MISSISSIPPI LEGISLATURE

1998 Regular Session

To: Appropriations

By: Representatives Perry, McCoy

House Bill 1664

(As Passed the House)

AN ACT TO AMEND SECTION 25-11-109, MISSISSIPPI CODE OF 1972, TO ALLOW AN INACTIVE VESTED MEMBER OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM TO PURCHASE OUT-OF-STATE AND PROFESSIONAL LEAVE CREDIT; TO AMEND SECTION 25-11-113, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT AN INACTIVE MEMBER MUST FILE AN APPLICATION FOR DISABILITY RETIREMENT WITHIN SIX MONTHS OF TERMINATING EMPLOYMENT; TO PROVIDE THAT A MEMBER WITH NOT LESS THAN THREE YEARS OF MEMBERSHIP CREDIT OR A RETIREE RETURNING TO COVERED EMPLOYMENT MUST REMAIN AN ACTIVE MEMBER FOR A PERIOD OF NOT LESS THAN ONE YEAR AFTER REENTRY BEFORE BEING ELIGIBLE TO FILE FOR NONDUTY RELATED DISABILITY BENEFITS; TO AMEND SECTION 25-11-115, MISSISSIPPI CODE OF 1972, TO CLARIFY A MEMBER'S ANNUITY TO BE THE VALUE OF THE ANNUITY SAVINGS ACCOUNT FOR THE MEMBER; TO DISCONTINUE ADVANCING FUNDS TO MEMBERS UNDER OPTION 4-C BY REMOVING THE OPTION; TO AMEND SECTION 25-11-115.1, MISSISSIPPI CODE OF 1972, TO PROVIDE FOR A METHOD OF MAKING PAYMENTS TO A MEMBER OR BENEFICIARY DETERMINED LEGALLY INCOMPETENT OR INCAPABLE OF APPLYING FOR, MANAGING OR DIRECTING THE MANAGEMENT OF BENEFITS WHEN THE MEMBER OR BENEFICIARY HAS NOT PREVIOUSLY MADE LEGAL PROVISIONS FOR A CONSERVATOR, GUARDIAN OR COMPLETED A DURABLE POWER OF ATTORNEY; TO AMEND SECTION 25-11-117, MISSISSIPPI CODE OF 1972, TO AUTHORIZE REPAYMENT OF A REFUND UPON REEMPLOYMENT IN A COVERED POSITION; TO CODIFY SECTION 25-11-118, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE RETIREMENT SYSTEM TO ACCEPT ELIGIBLE ROLL OVER DISTRIBUTIONS FOR THE PURPOSE OF REPAYING A REFUND OR PURCHASING OPTIONAL SERVICE CREDIT; TO AMEND SECTION 25-11-120, MISSISSIPPI CODE OF 1972, TO DEFINE WHAT CONSTITUTES A RECORD FOR APPEAL PURPOSES; TO PROVIDE THAT A FINDING OF TOTAL DISABILITY BY THE SOCIAL SECURITY ADMINISTRATION WILL CREATE A REBUTTABLE PRESUMPTION OF DISABILITY; TO PROVIDE THAT CLEAR AND CONVINCING EVIDENCE IS NEEDED TO OVERCOME THE PRESUMPTION; TO AMEND SECTION 25-11-123, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT DELINQUENT EMPLOYEE CONTRIBUTIONS PLUS ACCRUED INTEREST WILL BE THE OBLIGATION OF THE EMPLOYEE, AND DELINQUENT EMPLOYER CONTRIBUTIONS PLUS ACCRUED INTEREST WILL BE THE OBLIGATION OF THE EMPLOYER; TO AUTHORIZE THE EMPLOYER, IN ITS DISCRETION, TO PAY THE ACCRUED INTEREST ON DELINQUENT EMPLOYEE CONTRIBUTIONS; TO AMEND SECTION 25-11-127, MISSISSIPPI CODE OF 1972, WHICH RELATES TO BENEFITS UPON REEMPLOYMENT OF RETIRED PERSONS FOR THE PURPOSE OF RESTRUCTURING THE PROVISIONS IN A MORE READABLE SECTION; TO PROVIDE THAT THE PROVISIONS OF SECTION 25-11-127 SHALL NOT APPLY TO A RETIREE WHO CONTINUES IN AN ELECTED OFFICE IN A MUNICIPALITY OR COUNTY OR HAS BEEN ELECTED TO PUBLIC OFFICE IN A MUNICIPALITY OR COUNTY, PROVIDED THERE IS FILED A WAIVER OF ALL SALARY OR COMPENSATION FOR THE POSITION; TO ESTABLISH AN ASSESSMENT TO THE EMPLOYER WHO FAILS TO TIMELY NOTIFY THE SYSTEM OF THE REEMPLOYMENT OF A RETIREE; TO ESTABLISH THE RESPONSIBILITY AS THAT OF THE EMPLOYER AND THE RETIREE FOR THE CARRYING OUT OF THE PROVISIONS OF SECTION 25-11-127; TO AMEND SECTION 25-11-137, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE COST TO TRANSFER ELIGIBLE LAW ENFORCEMENT OR FIRE DEPARTMENT SERVICE CREDIT FROM ONE RETIREMENT SYSTEM TO ANOTHER RETIREMENT SYSTEM SHALL BE THE ACTUARIAL COST FOR SUCH SERVICE CREDIT; TO PROVIDE THAT ONLY ESTABLISHED SERVICE COVERED BY A RETIREMENT SYSTEM IN THE STATE OF MISSISSIPPI IS ELIGIBLE FOR TRANSFER; TO PROVIDE THAT A MEMBER MAY TRANSFER SUCH CREDIT AFTER HAVING COMPLETED THE MINIMUM ELIGIBILITY PERIOD FOR MONTHLY BENEFITS; TO AMEND SECTION 25-11-401, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE INTERPRETATION OF THE TERM "TEACHING OR ADMINISTRATIVE FACULTY" BY THE BOARD OF TRUSTEES OF THE SYSTEM IN CONSULTATION WITH THE BOARD OF TRUSTEES OF STATE INSTITUTIONS OF HIGHER LEARNING, SHALL BE LIBERALLY CONSTRUED IN DETERMINING ELIGIBILITY FOR THE OPTIONAL RETIREMENT PROGRAM; TO AMEND SECTION 25-11-409, MISSISSIPPI CODE OF 1972, TO REDUCE FROM NINETY TO THIRTY DAYS THE PERIOD FOR ENROLLMENT IN THE OPTIONAL RETIREMENT PROGRAM; TO AMEND SECTION 25-13-13, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT PAYMENT OF DEATH BENEFITS UNDER THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM SHALL BE IN ACCORDANCE WITH THE STATUTORY PROVISIONS SET FORTH AS OF THE DATE OF DEATH; TO PROVIDE THAT IF THE MEMBER AND BENEFICIARY DIE BEFORE HAVING RECEIVED IN BENEFITS AN AMOUNT EQUAL TO THE TOTAL OF THE CONTRIBUTIONS AND ACCRUED INTEREST OF THE MEMBER AT THE TIME OF RETIREMENT, THE BALANCE WILL BE REFUNDED TO THE DESIGNATED BENEFICIARY OR BY STATUTORY SUCCESSION; TO AMEND SECTION 25-13-16, MISSISSIPPI CODE OF 1972, TO DEFINE ANNUITY AS THE ANNUITY SAVINGS ACCOUNT UNDER THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM; TO AUTHORIZE A RETIREE WHO RETIRED BEFORE OR AFTER JULY 1, 1998, AND WHOSE DESIGNATED BENEFICIARY PREDECEASED OR PREDECEASES HIM OR WHOSE DESIGNATED BENEFICIARY IS OR WAS THE SPOUSE AND THE MARRIAGE IS OR WAS DISSOLVED TO ELECT TO HAVE BENEFITS RECALCULATED TO RECEIVE THE MAXIMUM BENEFITS; TO AUTHORIZE A RETIREE WHO RETIRED BEFORE OR AFTER JULY 1, 1998, WHO MARRIED, MARRIES OR REMARRIES, AND THE SPOUSE IS NOT THE SAME SPOUSE MARRIED TO THE MEMBER AT THE TIME OF RETIREMENT, TO ELECT TO RECEIVE A REDUCED RETIREMENT ALLOWANCE UNDER OPTION 2 OR OPTION 4-A; TO REMOVE THE COST TO THE RETIREE FOR THE RIGHT TO ELECT TO HAVE BENEFITS RECALCULATED TO RECEIVE THE MAXIMUM BENEFITS TO PROVIDE THAT NO PAYMENTS UNDER THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM MAY BE MADE FOR A PERIOD IN EXCESS OF THAT ALLOWED BY FEDERAL LAW; TO PROVIDE THAT IF A MEMBER AND HIS BENEFICIARY BOTH DIE BEFORE HAVING RECEIVED IN MONTHLY BENEFITS AN AMOUNT EQUAL TO THE CONTRIBUTIONS AND ACCRUED INTEREST OF THE MEMBER AT THE TIME OF RETIREMENT, THE BALANCE WILL BE REFUNDED TO THE ESTATE OF THE SURVIVOR OF THE RETIRANT AND HIS BENEFICIARY; TO PROVIDE THAT THE RETIREMENT ALLOWANCE FOR ANY RETIRED MEMBER WHO RETIRED UNDER OPTION 2(5) OR OPTION 4-A(5) WHO IS STILL RECEIVING BENEFITS ON JULY 1, 1998, WILL BE INCREASED BY AN AMOUNT EQUAL TO THE AMOUNT THEY WOULD HAVE RECEIVED UNDER OPTION 2 OR OPTION 4-A WITHOUT THE REDUCTION FOR OPTION 5; TO AMEND SECTION 25-13-21, MISSISSIPPI CODE OF 1972, TO AUTHORIZE A MEMBER OF THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM OR ELIGIBLE BENEFICIARY WHO IS ELIGIBLE FOR A REFUND TO ELECT TO HAVE AN ELIGIBLE ROLL OVER DISTRIBUTION OF ACCUMULATED CONTRIBUTIONS PAID DIRECTLY TO AN ELIGIBLE RETIREMENT PLAN OR INDIVIDUAL RETIREMENT ACCOUNT; TO ALLOW REPAYMENT OF A REFUND UPON THE REEMPLOYMENT OF A MEMBER IN A POSITION COVERED BY THE SYSTEM; TO PROVIDE THAT THE REPAYMENT SHALL BE IN INCREMENTS OF NOT LESS THAN ONE-FOURTH-YEAR OF CREDITABLE SERVICE; TO PROVIDE THAT THE REPURCHASED SERVICE CREDIT SHALL NOT BE ELIGIBLE TO BE USED IN THE CALCULATION OF BENEFITS UNTIL THE MEMBER HAS COMPLETED FIVE YEARS OF MEMBERSHIP AFTER REENTERING THE SYSTEM; TO CODIFY SECTION 25-13-22, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM TO ACCEPT AN ELIGIBLE ROLL OVER DISTRIBUTION OR A DIRECT TRANSFER OF FUNDS FROM ANOTHER QUALIFIED PLAN IN PAYMENT OF ALL OR A PORTION OF THE COST TO PURCHASE OPTIONAL SERVICE CREDIT OR REINSTATE PREVIOUSLY WITHDRAWN SERVICE CREDIT; TO AMEND SECTION 25-13-35, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT BENEFITS WILL CEASE FOR A HIGHWAY PATROL RETIREE WHO BECOMES REEMPLOYED IN A LAW ENFORCEMENT POSITION UNDER EITHER THE DEPARTMENT OF PUBLIC SAFETY OR THE MISSISSIPPI BUREAU OF NARCOTICS, AND THAT PERSON MUST REENTER MEMBERSHIP IN THE HIGHWAY SAFETY PATROL RETIREMENT SYSTEM; TO CODIFY SECTION 21-29-323, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE MONTHLY BENEFITS PAYABLE TO A SPOUSE IN THE EVENT OF THE DEATH OF A MEMBER OF A CITY FIREMEN'S AND POLICEMAN'S DISABILITY AND RELIEF FUND BEFORE RETIREMENT OR OF A RETIREE AFTER RETIREMENT SHALL BE DIVIDED AND PAID TO OR FOR THE BENEFIT OF ANY DEPENDENT CHILDREN OF THE DECEASED MEMBER OR RETIREE IN AN AMOUNT EQUAL TO 10% FOR ONE DEPENDENT CHILD, 20% FOR TWO DEPENDENT CHILDREN OR 30% FOR THREE OR MORE DEPENDENT CHILDREN; TO PROVIDE THAT IF THERE ARE MORE THAN THREE DEPENDENT CHILDREN, WHEN THE OLDEST CHILD CEASES TO QUALIFY THE BENEFITS WILL BE REDISTRIBUTED TO THE REMAINING DEPENDENT CHILDREN; TO PROVIDE THAT BENEFITS MAY BE PAID TO THE SURVIVING PARENT OR LAWFUL CUSTODIAN OF SUCH CHILDREN FOR THE USE AND BENEFIT OF THE CHILDREN WITHOUT THE NECESSITY OF APPOINTMENT OF A GUARDIAN; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 25-11-109, Mississippi Code of 1972, is amended as follows:

