[28 Pa.B. 1543]
[Continued from previous Web Page]
BENEFITS § 213.41. Return of accumulated deductions.
Any member who elected to receive only [his] accumulated deductions, in lieu of any other benefit to which [he] the member would otherwise be entitled, shall, by [such] election, be deemed to have irrevocably waived entitlement to [such] other benefits except as otherwise provided [in the event] if a member returns to school service.
§ 213.42. [Maximum single life annuity] (Reserved).
[From and after July 1, 1976, in the case of any member, including a vestee, who has attained age 55 and has 25 or more eligibility points, he shall be entitled to a lesser reduction in his annuity as provided in sections 8342(a) of the code (relating to maximum single life annuity). Any member lacking either of the above conditions shall not be eligible for such lesser reduction, but his annuity shall be subject to the normal reduction tables currently in effect.]
§ 213.44. Disability annuities.
(a) Any member with at least [five] 5, but less than [ten] 10 years of credited school service shall be eligible, upon submitting appropriate medical evidence, to a disability annuity, but may not be entitled to elect any option on any portion of [said] the disability annuity. Any member entitled to a disability annuity, having ten or more eligibility points, [shall be] is entitled to select a joint and survivor option on that portion of the annuity to which [he] the member is otherwise entitled.
(b) Any disability annuitant no longer entitled to disability annuity in accordance with [the provisions of sections] section 8505(c)(2) or 8508(b) or (c) of the code (relating to duties of board regarding applications and elections of members), shall be entitled to either file an application for the election of optional modification of [such] the annuity to which [he] the annuitant would be otherwise entitled in accordance with section 8342 of the code (relating to maximum single life annuity) or vest the benefit, if [he] the annuitant has at least ten or more eligibility points. [In the event] If a disability annuity ceases and the member does not return to school service, [he] the member shall, if [he] the member has not already received on account of [his] the member's annuity the amount of [his] the accumulated deductions, be entitled to the difference upon application.
(c) Payments on account of disability shall be reduced by that amount by which the earned income of the annuitant, as reported in accordance with section 8505(b) of the code, [relating to rights and duties of annuitants,] for the preceding year together with the disability annuity payments for the year, exceeds the greater of $5,000 or the last year's salary of the annuitant as a school employe, provided that the annuitant [shall] will not receive less than his member's annuity or the amount to which [he] the annuitant may be entitled under section 8342 of the code, [relating to maximum single life annuity,] whichever is greater.
§ 213.46. Termination of annuities.
* * * * * (c) Emergency return to school service. Any annuitant returning to school service in an emergency situation, as provided in section 8346(b) of the code and who works for a period in excess of [60] 95 days in any school year, shall suffer discontinuance of his annuity from the [61st] 96th day of [such] service and the Board will make [such] the adjustment as the case may warrant.
(d) Termination of annuitants--independent contractor. An annuitant may render service without discontinuance of an annuity if [he] the annuitant renders it in the capacity of an independent contractor for a sum certain and for a specific period of time, pursuant to a contract approved by the employer. The Board will have the right to determine whether the services to be performed [are such as to] warrant the conclusion that it is an independent contractor relationship. The Board may also inquire as to the circumstances surrounding an annuitant who seeks to render services as an independent contractor [in order] to determine whether [such] the relationship does exist, thereby entitling [such] the person to [his] both an annuity and [his] the contractor or consultant fees simultaneously. In any case in which the Board finds that [such] the relationship may be contrary to the intent of this section, it will have the right to discontinue [such] the annuity or make [such] an adjustment as the circumstances warrant.
[(e) Termination of annuitants--disability annuitant. (Reserved).]
§ 213.47. Death benefits.
* * * * * (b) If a single life annuitant dies before receiving in monthly annuity payments the total amount of [his] the accumulated deductions, the balance of the total accumulated deductions less total annuity payments received shall be paid to [his] the designated beneficiary without regard to the actual proportion the employer's share represents to the total monthly annuity payments actually received before death.
§ 213.49. Payment of benefits.
* * * * * (b) If a beneficiary predeceases a member, or dies within 30 days of [his] the member's death, or if there is no valid beneficiary designation on file to take effect at death, any money payable from the account of the member shall be paid to the estate of the member or next of kin, under [the provisions of section 3101 of the Probate, Estates and Fiduciaries Code,] 20 Pa.C.S. § 3101 (relating to payments to family and funeral directors) as the case may be.
* * * * *
CHAPTER 215. GENERAL ADMINISTRATION
GENERAL PROVISIONS § 215.2. Administrative duties of the Board.
* * * * * (b) The Board will furnish, to the extent required by Federal law, information to members concerning those provisions of the Internal Revenue Code of [1954] 1986 (26 U.S.C.A. [§§ 1--904(2)]) which may impose a tax liability upon a member or beneficiary. The sole responsibility for [such] the tax liability, including the tax computation, is imposed upon the member and not the Board and the member should consult tax counsel or legal counsel for advice in these matters since the Board is not qualified or required to offer [same] the advice.
