ENROLLED SENATE
BILL NO. 794	By:	Mazzei, Brecheen, Allen and Brinkley of the Senate

			and

		McDaniel (Randy) of the House

An Act relating to the Oklahoma Public Employees Retirement System; amending 74 O.S. 2001, Sections 902, as last amended by Section 1, Chapter 435, O.S.L. 2010, 913.4, as last amended by Section 2, Chapter 435, O.S.L. 2010 and 914, as last amended by Section 3, Chapter 435, O.S.L. 2010 (74 O.S. Supp. 2010, Sections 902, 913.4 and 914), which relate to normal retirement age provisions; modifying definitions; providing normal retirement age for certain members; requiring certain rate and retirement benefit for certain elected officials; modifying normal retirement date for certain elected officials; modifying early retirement percentages for certain elected officials; modifying eligibility date to receive survivor and retirement benefits for certain elected officials; prescribing benefits based upon early retirement; and providing an effective date.

SUBJECT:  Oklahoma Public Employees Retirement System

BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:

SECTION 1.     AMENDATORY     74 O.S. 2001, Section 902, as last amended by Section 1, Chapter 435, O.S.L. 2010 (74 O.S. Supp. 2010, Section 902), is amended to read as follows:

Section 902.  As used in Section 901 et seq. of this title:

(1)  “System” means the Oklahoma Public Employees Retirement System as established by this act and as it may hereafter be amended;

(2)  “Accumulated contributions” means the sum of all contributions by a member to the System which shall be credited to the member’s account;

(3)  “Act” means Sections 901 to 932, inclusive, of this title;

(4)  “Actuarial equivalent” means a deferred income benefit of equal value to the accumulated deposits or benefits when computed upon the basis of the actuarial tables in use by the System;

(5)  “Actuarial tables” means the actuarial tables approved and in use by the Board at any given time;

(6)  “Actuary” means the actuary or firm of actuaries employed by the Board at any given time;

(7)  “Beneficiary” means any person named by a member to receive any benefits as provided for by Section 901 et seq. of this title.  If there is no beneficiary living at time of member employee’s death, the member’s estate shall be the beneficiary;

(8)  “Board” means the Oklahoma Public Employees Retirement System Board of Trustees;

(9)  “Compensation” means all salary and wages, as defined by the Board of Trustees, including amounts deferred under deferred compensation agreements entered into between a member and a participating employer, but exclusive of payment for overtime, payable to a member of the System for personal services performed for a participating employer but shall not include compensation or reimbursement for traveling, or moving expenses, or any compensation in excess of the maximum compensation level, provided:

(a)	For compensation for service prior to January 1, 1988, the maximum compensation level shall be Twenty-five Thousand Dollars ($25,000.00) per annum.

For compensation for service on or after January 1, 1988, through June 30, 1994, the maximum compensation level shall be Forty Thousand Dollars ($40,000.00) per annum.

For compensation for service on or after July 1, 1994, through June 30, 1995, the maximum compensation level shall be Fifty Thousand Dollars ($50,000.00) per annum; for compensation for service on or after July 1, 1995, through June 30, 1996, the maximum compensation level shall be Sixty Thousand Dollars ($60,000.00) per annum; for compensation for service on or after July 1, 1996, through June 30, 1997, the maximum compensation level shall be Seventy Thousand Dollars ($70,000.00) per annum; and for compensation for service on or after July 1, 1997, through June 30, 1998, the maximum compensation level shall be Eighty Thousand Dollars ($80,000.00) per annum.  For compensation for services on or after July 1, 1998, there shall be no maximum compensation level for retirement purposes.

(b)	Compensation for retirement purposes shall include any amount of elective salary reduction under Section 457 of the Internal Revenue Code of 1986 and any amount of  nonelective salary reduction under Section 414(h) of the Internal Revenue Code of 1986.

(c)	Notwithstanding any provision to the contrary, the compensation taken into account for any employee in determining the contribution or benefit accruals for any plan year is limited to the annual compensation limit under Section 401(a)(17) of the federal Internal Revenue Code.