25-11-109. (1) Under such rules and regulations as the board of trustees shall adopt, each person who becomes a member of this retirement system, as provided in Section 25-11-105, on or prior to July 1, 1953, or who becomes a member and contributes to the system for a minimum period of four (4) years, shall receive credit for all state service rendered before February 1, 1953. To receive such credit, such member shall file a detailed statement of all services as an employee rendered by him in the state service before February 1, 1953. For any member who joined the system after July 1, 1953, any creditable service for which the member is not required to make contributions shall not be credited to the member until the member has contributed to the system for a minimum period of at least four (4) years.

(2) In the computation of membership service or prior service under the provisions of this article, the total months of accumulative service during any fiscal year shall be calculated in accordance with the schedule as follows: ten (10) or more months of creditable service during any fiscal year shall constitute a year of creditable service; seven (7) months to nine (9) months inclusive, three-quarters (3/4) of a year of creditable service; four (4) months to six (6) months inclusive, one-half-year of creditable service; one (1) month to three (3) months inclusive, one-quarter (1/4) of a year of creditable service. In no case shall credit be allowed for any period of absence without compensation except for disability while in receipt of a disability retirement allowance, nor shall less than fifteen (15) days of service in any month, or service less than the equivalent of one-half (1/2) of the normal working load for the position and less than one-half (1/2) of the normal compensation for the position in any month, constitute a month of creditable service, nor shall more than one (1) year of service be creditable for all services rendered in any one (1) fiscal year; provided that for a school employee, substantial completion of the legal school term when and where the service was rendered shall constitute a year of service credit for both prior service and membership service. Any state or local elected official shall be deemed a full-time employee for the purpose of creditable service for prior service or membership service. However, an appointed or elected official compensated on a per diem basis only shall not be allowed creditable service for terms of office.

In the computation of any retirement allowance or any annuity or benefits provided in this article, any fractional period of service of less than one (1) year shall be taken into account and a proportionate amount of such retirement allowance, annuity or benefit shall be granted for any such fractional period of service.

