38-922

38-922. Transfer or redemption of service
credits

A. Service credits qualified in accordance with section 38-921 may be transferred
or redeemed in accordance with this section.

B. In the case of a member whose contributions remain on deposit with the prior
retirement system or plan, the following shall be calculated:

1. The prior system or plan shall calculate the amount equal to the actuarial
present value of a member's projected benefits to the extent funded on a market value
basis as of the most recent actuarial valuation under the prior system or plan as
calculated by that system's or plan's actuary using the same actuarial method and
assumptions used in calculating that system's or plan's funding requirements based on the
transferring member's service credits at the time of transfer.

2. The system or plan to which the member is transferring shall calculate the
increase in the actuarial present value of the projected benefits provided as a result of
the transfer of the member's service credits. This calculation shall be performed by that
system's or plan's actuary using the same actuarial method and assumptions used in
calculating that system's or plan's funding requirements based on the transferring
member's service credits at the time of transfer.

C. In the event a member decides to transfer:

1. If the amount calculated in subsection B, paragraph 2 is greater than the amount
calculated in subsection B, paragraph 1:

(a) The prior system or plan shall transfer to the present system or plan the
greater of the amount calculated in subsection B, paragraph 1 or the member's accumulated
contribution account balance.

(b) If the amount transferred is less than the amount calculated under subsection
B, paragraph 2, the transferring member shall elect either to pay the difference or to
accept a reduced transfer of service credits. If the member elects to pay the
difference, the amount paid shall be added to the member's accumulated contribution
account balance. If the member elects to accept a reduced transfer of service credits,
the amount of service credits transferred shall be equal to the amount of service credits
used in making the calculation under subsection B, paragraph 1 multiplied by the ratio of
the amount calculated under subsection B, paragraph 1 to the amount calculated under
subsection B, paragraph 2.

2. If the amount calculated in subsection B, paragraph 2 is less than or equal to
the amount calculated in subsection B, paragraph 1, the prior system or plan shall
transfer to the present system or plan the greater of the amount calculated in subsection
B, paragraph 2 or the member's accumulated contribution account balance.

D. In the case of an applicant who has withdrawn his member contributions from
another prior system or plan of this state, the applicant shall pay into the new system
or plan to which he is transferring an amount equal to the increase in the actuarial
present value of the projected benefits provided by the service credits being redeemed
and this amount shall be included in the member's current accumulated contribution
account balance. This calculation shall be performed by the actuary of the system or plan
to which the service credits are being transferred using the same actuarial method and
assumptions used in calculating that system's or plan's funding requirements.

E. Service credits shall not be applied to the applicant's account until such time
as complete payment is made to the retirement system or plan to which the applicant is
transferring. On completion of the transfer provided for in this article, the member's
rights in the retirement system or plan from which the member is transferring are
extinguished.

F. A member electing to transfer to or redeem service with the public safety
personnel retirement system, the elected officials' retirement plan or the corrections
officer retirement plan pursuant to this section may pay for the service being
transferred or redeemed in the form of a lump sum payment to the system or plan, a
trustee-to-trustee transfer or a direct rollover of an eligible distribution from a plan
described in section 402(c)(8)(B)(iii), (iv), (v) or (vi) of the internal revenue code or
a rollover of an eligible distribution from an individual retirement account or annuity
described in section 408(a) or (b) of the internal revenue code.