(c) [Pursuant to the provisions of] Under section 8502(g) of the code [(24 Pa.C.S. § 8502(g)),] (relating to administrative duties of board), an employer failing to comply with procedures as mandated in the code dealing with duties imposed upon employers, shall pay for the cost of performing these duties, [should] if the Board [initiate] initiates action to perform [same] the duties on behalf of the employer not doing so. [In the event] If an employer is delinquent in the payment of contributions in accordance with section 8327 of the code [(24 Pa.C.S. § 8327)] (relating to payments by employers), the Board [will] shall notify the Secretary of Education and the State Treasurer of [such] the delinquency for [such] the action as those officials are required to take [hereunder], consistent with the billing and delinquency regulations [set forth] in § 213.27(a) (relating to payments by employers).
* * * * * (f) The Board will, in compliance with the percentage certifications in subsection (e), [bill the Commonwealth] determine within 30 days following the end of each quarter [for] the amount due based thereon, taking into consideration the member's total payroll and shall submit simultaneously therewith a requisition for [such] the amount [to the State Treasurer for payment] determined to be due from the Commonwealth.
(g) The Board will credit to the account of each member all amounts paid by [him] the member into the fund, including [his] the member's contributions for current service, payroll deductions for the purchase of service as otherwise provided in this [Part] part or lump sum payments for the purchase of service. No person or governmental employer [shall] may make payments on behalf of the member unless authorized by the code or this [Part] part. All member contributions shall be credited with statutory interest until the date of termination of service, except in the case of the vestee. In that event, statutory interest shall be credited until the effective date of retirement or until a return of [his] the accumulated deductions, if [he] the member so elects. In the case of a multiple service member, interest shall be credited to the member's accounts in each system until a termination of State or school service.
§ 215.3. [Duties of the Board to advise and report to the employers and members] (Reserved).
[(a) On or before December 31 of each year, the Board will furnish a statement to each active contributing member showing the accumulated deductions standing to his credit as of the end of the previous fiscal year as well as the number of years and fractional parts of a year of service credited. Such statement will be mailed to the address of the active contributing member. The first statement mailed after the effective date of the code will not contain the name of the designated beneficiary but, upon subsequent written request by the member, it will appear on any subsequent statement. Such beneficiary designation may be deleted at any time and remain confidential upon the written request of the member. In no event will such information be divulged to any person other than the member and then only upon his written request.
(b) Whenever an active member or eligible school employe applies for purchase of credit for previous school or creditable nonschool service, the Board will bill the applicable employer, as the case may be, for its share in order to complete the purchase of such service. The employer's billing for such service shall be paid in a lump sum at the next quarterly pay cycle and credit shall be applied to the member accordingly. Failure of the employer to make the required payment timely shall cause a delinquency to occur and shall be treated accordingly.
(c) The Board will make available to all members information regarding benefits and options, including option 4, sufficient to apprise such members of same.]
§ 215.4. [Duties of the Board to report to the State Employes' Retirement Board--multiple service members] (Reserved).
[(a) Multiple service membership of school employes. Upon receipt of an application for membership in the System of a school employe who is a former State employe and who has elected multiple service membership, the Board will advise the State Employes' Retirement Board accordingly.
(c) Multiple service membership of State employes. Upon receipt of notification from the State Employes' Retirement Board that a former school employe has become an active member in the State Employes' Retirement System and has elected to receive credit for multiple service, the Board will so certify to the State Employes' Retirement Board and concurrently certify to the member the total credited service and fractional years thereof, as well as the annual compensation received each school year by the multiple service member for credited school service. Duplicate purchases of service under subsections (a) or (b) of this section will be prohibited in both the State Employes' Retirement System and this System.
(c) Any eligible multiple service member retiring from the State system or dying in service therein shall be entitled to a multiple service benefit, a portion of which is attributable to his school service. The Board will, therefore, certify to the State Employes Retirement Board the salary history and the final average salary to the multiple service member based on the highest compensation received as a State or school employe and the annuity or benefit to which the member or his beneficiary is entitled, as modified by any option, if applicable, for his school portion of the annuity.
(d) In the event a State employe, who is a multiple service member, is eligible for an annuity or dies in State service and was eligible for a benefit, the Board will transfer to the State Fund, no later than the end of the next quarter, the total accumulated deductions standing to the multiple service member's credit in this system and the actuarial reserve required to fund the school service benefit based on the compensation as determined by the final average salary in both systems.]
§ 215.5. Duties of the Board.
(a) [General duties. General duties of the Board shall include:
(1) The Board will, as soon as may be practicable, after each member joins the system, issue a statement, as to that member's aggregate length of total previous school and creditable nonschool service for which he may be eligible to purchase and receive credit.
