S.L. 1965-780

NORTH CAROLINA GENERAL ASSEMBLY

1965 SESSION

CHAPTER 780

HOUSE BILL 691

AN ACT TO AMEND CHAPTER 135 OF THE GENERAL STATUTES RELATING TO THE TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM.

The General Assembly of North Carolina do enact:

Section 1. Chapter 135 of the General Statutes, as the same appears in the 1964 Replacement Volume of the General Statutes, is hereby amended as set out below:

(a) Subdivision (10) of G.S. 135-1 is hereby amended by striking out the first sentence and inserting the following in lieu thereof:

"'Employee' shall mean all full-time employees, agents or officers of the State of North Carolina or any of its departments, bureaus and institutions other than educational, whether such employees are elected, appointed or employed: Provided, that the term 'employee' shall not include any Justice of the Supreme Court, any Judge of the Superior Court, or any part-time or temporary employee. In all cases of doubt, the board of trustees shall determine whether any person is an employee as defined in this Chapter."

(b) Subdivision (25) of G.S. 135-1 is hereby amended by striking out the period at the end of the first sentence, inserting a colon in lieu thereof, and adding the following words: "provided, that the term 'teacher' shall not include any part-time, temporary, or substitute teacher or employee."

"On and after July 1, 1965, new Extension Service employees in the employ of a county participating in the local Governmental Employees' Retirement System are hereby excluded from participation in the Teachers' and State Employees' Retirement System to the extent of that part of their compensation derived from a county; provided that on and after July 1, 1965, new Extension Service employees who are required to accept a Federal Civil Service appointment may elect in writing, on a form acceptable to the Retirement System, to be excluded from the Teachers' and State Employees' Retirement System and the local Retirement System."

(d) Subdivision (5) of G.S. 135-3 is hereby amended by adding the following at the end thereof:

"Any such member on or after June 30, 1965, anything in this Chapter to the contrary, may deposit in the annuity savings fund by a single payment the contributions plus interest which would have been credited to his account had he not signed a non-election blank on or before January 1, 1942, and be entitled to such membership service credits and any prior service credits which became void upon execution of such non-election blank; provided that the employer will pay the appropriate matching contributions."

(e) Subsection (f) of G.S. 135-4 is hereby amended by inserting a comma and the following words in line eight after the figures "1952":

"or who devote not less than ten years of service to the State,".

(f) Subdivision (1) of subsection (b1) of G.S. 135-5 is hereby amended to read as follows:

"(1) If the member's service retirement date occurs on or after his 65th birthday, such allowance shall be equal to the sum of (i) one per centum (1%) of the portion of his average final compensation not in excess of forty-eight hundred dollars ($4800.00) plus one and one-half per centum (1 ½%) of the portion of such compensation in excess of forty-eight hundred dollars ($4800.00), multiplied by the number of years of his creditable service rendered prior to January 1, 1966 and (ii) one per centum (1%) of the portion of his average final compensation not in excess of fifty-six hundred dollars ($5600.00) plus one and one-half per centum (1 ½%) of the portion of such compensation in excess of fifty-six hundred dollars ($5600.00), multiplied by the number of years of his creditable service rendered after January 1, 1966."

(g) Subsection (f) of G.S. 135-5 is hereby amended by rewriting the fourth sentence to read as follows:

"Upon receipt of proof satisfactory to the board of trustees of the death, prior to retirement, of a member or former member there shall be paid to such person or persons as he shall have nominated by written designation duly acknowledged and filed with the board of trustees, if such person or persons are living at the time of the member's death, otherwise to the member's legal representatives, the amount of his accumulated contributions at the time of his death."

(h) The first paragraph of subsection (g) of G.S. 135-5 is hereby amended by rewriting said paragraph to read as follows:

"(g) Election of Optional Allowance. With the provision that until the first payment on account of any benefit becomes normally due, or his first retirement check has been cashed, any member may elect to receive his benefits in a retirement allowance payable throughout life, or he may elect to receive the actuarial equivalent of such retirement allowance in a reduced allowance payable throughout life under the provisions set forth in options one, two, three, or four below: provided further, that an optional election may be made after attainment of age 60 without establishment of a date of retirement. Such election will be effective 30 days after execution and filing thereof with the Retirement System. The election of option two or option three or nomination of the person thereunder shall be revoked if such person nominated dies prior to the date the first payment becomes normally due or until the first retirement check has been cashed. Such election may be revoked by the member prior to the date the first payment becomes normally due or until his first retirement check has been cashed. Any member dying in service after his optional election has become effective shall be presumed to have retired on the first day of the month following the date of death."

