described in this subsection is added to the amount of the benefit the sheriff 10
520	525		receives under G.S. 143-166.42 and the amount of the sheriff's retired retirement allowance at 11
521	526		retirement from the Local Governmental Employees' Retirement System or the amount the 12
522	527		sheriff would have been eligible to receive if service had not been forfeited by the withdrawal of 13
523	528		accumulated contributions. 14
524	529		(a1) A sheriff who is still in service and who is entitled to receive a supplemental pension 15
525	530		benefit under this Article shall receive an annual pension benefit, payable in equal monthly 16
526	531		installments, equal to an amount that, when added to a retirement allowance from the Local 17
527	532		Governmental Employees' Retirement System is equal to seventy-five percent (75%) of a 18
528	533		sheriff's equivalent annual salary immediately preceding the sheriff's election to begin receiving 19
529	534		a retirement allowance while in service under G.S. 128-27.1 computed on the latest monthly base 20
530	535		rate, to a maximum amount that does not exceed (i) one thousand five hundred dollars ($1,500) 21
531	536		or (ii) the sheriff's equivalent annual salary immediately preceding the sheriff's election to begin 22
532	537		receiving a retirement allowance while in service under G.S. 128-27.1 computed on the latest 23
533	538		monthly base rate when the benefit described in this subsection is added to the amount of the 24
534	539		benefit the sheriff receives under G.S. 143-166.42 and the amount of the sheriff's retirement 25
535	540		allowance from the Local Governmental Employees' Retirement System. 26
536	541		(b) All monthly pensions pension benefits payable under this Article shall be paid on the 27
537	542		last business day of each month. 28
538	543		(c) At the death of the pensioner, supplemental pension benefits under this Article for the 29
539	544		current calendar year will continue and be paid in monthly installments to the decedent's spouse 30
540	545		or estate, in accordance with the provisions of Chapter 28A of the General Statutes. Benefits 31
541	546		under this Article will cease upon the last payment being made in December of the current year. 32
542	547		(d) Monthly pensions pension benefits payable under this Article will cease upon the at 33
543	548		the first occurrence of one of the following: 34
544	549		(1) The full-time reemployment of a pensioner with an employer participating in 35
545	550		the Local Governmental Employees' Retirement System for as long as the 36
546	551		pensioner is so reemployed.reemployed, except under any of the following 37
547	552		circumstances: 38
548	553		a. The pensioner is reemployed full-time as the sheriff of a county or in 39
549	554		a public safety position meeting all of the requirements of a public 40
550	555		safety position under G.S. 166.42(c)(1). 41
551	556		b. The pensioner has elected to receive distributions while in service 42
552	557		under G.S. 128-27(a)(2) upon the reemployment. 43
553	558		(2) If a pensioner who is in service has elected to receive a retirement allowance 44
554	559		under G.S. 128.27.1(a)(1), the revocation of that election. If a sheriff later 45
555	560		retires after the revocation and if the sheriff otherwise qualifies for a 46
556	561		supplemental pension benefit under this Article, then the sheriff shall be paid 47
557	562		the monthly pension benefit as though the sheriff had not previously received 48
558	563		the supplemental pension benefit under this Article. 49
559	564		…." 50
560	565		51 General Assembly Of North Carolina Session 2025
561		-	Page 12 ~~Senate Bill 701-First Edition~~
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562	567		TECHNICAL AND CONFORMING CHANGES 1
563	568		SECTION 4.1. G.S. 135-103 is amended by adding a new subsection to read: 2
564	569		"(c) Notwithstanding subsection (a) of this section, any member of the Retirement System 3
565	570		that has elected to begin receiving a retirement allowance under G.S. 135-5.6 is ineligible to 4
566	571		participate in the Disability Income Plan while receiving a retirement allowance." 5
567	572		SECTION 4.2. G.S. 143-166.81(a) is repealed. 6
568	573		SECTION 4.3. G.S. 134-166.60(a) reads as rewritten: 7
569	574		"(a) A Separate Insurance Benefits Plan, hereinafter called the "Plan", is to be an employee 8
570	575		welfare benefit plan, established for the benefit of (i) all law enforcement officers, as defined in 9
571	576		G.S. 135-1(11c) and G.S. 128-21(11d) G.S. 135-1 and G.S. 128-21, employed by the State and 10
572	577		local governments and (ii) all former law-enforcement officers previously employed by the State 11
573	578		and local governments, who had 20 or more years of service as an officer or are in receipt of a 12