In the computation of unused leave for creditable service authorized in Section 25-11-103, the following shall govern: twenty-one (21) days of unused leave shall constitute one (1) month of creditable service and in no case shall credit be allowed for any period of unused leave of less than fifteen (15) days. The number of months of unused leave shall determine the number of quarters or years of creditable service in accordance with the above schedule for membership and prior service. In order for the member to receive creditable service for the number of days of unused leave, the system must receive certification from the governing authority.

For the purpose of this subsection, for members of the system who are elected officers and who retire on or after July 1, 1987, the following shall govern:

(a) For service prior to July 1, 1984, the members shall receive credit for leave (combined personal and major medical) for service as an elected official prior to that date at the rate of thirty (30) days per year.

(b) For service on and after July 1, 1984, the member shall receive credit for personal and major medical leave beginning July 1, 1984, at the rates authorized in Sections 25-3-93 and 25-3-95, computed as a full-time employee.

(3) Subject to the above restrictions and to such other rules and regulations as the board may adopt, the board shall verify, as soon as practicable after the filing of such statements of service, the services therein claimed.

(4) Upon verification of the statement of prior service, the board shall issue a prior service certificate certifying to each member the length of prior service for which credit shall have been allowed on the basis of his statement of service. So long as membership continues, a prior service certificate shall be final and conclusive for retirement purposes as to such service, provided that any member may within five (5) years from the date of issuance or modification of such certificate request the board of trustees to modify or correct his prior service certificate. Any modification or correction authorized shall only apply prospectively.

When membership ceases, such prior service certificates shall become void. Should the employee again become a member, he shall enter the system as an employee not entitled to prior service credit except as provided in Sections 25-11-105(I), 25-11-113 and 25-11-117.

(5) Creditable service at retirement, on which the retirement allowance of a member shall be based, shall consist of the membership service rendered by him since he last became a member, and also, if he has a prior service certificate which is in full force and effect, the amount of the service certified on his prior service certificate.

(6) Anything in this article to the contrary notwithstanding, any member who served on active duty in the Armed Forces of the United States, or who served in maritime service during periods of hostility in World War II, shall be entitled to creditable service for his service on active duty in the armed forces or in such maritime service, provided he entered state service after his discharge from the armed forces or entered state service after he completed such maritime service. The maximum period for such creditable service for all military service shall not exceed four (4) years unless positive proof can be furnished by such person that he was retained in the armed forces during World War II or in maritime service during World War II by causes beyond his control and without opportunity of discharge. The member shall furnish proof satisfactory to the board of trustees of certification of military service or maritime service records showing dates of entrance into active duty service and the date of discharge. From and after July 1, 1993, no creditable service shall be granted for any military service or maritime service to a member who qualifies for a retirement allowance in another public retirement system administered by the Board of Trustees of the Public Employees' Retirement System based in whole or in part on such military or maritime service. In no case shall the member receive creditable service if the member received a dishonorable discharge from the Armed Forces of the United States.

(7) Any * * * member of the Public Employees' Retirement System who has at least four (4) years of membership service credit shall be entitled to receive a maximum of five (5) years creditable service for service rendered in another state as a public employee of such other state, or a political subdivision, public education system or other governmental instrumentality thereof, or service rendered as a teacher in American overseas dependent schools conducted by the Armed Forces of the United States for children of citizens of the United States residing in areas outside the continental United States, provided that:

(a) The member shall furnish proof satisfactory to the board of trustees of certification of such services from the state, public education system, political subdivision or retirement system of the state where the services were performed or the governing entity of the American overseas dependent school where the services were performed; and

(b) The member is not receiving or will not be entitled to receive from the public retirement system of the other state or from any other retirement plan, including optional retirement plans, sponsored by the employer, a retirement allowance including such services; and

(c) The member shall pay to the retirement system on the date he or she is eligible for credit for such out-of-state service or at any time thereafter prior to date of retirement the actuarial cost as determined by the actuary for each year of out-of-state creditable service. * * * The provisions of this subsection are subject to the limitations of Section 415 of the Internal Revenue Code and regulations promulgated thereunder.

(8) Any * * * member of the Public Employees' Retirement System who has at least four (4) years of membership service credit and who receives, or has received, professional leave without compensation for professional purposes directly related to the employment in state service shall receive creditable service for the period of professional leave without compensation provided:

(a) The professional leave is performed with a public institution or public agency of this state, or another state or federal agency;

(b) The employer approves the professional leave showing the reason for granting the leave and makes a determination that the professional leave will benefit the employee and employer;

(c) Such professional leave shall not exceed two (2) years during any ten-year period of state service;

(d) The employee shall serve the employer on a full-time basis for a period of time equivalent to the professional leave period granted immediately following the termination of said leave period;

(e) The actively contributing member shall pay to the retirement system the actuarial cost as determined by the actuary for each year of professional leave. * * * The provisions of this subsection are subject to the regulations of the Internal Revenue Code limitations;

(f) Such other rules and regulations consistent herewith as the board may adopt and in case of question, the board shall have final power to decide the questions.

Any actively contributing member participating in the School Administrator Sabbatical Program established in Section 37-9-77 shall qualify for continued participation under this subsection (8).

(9) Any member of the Public Employees' Retirement System who has at least four (4) years of credited membership service shall be entitled to receive a maximum of ten (10) years creditable service for:

(a) Any service rendered as an employee of any political subdivision of this state, or any instrumentality thereof, which does not participate in the Public Employees' Retirement System; or

(b) Any service rendered as an employee of any political subdivision of this state, or any instrumentality thereof, which participates in the Public Employees' Retirement System but did not elect retroactive coverage; or

(c) Any service rendered as an employee of any political subdivision of this state, or any instrumentality thereof, for which coverage of the employee's position was or is excluded; provided that the member pays into the retirement system the actuarial cost as determined by the actuary for each year, or portion thereof, of such service. Payment for such service may be made in increments of one-quarter-year of creditable service. After a member has made full payment to the retirement system for all or any part of such service, the member shall receive creditable service for the period of such service for which full payment has been made to the retirement system.

SECTION 2. Section 25-11-113, Mississippi Code of 1972, is amended as follows:

25-11-113. (1) (a) Upon the application of a member or his employer, any active member in state service who has at least four (4) years of membership service credit may be retired by the board of trustees on the first of the month following the date of filing such application on a disability retirement allowance, but in no event shall the disability retirement allowance commence before termination of state service, provided that the medical board, after a medical examination, shall certify that the member is mentally or physically incapacitated for the further performance of duty, that such incapacity is likely to be permanent, and that the member should be retired; however, the board of trustees may accept a disability medical determination from the Social Security Administration in lieu of a certification from the medical board. For the purposes of disability determination, the medical board shall apply the following definition of disability: the inability to perform the usual duties of employment or the incapacity to perform such lesser duties, if any, as the employer, in its discretion, may assign without material reduction in compensation, or the incapacity to perform the duties of any employment covered by the Public Employees' Retirement System (Section 25-11-101 et seq.) that is actually offered and is within the same general territorial work area, without material reduction in compensation. The employer shall be required to furnish the job description and duties of the member. The employer shall further certify whether the employer has offered the member other duties and has complied with the applicable provisions of the Americans With Disabilities Act in affording reasonable accommodations which would allow the employee to continue employment.

(b) Any inactive member with four (4) or more years of membership service credit, who has withdrawn from active state service, is not eligible for a disability retirement allowance unless the application is properly completed and filed in the office of the system within six (6) months of the termination of active service and unless satisfactory proof is presented to the board of trustees that the disability was the direct cause of withdrawal from state service.

(c) Any person or retiree returning to covered employment with not less than three (3) years of membership service at the time of reentry must remain an actively contributing member for a period of not less than one (1) year before being eligible to apply for nonduty disability benefits.