(d)	Current appointed members of the Oklahoma Tax Commission whose salary is constitutionally limited and is less than the highest salary allowed by law for his or her position shall be allowed, within ninety (90) days from the effective date of this act, to make an election to use the highest salary allowed by law for the position to which the member was appointed for the purposes of making contributions and determination of retirement benefits.  Such election shall be irrevocable and be in writing.   Reappointment to the same office shall not permit a new election.  Members appointed to the Oklahoma Tax Commission after the effective date of this act shall make such election, pursuant to this subparagraph, within ninety (90) days of taking office;

(10)  “Credited service” means the sum of participating service, prior service and elected service;

(11)  “Dependent” means a parent, child, or spouse of a member who is dependent upon the member for at least one-half (1/2) of the member’s support;

(12)  “Effective date” means the date upon which the System becomes effective by operation of law;

(13)  “Eligible employer” means the state and any county, county hospital, city or town, conservation districts, circuit engineering districts and any public or private trust in which a county, city or town participates and is the primary beneficiary is to be an eligible employer for the purpose of this act only, whose employees are covered by Social Security and are not covered by or eligible for another retirement plan authorized under the laws of this state which is in operation on the initial entry date.  Emergency medical service districts may join the System upon proper application to the Board.  Provided affiliation by a county hospital shall be in the form of a resolution adopted by the board of control.

(a)	If a class or several classes of employees of any above-defined employers are covered by Social Security and are not covered by or eligible for and will not become eligible for another retirement plan authorized under the laws of this state, which is in operation on the effective date, such employer shall be deemed an eligible employer, but only with respect to that class or those classes of employees as defined in this section.

(b)	A class or several classes of employees who are covered by Social Security and are not covered by or eligible for and will not become eligible for another retirement plan authorized under the laws of this state, which is in operation on the effective date, and when the qualifications for employment in such class or classes are set by state law; and when such class or classes of employees are employed by a county or municipal government pursuant to such qualifications; and when the services provided by such employees are of such nature that they qualify for matching by or contributions from state or federal funds administered by an agency of state government which qualifies as a participating employer, then the agency of state government administering the state or federal funds shall be deemed an eligible employer, but only with respect to that class or those classes of employees as defined in this subsection; provided, that the required contributions to the retirement plan may be withheld from the contributions of state or federal funds administered by the state agency and transmitted to the System on the same basis as the employee and employer contributions are transmitted for the direct employees of the state agency.  The retirement or eligibility for retirement under the provisions of law providing pensions for service as a volunteer fire fighter shall not render any person ineligible for participation in the benefits provided for in Section 901 et seq. of this title.  An employee of any public or private trust in which a county, city or town participates and is the primary beneficiary shall be deemed to be an eligible employee for the purpose of this act only.

(c)	All employees of the George Nigh Rehabilitation Institute who elected to retain membership in the System, pursuant to Section 913.7 of this title, shall continue to be eligible employees for the purposes of this act.  The George Nigh Rehabilitation Institute shall be considered a participating employer only for such employees.

(d)	A participating employer of the Teachers’ Retirement System of Oklahoma, who has one or more employees who have made an election pursuant to enabling legislation to retain membership in the System as a result of change in administration, shall be considered a participating employer of the Oklahoma Public Employees Retirement System only for such employees;

(14)  “Employee” means any officer or employee of a participating employer, whose employment is not seasonal or temporary and whose employment requires at least one thousand (1,000) hours of work per year and whose salary or wage is equal to the hourly rate of the monthly minimum wage for state employees.  For those eligible employers outlined in Section 910 of this title, the rate shall be equal to the hourly rate of the monthly minimum wage for that employer.  Each employer, whose minimum wage is less than the state’s minimum wage, shall inform the System of the minimum wage for that employer.  This notification shall be by resolution of the governing body.

(a)	Any employee of the county extension agents who is not currently participating in the Teachers’ Retirement System of Oklahoma shall be a member of this System.

(b)	Eligibility shall not include any employee who is a contributing member of the United States Civil Service Retirement System.

(c)	It shall be mandatory for an officer, appointee or employee of the office of district attorney to become a member of this System if he or she is not currently participating in a county retirement system.  Provided further, that if an officer, appointee or employee of the office of district attorney is currently participating in such county retirement system, he or she is ineligible for this System as long as he or she is eligible for such county retirement system.  Any eligible officer, appointee or employee of the office of district attorney shall be given credit for prior service as defined in this section.  The provisions outlined in Section 917 of this title shall apply to those employees who have previously withdrawn their contributions.