(i) Subsection (k) of G.S. 135-6 is hereby amended by striking out in line two the word "three" and inserting in lieu thereof the words "not less than three nor more than five".

(j) Line three of subsection (g) of G.S. 135-6 is hereby amended by striking out the word "secretary" and substituting in lieu thereof the word "director". Subdivision (7) of G.S. 135-20 is hereby amended by striking out the words "secretary of the board of trustees" in line one, and inserting in lieu thereof the word "director." Reference in any statute to the "secretary of the board of trustees of the Teachers' State Employees' Retirement System shall be deemed to be a reference to the director of said Retirement System.

(k) Subdivision (1) of subsection (b) of G.S. 135-8 is hereby amended by adding the following immediately after the word "amended" in line thirteen:

"and with respect to members covered under G.S. 135-27, with such coverage retroactive to January 1, 1955,".

(1) Subdivision (1) of subsection (b) of G.S. 135-8 is hereby further amended by rewriting the last paragraph thereof to read as follows:

"Notwithstanding the foregoing, effective July 1, 1963, with respect to the period of service commencing on July 1, 1963 and ending December 31, 1965 the rates of such deduction shall be four per centum (4%) of the portion of compensation not in excess of forty-eight hundred dollars ($4800.00) and six per centum (6%) of the portion of compensation in excess of forty‑eight hundred dollars ($4800.00); and with respect to the period of service commencing January 1, 1966, the rate of such deductions shall be four per centum (4%) of the portion of compensation not in excess of fifty-six hundred dollars ($5600.00) and six per centum (6%) of the portion of compensation in excess of fifty-six hundred dollars ($5600.00). Such rates shall apply uniformly to all members of the Retirement System, without regard to their coverage under the Social Security Act."

(m) Subdivision (1) of subsection (d) of G.S. 135-8 is hereby amended by striking out the word "annually", in line one, and the words "for the preceding fiscal year", in line two.

(n) Subdivision a of subdivision (2) of subsection (f) of G.S. 135-8 is hereby amended by rewriting said subdivision a to read as follows:

"a. Upon the basis of each actuarial valuation provided herein there shall be prepared biennially and certified to the budget division of the Department of Administration a statement of the total amount necessary for the ensuing biennium to the pension accumulation and expense funds, as provided under subsections (d) and (f) of this Section, and these funds shall be handled and disbursed in accordance with Chapter 100, Public Laws of 1929, and amendments thereto (143-1 et seq.), known as The Executive Budget Act."

(o) Subsection (h) of G.S. 135-8 is hereby repealed.

(p) Subsection (a) of G.S. 135-18.1 is hereby amended by rewriting the last sentence to read as follows:

"Any person who becomes a member of this Retirement System after July 1, 1951, shall be entitled to transfer to this Retirement System his credits for membership and prior service in the local system: Provided, the actual transfer of employment is made within five years from date of separation from employment covered by the local system and such person shall request the local system to transfer his accumulated contributions, interest, and service credits to this Retirement System."

(q) Subsection (a) of G.S. 135-28 is hereby rewritten to read as follows:

"(a) Any member whose services as a teacher or State employee are terminated for any reason other than retirement or death, who, within five years from date of such termination becomes employed by an employer participating in the North Carolina Local Governmental Employees' Retirement System or an employer which brings its employees into participation in said System within five years after such teacher or State employee has ceased to be a teacher or State employee, may elect to leave his total accumulated contributions in the Teachers' and State Employees' Retirement System during the period he is in the employment of such employer, or his account remains active in the local System. This subsection shall be effective retroactively as well as prospectively."

(r) Subsection (b) of G.S. 135-28 is hereby amended by striking out the words "Any member who files such an election" in the first line and inserting in lieu thereof the words "Any such member".

Sec. 2. All laws and clauses of laws in conflict with this Act are hereby repealed.

Sec. 3. This Act shall be in full force and effect on and after July 1, 1965.

In the General Assembly read three times and ratified, this the 2nd day of June, 1965.