(d) If the medical board certifies that the member is not mentally or physically incapacitated for the future performance of duty, the member may request, within sixty (60) days, a hearing before the hearing officer as provided in Section 25-11-120. All hearings shall be held in accordance with rules and regulations adopted by the board of trustees to govern such hearings. Such hearing may be closed upon the request of the member.

(e) The medical board may request additional medical evidence and/or other physicians to conduct an evaluation of the member's condition. If the medical board requests additional medical evidence and the member refuses the request, the application shall be considered void.

(2) Allowance on disability retirement.

(a) Upon retirement for disability, an eligible member shall receive a retirement allowance if he has attained the age of sixty (60) years.

(b) Except as provided in paragraph (c) of this subsection (2), an eligible member who is retired for disability and who has not attained sixty (60) years of age shall receive a disability benefit as computed in Section 25-11-111(d)(1) through (d)(4) which shall consist of:

(i) A member's annuity which shall be the actuarial equivalent of his accumulated contributions at the time of retirement; and

(ii) An employer's annuity equal to the amount that would have been payable as a retirement allowance for both membership service and prior service had the member continued in service to the age of sixty (60) years, which shall apply to the allowance for disability retirement paid to retirees receiving such allowance upon and after April 12, 1977. This employer's annuity shall be computed on the basis of the average "earned compensation" as defined in Section 25-11-103.

(c) For persons who become members after June 30, 1992, and for active members on June 30, 1992, who elect benefits under this paragraph (c) instead of those provided under paragraph (b) of this subsection (2), the disability allowance shall consist of two (2) parts: a temporary allowance and a deferred allowance.

The temporary allowance shall equal the greater of (i) forty percent (40%) of average compensation at the time of disability, plus ten percent (10%) of average compensation for each of the first two (2) dependent children, as defined in Sections 25-11-103 and 25-11-114, or (ii) the accrued benefit based on actual service. It shall be payable for a period of time based on the member's age at disability, as follows:

Age at Disability Duration

60 and earlier to age 65

61 to age 66

62 to age 66

63 to age 67

64 to age 67

65 to age 68

66 to age 68

67 to age 69

68 to age 70

69 and over one year

The deferred allowance shall commence when the temporary allowance ceases and shall be payable for life. The deferred allowance shall equal the greater of (i) the allowance that would have been payable had the member continued in service to the termination age of the temporary allowance, but no more than forty percent (40%) of average compensation, or (ii) the accrued benefit based on actual service at the time of disability. The deferred allowance as determined at the time of disability shall be adjusted in accordance with Section 25-11-112 for the period during which the temporary annuity is payable. In no case shall a member receive less than Ten Dollars ($10.00) per month for each year of service and proportionately for each quarter year thereof reduced for the option selected.

(d) The member may elect to receive the actuarial equivalent of the disability retirement allowance in a reduced allowance payable throughout life under any of the provisions of the options provided under Section 25-11-115.

(e) Should a disability retiree who has not selected an option under Section 25-11-115 die before being repaid in disability benefits the sum of his total contributions, then his named beneficiary shall receive the difference in cash, which shall apply to all deceased disability retirees from and after January 1, 1953.

(3) Reexamination of retirees retired on account of disability. Except as otherwise provided in this section, once each year during the first five (5) years following retirement of a member on a disability retirement allowance, and once in every period of three (3) years thereafter, the board of trustees may, and upon his application shall, require any disability retiree who has not yet attained the age of sixty (60) years or the termination age of the temporary allowance under paragraph (2)(c) of this section to undergo a medical examination, such examination to be made at the place of residence of said retiree or other place mutually agreed upon by a physician or physicians designated by the board. The board, however, in its discretion, may authorize the medical board to establish reexamination schedules appropriate to the medical condition of individual disability retirees. Should any disability retiree who has not yet attained the age of sixty (60) years or the termination age of the temporary allowance under paragraph (2)(c) of this section refuse to submit to any medical examination provided herein, his allowance may be discontinued until his withdrawal of such refusal; and should his refusal continue for one (1) year, all his rights to a disability benefit shall be revoked by the board of trustees.

(4) If the medical board reports and certifies to the board of trustees, after a comparable job analysis or other similar study, that such disability retiree is engaged in, or is able to engage in, a gainful occupation paying more than the difference between his disability allowance, exclusive of cost of living adjustments, and the average compensation, and if the board of trustees concurs in such report, the disability benefit shall be reduced to an amount which, together with the amount earnable by him, shall equal the amount of his average compensation. If his earning capacity be later changed, the amount of the said benefit may be further modified, provided that the revised benefit shall not exceed the amount originally granted. A retiree receiving a disability benefit who is restored to active service at a salary less than the average compensation shall not become a member of the retirement system.

(5) Should a disability retiree under the age of sixty (60) years or the termination age of the temporary allowance under paragraph (2)(c) of this section be restored to active service at a compensation not less than his average compensation, his disability benefit shall cease, he shall again become a member of the retirement system, and contributions shall be withheld and reported. Any such prior service certificate, on the basis of which his service was computed at the time of retirement, shall be restored to full force and effect. In addition, upon his subsequent retirement he shall be credited with all creditable service as a member, but the total retirement allowance paid to the retired member in his previous retirement shall be deducted from his retirement reserve and taken into consideration in recalculating the retirement allowance under a new option selected.

(6) If following reexamination in accordance with the provisions contained in this section, the medical board determines that a retiree retired on account of disability is physically and mentally able to return to the employment from which he is retired, the board of trustees, upon certification of such findings from the medical board, shall, after a reasonable period of time, terminate the disability allowance, whether or not the retiree is re-employed or seeks such re-employment. In addition, if the board of trustees determines that the retiree is no longer sustaining a loss of income as established by documented evidence of the retiree's earned income, the eligibility for a disability allowance shall terminate and the allowance terminated within a reasonable period of time. In the event the retirement allowance is terminated under the provisions of this section, the retiree may subsequently qualify for a retirement allowance under Section 25-11-111 based on actual years of service credit plus credit for the period during which a disability allowance was paid.

(7) Any current member as of June 30, 1992, who retires on a disability retirement allowance after June 30, 1992, and who has not elected to receive benefits under paragraph (2)(c) of this section, shall relinquish all rights under the Age Discrimination in Employment Act of 1967, as amended, with regard to the benefits payable under this section.

SECTION 3. Section 25-11-115, Mississippi Code of 1972, is amended as follows:

25-11-115. (1) Upon application for superannuation or disability retirement, any member may elect to receive his benefit in a retirement allowance payable throughout life with no further payments to anyone at his death, except that in the event his total retirement payments under this article do not equal his total contributions under this article, his named beneficiary shall receive the difference in cash at his death. Or he may elect upon retirement, or upon becoming eligible for retirement, to receive the actuarial equivalent subject to the provisions of subsection (3) of this section of his retirement allowance in a reduced retirement allowance payable throughout life with the provision that:

Option 1. If he dies before he has received in annuity payment the value of the member's annuity savings account as it was at the time of his retirement, the balance shall be paid to his legal representative or to such person as he shall nominate by written designation duly acknowledged and filed with the board; or

Option 2. Upon his death, his reduced retirement allowance shall be continued throughout the life of, and paid to, such person as he has nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement;

Option 3. Upon his death, one-half (1/2) of his reduced retirement allowance shall be continued throughout the life of, and paid to, such person as he shall have nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement, and the other one-half (1/2) of his reduced retirement allowance to some other designated beneficiary;

Option 4-A. Upon his death, one-half (1/2) of his reduced retirement allowance, or such other specified amount, shall be continued throughout the life of, and paid to, such person as he shall have nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement; or

Option 4-B. A reduced retirement allowance shall be continued throughout the life of the retirant, but with the further guarantee of payments to the named beneficiary, beneficiaries or to the estate for a specified number of years certain. If the retired member or the last designated beneficiary receiving annuity payments dies prior to receiving all guaranteed payments due, the actuarial equivalent of the remaining payments would be paid to the estate of the retired member as intestate property;

Option 4-C. Such retirement allowance otherwise payable may be converted into a retirement allowance of equivalent actuarial value in such an amount that, with the member's benefit under Title II of the federal Social Security Act, the member will receive, so far as possible, approximately the same amount annually before and after the earliest age at which the member becomes eligible to receive a Social Security benefit. Effective July 1, 1998, this option shall not be available to the member whose initial retirement is effective on or after July 1, 1998.