574	579		disability retirement allowance from any State-administered retirement system or are in receipt 13
575	580		of a benefit from the Disability Income Plan of North Carolina, who shall be participants." 14
576	581		SECTION 4.4.(a) G.S. 143-166.30 is rewritten to read: 15
577	582		"§ 143-166.30. Retirement benefits for State law-enforcement officers. 16
578	583		(a) Definitions. – The following words and phrases as used definitions apply in this 17
579	584		Article, unless a different meaning is plainly required by the context, shall have the following 18
580	585		meanings:Article: 19
581	586		… 20
582	587		(7a) "Plan" means the Supplemental Retirement Income Plan for State Law 21
583	588		Enforcement Officers. 22
584	589		… 23
585	590		(d) Supplemental Retirement Income Plan for State Law-Enforcement Law Enforcement 24
586	591		Officers. – As of January 1, 1985, there shall be created a Supplemental Retirement Income Plan, 25
587	592		hereinafter called the "Plan," established for the benefit of all law-enforcement All law 26
588	593		enforcement officers employed by the State, who shall be participants. The Board of Trustees of 27
589	594		the State Retirement System shall administer the Plan and shall, under the terms and conditions 28
590	595		otherwise appearing herein, provide Plan benefits either (i) by establishing a separate trust fund 29
591	596		in conformance with Section 401(a), Section 401(k) or other sections of the Internal Revenue 30
592	597		Code of 1954 as amended or, (ii) by causing the Plan to affiliate with some master trust fund 31
593	598		providing the same benefits for participants. The Plan shall be separate and apart from any 32
594	599		retirement systems. State are participants in the Supplemental Retirement Income Plan as 33
595	600		provided by Article 5 of Chapter 135 of the General Statutes. All of the following shall apply: 34
596	601		(1) In addition to the contributions transferred from the Law-Enforcement 35
597	602		Officers' Retirement System and the contributions otherwise provided for in 36
598	603		this Article, participants may make voluntary contributions to the Plan to be 37
599	604		credited to the designated individual accounts of participants. 38
600	605		(2) All contributions to the Plan shall be credited to the individual accounts of 39
601	606		participants, and except as provided in subsection (g1) of this section, shall be 40
602	607		fully and immediately vested in the name of the participant, and shall be 41
603	608		invested according to each participant's election, as provided by the Board of 42
604	609		Trustees, including but not limited to time deposits, and both fixed and 43
605	610		variable investments. The Plan may provide for loans to participants, at 44
606	611		reasonable rates of interest to be charged, from participants' individual 45
607	612		accounts, and may provide for withdrawal of contributions on account of 46
608	613		hardship. 47
609	614		(3) The benefit to a participant in the Plan shall be either a lump-sum distribution 48
610	615		or a distribution in periodic installments of the participant's account payable 49
611	616		under retirement, disability, or termination of employment. Upon the death of 50
612	617		a participant there shall be paid the same lump-sum distribution or periodic 51 General Assembly Of North Carolina Session 2025
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	618	+	DRS15281-MRap-17B Page 13
614	619		installments to the surviving spouse of the participant or otherwise to the 1
615	620		participant's estate; provided, should a participant instruct the Board of 2
616	621		Trustees in writing that he the participant does not wish these benefits to be 3
617	622		paid to his the participant's spouse or estate, then the benefits shall be paid to 4
618	623		the person or persons as the participant may name for this purpose. 5
619	624		(4) Upon retirement, retirement or the election to receive a retirement allowance 6
620	625		under G.S. 135-5.6(a)(1),a participant in the Plan may elect to transfer any 7
621	626		portion of his eligible accumulated contributions, not including any Roth 8
622	627		after-tax contributions and the earnings thereon, contributions or earnings, to 9
623	628		the Teachers' and State Employees' Retirement System and receive, in 10
624	629		addition to his the basic service, early early, or disability retirement allowance 11
625	630		allowance, a special retirement allowance which shall be based on his the 12
626	631		participant's eligible accumulated account balance at the date of the transfer 13
627	632		of the assets. 14
628	633		(e) State Contributions to the Supplemental Retirement Income Plan. – Under all other 15