(2) In the event an active member of the State system, elects multiple service membership and is receiving an annuity from the school System, his annuity will be discontinued retroactively to the date he becomes a member of the State system and any annuity payments received from this System subsequent to that date shall be restored to the fund, within 30 days from certification of the amount due.
(3) If a multiple service member is not receiving an annuity from the school System, having elected multiple service membership, and has not withdrawn his accumulated deductions, the Board will continue or resume the crediting of statutory interest on such deductions.
(4) In the event such member has withdrawn his accumulated deductions, he will be required to restore to the fund by a lump sum payment within 90 days of certification of the amount due, the accumulated deductions at the time of his separation had he been a full-coverage T-C member together with statutory interest for all periods of subsequent State and school service to the date of repayment.
(b)] Application, elections[,] and disability annuities. Duties of the Board regarding applications and elections of members and disability annuities shall include the following:
(1) Subsequent to the receipt of an application for a disability annuity based on physical and mental incapacity for the performance of a job for which the member is employed, the Board will, through its chief medical examiner, and [such other] another medical examiner as it may engage, cause the applicant to be examined; and on the basis of the medical evidence submitted, a recommendation shall be submitted to the Board stating whether a disability [or nondisability] should be granted, together with a report as to the permanency of the disability or the need for periodic examinations as well as the time interval for [such] the examinations. The Board will also establish an effective date of disability which shall be the day following the last day of compensation or the day the application is filed, whichever is later.
(2) Any disability applicant who is required by the Board to furnish additional medical documentation to support [his] the application, shall provide [same] the documentation within 30 days of [such] the request, or the Board may render the disability application null and void.
(3) The chief medical examiner, or [such] other medical examiners as the Board may engage, may recommend to the Board, on the basis of subsequent medical examinations, whether a disability annuitant should continue on disability or whether a finding of nondisability may be appropriate. In the latter event, the Board will establish the date of termination of disability, based on the recommendation of the medical examiner, whereupon the disability annuity shall be discontinued in excess of any annuity to which [he] the member may be otherwise entitled under section 8342 of the code [(24 Pa.C.S. § 8342)] (relating to maximum single life annuity).
(4) [In the event] If the Board denies a disability applicant for insufficient medical evidence, the applicant may still file, within 90 days after notification of [such] the denial, an application to vest or take an annuity, if the applicant is eligible [for same] to apply. [Such] The filing shall be considered timely, as of the original eligibility date, for the purposes of payment of other benefits or vesting, as the case may be.
(5) A disability annuity may also be subject to a disability annuity adjustment depending upon the earned income of the annuitant, as provided in section 8505(c)(3) of the code [(24 Pa.C.S. § 8505(c)(3))] (relating to duties of board regarding applications and elections of members).
[(c)] (b) Refund to members. [Duties of the Board and refund to members shall include the following:
(1) The Board will pay, to any member applying for a withdrawal of his accumulated deductions upon a termination of school service, the sum representing that amount, within 60 days after the application is filed or date of termination of service whichever is later, provided that the Board is in receipt of the required data to calculate the accumulated deductions due and owing such member.
(2)] If the Board finds that a member is terminating service at the end of a school year intending to return the subsequent school year, following vacation periods, and to reinstate [his] accumulated deductions, [it] the Board may choose not to pay [such] the deductions in the first instance. The Board may require certification from the employer that [such] the events are not intended.
[(d) Certification to vestees. Certification to vestees shall include the following:
(1) Within one year of termination of service, the Board will certify to a vestee the folllowing:
(i) Accumulated deductions in account to date of service termination.
(ii) Number of years and fractional parts of years of credited service.
(iii) Maximum single life annuity to which a vestee would be entitled, upon attainment of superannuation age and timely filing of a proper application.
(2) The Board will also, within 90 days prior to attainment of superannuation age, notify the vestee in writing at the last address which the Board has in its files, the availability of such benefits and the fact that failure to timely file shall result in cancellation of a death benefit in exces of the accumulated deductions while a vestee, if such filing is more than 90 days subsequent to superannuation age. In the event a vestee fails to timely file for a benefit within seven years after superannuation retirement, he shall only be entitled to a return of his accumulated deductions, thereby forfeiting any other benefit available had application has been timely filed.
(e)] (c) Payment of annuities. Payment of annuities shall include [the following:] the tax information as required by the Internal Revenue Code of 1986 (26 U.S.C.A.).
[(1) The Board will, within 60 days subsequent to the effective date of an annuity and the receipt of the required data for the calculation thereof, pay such annuity. Concurrently with the payment of such annuity, the Board will certify to each member, on a separate statement, the following:
(i) The accumulated deductions credited to the termination of service itemized as to member contributions and interest credited thereon.
(ii) The number of years and fractional parts of a year of credited service.