(2) No change in the option selected shall be permitted after the member's death or after the member has received his first retirement check except as provided in subsections (3) and (4) of this section and in Section 25-11-127. However, any retired member who is receiving a retirement allowance under Option 2 or Option 4-A upon July 1, 1992, and whose designated beneficiary predeceased him or whose marriage to a spouse who is his designated beneficiary is terminated by divorce or other dissolution, upon written notification to the retirement system of the death of the designated beneficiary or of the termination of his marriage to his designated beneficiary, the retirement allowance payable to the member after receipt of such notification by the retirement system shall be equal to the retirement allowance which would have been payable had the member not elected the option. In addition, any retired member who is receiving the maximum retirement allowance for life, a retirement allowance under Option 1 or who is receiving a retirement allowance under Option 2 or Option 4-A on July 1, 1992, may elect to provide survivor benefits under Option 2 or Option 4-A to a spouse who was not previously the member's beneficiary and whom the member married before July 1, 1992.

(3) Any retired member who is receiving a reduced retirement allowance under Option 2 or Option 4-A whose designated beneficiary predeceases him, or whose marriage to a spouse who is his designated beneficiary is terminated by divorce or other dissolution, may elect to cancel his reduced retirement allowance and receive the maximum retirement allowance for life in an amount equal to the amount that would have been payable if the member had not elected Option 2 or Option 4-A. Such election must be made in writing to the office of the executive director of the system on a form prescribed by the board. Any such election shall be effective the first of the month following the date the election is received by the system.

(4) Any retired member who is receiving the maximum retirement allowance for life, or a retirement allowance under Option 1, and who marries after his retirement may elect to cancel his maximum retirement allowance and receive a reduced retirement allowance under Option 2 or Option 4-A to provide continuing lifetime benefits to his spouse. Such election must be made in writing to the office of the executive director of the system on a form prescribed by the board not earlier than the date of the marriage. Any such election shall be effective the first of the month following the date the election is received by the system. The amount of the reduced retirement allowance shall be the actuarial equivalent, taking into account that the member received the maximum retirement allowance for a period of time before electing to receive a reduced retirement allowance.

(5) In the event the election of an optional benefit is made after the member has attained the age of sixty-five (65) years, the actuarial equivalent factor shall be used to compute the reduced retirement allowance as if the election had been made on his sixty-fifth birthday. However, if a retiree marries or remarries after retirement and elects either Option 2 or Option 4-A as provided in subsection (2) or (4) of this section, the actuarial equivalent factor used to compute the reduced retirement allowance shall be the factor for the age of the retiree and his or her beneficiary at the time such election for recalculation of benefits is made.

(6) Notwithstanding any provision of Section 25-11-1 et seq., no payments may be made for a retirement allowance on a monthly basis for a period of time in excess of that allowed by federal law.

(7) If a retirant and his eligible beneficiary, if any, both die before they have received in annuity payments a total amount equal to the accumulated contributions standing to the retirant's credit in the annuity savings account at the time of his retirement, the difference between the accumulated contributions and the total amount of annuities received by them shall be paid to such persons as the retirant has nominated by written designation duly executed and filed in the office of the executive director. If no designated person survives the retirant and his beneficiary, the difference, if any, shall be paid to the estate of the survivor of the retirant and his beneficiary.

(8) Any retired member who retired on Option 2(5) or 4-A(5) prior to July 1, 1992, who is still receiving a retirement allowance on July 1, 1994, shall receive an increase in the annual retirement allowance effective July 1, 1994, equal to the amount they would have received under Option 2 or Option 4-A without a reduction for Option 5 based on the ages at retirement of the retiree and beneficiary and option factors in effect on July 1, 1992. Such increase shall be prospective only.

SECTION 4. Section 25-11-115.1, Mississippi Code of 1972, is amended as follows:

25-11-115.1. (1) It is the intent of the Public Employees' Retirement System to provide benefit payments in an efficient manner consistent with the member's best interests. However, the system shall not knowingly allow payments to be made directly to persons who are determined legally incompetent, or incapable of managing or directing the management of benefits. Any person applying for or receiving benefits who comes to be known, by reason of mental or physical impairment as incapable of applying for, managing or directing the management of benefits, as certified by a medical doctor, shall be directed to obtain a conservator or legal guardian for purposes of applying for, receiving, managing and/or directing benefit payments. However, under certain circumstances, the Public Employees' Retirement System may designate a representative payee for such purposes, in the absence of a conservator or legal guardian or durable power of attorney signed by the member/benefit recipient before the incapacity. The benefit recipient may nominate a representative payee for consideration by the system in selecting a payee, and the system shall try to select the person, including an agency, organization, or institution, that will best serve the interest of the benefit recipient. The system may also accept the Social Security Administration's designation of a representative payee to manage and direct funds paid by the system.

(2) Medical certification of incapacity to apply for, manage or direct the management of benefits is required by the system before appointment of a representative payee. Preferred medical certification of incapacity comes from a qualified treating source, a medical opinion from a consultative examiner or another physician based upon recent examination of the person with documentation of the person's present condition including information concerning the nature of the person's illness, the person's chances of recovery and the opinion of the physician as to whether the person is able to apply for, manage or direct the management of benefit payments. Lay evidence may also be used by the system in cases raising the issue of a person's ability to manage benefits.

(3) The system will reevaluate capability whenever there is an allegation or indication that an incapable benefit recipient is now capable, as evidenced by a request for direct payment, or where any other benefit recipient may become incapable, as evidence by admission to a mental hospital or nursing home. Revocation of the system's requirement for a representative payee will be made only where supported by acceptable medical certification of the benefit recipient's ability to manage or direct the management of his or her funds. A review of capability determination may be also considered when a request to change a benefit recipient's payee is received or whenever the system makes any subsequent contact with the benefit recipient or payee. Other situations where a capability review may be considered include continuing disability reviews, benefit recalculations and changes of address, especially when the payee ceases to be the benefit recipient's custodian or the benefit recipient is admitted to a mental hospital or a nursing home.

(4) The system is responsible for finding and selecting the person best suited, based on the information available, to be the benefit recipient's representative payee once it has been determined that the beneficiary is incapable of applying for or managing benefits. The system shall have the authority to establish rules for the administration of this section.

(5) A representative payee is directed to apply benefits paid from the system only for the use and benefit of the benefit recipient. The system shall require a payee to submit an accounting report no less than annually with respect to the use of the funds in order to determine how the payee is using the funds and to ascertain potential payee mishandling of benefits. The system discharges its obligations to a benefit recipient when it makes a correct payment to a representative payee on the benefit recipient's behalf, and the system is without liability for the theft or misuse of benefits if the benefits were properly paid based upon the information available to the system at the time the payments were made.

(6) A representative payee who has been selected to receive benefits on behalf of a benefit recipient is not the equivalent of a legal guardian, inasmuch as no determination of a benefit recipient's incompetency pursuant to a legal proceeding is required before the appointment of a payee. However, if a legal guardian is appointed after the selection of a representative payee, then upon proper notification, the system shall make future payments to the legal guardian.