629	634		restrictions as are herein provided, the provided for under this section, the following State 16
630	635		contributions shall be made: 17
631	636		(1) The State shall contribute monthly to the individual accounts of participants 18
632	637		who are employed by the State an amount equal to five percent (5%) of the 19
633	638		compensation of each participant. The contributions so paid shall be in 20
634	639		addition to the contributions on account of court cost assessments as 21
635	640		hereinafter provided. 22
636	641		(2) Contributions shall be made to the individual accounts of all participants in 23
637	642		the Plan on a per capita basis in equal shares, equal to the sum of the one-half 24
638	643		dollar ($0.50) for each cost of court assessed and collected under G.S. 7A-304. 25
639	644		If a law enforcement officer elects to receive a retirement allowance under 26
640	645		G.S. 135-5.6(a)(1), the contributions under this subsection shall cease. 27
641	646		…." 28
642	647		SECTION 4.4.(b) G.S. 143-166.50(e) reads as rewritten: 29
643	648		"(e) Supplemental Retirement Income Plan for Local Governmental Law-Enforcement 30
644	649		Officers. – As of January 1, 1986, all All law-enforcement officers employed by a local 31
645	650		government employer, are participating members of the Supplemental Retirement Income Plan 32
646	651		as provided by Article 5 of Chapter 135 of the General Statutes. In addition to the contributions 33
647	652		transferred from the Law-Enforcement Officers' Retirement System, participants may make 34
648	653		voluntary contributions to the Supplemental Retirement Income Plan to be credited to the 35
649	654		designated individual accounts of participants. From July 1, 1987, until July 1, 1988, local 36
650	655		government employers of law enforcement officers shall contribute an amount equal to at least 37
651	656		two percent (2%) of participating local officers' monthly compensation to the Supplemental 38
652	657		Retirement Income Plan to be credited to the designated individual accounts of participating local 39
653	658		officers; and on and after July 1, 1988, local All of the following applies to the Supplemental 40
654	659		Retirement Income Plan for Local Government Officers: 41
655	660		(1) Local government employers of law enforcement officers shall contribute an 42
656	661		amount equal to five percent (5%) of participating local officers' monthly 43
657	662		compensation to the Supplemental Retirement Income Plan to be credited to 44
658	663		the designated individual accounts of participating local officers. 45
659	664		(2) Additional contributions shall also be made to the individual accounts of all 46
660	665		participants in the Plan, except for Sheriffs, on a per capita equal-share basis 47
661	666		from the sum of one dollar and twenty-five cents ($1.25) for each cost of court 48
662	667		collected under G.S. 7A-304. 49 General Assembly Of North Carolina Session 2025
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	668	+	Page 14 DRS15281-MRap-17B
664	669		(3) Contributions under subdivisions (1) and (2) of this subsection shall cease 1
665	670		upon the officer's election to receive a retirement allowance under 2
666	671		G.S. 128-27.1(a)(1). 3
667	672		(4) Upon retirement, retirement, or the election to receive a retirement allowance 4
668	673		under G.S. 128-27.1(a)(1), a participant in the Plan may elect to transfer any 5
669	674		portion of his eligible accumulated contributions, not including any Roth 6
670	675		after-tax contributions and the earnings thereon, or earnings, to the Local 7
671	676		Governmental Employees' Retirement System and receive, in addition to 8
672	677		histhe basic service, early early, or disability retirement allowance allowance, 9
673	678		a special retirement allowance which shall be that is based on his the 10
674	679		participant's eligible accumulated account balance at the date of the transfer 11
675	680		of the assets." 12
676	681		13
677	682		FUNDS TO ADDRESS INCREASED COSTS 14
678	683		SECTION 5.1. Effective July 1, 2025, there is appropriated from the General Fund 15
679	684		to the Department of State Treasurer the sum of ten million dollars ($10,000,000) in recurring 16
680	685		funds for each year of the 2025-2027 fiscal biennium to be used to address the increased costs as 17
681	686		result of the implementation of this Part. 18
682	687		19
683	688		SEVERABILITY AND EFFECTIVE DATE 20
684	689		SECTION 6.1.(a) If any provision of this act or its application is held invalid, the 21
685	690		invalidity does not affect other provisions or applications of this act that can be given effect 22
686	691		without the invalid provisions or application, and to this end the provisions of this act are 23
687	692		severable. 24
688	693		SECTION 6.1.(b) If the Internal Revenue Service (IRS) notifies the State Treasurer 25