(iii) The final average salary on which such annuity is based as well as the applicable reduction factors due to age or option selection, or both.
(iv) The total annuity payable, the option selected, and the amount and effective date of any future reduction on account of Social Security benefits, if any.
(v) Such tax information as required by the Internal Revenue Code of 1954 (26 U.S.C.A. §§ 1--904(2)).]
[(f)] (d) Miscellaneous duties. Miscellaneous duties shall include the following:
(1) [In the event] If a member dies in service and is eligible for a death benefit, the Board will, within 60 days after receipt of the necessary data and death certificate, pay [such] the death benefit to the designated beneficiary or survivor annuitant, as the case may be.
(2) [In the event] If the Board [will receive] receives notification from an insurance carrier approved by [it] the Board that an annuitant who has attained age 65, has elected appropriate hospitalization insurance coverage, [it] the Board will [cause to be deducted] deduct from the annuity payments, the appropriate monthly installment and forward [such] the deduction to the particular insurance carrier at [such] times as the Board and carrier mutually agree.
[(3) Each joint coverage annuitant, retiring prior to July 1, 1962, may elect no later than one year after October 2, 1975, to receive his annuity without reduction attributable to social security coverage, and shall make payment of the lump sum required to pay for the offset, within 60 days after certification from the Board of the amount so due and thereby become a full coverage member. The recomputed annuity, without the offset, shall be paid beginning with the second monthly payment next following the month in which the lump sum payment is received.]
§ 215.6. Duties of employers.
(a) [Status Members. The employer shall, each month, notify the Board, in a manner it presecribes, the payroll changes effective during the past month, the date of all removals from the payroll, and the type of leave of any member who has been removed from the payroll for any time during that month.
(1) If the removal is due to leave without pay, the employer shall furnish the Board with the date of beginning leave, the date of return to service, and the reason for leave.
(2) If the removal is due to a transfer to another employer, the former employer shall furnish such employer and the Board with a complete school service record, including credited or creditable nonschool service.
(3) If the removal is due to termination of school service, the employer shall furnish the Board with a complete school service and salary record, including credited school or creditable nonschool service, and, in the case of death of the member, the employer shall so notify the Board.
(4)] The following procedures shall be employed for reporting salaried, per diem and hourly employes:
[(i)] (1) Salaried employes. Reporting procedures for salaried employes shall comply with the following:
[(A)] (i) [Effective July 1, 1975, all] All part time salaried employes, irrespective of the percentage of time employed, shall be reported based on the percentage of time employed, as it relates to full time salaried employes, and if requested, the employer shall furnish, [pursuant to] under section 508 of the Public School Code of 1949 (24 P. S. § 5-508), minutes of board meetings indicating the conditions of employment of [such] these individuals. [Such a procedure shall be effective, on a current basis, for all salaried employes, as of July 1, 1976. For the 1975-76 school year, employes shall pay their share without statutory interest and the employer its share under the general provisions applicable to purchase such service.]
[(B)] (ii) This procedure in no way affects the enrollment of salaried employes who are currently members of the System. The member's purchase of [such] the previous part time salaried service in the 1975-76 school year shall be either a lump sum payment or a method agreed upon by the System and the member without application of interest.
[(ii)] (2) Per diem and hourly employes. Since a per diem or hourly employe is required to [join after working] become a member of the System during a school year in which the employe works 80 days or 500 hours [as of the date of employment], an employer is responsible for determining if that person shall become eligible for membership during the fiscal year.
[(A)] (i) * * *
[(B)] (ii) If an employe is enrolled as a member at the beginning of the fiscal year, or when employed, and does not qualify during that fiscal year the employe is then entitled to a refund of accumulated deductions. If an employe is not enrolled at the beginning of the fiscal year, or date of employment, but qualifies during the fiscal year, the school district shall make deductions from that time forward and the employe shall then purchase the first 500 hours or 80 days without application of interest. [Any employe who would have been eligible for service credit for the 1975-76 fiscal year may purchase that credit, without statutory interest, if application is timely made.
(b) Records and information. At the direction of the Board, the employer shall furnish service and compensation records as well as other information requested by the Board as soon as same is filed, received, or determined and shall maintain and preserve such records as the Board may require for the expeditious discharge of its duties.
(c) Member and employer contribution. The employer shall certify to his treasurer the required member contributions deducted from each payroll. The treasurer shall remit to the secretary of the Board each month the total of the member contributions and, quarterly, the amount due from the employer determined in accordance with section 8327 of the code, 24 Pa.C.S. § 8327, relating to payments by employers.