(7) In the absence of a conservator, legal guardian or a durable power of attorney signed by a benefit applicant before the existence of the incapacity, an unmarried benefit applicant, deemed to be incapable of applying for, managing or directing his or her benefits, shall be entitled to receive annuity payments in an amount equal to the normal retirement allowance with the maximum benefit payable to the member for life and with any remaining benefit at the death of the member payable to the estate of the member as intestate property. Such payments shall be paid to the representative payee, designated by the system in accordance with the provisions of this section.

(8) In the absence of a conservator, legal guardian or durable power of attorney signed by a benefit applicant prior to the existence of an incapacity, any married benefit applicant, deemed to be incapable of applying for, managing or directing his or her benefits, shall be paid a reduced retirement allowance under Option 2 as provided in Section 25-11-115, with the lawful spouse as the beneficiary. Such payments shall be paid to a representative payee as designated by the system during the period of the benefit recipient's incapacity.

SECTION 5. Section 25-11-117, Mississippi Code of 1972, is amended as follows:

25-11-117. (1) A member may be paid a refund of the amount of accumulated contributions to the credit of the member in the annuity savings account provided the member has withdrawn from state service and further provided the member has not returned to state service on the date the refund of the accumulated contributions would be paid. Such refund of the contributions to the credit of the member in the annuity savings account shall be paid within ninety (90) days from receipt in the office of the retirement system of the properly completed form requesting such payment. In the event of death prior to retirement of any member whose spouse and/or children are not entitled to a retirement allowance, the accumulated contributions to the credit of the deceased member in the annuity savings account shall be paid to the designated beneficiary on file in writing in the office of executive director of the board of trustees within ninety (90) days from receipt of a properly completed form requesting such payment. If there is no such designated beneficiary on file for such deceased member in the office of the system, upon the filing of a proper request with the board, the contributions to the credit of the deceased member in the annuity savings account shall be refunded to the estate of the deceased member. The payment of the said refund shall discharge all obligations of the retirement system to the said member on account of any creditable service rendered by the member prior to the receipt of the refund. By the acceptance of the refund, the member shall waive and relinquish all accrued rights in the system.

(2) Pursuant to the Unemployment Compensation Amendments of 1992 (P.L. 102-318 (UCA)), a member or eligible beneficiary eligible for a refund under this section may elect on a form prescribed by the board under rules and regulations established by the board, to have an eligible roll over distribution of accumulated contributions payable under this section paid directly to an eligible retirement plan or individual retirement account. If the member or eligible beneficiary makes such election and specifies the eligible retirement plan or individual retirement account to which such distribution is to be paid, the distribution will be made in the form of a direct trustee-to-trustee transfer to the specified eligible retirement plan. Flexible roll overs under this subsection shall not be considered assignments under Section 25-11-129.

(3) If any person who has received a refund reenters the state service and again becomes a member of the system * * *, the member may repay all or part of the amounts previously received as a refund, together with regular interest covering the period from the date of refund to the date of repayment; provided, however, that the amounts that are repaid by the member and the creditable service related thereto shall not be used in any benefit calculation or determination until the member has remained a contributor to the system for a period of at least four (4) years subsequent to such member's reentry into state service. Repayment for such time shall be made in increments of not less than one-quarter (1/4) year of creditable service beginning with the most recent service for which refund has been made. Upon the repayment of all or part of such refund and interest, the member shall again receive credit for the period of creditable service for which full repayment has been made to the system.

SECTION 6. The following shall be codified as Section 25-11-118, Mississippi Code of 1972:

25-11-118. Effective July 1, 1999, and subject to the rules adopted by the board of trustees, the system shall accept an eligible roll over distribution or a direct transfer of funds from another qualified plan in payment of all or a portion of the cost to purchase optional service credit or to reinstate previously withdrawn service credit as permitted by the system. The system may only accept roll over payments in an amount equal to or less than the balance due for purchase or reinstatement of service credit. The rules adopted by the board of trustees shall condition the acceptance of a roll over or transfer from another qualified plan on the receipt from the other plan of information necessary to enable the system to determine the eligibility of any transferred funds for tax-free roll over treatment or other treatment under federal income tax law.

SECTION 7. Section 25-11-120, Mississippi Code of 1972, is amended as follows:

25-11-120. (1) Any individual aggrieved by an administrative determination, including a determination of the medical board, relating to the eligibility for or payment of benefits, or the calculation of creditable service or other similar matters relating to the Public Employees' Retirement System or any other retirement system or program administered by the board, may request a hearing before a hearing officer designated by the board. Such hearings shall be conducted in accordance with rules and regulations adopted by the board and formal rules of evidence shall not apply. The hearing officer is authorized to administer oaths, hear testimony of witnesses and receive documentary and other evidence. After the hearing, the hearing officer shall certify the record to the board. The record may include a taped recording of the proceedings of the hearing in lieu of a transcription, a copy of the aggrieved individual's member file containing all information considered by the hearing officer as well as the hearing officer's proposed statement of facts and recommendation. The board shall receive the record and make its determination based solely on matters contained therein.

(2) Any individual aggrieved by the determination of the board may appeal to the Circuit Court of the First Judicial District of Hinds County, Mississippi, in accordance with the Uniform Circuit Court Rules governing appeals to the circuit court in civil cases. Such appeal shall be made solely on the record before the board and this procedure shall be the exclusive method of appealing determinations of the board.

(3) The board is authorized to appoint a committee of the board to serve as hearing officer or to employ or contract with qualified personnel to perform the duties of hearing officer and court reporter as may be necessary for conducting, recording and transcribing such hearings. The board may assess and collect fees to offset costs related to such hearings. Said fees shall be deposited to the credit of the Public Employees' Retirement System.

(4) In making a determination as to whether a member is eligible for disability retirement allowance, a finding of total disability by the Social Security Administration will create a rebuttable presumption of disability; however, the presumption may be overcome by clear and convincing evidence.

SECTION 8. Section 25-11-123, Mississippi Code of 1972, is amended as follows:

25-11-123. All of the assets of the system shall be credited according to the purpose for which they are held to one (1) of four (4) reserves; namely, the annuity savings account, the annuity reserve, the employer's accumulation account, and the expense account.

(a) Annuity savings account. In the annuity savings account shall be accumulated the contributions made by members to provide for their annuities, including interest thereon which shall be posted monthly. Credits to and charges against the annuity savings account shall be made as follows:

(1) Beginning July 1, 1991, the employer shall cause to be deducted from the salary of each member on each and every payroll of such employer for each and every payroll period seven and one-fourth percent (7-1/4%) of earned compensation as defined in Section 25-11-103. Future contributions shall be fixed biennially by the board on the basis of the liabilities of the retirement system for the various allowances and benefits as shown by actuarial valuation; provided, however, that any member earning at a rate less than Sixteen Dollars and Sixty-seven Cents ($16.67) per month, or Two Hundred Dollars ($200.00) per year, shall contribute not less than One Dollar ($1.00) per month, or Twelve Dollars ($12.00) per year.

(2) The deductions provided herein shall be made notwithstanding that the minimum compensation provided by law for any member shall be reduced thereby. Every member shall be deemed to consent and agree to the deductions made and provided for herein and shall receipt for his full salary or compensation, and payment of salary or compensation less said deduction shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by such person during the period covered by such payment, except as to the benefits provided under Articles 1 and 3. The board shall provide by rules for the methods of collection of contributions from members and the employer. The board shall have full authority to require the production of evidence necessary to verify the correctness of amounts contributed.