(d)	Eligibility shall also not include any officer or employee of the Oklahoma Employment Security Commission, except for those officers and employees of the Commission electing to transfer to this System pursuant to the provisions of Section 910.1 of this title or any other class of officers or employees specifically exempted by the laws of this state, unless there be a consolidation as provided by Section 912 of this title.  Employees of the Oklahoma Employment Security Commission who are ineligible for enrollment in the Employment Security Commission Retirement Plan, that was in effect on January 1, 1964, shall become members of this System.

(e)	Any employee employed by the Legislative Service Bureau, State Senate or House of Representatives for the full duration of a regular legislative session shall be eligible for membership in the System regardless of classification as a temporary employee and may participate in the System during the regular legislative session at the option of the employee.  For purposes of this subparagraph, the determination of whether an employee is employed for the full duration of a regular legislative session shall be made by the Legislative Service Bureau if such employee is employed by the Legislative Service Bureau, the State Senate if such employee is employed by the State Senate, or by the House of Representatives if such employee is employed by the House of Representatives.  Each regular legislative session during which the legislative employee or an employee of the Legislative Service Bureau participates full time shall be counted as six (6) months of full-time participating service.

(i)	Except as otherwise provided by this subparagraph, once a temporary session employee makes a choice to participate or not, the choice shall be binding for all future legislative sessions during which the employee is employed.

(ii)	Notwithstanding the provisions of division (i) of this subparagraph, any employee, who is eligible for membership in the System because of the provisions of this subparagraph and who was employed by the State Senate or House of Representatives after January 1, 1989, may file an election, in a manner specified by the Board, to participate as a member of the System prior to September 1, 1989.

(iii)	Notwithstanding the provisions of division (i) of this subparagraph, a temporary legislative session employee who elected to become a member of the System may withdraw from the System effective the day said employee elected to participate in the System upon written request to the Board.  Any such request must be received by the Board prior to October 1, 1990.  All employee contributions made by the temporary legislative session employee shall be returned to the employee without interest within four (4) months of receipt of the written request.

(iv)	A member of the System who did not initially elect to participate as a member of the System pursuant to subparagraph (e) of this paragraph shall be able to acquire service performed as a temporary legislative session employee for periods of service performed prior to the date upon which the person became a member of the System if:

a.	the member files an election with the System not later than December 31, 2000, to purchase the prior service; and

b.	the member makes payment to the System of the actuarial cost of the service credit pursuant to subsection A of Section 913.5 of this title.  The provisions of Section 913.5 of this title shall be applicable to the purchase of the service credit, including the provisions for determining service credit in the event of incomplete payment due to cessation of payments, death, termination of employment or retirement, but the payment may extend for a period not to exceed ninety-six (96) months;

(15)  “Entry date” means the date on which an eligible employer joins the System.  The first entry date pursuant to Section 901 et seq. of this title shall be January 1, 1964;

(16)  “Executive Director” means the managing officer of the System employed by the Board under Section 901 et seq. of this title;

(17)  “Federal Internal Revenue Code” means the federal Internal Revenue Code of 1954 or 1986, as amended and as applicable to a governmental plan as in effect on July 1, 1999;

(18)  “Final average compensation” means the average annual compensation, including amounts deferred under deferred compensation agreements entered into between a member and a participating employer, up to, but not exceeding the maximum compensation levels as provided in paragraph (9) of this section received during the highest three (3) of the last ten (10) years of participating service immediately preceding retirement or termination of employment.  Provided, no member shall retire with a final average compensation unless the member has made the required contributions on such compensation, as defined by the Board of Trustees;

(19)  “Fiscal year” means the period commencing July 1 of any year and ending June 30 of the next year.  The fiscal year is the plan year for purposes of the federal Internal Revenue Code; however, the calendar year is the limitation year for purposes of Section 415 of the federal Internal Revenue Code;

(20)  “Fund” means the Oklahoma Public Employees Retirement Fund as created by Section 901 et seq. of this title;

(21)  “Leave of absence” means a period of absence from employment without pay, authorized and approved by the employer and acknowledged to the Board, and which after the effective date does not exceed two (2) years;

(22)  “Member” means an eligible employee or elected official who is in the System and is making the required employee or elected official contributions, or any former employee or elected official who shall have made the required contributions to the System and shall have not received a refund or withdrawal;