(d) New employers subject to mandatory membership. Upon the assumption of duties of each new school employe whose membership in the system is mandatory, the employer shall, no later than 30 days thereafter, cause an application for membership, which application shall include the home address of the employe, birthdate certified by the employer, previous school or State service and any other information requested by the Board, and a nomination of beneficiary to be made by such employe, to be filed with the Board and shall make payroll deductions from the effective date of school employment
(e) New employers subject to optional membership. The employer shall, within 30 days of employment, inform any eligible school employe, whose membership in the system is not mandatory, of his opportunity to become a member of the System provided that he elects to purchase credit for all such continuous creditable service. If such employe so elects, the employer shall no later than 30 days thereafter, cause an application for membership, containing the same information so required in subsection (d) of this section, to be filed with the Board and shall make payroll deductions from the date of employment.
(f) Advising members of duties. The employer shall advise his employes of their duties as members of the System. Employers shall be held harmless from decisions made by the employe in this regard provided the employe is furnished sufficient information to make a decision.
(g) Former State employe contributions. The employer shall, upon the employment of a former member of the State Employe's Retirement System who is not an annuitant of that system, advise such employe of his right to elect multiple service membership within 30 days of entry into the school System, and, if any such employe, who so elects, has withdrawn his accumulated deductions, require him to restore his accumulated deductions to the State system as they would have been at the time of his separation had he been a full coverage member, together with statutory interest for all periods of subsequent State and school service to date of repayment. The employer shall immediately advise the Board of such election.
(h) Former State employe annuitants. The employer shall, upon the employment of an annuitant of the State Employes' Retirement System, who applies for membership in the System, advise such employe that he may elect multiple service membership within 30 days of entry into the System, and that if he so elects, his annuity from the State Employes' Retirement System shall be discontinued and upon termination of school service and application for annuity, the annuity shall be adjusted in accordance with section 8507 of the code, 24 Pa.C.S. § 8507, relating to termination of annuities. The employer shall immediately advise the Board of such election.
(i) Independent contractors. The employer shall, upon engagement of an independent contractor, who is in receipt of an annuity from this System, notify the Board of such engagement and furnish such information as the Board may require in order for it to determine whether such annuity shall be discontinued and the individual returned to school service.
(j)] (b) Annuitants employed in an emergency. The employer shall, upon the reemployment of an annuitant from the State Employes' Retirement System who has elected multiple service or this System, in an emergency, notify the Board of commencement and termination of [such] the employment to insure that the [60] 95-day period for a continued receipt of the annuity is not exceeded. If that limitation shall be exceeded in any school year, the employer shall reenroll [such] the annuitant from the [61st] 96th day of employment as an active member of the System, whereupon an annuity adjustment shall be made, as the case may warrant.
[(k) Termination of service. The employer shall, in the case of any member terminating school service, advise such member in writing of any benefits to which he may be entitled under the provisions of this Part and shall have the member prepare on or before the date of termination of school service, one of the following three forms, a copy of which shall be given to the member and the original of which shall be filed with the Board as soon as possible.
(1) An application for the return of accumulated deductions.
(2) An election to vest his retirement rights, and if he is a joint-coverage member and so desires, an election to become a full-coverage member and an agreement to pay within 30 days of the date of termination of service the lump sum required.
(3) An application for an immediate annuity and, if he is a joint-coverage member and so desires, an election to become a full-coverage member and an agreement to pay within 30 days of date of termination of service the lump sum required. If such a member does not elect to become a full-coverage member at this time, he shall not have the right to purchase this credit at a later date.
(l) Date of application for benefits. Any application properly executed and filed with the employer under subsection (k), or properly executed and filed with the employer after termination of service shall be deemed to have been filed with the Board on the date filed with employer, whereupon only those benefits appplicable to such application shall be paid.]
§ 215.7. Rights and duties of school employes and members.
(a) Information on new employes. [Upon his assumption of duties, each] Each new school employe shall [furnish his] provide the employer with a complete record of [his] previous school or State service, or creditable nonschool service, proof of [his] date of birth, in the order of preference set forth in subsection (b), [his] home address, [his] current status in the system and in the State Employes' Retirement System and [such] other information as the Board may require. Willful failure to provide the information required by this subsection, to the extent available, or the furnishing of erroneous information upon entrance into the System shall result in the forfeiture of the right of the member to subsequently assert [any] a right to benefits based on [such] the erroneous information or on any of the required information which [he] the member failed to provide, intentionally or otherwise. [In any case in which] When the Board finds that a member is receiving an annuity based on false, misleading[,] or improper information, the additional amounts received predicated on [such] the information together with statutory interest doubled and compounded shall be deducted from the present value of [any] remaining benefits to which the member is legally entitled and [such] the remaining benefits shall be correspondingly decreased.
* * * * * [(c) Application for membership. In those cases where a member has optional membership and in the event he chooses not to join, he shall, nevertheless, execute on forms supplied by the Board, a declination of membership in the System during his continuous school service while in that optional category. In the event an employe designated in section 8301(a)(3) of the code, 24 Pa.C.S. § 8301(a)(3) has chosen membership in the system, his membership shall commence from the original date of eligibility.