(b) Annuity reserve. The annuity reserve shall be the account representing the actuarial value of all annuities in force, and to it shall be charged all annuities and all benefits in lieu of annuities, payable as provided in this article. If a beneficiary retired on account of disability is restored to active service with a compensation not less than his average final compensation at the time of his last retirement, the remainder of his contributions shall be transferred from the annuity reserve to the annuity savings account and credited to his individual account therein, and the balance of his annuity reserve shall be transferred to the employer's accumulation account.

(c) Employer's accumulation account. The employer's accumulation account shall represent the accumulation of all reserves for the payment of all retirement allowances and other benefits payable from contributions made by the employer, and against this account shall be charged all retirement allowances and other benefits on account of members. Credits to and charges against the employer's accumulation account shall be made as follows:

(1) On account of each member there shall be paid monthly into the employer's accumulation account by the employers for the preceding fiscal year an amount equal to a certain percentage of the total earned compensation, as defined in Section 25-11-103, of each member. The percentage rate of such contributions shall be fixed biennially by the board on the basis of the liabilities of the retirement system for the various allowances and benefits as shown by actuarial valuation. Beginning January 1, 1990, the rate shall be fixed at nine and three-fourths percent (9-3/4%). Political subdivisions joining Article 3 of the Public Employees' Retirement System after July 1, 1968, may adjust the employer's contributions by agreement with the Board of Trustees of the Public Employees' Retirement System to provide service credits for any period prior to execution of the agreement based upon an actuarial determination of employer's contribution rates.

(2) On the basis of regular interest and of such mortality and other tables as shall be adopted by the board of trustees, the actuary engaged by the board to make each valuation required by this article during the period over which the accrued liability contribution is payable, immediately after making such valuation, shall determine the uniform and constant percentage of the earnable compensation of each member which, if contributed by the employer on the basis of compensation of such member throughout his entire period of membership service, would be sufficient to provide for the payment of any retirement allowance payable on his account for such service. The percentage rate so determined shall be known as the "normal contribution rate." After the accrued liability contribution has ceased to be payable, the normal contribution rate shall be the percentage rate of the salary of all members obtained by deducting from the total liabilities on account of membership service the amount in the employer's accumulation account, and dividing the remainder by one percent (1%) of the present value of the prospective future salaries of all members as computed on the basis of the mortality and service tables adopted by the board of trustees and regular interest. The normal rate of contributions shall be determined by the actuary after each valuation.

(3) The total amount payable in each year to the employer's accumulation account shall not be less than the sum of the percentage rate known as the "normal contribution" rate and the "accrued liability contribution" rate of the total compensation earnable by all members during the preceding year, provided that the payment by the employer shall be sufficient, when combined with the amounts in the account, to provide the allowances and other benefits chargeable to this account during the year then current.

(4) The accrued liability contribution shall be discontinued as soon as the accumulated balance in the employer's accumulation account shall equal the present value, computed on the basis of the normal contribution rate then in force, or the prospective normal contributions to be received on account of all persons who are at that time members.

(5) All allowances and benefits in lieu thereof, with the exception of those payable on account of members who receive no prior service credit, payable from contributions of the employer, shall be paid from the employer's accumulation account.

(6) Upon the retirement of a member, an amount equal to his retirement allowance shall be transferred from the employer's accumulation account to the annuity reserve.

(d) Expense account. The expense account shall be the account to which the expenses of the administration of the system shall be charged, exclusive of amounts payable as retirement allowances and as other benefits provided herein. The Legislature shall make annual appropriations in amounts sufficient to administer the system, which shall be credited to this account. There shall be transferred to the State Treasury from this account, not less than once per month, an amount sufficient for payment of the estimated expenses of the system for the succeeding thirty (30) days. Any interest earned on the expense account shall accrue to the benefit of the system. Provided, however, that notwithstanding the provisions of Sections 25-11-15(10) and 25-11-105(f)(5)e, all expenses of the administration of the system shall be paid from the interest earnings, provided the interest earnings are in excess of the actuarial interest assumption as determined by the board, and provided the present cost of the administrative expense fee of two percent (2%) of the contributions reported by the political subdivisions and instrumentalities shall be reduced to one percent (1%) from and after July 1, 1983, through June 30, 1984, and shall be eliminated thereafter.

(e) Collection of contributions. The employer shall cause to be deducted on each and every payroll of a member for each and every payroll period, beginning subsequent to January 31, 1953, the contributions payable by such member as provided in Articles 1 and 3.

The employer shall make deductions from salaries of employees as provided in Articles 1 and 3 and shall transmit monthly, or at such time as the board of trustees shall designate, the amount specified to be deducted to the Executive Director of the Public Employees' Retirement System. The executive director, after making a record of all such receipts, shall deposit such amounts as provided by law.

(f) Upon the basis of each actuarial valuation provided herein, the board of trustees shall biennially determine the normal contribution rate and the accrued liability contribution rate as provided in this section. The sum of these two (2) rates shall be known as the "employer's contribution rate." Beginning on earned compensation effective January 1, 1990, the rate computed as provided in this section shall be nine and three-fourths percent (9-3/4%). The percentage rate of such contributions shall be fixed biennially by the board on the basis of the liabilities of the retirement system for the various allowances and benefits as shown by actuarial valuation. Notwithstanding any other provision of law, the county board of education, the governing authorities of separate, consolidated, or municipal school districts, and all other such boards set up by law which handle and disburse school funds, shall pay from local tax sources one and one-half percent (1-1/2%) of the total employer's contribution rate of nine and three-fourths percent (9-3/4%).

The amount payable by the employer on account of normal and accrued liability contributions shall be determined by applying the employer's contribution rate to the amount of compensation earned by employees who are members of the system. Monthly, or at such time as the board of trustees shall designate, each department or agency shall compute the amount of the employer's contribution payable, with respect to the salaries of its employees who are members of the system, and shall cause said amount to be paid to the board of trustees from the personal service allotment of the amount appropriated for the operation of the department or agency, or from funds otherwise available to the agency, for the payment of salaries to its employees.

Once each year, under procedures established by the system, each employer shall submit to the Public Employees' Retirement System a copy of their report to Social Security of all employees' earnings.

The board shall provide by rules for the methods of collection of contributions of employers and members. The amounts determined due by an agency to the various funds as specified in Articles 1 and 3 are made obligations of the agency to the board and shall be paid as provided herein. Failure to deduct such contributions shall not relieve the employee and employer from liability thereof. Delinquent employee contributions and any accrued interest shall be the obligation of the employee and delinquent employer contributions and any accrued interest shall be the obligation of the employer. The employer may, in its discretion, elect to pay any or all of the interest on delinquent employee contributions. From and after July 1, 1996, under rules and regulations established by the board, all employers are authorized and shall transfer all funds due to the Public Employees' Retirement System electronically and shall transmit any wage or other reports by computerized reporting systems.

SECTION 9. Section 25-11-127, Mississippi Code of 1972, is amended as follows:

25-11-127.

 * * *

(1) The board of trustees of the Public Employees' Retirement System shall have the right to prescribe rules and regulations for the carrying out of this section.

(2) Under no circumstances, except as provided in this section, may an individual who is paid a service retirement allowance or a pension after retirement as provided for under this article, be employed or paid for any service as an employee, a contractual employee/worker, or any other contract personnel, who does not meet the criteria of an independent contractor as determined by the board of trustees, consistent with Internal Revenue Service Guidelines. Any person who has retired under the provisions of this article after a withdrawal from service as defined in regulations of the board of trustees, who is later reemployed by a covered employer and who does not fall within an exception to the reemployment provisions as set forth under subsection (3) of this section, shall cease to receive retirement benefits and shall again become a contributing member of the retirement system. Upon termination of employment, the retiring member whose reemployment exceeds six (6) months, shall have his or her retirement allowance recalculated to include credit for the additional employment.