(23)  “Military service” means service in the Armed Forces of the United States by an honorably discharged person during the following time periods, as reflected on such person’s Defense Department Form 214, not to exceed five (5) years for combined participating and/or prior service, as follows:

(a)	during the following periods, including the beginning and ending dates, and only for the periods served, from:

(i)	April 6, 1917, to November 11, 1918, commonly referred to as World War I,

(ii)	September 16, 1940, to December 7, 1941, as a member of the 45th Division,

(iii)	December 7, 1941, to December 31, 1946, commonly referred to as World War II,

(iv)	June 27, 1950, to January 31, 1955, commonly referred to as the Korean Conflict or the Korean War,

(v)	February 28, 1961, to May 7, 1975, commonly referred to as the Vietnam era, except that:

a.	for the period from February 28, 1961, to August 4, 1964, military service shall only include service in the Republic of Vietnam during that period, and

b.	for purposes of determining eligibility for education and training benefits, such period shall end on December 31, 1976, or

(vi)	August 1, 1990, to December 31, 1991, commonly referred to as the Gulf War, the Persian Gulf War, or Operation Desert Storm, but excluding any person who served on active duty for training only, unless discharged from such active duty for a service-connected disability;

(b)	during a period of war or combat military operation other than a conflict, war or era listed in subparagraph (a) of this paragraph, beginning on the date of Congressional authorization, Congressional resolution, or Executive Order of the President of the United States, for the use of the Armed Forces of the United States in a war or combat military operation, if such war or combat military operation lasted for a period of ninety (90) days or more, for a person who served, and only for the period served, in the area of responsibility of the war or combat military operation, but excluding a person who served on active duty for training only, unless discharged from such active duty for a service-connected disability, and provided that the burden of proof of military service during this period shall be with the member, who must present appropriate documentation establishing such service.

An eligible member under this paragraph shall include only those persons who shall have served during the times or in the areas prescribed in this paragraph, and only if such person provides appropriate documentation in such time and manner as required by the System to establish such military service prescribed in this paragraph, or for service pursuant to subdivision a of division (v) of subparagraph (a) of this paragraph those persons who were awarded service medals, as authorized by the United States Department of Defense as reflected in the veteran’s Defense Department Form 214, related to the Vietnam Conflict for service prior to August 5, 1964;

(24)  “Normal retirement date” means the date on which a member may retire with full retirement benefits as provided in Section 901 et seq. of this title, such date being whichever occurs first:

(a)	the first day of the month coinciding with or following a member’s:

(1)	sixty-second birthday with respect to members whose first participating service occurs prior to November 1, 2011, or

(2)	sixty-fifth birthday with respect to members whose first participating service occurs on or after November 1, 2011, or with respect to members whose first participating service occurs on or after November 1, 2011, reaches a minimum age of sixty (60) years and who also reaches a normal retirement date pursuant to subparagraph c of this paragraph,

(b)	for any person who initially became a member prior to July 1, 1992, and who does not reach a normal retirement date pursuant to division (1) of subparagraph (a) of this paragraph, the first day of the month coinciding with or following the date at which the sum of a member’s age and number of years of credited service total eighty (80); such a normal retirement date will also apply to any person who became a member of the sending system as defined in Section 901 et seq. of this title, prior to July 1, 1992, regardless of whether there were breaks in service after July 1, 1992,

(c)	for any person who became a member after June 30, 1992, but prior to November 1, 2011, and who does not reach a normal retirement date pursuant to division (1) of subparagraph (a) of this paragraph, the first day of the month coinciding with or following the date at which the sum of a member’s age and number of years of credited service total ninety (90),

(d)	in addition to subparagraphs (a), (b) and (c) of this paragraph, the first day of the month coinciding with or following a member’s completion of at least twenty (20) years of full-time-equivalent employment as:

(i)	a correctional or probation and parole officer with the Department of Corrections and at the time of retirement, the member was a correctional or probation and parole officer with the Department of Corrections, or

(ii)	a correctional officer, probation and parole officer or fugitive apprehension agent with the Department of Corrections who is in such position on June 30, 2004, or who is hired after June 30, 2004, and who receives a promotion or change in job classification after June 30, 2004, to another position in the Department of Corrections, so long as such officer or agent has at least five (5) years of service as a correctional officer, probation and parole officer or fugitive apprehension agent with the Department, has twenty (20) years of full-time-equivalent employment with the Department and was employed by the Department at the time of retirement, or