(d)] (c) * * *
[(e)](d) [Beneficiary] Beneficiaries. Every member shall nominate a beneficiary and contingent beneficiary, if desired, on a form to be filed with the Board and supplied by [it] the Board. In all such cases, the designated or contingent beneficiary, as the case may be, shall be the only one entitled to receive the accumulated deductions or the death benefit for those who die in service or those who would be entitled to a benefit under the provisions of Option 1 under section 8345 of the code (relating to member's options). If the beneficiary or contingent beneficiary so designated fails to survive the member, then [such] the payment, subject to the limitation in [section 3101 of the Probate, Estates and Fiduciaries Code, (]20 Pa.C.S. § 3101[, )] (relating to payments to family and funeral directors) shall be paid to the next of kin. If the applicable limitation cannot be met, then the payment, in the absence of a designated beneficiary, shall be paid to the estate upon the submission of documents required by the Board to authorize payment.
[(f)](e) Termination. Upon termination of service, a member, by written application, may elect to do any of the following:
(1) Withdraw [his] the accumulated deductions, thereby forfeiting any other benefit to which [he] the member would otherwise be entitled.
(2) Vest [his] the retirement account, thereby making [him] the member eligible for the vesting benefits as otherwise provided in this part [, and if]. If [he] the member is a joint coverage member [and so desires to], the member may elect to become a full-coverage member and to pay the lump sum required within 30 days subsequent to termination of service.
(3) Receive an immediate annuity and [if he so elects], in the case of joint coverage membership, pay the lump sum required to become a full-coverage member within 30 days of termination of service.
[(g)] (f) Rights of vestees. [Any] A vestee may, subsequent to vesting, and at any time during the vesting period, withdraw [his] the accumulated deductions, thereby forfeiting any other benefit to which [he] the vestee would be otherwise entitled, or apply for an annuity, if [he] the vestee has at least ten eligibility points. The vestee shall also nominate a beneficiary to receive the vested benefits [should he fail] if the vestee fails to survive the receipt of the benefit [himself].
[(h)] (g) Right of vestee at superannuation age. [In order for] For a vestee to be entitled to, and receive, an annuity, effective the date [he] the vestee attains superannuation age, [he] the vestee shall file [his] an application no later than 90 days thereafter. [Any] An application subsequently filed shall be effective upon the date filed. If a vestee dies within the 90-day period subsequent to superannuation age, not having filed an application for benefits, [he] the vestee shall be deemed to have elected the automatic death benefit Option 1. [Should] If the vestee fails to do anything within [seven] 7 years subsequent to superannuation age, [he] the vestee shall be deemed to have elected to receive [his] the accumulated deductions and shall, upon application, be entitled to receipt of [same] the deductions, thereby forfeiting any other benefit [to which he would otherwise be entitled.
(i) Failure to apply for annuity. If a member is eligible to receive an annuity and fails to file a proper application within 90 days of termination of service, he shall be deemed to have elected to vest, and his annuity shall become effective as of the date an application is filed with the Board or the date designated on the application, whichever is later.
(j)](h) Nomination of beneficiary or survivor annuitant. A member in receipt of a reduced annuity, under any of the options, shall have the following rights with regard to designation of a beneficiary or survivor annuitant:
(1) In the event a member elects Option 1, [he] the member may change [his] the designated beneficiary at any time.
(2) [In the event] If the member selects a survivor annuity option, [that is, Option 2 or Option 3,] no new survivor annuitant [shall] may be permitted to be named except in the event that the survivor annuitant [predeceased him] predeceases the member or there is a change in marital status subsequent to the election of the option. In [such] these cases, [only one new survivor annuitant may be selected and] the annuity shall be recomputed to be actuarially equivalent as of the date of recomputation to the annuity in effect immediately prior thereto. In [such] this case, the member may elect a new option in addition to the [one] new survivor annuitant. In no other case shall a benefit plan be changed by an annuitant.
(3) Any annuitant having a right to [re-elect] reelect an option and name a new survivor annuitant under the circumstances [set forth] in paragraphs (1) and (2), may do so at any time after the death of the beneficiary or change in [his] marital status. [In no event shall an annuitant, under the circumstances set forth in paragraphs (1) and (2), select more than one survivor annuitant under Option 2 or 3.
(k) Disability annuities. An application for a disability annuity filed prior to superannuation age, on behalf of one whose physical or mental incapacity precludes him from the performance of duty, may have such application executed by a person legally authorized, to act on his behalf. Such person shall have evidence of appropriate judicial documents giving him the authority to so act, or shall provide such documentation as the Board may require in the circumstances.]
§ 215.8. [Rights and duties of annuitants] (Reserved).
[(a) Full coverage annuity. Any annuitant joint coverage member receiving an annuity prior to July 1, 1962, may elect to receive a full-coverage annuity provided the election is made within one year following the effective date of the code. The lump sum payment required shall also be made to the Board within 60 days of receipt of the amount certified to be due.