689	694		that one or more provisions of this act is not in compliance with federal law or regulations, then 26
690	695		each provision to which the IRS notification pertains shall expire 30 days from receipt of the 27
691	696		notification by the State Treasurer. The State Treasurer shall notify the Revisor of Statutes of any 28
692	697		IRS notification that requires the expiration of a provision of this act in accordance with this 29
693	698		section. 30
694	699		SECTION 6.2. All of the following expire on December 31, 2029: 31
695	700		(1) G.S. 135-5.6. 32
696	701		(2) G.S. 135-3(b1) 33
697	702		(3) G.S. 128-27.1. 34
698	703		(4) G.S. 128-24(b2). 35
699	704		(5) G.S. 143-166.41(a)(2), G.S. 143-166.41(b2)(2), G.S. 143-166.41(c)(3)c., and 36
700	705		G.S. 143-166.41(c)(4). 37
701	706		(6) G.S. 143-166.42(a)(2), G.S. 143-166.42(b1)(2), G.S. 143-166.42(c)(3)c., and 38
702	707		G.S. 143-166.42(c)(4). 39
703	708		(7) Subsections (a3) and (b2) of G.S. 143-166.85. 40
704	709		(8) G.S. 143-166.85(a1), G.S. 143-166.85(d)(1)b., and G.S. 143-166.85(d)(2). 41
705	710		(9) G.S. 135-103(c) 42
706	711		SECTION 6.3. This Part becomes effective October 1, 2025. 43
707	712		44
708	713		PART II. ADDITIONAL SPECIAL SEPARATION ALLOWANCE OPTION FOR 45
709	714		STATE AND LOCAL LAW ENFORCEMENT OFFICERS WITH AT LEAST THIRTY 46
710	715		YEARS OF CREDITABLE SERVICE 47
711	716		SECTION 7.1.(a) G.S. 143-166.41, as amended by Section 2.1(a) of this act, reads 48
712	717		as rewritten: 49
713	718		"§ 143-166.41. Special separation allowance for State law enforcement officers. 50
714	719		… 51 General Assembly Of North Carolina Session 2025
715		-	~~Senate Bill 701-First Edition~~ Page 15
	720	+	DRS15281-MRap-17B Page 15
716	721		(b1) Eligibility for Allowance.Allowance and Calculation of Allowance Amount. – To be 1
717	722		eligible for an allowance under this section, an officer is required to meet all one of the following 2
718	723		criteria:sets of criteria that shall also determine the allowance amount 3
719	724		(1) For officers eligible under this subsection, the annual special separation 4
720	725		allowance to be paid is equal to eighty-five hundredths percent (0.85%) of the 5
721	726		annual base rate of compensation most recently applicable to the officer for 6
722	727		each year of that officer's creditable service, except if an officer in service 7
723	728		elected to receive a retirement allowance as provided for under 8
724	729		G.S. 135-5.6(a)(1). For an officer in service who elected to receive a 9
725	730		retirement allowance under G.S. 135-5.6(a)(1), the amount of the allowance 10
726	731		is equal to eighty-five hundredths percent (0.85%) of the annual equivalent of 11
727	732		the base rate of compensation and years of creditable service applicable to the 12
728	733		officer at the time the officer makes the election to receive the allowance under 13
729	734		G.S. 135-5.6. To be eligible for an allowance under this subdivision, all of the 14
730	735		follow shall apply: 15
731	736		a. The officer (i) has completed 30 or more years of creditable service or 16
732	737		(ii) is 55 years of age or older and completed five or more years of 17
733	738		creditable service. 18
734	739		(2)b. The officer is less than 62 years of age. 19
735	740		(3)c. The officer has completed at least five years of continuous service as 20
736	741		a law enforcement officer immediately preceding the officer's service 21
737	742		retirement. Any break in this required continuous service that is a 22
738	743		result of disability retirement or disability salary continuation benefits 23
739	744		shall not adversely affect an officer's qualification to receive an 24
740	745		allowance under this subdivision so long as the officer returned to 25
741	746		service within 45 days after the disability benefits had ceased and is 26
742	747		otherwise qualified to receive the allowance. 27
743	748		(4)d. At least fifty percent (50%) of the officer's creditable service is as a 28
744	749		law enforcement officer, or for service prior to July 1, 2017, as a 29
745	750		probation/parole officer. 30
746	751		(2) For officers meeting all of the following criteria, the annual special separation 31
747	752		allowance to be paid is equal to eighty-five hundredths percent (0.85%) of the 32
748	753		annual equivalent of the base rate of compensation at the time the officer 33
749	754		attained 30 years of service multiplied by 30: 34
750	755		a. Prior to attaining 62 years of age, the officer has completed 30 or more 35
751	756		years of creditable service, at least fifty percent (50%) of which was 36
752	757		as a law enforcement officer or, for service prior to July 1, 2017, as a 37
753	758		probation/parole officer. 38
