RBH No. 8175
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STATE OF OKLAHOMA
1st Session of the 59th Legislature (2023)
COMMITTEE SUBSTITUTE
FOR ENGROSSED
SENATE BILL NO. 448 By: Montgomery of the Senate
and
Lepak of the House
COMMITTEE SUBSTITUTE
An Act relating to retirement benefits payment;
amending 20 O.S. 2021, Section 110 2C, which relates
to the Uniform Retirement System for Justices and
Judges; conforming language; providing that spousal
consent is not required for certain election;
amending 74 O.S. 2021, Sections 918 and 935.7, which
relate to the Oklahoma Public Employees Retirement
System; conforming language; providing that spousal
consent is not required for certain election;
authorizing that certain contributions be used as
permitted by federal law; and providing an effective
date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 20 O.S. 2021, Section 1102C, is
amended to read as follows:
Section 1102C. A. Except as otherwi se provided for in this
section and Section 1104.2 of this title, members who join the
Uniform Retirement System for Justices and Judges on September 1,
2005, or thereafter, may elect to have th e retirement benefit paid
under one of the options provided in this section in lieu of having RBH No. 8175
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it paid in the form stated in Section 1104 of this title. The
election of an option must be made prior to the member ’s retirement
date or to receipt of a benefit after termination of service with a
vested benefit. A specif ic person must be designated as joint
annuitant at the time of the election of Option A or B. Election of
an option is available with respect to the vested benefit. All
retirement benefits of a married member shall be paid pursuant to
the Option A plan or Option B plan as provided for in this section
unless the spouse of a member consents in writing for the unreduced
benefits to be paid as provided for in S ection 1104 of this title.
The spouse of the member is not required to consent in writing to
the election of the Option B plan by t he member.
B. The amount of retirement benefit payable under an option
shall be based on the age and sex of the member and the age and sex
of the joint annuitant at the reti rement date, and sha ll be such
amount as to be the actuarial equivalent of the ret irement benefit
otherwise payable under Section 1104 of this title.
C. The retirement options are:
Option A. Joint and one -half to joint annuitant survivor. A
reduced retirement benefit is pa yable to the retiree during h is or
her lifetime with one -half (1/2) of that amount continued to the
joint annuitant during such joint annuitant’s remaining lifetime, if
any, after the death of the retiree. If the named joint annuitant
dies at any time aft er the member’s retirement date, but before the RBH No. 8175
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death of the retiree, the retiree shall return to the unreduced
retirement benefit, including any postretirement post-retirement
benefit increases, the member would have received had the member not
selected Option A. The benefit shall be det ermined at the date of
death of the named joint annuitant. This increase shall become
effective the first day of the month following the date of death of
the named joint annuitant, and shall be payable for the retiree ’s
remaining lifetime. The retiree sh all notify the Uniform Retirement
System for Justices and Judges of the death of the named joint
annuitant in writing. In the absence of the written no tice being
filed by the member notifying the Uniform Retirement Sy stem for
Justices and Judges of the de ath of the named joint annuitant within
six (6) months of the date of death, nothing in this subsection
shall require the Uniform Retirement System for Justices and Judges
to pay more than six (6) months of retrospecti ve benefits increase.
Option B. Joint and survivor. A reduced retirement benefit is
payable to the retiree during his or her lifetime with that amount
continued to the joint annuitant duri ng the joint annuitant ’s
remaining lifetime, if any, after the dea th of the retiree. If the
named joint annuitant dies at any time after the member’s retirement
date, but before the death of the retiree, the retiree shall return
to the unreduced retiremen t benefit, including any postretirement
post-retirement benefit increases, the member would have receive d
had the member not select ed Option B. The benefit shall be RBH No. 8175
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determined at the date of death of the named joint annuitant. This
increase shall become effective the first day of the month following
the date of death of th e named joint annuitant, and shall be payable
for the retiree’s remaining lifetime. The retiree shall notify the
Uniform Retirement System for Justices and Judges of the death of
the named joint annuitant in writing. In the absence of such
written notice being filed by the member notifyi ng the Uniform
Retirement System for Justices and Judges of the death of the named
joint annuitant within six (6) months of the date of death, nothing
in this subsection shall require the Uniform Retirement System for
Justices and Judges to pay more than s ix (6) months of retrospect ive
benefits increase.