(b) Periodic earnings statements by disability annuitants. It shall be the duty of a disability annuitant, while still under superannuation age, to furnish a written statement within 30 days of the close of each year of all earned income during that year and information showing whether or not he is able to engage in a gainful occupation and such other information as may be required by the board. On failure, neglect, or refusal to furnish such information for the period of the preceding year, the Board may refuse to make further payments due to disability to such annuitant until he has furnished such information to the satisfaction of the Board. Should such refusal continue for six months, all of his rights to the disability annuity payments, in excess of any annuity to which he is otherwise entitled, shall be forfeited from the date of his last statement to the Board. Any moneys received in excess of those to which he was entitled shall be deducted from the present value of the annuity to which he is otherwise entitled.
(c) Medical examinations. Any disability annuitant refusing, while required to do so, to submit to a medical examination requested by the Board through its medical examiners, shall result in his disability payments being discontinued because of such refusal, and, if the refusal continues for a period of at least six months, his disability payments is excess of any annuity benefits to which he would be otherwise entitled, shall be immediately forfeited.]
MANAGEMENT OF FUND AND ACCOUNTS § 215.21. [Management of fund and accounts] (Reserved).
[(a) Trustees. The Board members will be trustees of the fund with exclusive control and management of the same and with full power to invest the same subject to the limitations herein imposed and also imposed by the act of April 15, 1929 (P. L. 723)(72 P. S. § 3603), dealing with investments by the various agencies of the Commonwealth.
(b) Custodians. The custodian of the fund shall be the State Treasurer and no payments shall be made from the fund unless made by the State Treasurer in accordance with requisitions signed by the Board Secretary as ratified by Board resolution.
(c) Fiduciaries. Each member of the Board, its employes and agents, will be fiduciaries to the members of the System, regarding investments and disbursements of any of the fund monies, and will not benefit or profit, directly or indirectly, with respect to any transaction in which it is directly or indirectly involved.
(d) Name for transacting business. All business of the system, including investments and disbursements, shall be conducted in the name of the Public School Employees' Retirement System or the Public School Employes' Retirement System. The Board pursuant to its authority to transact business will establish a nomination registration procedure to facilitate the sale and transfer of securities under the fictitious name of ''SERPA & CO.''
(e) Investment in corporate stocks. [Reserved].
(f) Investment in real estate and mortgages. [Reserved].
§ 215.23. Member's Savings Account.
Interest is credited to each member's savings account during active or inactive service and also during the period a vestee retains [his] vested credits. No interest is credited to a member's savings account if [he] the member has terminated service or has been an inactive member over 2 years and is not eligible for vested benefits. The rate of interest when credited is the statutory rate of 4.0% per annum.
MISCELLANEOUS PROVISIONS § 215.31. [Commonwealth guarantee] (Reserved).
[The required statutory interest charges payable, the maintenance of reserves in the fund, and the payment of all annuities and other benefits granted by the Board under the provisions of the code are hereby made obligations of the Commonwealth, as specifically provided for in sections 8326 and 8327 of the Code, 24 Pa.C.S. §§ 8326 and 8327.]
§ 215.33. Taxation, attachment and assignment of funds.
The exemption provided in this section shall also [extend to] include a spouse's election as authorized under [sections 6108 and 6111 of the Probate, Estates, and Fiduciaries Code (]20 Pa.C.S. §§ 6108 and 6111[)] (repealed) (relating to designation of beneficiaries of insurance or employee death benefits not testamentary; and conveyance to defeat marital rights) to the extent applicable. From and after the effective date of this law, the Board will not entertain an assignment from any credit union which, under prior law, was authorized to forward assignments [in order] to collateralize funds in the system to the extent of $750. From and after [three] 3 years from the effective date of the code, the Board will not honor any credit union loan which had, under prior law, been forwarded to the Board under the provisions thereof. [No] A credit union [shall] may not, directly or indirectly, use an existing assignment on record with the Board as a device to renew or reassign an existing loan in order to collateralize the funds in the System.
§ 215.34. [Fraud and adjustment of errors.] (Reserved).
[(a) Offense defined. Any person who shall knowingly make any false statement or shall falsify or permit to be falsified any record or records of this System in any attempt to defraud the System as a result of such act shall be guilty of a misdemeanor of the second degree.
(b) Adjustment of errors. Should any change or mistake in records result in any member, beneficiary or survivor annuitant receiving from the System more or less than he would have been entitled to receive had the records been correct, then regardless of the intentional or unintentional nature of the error and upon the discovery of such error, the Board will correct the error so far as practicable and will adjust the payments which may be made for and to such person in such a manner that the actuarial equivalent of the benefit to which he was correctly entitled will be paid. The Board shall recover erroneous payments as the circumstances may warrant.]