754	759		b. The officer has completed at least five years of continuous service as 39
755	760		a law enforcement officer immediately preceding the officer's service 40
756	761		retirement. Any break in this required continuous service that is a 41
757	762		result of disability retirement or disability salary continuation benefits 42
758	763		shall not adversely affect an officer's qualification to receive an 43
759	764		allowance under this subdivision so long as the officer returned to 44
760	765		service within 45 days after the disability benefits had ceased and is 45
761	766		otherwise qualified to receive the allowance. 46
762	767		If an officer meets all of the criteria under each subdivision of this subsection, then the 47
763	768		employer making the allowance payments shall allow the officer to choose which of the two 48
764	769		calculation formulas to use for that officer's allowance. This election by the officer is a one-time, 49
765	770		irrevocable election and shall be made prior to the first allowance payment. If no election is made 50
766	771		by the officer, then the calculation amount under subdivision (2) of this subsection shall be used. 51 General Assembly Of North Carolina Session 2025
767		-	Page 16 ~~Senate Bill 701-First Edition~~
	772	+	Page 16 DRS15281-MRap-17B
768	773		(b2) Allowance Amount. – The amount of the allowance under this section shall be 1
769	774		calculated as follows: 2
770	775		(1) For retired officers, the amount of the allowance is equal to eighty-five 3
771	776		hundredths percent (0.85%) of the annual equivalent of the base rate of 4
772	777		compensation most recently applicable to the officer for each year of 5
773	778		creditable service. 6
774	779		(2) For officers in service who have elected to receive a retirement allowance as 7
775	780		provided for under G.S. 135-5.6(a)(1), the amount of the allowance is equal 8
776	781		to eighty-five hundredths percent (0.85%) of the annual equivalent of the base 9
777	782		rate of compensation and years of creditable service applicable to the officer 10
778	783		at the time the officer makes the election to receive the allowance under 11
779	784		G.S. 135-5.6. 12
780	785		(c) Cessation of Payment. – Payment of the allowance to a retired officer under the 13
781	786		provisions of this section shall cease at the first occurrence of one of the following: 14
782	787		(1) The death of the officer. 15
783	788		(2) The last day of the month in which either of the following applies: 16
784	789		a. If the officer is receiving an allowance in an amount determined under 17
785	790		subdivision (b1)(1) of this section, the officer attains 62 years of age; 18
786	791		orage. 19
787	792		b. If the officer is receiving an allowance in an amount determined under 20
788	793		subdivision (b1)(2) of this section, there has been a period of receiving 21
789	794		the allowance that is equivalent to the total of 62 years minus the age 22
790	795		at which the officer first completed 30 years of creditable service. 23
791	796		…." 24
792	797		SECTION 7.1.(b) G.S. 143-166.42, as amended by Section 2.1.(b) of this act, reads 25
793	798		as rewritten: 26
794	799		"§ 143-166.42. Special separation allowances for local law enforcement officers. 27
795	800		… 28
796	801		(a1) Eligibility for Allowance. Allowance and Calculation of Allowance Amount. – To 29
797	802		qualify for the allowance, the officer shall meet all one of the following criteria:sets of criteria, 30
798	803		which shall also determine the allowance amount: 31
799	804		(1) For officers eligible under this subsection, the annual special separation 32
800	805		allowance to be paid is equal to eighty-five hundredths percent (0.85%) of the 33
801	806		annual base rate of compensation most recently applicable to the officer for 34
802	807		each year of that officer's creditable service, except if an officer in service 35
803	808		elected to receive a retirement allowance as provided for under 36
804	809		G.S. 128-27.1(a)(1). For an officer in service who elected to receive a 37
805	810		retirement allowance under G.S. 128-27.1(a)(1), the amount of the allowance 38
806	811		is equal to eighty-five hundredths percent (0.85%) of the annual equivalent of 39
807	812		the base rate of compensation and years of creditable service applicable to the 40
808	813		officer at the time the officer makes the election to receive the allowance under 41
809	814		G.S. 128-27.1. To be eligible for an allowance under this subdivision, all of 42
810	815		the follow shall apply: 43
811	816		a. The officer has (i) completed 30 or more years of creditable service or 44
812	817		(ii) is 55 years of age or older and has completed five or more years of 45
813	818		creditable service. 46
814	819		(2)b. The officer is less than 62 years of age. 47