D. If a member who is eligible to retire in accordance with the
provisions of this section or Section 1104 of this title but is not
actually retired or is eligible to vest or has elected a vested
benefit dies, the member’s spouse may elect to receive benefits as a
joint annuitant under Option B, calculated as if the member retired
on the date of death, in lieu of receiving the member ’s accumulated
contributions. However, n o benefits shall be payable before the
date the deceased memb er would have met the requirements for a
normal or early retirement. The provisions of this paragraph shall
be applicable to a surviving spouse of a deceased member who died
prior to the effective date of this act September 1, 2005, but only
if no benefits or distributions have been previously paid. RBH No. 8175
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SECTION 2. AMENDATORY 74 O.S. 2021, Section 918, is
amended to read as follows:
Section 918. (1) Except as otherwise prov ided for in this
section and Section 918.1 of this title, a me mber may elect to have
the retirement benefit paid under one of the options provided in
this section in lieu of having it paid in the form stated in Section
915 of this title. The election of a n option must be made at any
time prior to retirement or prior to termination of service with a
vested benefit. A specific person must be designated as joint
annuitant at the time of election of Option A or B. Election of an
option is available with resp ect to the vested benefit. Al l
retirement benefits of a marri ed member shall be paid pursuant to
the Option A plan or Option B plan as provided for in this section
unless the spouse of a member consents in writing for the benefits
to be paid as provided f or in Section 915 of this titl e or pursuant
to Option C as provided for in this section. The spouse of the
member is not required to consent in writing to the election of the
Option B plan by the member.
(2) The amount of retirement benefit payable under an option
shall be based on the age and sex of the member and the age and sex
of the joint annuitant, and shall be such amount as to be the
actuarial equivalent of the retirement benefi t otherwise payable
under Section 915 of this title.
(3) The retirement options are: RBH No. 8175
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Option A. Joint and one-half to joint annuita nt survivor. A
reduced retirement benefit is payable to the retiree during his or
her lifetime with one -half (1/2) of that amount continued to the
joint annuitant during such joint annuitant ’s remaining lifetime, if
any, after the death of the retiree. I f the named joint annuitant
dies at any time after the member’s retirement date, but before the
death of the retiree, the re tiree shall return to the retirement
benefit, including any post -retirement benefit increases the m ember
would have received had the member not selected Option A. The
benefit shall be determined at the date of death of the named joint
annuitant or July 1, 1994, whichever is later. This increase shall
become effective the f irst day of the month followi ng the date of
death of the named joint annuitant or July 1, 1994, whichever is
later, and shall be payable for the retiree’s remaining lifetime.
The retiree shall notify the Oklahoma Public Employees Retirement
System of the death of the named joint annu itant in writing. In the
absence of the written notice being filed by the member notifying
the Oklahoma Public Employees Retirement System of the death of t he
named joint annuitant within six (6) months of the date of death,
nothing in this subsection sha ll require the Oklahoma Public
Employees Retirement System to pay more than six (6) months of
retrospective benefits increase.
Option B. Joint and survivor. A reduced retirement benefit is
payable to the retiree during his or her lifetime with that amoun t RBH No. 8175
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continued to the joint annuitan t during the joint annuitant’s
remaining lifetime, if any, after the death of the retiree. If the
named joint annuitant die s at any time after the member ’s retirement
date, but before the death of the retiree, the retiree shall return
to the retirement be nefit, including any post retirement post-
retirement benefit increases the member would have received had the
member not selected Option B. The benefit shall be determined at
the date of death of the named joint annuitant or Ju ly 1, 1994,
whichever is later. This increase shall become effective the first
day of the month following the date of death of the named joint
annuitant or July 1, 1994, whichever is later, and shall be payable
for the retiree’s remaining lifetime. The r etiree shall notify the
Oklahoma Public Employees Retirement System of the death of the
named joint annuitant in writing. In the absence of such writte n
notice being filed by the member notifying the Oklahoma Public
Employees Retirement System of the deat h of the named joint
annuitant within six (6) months of the date of death, nothing in
this subsection shall require the Oklahoma Public Employees
Retirement System to pay more than six (6) months of retrospective
benefits increase.