(iii)	a firefighter with the Oklahoma Military Department either employed for the first time on or after July 1, 2002, or who was employed prior to July 1, 2002, in such position and who makes the election authorized by division (2) of subparagraph b of paragraph (8) of subsection A of Section 915 of this title and at the time of retirement, the member was a firefighter with the Oklahoma Military Department, and such member has at least twenty (20) years of credited service upon which the two and one-half percent (2 1/2%) multiplier will be used in calculating the retirement benefit,

(e)	for those fugitive apprehension agents who retire on or after July 1, 2002, the first day of the month coinciding with or following a member’s completion of at least twenty (20) years of full-time-equivalent employment as a fugitive apprehension agent with the Department of Corrections and at the time of retirement, the member was a fugitive apprehension agent with the Department of Corrections, or

(f)	for any member who was continuously employed by an entity or institution within The Oklahoma State System of Higher Education and whose initial employment with such entity or institution was prior to July 1, 1992, and who without a break in service of more than thirty (30) days became employed by an employer participating in the Oklahoma Public Employees Retirement System, the first day of the month coinciding with or following the date at which the sum of the member’s age and number of years of credited service total eighty (80);

(25)  “Participating employer” means an eligible employer who has agreed to make contributions to the System on behalf of its employees;

(26)  “Participating service” means the period of employment after the entry date for which credit is granted a member;

(27)  “Prior service” means the period of employment of a member by an eligible employer prior to the member’s entry date for which credit is granted a member under Section 901 et seq. of this title;

(28)  “Retirant” or "retiree” means a member who has retired under the System;

(29)  “Retirement benefit” means a monthly income with benefits accruing from the first day of the month coinciding with or following retirement and ending on the last day of the month in which death occurs or the actuarial equivalent thereof paid in such manner as specified by the member pursuant to Section 901 et seq. of this title or as otherwise allowed to be paid at the discretion of the Board;

(30)  “Retirement coordinator” means the individual designated by each participating employer through whom System transactions and communication shall be directed;

(31)  “Social Security” means the old-age survivors and disability section of the Federal Social Security Act;

(32)  “Total disability” means a physical or mental disability accepted for disability benefits by the Federal Social Security System;

(33)  “Service-connected disability benefits” means military service benefits which are for a service-connected disability rated at twenty percent (20%) or more by the Veterans Administration or the Armed Forces of the United States;

(34)  “Elected official” means a person elected to a state office in the legislative or executive branch of state government or a person elected to a county office for a definite number of years and shall include an individual who is appointed to fill the unexpired term of an elected state official;

(35)  “Elected service” means the period of service as an elected official; and

(36)  “Limitation year” means the year used in applying the limitations of Section 415 of the Internal Revenue Code of 1986, which year shall be the calendar year.

SECTION 2.     AMENDATORY     74 O.S. 2001, Section 913.4, as last amended by Section 2, Chapter 435, O.S.L. 2010 (74 O.S. Supp. 2010, Section 913.4), is amended to read as follows:

Section 913.4  A.  1.  An Except as otherwise provided in this subsection, an elected official may elect to participate in the System and if he or she elects to do so shall have the option of participating at any one of the computation factors set forth in paragraphs 3 or 4 of this subsection and will receive retirement benefits in accordance with the computation factor chosen.  The election on participation in the System must be in writing, must specify the computation factor chosen, and must be filed with the System within ninety (90) days after the elected official takes office.  The election to participate and the election of a computation factor shall be irrevocable.  Reelection to the same office will not permit new elections.  Failure of an elected official to file such election form within the ninety-day period shall be deemed an irrevocable election to participate in the System at the maximum computation factor.

2.  Contributions and benefits will be based upon the elected official’s annual compensation as defined in Section 902 of this title.  Employer and elected official contributions shall be remitted at least monthly, or as the Board may otherwise provide, to the System for deposit in the Oklahoma Public Employees Retirement Fund.  Effective July 1, 1994, and thereafter, the participating employer shall contribute as provided in Section 920 of this title.