815	820		(3)c. The officer has completed at least five years of continuous service as 48
816	821		a law enforcement officer immediately preceding a service retirement. 49
817	822		Any break in this required continuous service that is a result of 50
818	823		disability retirement or disability salary continuation benefits shall not 51 General Assembly Of North Carolina Session 2025
819		-	~~Senate Bill 701-First Edition~~ Page 17
	824	+	DRS15281-MRap-17B Page 17
820	825		adversely affect an officer's qualification to receive the allowance, 1
821	826		provided the officer returns to service within 45 days after the 2
822	827		disability benefits cease and is otherwise qualified to receive the 3
823	828		allowance. 4
824	829		(4)d. At least fifty percent (50%) of the officer's creditable service is as a 5
825	830		law enforcement officer. 6
826	831		(2) For officers meeting all of the following criteria, the annual special separation 7
827	832		allowance to be paid is equal to eighty-five hundredths percent (0.85%) of the 8
828	833		annual equivalent of the base rate of compensation at the time the officer 9
829	834		attained 30 years of service multiplied by 30: 10
830	835		a. Prior to attaining 62 years of age, the officer has completed 30 or more 11
831	836		years of creditable service, at least fifty percent (50%) of which was 12
832	837		as a law enforcement officer. 13
833	838		b. The officer has completed at least five years of continuous service as 14
834	839		a law enforcement officer immediately preceding the officer's service 15
835	840		retirement. Any break in this required continuous service that is a 16
836	841		result of disability retirement or disability salary continuation benefits 17
837	842		shall not adversely affect an officer's qualification to receive an 18
838	843		allowance under this subdivision so long as the officer returned to 19
839	844		service within 45 days after the disability benefits had ceased and is 20
840	845		otherwise qualified to receive the allowance. 21
841	846		If an officer meets all of the criteria under each subdivision of this subsection, then the 22
842	847		employer making the allowance payments shall allow the officer to choose which of the two 23
843	848		calculation formulas to use for that officer's allowance. This election by the officer is a one-time, 24
844	849		irrevocable election and shall be made prior to the first allowance payment. If no election is made 25
845	850		by the officer, then the calculation amount under subdivision (2) of this subsection shall be used. 26
846	851		… 27
847	852		(b1) Calculation of Allowance Amount. – The amount of the allowance under this section 28
848	853		shall be calculated as follows: 29
849	854		(1) For retired officers the amount of the allowance is equal to eighty-five 30
850	855		hundredths percent (0.85%) of the annual equivalent of the base rate of 31
851	856		compensation most recently applicable to the officer for each year of 32
852	857		creditable service. 33
853	858		(2) For officers in service who have elected to receive a retirement allowance as 34
854	859		provided for under G.S. 128-27.1(a)(1), the amount of the allowance is equal 35
855	860		to eighty-five hundredths percent (0.85%) of the annual equivalent of the base 36
856	861		rate of compensation and years of creditable service applicable to the officer 37
857	862		at the time the officer makes the election to receive the allowance under 38
858	863		G.S. 128-27.1. 39
859	864		(c) Cessation of Payment. – Payment of the allowance to a retired officer under the 40
860	865		provisions of this section shall cease at the first occurrence of any of the following: 41
861	866		(1) The death of the officer. 42
862	867		(2) The last day of the month in which either of the following applies: 43
863	868		a. If the officer is receiving an allowance in an amount determined under 44
864	869		subdivision (b1)(1) of this section, the officer attains 62 years of age; 45
865	870		orage. 46
866	871		b. If the officer is receiving an allowance in an amount determined under 47
867	872		subdivision (b1)(2) of this section, there has been a period of receiving 48
868	873		the allowance that is equivalent to the total of 62 years minus the age 49
869	874		at which the officer first completed 30 years of creditable service. 50
870	875		…." 51 General Assembly Of North Carolina Session 2025
871		-	Page 18 ~~Senate Bill 701-First Edition~~
	876	+	Page 18 DRS15281-MRap-17B
872	877		SECTION 7.1.(c) This section becomes effective October 1, 2025, and applies to 1
873	878		law enforcement officers retiring on or after that date. 2
874	879		3
875	880		PART III. EFFECTIVE DATE. 4
876	881		SECTION 8.1. Except as otherwise provided, this act is effective when it becomes 5
877	882		law. 6