Option C. Life with ten (10) years certain. A reduced
retirement benefit is payable to the retiree during his or her
lifetime and if the retiree dies within the ten -year certain period,
measured from the commencement of retirement benefits paym ents, such RBH No. 8175
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payments will be contin ued to the beneficiary during the balance of
the ten-year certain period. If the retiree dies within the ten-
year certain period, and there are no livi ng designated
beneficiaries, the person responsible for the estate of the retiree
may elect for the esta te to be paid the benefits for the remainder
of the term or to receive the present value of the remaining benefit
payments according to rules adopted by the Board of Trustees of the
System. If the retiree predeceases a de signated beneficiary within
the ten-year certain period, and the beneficiary dies after the
beneficiary has begun to receive benefits, the person responsible
for the estate of the benefi ciary may elect for the estate to be
paid the benefits for the remaind er of the term or to receive the
present value of the remaining benefit payments according to rules
adopted by the Board of Trustees of the System.
(4) If the selection of a joint annui tant would violate the
distribution requirements contained in Section 918.1 of this title,
such selection will not be permitted.
(5) If a member who is eligible to retire in accordance with
the provisions of Section 914 of this title but is not actually
retired or is eligible to vest or has elected a vested benefit dies,
the member’s spouse may elect to rec eive benefits as a joint
annuitant under Option B calculated as if the member retired on the
date of death, in lieu of receiving the member ’s accumulated
contributions. However, no benefits shall be payable before the RBH No. 8175
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date the deceased member would have m et the requirements for a
normal or early retirement. The provisions of this paragraph shall
be applicable to a surviving spouse of a deceased member w ho died
prior to the effective date of this act July 1, 2002, but only if no
benefits or distributions h ave been previously paid .
(6) Benefits payable to a joint annuitant shall accrue from the
first day of the month following the death of a member or ret iree
and, in the case of Option A and Option B, shall end on the last day
of the month in which the join t annuitant dies.
SECTION 3. AMENDATORY 74 O.S. 2021, Section 935.7, is
amended to read as follows:
Section 935.7 A. Participating employees shall at all times be
vested at one hundred percent ( 100%) of their accounts containing
solely their employee contributions, and the gains or losses on
these contributions. Pa rticipating employees will have investment
discretion over thes e accounts within the available options offered
by the Board.
B. Participating employees shall be vested with respect to the
employer matching amounts, and the gains or losses on these funds,
deposited into their defined contribution system account or acc ounts
according to the following schedule based on years of participat ing
service:
Year 1 20%
Year 2 40% RBH No. 8175
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Year 3 60%
Year 4 80%
Year 5 and thereafter 100%
C. Participating employees will ha ve investment discretion over
all employer contributions.
D. For purposes of determining a participating employee's right
to withdraw employer matching contributions and any investment gains
upon such employer contribution matching amounts, the vesting
percentages apply at the end of each full year of service as
described in subsection B of this section.
E. For participating employees who do not select any investment
options, the OPERS Board will establish default investment options
for the contributions received from participating employees and
default investment op tions for matching employer contributions.
F. To the extent that part icipants leave employment and have
not vested in all of the employer contributions, the nonvested
employer contributions, i ncluding any gains or losses, shall be
immediately forfeited to the 401(a) plan and may be used to offset
costs of administering the plan or as permitted by federal law .
Upon reemployment with an employer and satisfying the eligibility
requirements to become a participant , the reemployed participant
shall receive credit for previous service and be vested at the same
percentage the participant was vested when service was previously RBH No. 8175
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terminated. However, under no circumstances shall the participant
be entitled to any previou sly forfeited employer contributions.
SECTION 4. This act shall become effe ctive November 1, 2023.
59-1-8175 CMA 04/10/23