38-884

38-884. Membership of retirement plan;
termination; credited service; redemption

A. Each employee of a participating employer is a member of the plan unless the
employee is receiving a pension from the plan. A person employed shall undergo a medical
examination performed by a doctor or clinic appointed by the local board or, in the case
of a state correctional officer who is employed by the state department of corrections,
complete a physical examination pursuant to section 41-1822, subsection B. For the
purposes of subsection B of this section, the doctor or clinic appointed by the local
board may be the employer's regular employee or contractor.

B. The purpose of the medical examination authorized by this section is to identify
a member's physical or mental condition or injury that existed or occurred before the
member's date of membership in the plan. Any employee who fails or refuses to submit to
the medical examination prescribed in this section is deemed to waive all rights to
disability benefits under this article. Medical examinations conducted under this article
shall not be conducted or used for purposes of hiring, advancement, discharge, job
training or other terms, conditions and privileges of employment unrelated to receipt or
qualification for pension benefits or service credits from the fund. This subsection does
not affect or impair the right of an employer to prescribe medical or physical standards
for employees or prospective employees.

C. If a member ceases to be an employee for any reason other than death or
retirement, within twenty days after filing a completed application with the board, the
member is entitled to receive the following amounts, less any benefit payments the member
has received and any amount the member may owe to the plan:

1. If the member has less than five years of credited service with the plan, the
member may withdraw the member's accumulated contributions from the plan.

2. If the member has five or more years of credited service with the plan, the
member may withdraw the member's accumulated contributions plus an amount equal to the
amount determined as follows:

(a) 5.0 to 5.9 years of credited service, twenty-five per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

(b) 6.0 to 6.9 years of credited service, forty per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

(c) 7.0 to 7.9 years of credited service, fifty-five per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

(d) 8.0 to 8.9 years of credited service, seventy per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

(e) 9.0 to 9.9 years of credited service, eighty-five per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

(f) 10.0 or more years of credited service, one hundred per cent of all member
contributions deducted from the member's salary pursuant to section 38-891, subsection B.

D. If a member has more than ten years of credited service with the plan, leaves
the monies prescribed in subsection C of this section on account with the plan for more
than thirty days after termination of employment and after that time period requests a
refund of those monies, the member is entitled to receive the amount prescribed in
subsection C of this section plus interest at a rate determined by the board for each
year computed from and after the member's termination of employment.

E. If the refund includes monies that are an eligible rollover distribution and the
member elects to have the distribution paid directly to an eligible retirement plan or
individual retirement account or annuity and specifies the eligible retirement plan or
individual retirement account or annuity to which the distribution is to be paid, the
distribution shall be made in the form of a direct trustee-to-trustee transfer to the
specified eligible retirement plan. The distribution shall be made in the form and at
the time prescribed by the board.

F. Service shall be credited to a member's individual credited service account in
accordance with rules the local board prescribes. In no case shall more than twelve
months of credited service be credited on account of all service rendered by a member in
any one year. In no case shall service be credited for any period during which the
member is not employed in a designated position, except as provided by sections 38-921
and 38-922.

G. Credited service is forfeited if the amounts prescribed in subsection C or D of
this section are paid or are transferred in accordance with this section.

H. If a former member becomes reemployed with the same employer within two years
after the former member's termination date, a member may have forfeited credited service
attributable to service rendered during a prior period of service as an employee restored
on satisfaction of each of the following conditions:

1. The member files with the plan a written application for reinstatement of
forfeited credited service within ninety days after again becoming an employee.

2. The retirement fund is paid the total amount previously withdrawn pursuant to
subsection C or D of this section plus compound interest from the date of withdrawal to
the dates of repayment. Interest shall be computed at the rate of nine per cent for each
year compounded each year from the date of withdrawal to the date of repayment.
Forfeited credited service shall not be restored until complete payment is received by
the fund.

3. The required payment is completed within one year after returning to employee
status.

I. A present active member of the plan who received a refund of accumulated
contributions from the plan pursuant to subsection C or D of this section and forfeited
credited service pursuant to subsection G of this section may elect to redeem any part of
that forfeited credited service by paying into the plan any amounts required pursuant to
this subsection. A present active member who elects to redeem any part of forfeited
credited service for which the member is deemed eligible by the board shall pay into the
plan the amounts previously paid or transferred as a refund of the member's accumulated
contributions plus an amount, computed by the plan's actuary that is necessary to equal
the increase in the actuarial present value of projected benefits resulting from the
redemption calculated using the actuarial methods and assumptions prescribed by the
plan's actuary.

J. A retired member may become employed by an employer in a designated position and
continue to receive a pension if the employment occurs at least twelve months after
retirement. The retired member shall not contribute to the fund and shall not accrue
credited service. If a retired member becomes employed by an employer in a designated
position before twelve months after retirement:

1. Payment of the retired member's pension shall be suspended until the retired
member again ceases to be an employee. The amount of pension shall not be changed on
account of service as an employee subsequent to retirement.

2. The retired member shall not contribute to the fund and shall not accrue
credited service.