Introduced House Bill (H)

Authored by

DIGEST

Deferred retirement option plan for PERF and TRF. Establishes a deferred retirement option plan (DROP) for members of the public employees' retirement fund (PERF) and the Indiana state teachers' retirement fund (TRF), excluding elected officials of the state or a political subdivision. Provides that a member of PERF or TRF who is employed in a covered position and is eligible to receive an unreduced retirement benefit under the provisions of the fund to which the member belongs may make an election to enter the DROP. Provides that a member who enters the DROP: (1) shall execute an irrevocable election to Deferred retirement option plan for PERF and TRF. Establishes a deferred retirement option plan (DROP) for members of the public employees' retirement fund (PERF) and the Indiana state teachers' retirement fund (TRF), excluding elected officials of the state or a political subdivision. Provides that a member of PERF or TRF who is employed in a covered position and is eligible to receive an unreduced retirement benefit under the provisions of the fund to which the member belongs may make an election to enter the DROP. Provides that a member who enters the DROP: (1) shall execute an irrevocable election to retire on the DROP retirement date and remain employed until that date; (2) shall continue to make contributions to the fund to which the member belongs; (3) shall elect a DROP retirement date not less than 12 months and not more than 36 months after the member's DROP entry date; and (4) may make an election to enter the DROP only once in the member's lifetime. Provides that the employer of a member who elects to enter the DROP shall continue to make employer contributions to the fund to which the member belongs. Provides that a member who retires on the member's DROP retirement date may elect to receive a retirement benefit: (1) paid by and calculated under the provisions of the fund to which the member belongs as if the member had never entered the DROP; or (2) calculated under the applicable provisions of the fund to which the member belongs and based on the average of the annual compensation computed and the total creditable service completed by the member on the member's DROP entry date (DROP frozen benefit), plus an additional amount calculated by multiplying the amount of the DROP frozen benefit by the number of months that the member was in the DROP. Requires the member to elect to receive the additional amount as a lump sum or in three equal annual payments. Provides for a partial DROP benefit if the member retires because the member becomes disabled while in the DROP. Provides that benefits for the beneficiaries or survivors of a member who dies while in the DROP are calculated under the provisions of the fund to which the member belongs, as if the member had never entered the DROP. Outlines the treatment of cost of living increases paid to members of the fund to which a member belongs while the member is in the DROP. ... View more