3.  Except as provided in paragraph 4 of this subsection, effective July 1, 1994, the computation factor selected and the corresponding elected official contribution rate shall be as follows:

	Elected official	Computation	Alternate

	Contribution Rate	Factor	Formula

4.5%	1.9%	$12.50

6%	2.5%	$20.00

7.5%	3.0%	$25.00

8.5%	3.4%	$27.50

9%	3.6%	$30.00

10%	4.0%	$40.00

4.  Elected officials who are first elected or appointed to an elected office on or after November 1, 2010, shall elect a computation factor of either 1.9% or 4%.  The elected official contribution rate for the 1.9% computation factor is currently 4.5% and the contribution rate for the 4% computation factor is currently 10%.  All other computation factors and contribution rates set forth in paragraph 3 of this subsection shall not be available to any person first elected or appointed to an elected office on or after November 1, 2010.

5.  The contribution rate for elected officials who are first elected or appointed to an elected office on or after November 1, 2011, shall be in the amount specified in paragraph (a) of subsection (1) of Section 919.1 of this title.  The amount of the retirement benefit for elected officials who are first elected or appointed to an elected office on or after November 1, 2011, shall be based on the provisions of paragraph (1) of subsection A of Section 915 of this title.

6.  The computation factors and corresponding elected official contribution rates provided for in paragraphs 3 and 4 of this subsection shall be based on the entire compensation as an elected official subject to the definition and maximum compensation levels as set forth in paragraph (9) of Section 902 of this title.

B.  The normal retirement date for an elected official shall be the first day of the month coinciding with or following the official's sixtieth birthday or the first day of the month coinciding with or following the date at which the sum of the elected official's age and number of years of credited service total eighty (80).  The normal retirement date for an elected official first elected or appointed to an elected office on or after November 1, 2011, shall be the first day of the month coinciding with or following the official’s sixty-fifth birthday or the date upon which the elected or appointed official attains the age of sixty-two (62) and who has at least ten (10) years of elected or appointed service.  Any elective elected official first elected or appointed to an elected office before November 1, 2011, who has a minimum of ten (10) years' participating service may retire under the early retirement provisions of this act, including those electing a vested benefit and shall receive an adjustment of annual benefits in accordance with the following percentage schedule:

		Percentage of Normal

	Age	Retirement Benefits

60	100%

59	94%

58	88%

57	82%

56	76%

55	70%

Except for officials whose first elected or appointed service as an elected official occurs on or after November 1, 2011, and who retire at age sixty-two (62) with a minimum of ten (10) years of elected or appointed service, any elected official first elected or appointed for an elected office on or after November 1, 2011, who has a minimum of ten (10) years' participating service may retire under the early retirement provisions of this act, including those electing a vested benefit and shall receive an adjustment of annual benefits in accordance with the following percentage schedule:

		Percentage of Normal

	Age	Retirement Benefits

65	100%

64	93.33%

63	86.67%

62	80%

61	73.33%

60	66.67%

	C.  1.  Any elected official shall receive annual benefits computed based upon the computation factor selected multiplied by the member's highest annual compensation received as an elected official prior to retirement or termination of employment multiplied by the number of years of credited service.  No elected official shall retire using such highest annual compensation unless the elected official has made the required election and has paid the required contributions on such salary.

2.  The retirement benefit may be computed pursuant to the provisions of paragraph (1) of subsection A of Section 915 of this title if the benefit would be higher.  Elected officials who have a vested benefit prior to July 1, 1980, may elect to receive annual benefits based on the alternate formula provided above.  Such annual benefits shall be paid in equal monthly installments.

3.  Elected officials who become members of the Oklahoma Public Employees Retirement System on or after August 22, 2008, will receive retirement benefits in accordance with the computation factor selected pursuant to subsection A of this section multiplied by the member’s highest annual compensation received as an elected official and only for those years of credited service the member served as an elected official.  If such elected official has participating service as a nonelected member, then such nonelected service shall be computed separately pursuant to the provisions of paragraph (1) of subsection A of Section 915 of this title with the final benefit result added to the final benefit result for elected service.  In no event shall the elected official be entitled to apply the computation factor selected pursuant to subsection A of this section or the compensation received as an elected official to the computation of nonelected service.

4.  Elected officials who are first elected or appointed to an elected office on or after August 22, 2008, may not receive a maximum benefit greater than their single highest annual compensation received as a member of the Oklahoma Public Employees Retirement System.

D.  Any elected official making an election to participate at a computation factor less than the maximum and later selecting a higher computation factor shall contribute to the System a sum equal to the amount which  the elected official would have contributed if the elected official had made such election at the time the elected official first became eligible, plus interest as determined by the Board, in order to receive the additional benefits for all service as an elected official; otherwise, the additional benefits shall be applicable only to service for which the elected official pays the appropriate percent of contributions to the System.