§ 215.35. General regulations.
(a) Former annuitants who are active members of the System on the effective date of the code [shall] are not [be] subject to the recalculation of annuities of annuitants who return to school service thereafter.
[(b) Active members eligible to purchase creditable nonschool service, under the provisions of the Public School Employes' Retirement Code of 1959 (24 P. S. §§ 3101--3808 (repealed)), shall not be required to pay interest on such purchase, provided the active member elects to purchase such service and makes the required lump sum payment prior to January 1, 1976, or commences regular payments through salary deductions for such service purchase prior to such date, provided, however, that he completes such payments prior to January 1, 1978. Any member entitled to an interest free purchase, as provided in this subsection, who fails to make the elected lump sum payment he has prior to January 1, 1978, shall be required to purchase all such service with interest in accordance with the code, as in all other cases.]
[(c)] (b) * * *
[(d)] (c) * * *
[(e)] (d) * * *
[(f)] (e) * * *
[(g) The provisions reducing the basic contribution rate of active members from 5.5% of compensation to 5.25% of compensation, shall become effective on July 1, 1976, and the provisions relating to the frequency of payment of the employer contributions shall become effective on July 1, 1975.
(h)] (f) * * *
[(i)] (g) * * *
§ 215.36. Optional alternate retirement programs.
[Pursuant to] Under section 8301(a)(1) of the code [(24 Pa.C.S. § 8301(a)(1))] (relating to mandatory and optional membership), certain school employes may elect not to join the [Public School Employes' Retirement] System, or to depart from it in favor of an optional alternate retirement program approved by the employer, such as the Secretary of Education or the governing body of certain State institutions, including Pennsylvania State University, as the case may be. Therefore, the following [rules and regulations are] is adopted by the Board to establish guidelines and procedures, insofar as the Board is authorized to so do, with respect to implementing [such] a program for certain eligible school employes:
* * * * * (2) Employes, including those employed on the effective date of the establishment of an optional alternate retirement program, who are eligible for membership therein, and who are active members of this System, shall have the option of continuing their active membership or of joining the optional alternate retirement program provided they shall make [such] this election within [nine] 9 months of the effective date of the establishment of [such] the optional alternate retirement program. Every employe who subsequently becomes eligible for membership in the optional alternate retirement program shall make [such] the election within 30 days of the first date of active employment. [All employes] Employes not exercising the option to join the optional alternate retirement program [as aforesaid] shall be deemed to have chosen to commence or continue active membership in this System, unless they [shall] have elected membership in the State Employes' Retirement System, as otherwise provided by law.
(3) [Where] When an eligible employe, who is an active member of this System, elects to participate in the optional alternate retirement program in accordance with the provisions of paragraph (2) [of this subsection, he] the employe may elect to withdraw [his] the accumulated deductions from the fund as of the date of [such] the election; or, if [such] the employe is eligible for vesting in accordance with [the provisions of] the code, [he] the employe may elect to leave [his] the accumulated deductions credited to [his] account of the employe in the fund and receive a retirement allowance from the System upon separation from employment; or, at [his] the employe's option, upon attainment of superannuation retirement age, if later. [Such] This retirement allowance shall be based upon [his] credited service and final average salary while a contributing member to this System only.
(4) Notwithstanding any provisions [heretofore] to the contrary, an eligible employe employed on the effective date of the establishment of the optional alternate retirement program, who is eligible for membership therein, who is an active member of this System, and who is not vested in the retirement system, shall have the option of joining the optional alternate retirement program within 60 days of the date upon which [he] the employe becomes eligible for vesting in accordance with the applicable provisions of the code, in which case [he] the employe may vest and join the optional alternate retirement program under the same conditions as provided in paragraph (3).
(5) [Where] When an eligible employe elects to participate in the optional alternate retirement program in accordance with [the provisions of paragraphs] paragraph (2) or (4), the election shall be final and binding so long as [he] the employe shall remain eligible to remain in the optional alternate retirement program. [Where] If an employe later is employed in a capacity which does not qualify [him] for membership in the optional alternate retirement program, [he] the employe shall, upon meeting the qualifications for membership in this System, resume making contributions to the fund or reinstate [his] the former credited service for which contributions had been withdrawn, as the case may be, in accordance with the applicable provisions of the code. In no case shall service, salary or other compensation paid to an employe while a member of the optional alternate retirement program be credited toward membership in this System.
(6) In the case of eligible employes who elect to join the optional alternate retirement program, the contribution of the Commonwealth to the optional alternate retirement program on behalf of [such] the employes [shall] will not be [no] more than 1/2 of the employer normal contribution rate and accrued liability rate as determined in accordance with 24 Pa.C.S. § 8328 (b) and (c)) (relating to actuarial cost method).
[Pa.B. Doc. No. 98-486. Filed for public inspection March 27, 1998, 9:00 a.m.]
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