E.  The surviving spouse of a deceased elected official having who was first elected or appointed to an elected office before November 1, 2011, and who has at least six (6) years of participating service and the surviving spouse of a deceased elected official who was first elected or appointed to an elected office on or after November 1, 2011, and who has at least eight (8) years of participating service shall be entitled to receive survivor benefits in the amount herein prescribed, if married to the decedent continuously for a period of at least three (3) years immediately preceding the elected official's death.  Provided the elected official had met the service requirements, survivor benefits shall be payable when the deceased member would have met the requirements for normal or early retirement.  The amount of the benefits the surviving spouse may receive shall be fifty percent (50%) of the amount of benefits the deceased elected official was receiving or will be eligible to receive.  Remarriage of a surviving spouse shall disqualify the spouse for the receipt of survivor benefits.  Elected officials may elect a retirement option as provided in Section 918 of this title in lieu of the survivors benefit provided above.

F.  Any elected official who served in the Armed Forces of the United States, as defined in paragraph (23) of Section 902 of this title, prior to membership in the Oklahoma Public Employees Retirement System shall be granted credited service of not to exceed five (5) years for those periods of active military service during which the elected official was a war veteran.

G.  Any one Anyone appointed or elected to an elected position after July 1, 1990, shall not be eligible to receive benefits as provided in this section until such person has participated as an elected official for six (6) years.  Anyone appointed or elected to an elected position on or after November 1, 2011, shall not be eligible to receive benefits as provided in this section until such person has participated as an elected official for eight (8) years.

H.  Elected officials who terminate participation in the System and who have a minimum of six (6) years of participating service shall be entitled to elect a vested benefit and shall be entitled to the retirement options as provided in Section 918 of this title in lieu of the survivors benefit provided above in subsection E of this section.  Elected officials who terminate participation in the System and who have a minimum of eight (8) years of participating service shall be entitled to elect a vested benefit and shall be entitled to retirement options as provided in Section 918 of this title in lieu of the survivors benefits provided in subsection E of this section.

I.  In determining the number of years of credited service, a fractional year of six (6) months or more shall be considered as one (1) year, and less than six (6) months or more shall be disregarded.

SECTION 3.     AMENDATORY     74 O.S. 2001, Section 914, as last amended by Section 3, Chapter 435, O.S.L. 2010 (74 O.S. Supp. 2010, Section 914), is amended to read as follows:

Section 914.  A.  The normal retirement date for a member of the Oklahoma Public Employees Retirement System shall be as defined in Section 902 of this title, provided members employed on or after January 1, 1983, shall have six (6) or more years of full-time-equivalent employment with a participating employer before receiving any retirement benefits or if the member is a legislative session employee of the Legislature, shall have three (3) or more years of full-time-equivalent employment with a participating employer before receiving any retirement benefits.  In no event shall a normal retirement date for a member be before six (6) months after the entry date of the participating employer by whom he or she is employed.

B.  A member may be employed beyond the normal retirement date by the appointing authority of the participating employer.  However, the member may not receive retirement pay so long as the member continues employment under this act.  Any member who has terminated employment with a participating employer prior to the month immediately preceding said member's normal retirement date must elect a vested benefit pursuant to Section 917 of this title before receiving any retirement benefits.

C.  Notice for retirement shall be filed through the retirement coordinator for the participating employer in such form and manner as the Board shall prescribe; provided, that such notice for retirement shall be filed with the office of the retirement system at least sixty (60) days prior to the date selected for the member's retirement; provided further, that the Executive Director may waive the sixty-day notice for good cause shown as defined by the Board.

D.  No retirement benefits shall be payable to any member until the first day of the month following the termination of the member's employment with any participating employer.  The type of retirement benefit selected by a member may not be changed on or after the effective date of the member's retirement.  Receipt of workers' compensation benefits shall in no respect disqualify the retiree for benefits.

E.  If a retiree should be elected or appointed to any position or office for which compensation for service is paid from levies or taxes imposed by the state or any political subdivision thereof, the  retiree shall not receive any retirement benefit for any month for which the retiree serves in such position or office after the retiree has received compensation in a sum equal to the amount allowable as wages or earnings by the Social Security Administration in any calendar year.  This subsection shall not apply to service rendered by a retiree as a juror, as a witness in any legal proceeding or action, as an election board judge or clerk, or in any other office or position of a similar nature, or to an employer that is not a participating employer.  Provided, further, that any participating employer who is employing such a retiree shall make proper written notification to the System informing it of the beginning date of such retiree’s employment and the date such retiree reaches the maximum compensation allowed by this section in the calendar year.  Any retiree returning to work for a participating employer shall make contributions to the System and the employer shall do likewise.  All retirees who have returned to employment and participation in the System following retirement shall have post-retirement benefits calculated on one of the following methods:

1.  All service accumulated from date of reemployment shall be computed based on the benefit formula applicable at that time and the additional benefits shall be added to the previous benefits.  Such additional benefits shall be calculated each year based upon additional service accrued from July 1 to June 30 of the previous year and the additional benefit, if any, will be added to the retiree’s monthly benefit beginning January 1, 2000, and each January 1 thereafter.  However, the post-retirement service credit shall be cumulative, beginning with service credit accrued after the date of retirement, provided that the retiree has not received a distribution of the post-retirement contributions.

2.  Any retiree who returns to employment with a participating employer may elect not to receive any retirement benefits while so reemployed.  If such an election is made and reemployment is for a minimum period of thirty-six (36) consecutive months, all service accumulated from date of reemployment shall be participating service.  For purposes of determining the retirement benefits of such a member upon the termination of such reemployment all creditable service of the member shall be computed based on the benefit formula applicable at the time of termination of such reemployment.  Provided, a retiree who became reemployed prior to July 1, 1982, and who is reemployed for a minimum of thirty-six (36) consecutive months shall have all the creditable service of such retiree computed based on the benefit formula applicable at the time of termination of such reemployment if the retiree elects not to receive retirement benefits prior to such termination of reemployment.  A retiree who has waived receipt of the monthly benefit, but is not reemployed for the full thirty-six (36) consecutive months, shall upon termination of such reemployment have only the additional amount added to his or her benefit as if they had not waived the benefit as provided in paragraph 1 of this subsection.

3.  All post-retirement additional benefits shall be calculated using actual hours worked as well as the actual compensation received and upon which contributions are paid.  Post-retirement service is not subject to the partial year round-up provisions of subsection C of Section 913 of this title.

4.  A retired member who returns to work for a participating employer pursuant to this section shall be bound by the election made pursuant to paragraph (2) of subsection A of Section 915 of this title if the member had made such election prior to retirement.  If the member had not made such election prior to retirement, the member may do so during the member’s reemployment with a participating employer pursuant to this section.  A retired member may not be rehired by their former employer, nor may the retired member be permitted to enter into an employment contract of any kind with a former employer, for a period of one (1) year after the retired member ended his or her employment with the former employer unless the retired member waives his or her benefit under paragraph 2 of this subsection and returns as a bona fide employee.

F.  Any Except as otherwise provided by subsection G of this section, any member may elect to retire before his or her normal retirement date on the first day of any month coinciding with or following the attainment of age fifty-five (55), provided such member has completed ten (10) years of participating service, but in no event before six (6) months after the entry date.  Any member who shall retire before the normal retirement date shall receive an annual retirement benefit adjusted in accordance with the following percentage schedule:

		Percentage of Normal

	Age	Retirement Benefit

62	100.00%

61	93.33%

60	86.67%

59	80.00%

58	73.33%

57	66.67%

56	63.33%

55	60.00%

G.  Any member whose first participating service occurs on or after November 1, 2011, may elect to retire before his or her normal retirement date on the first day of any month coinciding with or following the attainment of age sixty (60), provided such member has completed ten (10) years of participating service, but in no event before six (6) months after the entry date.  Any member who shall retire before the normal retirement date shall receive an annual retirement benefit adjusted in accordance with the following percentage schedule:

		Percentage of Normal
	Age	Retirement Benefit

65	100.00%

64	93.33%

63	86.67%

62	80.00%

61	73.33%

60	66.67%

SECTION 4.  This act shall become effective November 1, 2011.

Passed the Senate the 9th day of May, 2011.

	
Presiding Officer 	of the Senate

Passed the House of Representatives the 21st day of April, 2011.

	
Presiding Officer of the House
	of Representatives