(3) A retiree may be reemployed on a temporary basis and shall continue to receive all retirement benefits that he or she would be entitled to, subject to the following limitations:

(a) The retiree may be reemployed for a period of time not to exceed one hundred twenty (120) days in any fiscal year, but less than one-half (1/2) of the normal working days for the position in any fiscal year, or

(b) The retiree may be reemployed for a period of time in any fiscal year sufficient in length to permit the retiree's earnings not to exceed twenty-five percent (25%) of the retiree's average compensation or the current rate of the salary in effect for the regular position filled.

(4) (a) Under both subsections (3)(a) and (3)(b) of this section, notice shall be given in writing to the executive director of the retirement system, setting forth the facts upon which the temporary employment is being made, and such notice shall be given within five (5) days from the date of employment and also from the date of termination of the employment.

(b) Failure by the employer to timely notify the retirement system may result in the assessment of a monetary penalty per occurrence as set forth by board regulation and shall be payable by the employer.

(c) The responsibility for compliance with this section is placed upon the employing authority, and each person employed under this section shall certify to the employer any information required in order to carry out the provisions of this section.

(5) The reemployment provisions of this section shall not apply to a retiree who continues in an elected office in a municipality or county, or has been elected to public office in a municipality or county, provided the following condition has been satisfied:

Before the continuation of such service in public office or taking office following election to public office, the retiree must file annually in writing, in the office of the employer and the office of the executive director of the retirement system, a waiver of all salary or compensation and his or her election to receive a retirement allowance in lieu of such salary or compensation.

In no event shall a salary or compensation thereafter be due or payable for service in public office, as described in this subsection (5), except that any such officer may receive, in addition to such retirement allowance, any per diem, office expense allowance, mileage or travel expense that is authorized by any statute of the State of Mississippi.

(6) Any member who has attained seventy (70) years of age and who has forty (40) or more years of creditable service may continue in office or employment or be reemployed or elected to public office, provided the following condition has been satisfied:

Before the continuation of such service in public office or taking office following election to public office, the retiree must file annually in writing, in the office of the employer and the office of the executive director of the retirement system, a waiver of all salary or compensation and his or her election to receive a retirement allowance in lieu of such salary or compensation.

In no event shall a salary or compensation thereafter be due or payable for service in public office, as described in this subsection (6), except that any such officer may receive, in addition to such retirement allowance, any per diem, office expense allowance, mileage or travel expense that is authorized by any statute of the State of Mississippi.

SECTION 10. Section 25-11-137, Mississippi Code of 1972, is amended as follows:

25-11-137. (1) (a) Any law enforcement officer or fireman who has been covered under this article or under Section 25-13-1 et seq., Section 21-29-101 et seq. or Section 21-29-201 et seq., and who may change his employment from one jurisdiction to another jurisdiction, or has previously made such change, may elect to transfer retirement service credit earned while covered under such retirement system of the former jurisdiction to that of the latter as hereinafter provided.

(b) Any such law enforcement officer or fireman transferring as described in paragraph (a) above and having paid retirement funds under this article or Sections 21-29-101, 21-29-201, and 25-13-1, must pay into the retirement system to which he is transferring the actuarial cost as determined by the actuary of any eligible service credit to be transferred to such fund. However, the system from which he is transferring has the option of paying into the system to which he is being transferred an amount equal to that which the employer would have paid had he been a member of that system for each year transferred, together with regular interest which would have been earned by that system thereon. * * * The retirement system from which he is being transferred shall be required to pay into the system to which he is transferring any funds credited to his account * * *. Any additional funds which may be required shall be paid by the person being transferred. Failure to make these proper adjustment payments will void any transfer of service credits.

(2) The benefits which are being currently paid by the system in which the law enforcement officer or fireman has last been a member, and the requirements for retirement or disability benefits, shall be those applicable to such officer falling under the provisions of this section. Such transfers may only be made after the member has satisfied the minimum eligibility period for monthly benefits, excluding any duty related benefits, in the system to which the member is transferring such credit. Upon the complete transfer and payment of such credit, all time spent in the covered law enforcement or fire department service, as noted above, within and for the State of Mississippi or the political subdivisions thereof, shall apply to the time required by law necessary to effect the retirement or disability of the officer.

SECTION 11. Section 25-11-401, Mississippi Code of 1972, is amended as follows:

25-11-401. There is established an optional retirement program for employees of the state institutions of higher learning included in Section 37-101-1, who are appointed or employed after July 1, 1990. To be eligible to participate in the optional retirement program, a newly appointed employee must hold a teaching or administrative faculty position, and be eligible for membership in the Public Employees' Retirement System of Mississippi. In interpreting the term "teaching or administrative faculty," the board of trustees, in consultation with the Board of Trustees of State Institutions of Higher Learning, shall liberally construe those terms in determining eligibility for the optional retirement program.

SECTION 12. Section 25-11-409, Mississippi Code of 1972, is amended as follows:

25-11-409. Eligible employees initially employed on or after July 1, 1990, shall elect to participate in the optional retirement program within thirty (30) days after (i) entry into state service, or (ii) the effective date of the optional retirement program, whichever is later. The election must be made in writing and filed with the board of trustees and will be effective as of the date of employment. If an eligible employee fails to timely make the election provided in this section, he shall become a member of the Public Employees' Retirement System of Mississippi in accordance with Article 3 of Chapter 11 of Title 25, Mississippi Code of 1972.

SECTION 13. Section 25-13-13, Mississippi Code of 1972, is amended as follows:

25-13-13. (1) Upon the death of any highway patrolman who has retired for service or disability and who has not elected any other option under Section 25-13-16, his widow shall receive one-half (1/2) the benefit which he was receiving and each child not having attained his nineteenth birthday shall receive one-fourth (1/4) of his benefit, but not more than one-half (1/2) of the benefits shall be paid for the support and maintenance of two (2) or more children. Upon each child's attaining the age of nineteen (19) years, the child shall no longer be eligible for such benefit, and when all of such children have attained their nineteenth birthday, only the widow shall be eligible for one-half (1/2) the amount of his benefit. She shall continue to be eligible for such benefit in the amount of fifty percent (50%) of his retirement benefit so long as she may live and until she remarries. In the event of her remarriage at any time, her eligibility for the fifty percent (50%) benefits shall cease and terminate, but she will be eligible to continue to receive benefits for their children until the last child attains his or her nineteenth birthday in the manner aforesaid.

(2) Upon the death of any highway patrolman who has served the minimum retirement period required for eligibility for such retirement program, his spouse and family shall receive all the benefits payable to the highway patrolman's beneficiaries as if he had retired at the time of his death. Such benefits cease as to the spouse upon remarriage but continue to be payable to each child until he reaches the age of nineteen (19) years. Such benefits are payable on a monthly basis.

(3) The spouse and/or the dependent children of an active member who is killed in the line of performance of duty or dies as a direct result of an accident occurring in the line of performance of duty shall qualify, on approval of the board, for a retirement allowance on the first of the month following the date of death, but not before receipt of application by the board. The spouse shall receive a retirement allowance equal to one-half (1/2) of the average compensation of the deceased highway patrolman. In addition to the retirement allowance for the spouse, or if there is no surviving spouse, a retirement allowance shall be paid in the amount of one-fourth (1/4) of the average compensation for the support and maintenance of one (1) child or in the amount of one-half (1/2) of the average compensation for the support and maintenance of two (2) or more children. Such benefits shall cease to be paid for the support and maintenance of each child upon such child attaining the age of nineteen (19) years; however, the spouse shall continue to be eligible for the aforesaid retirement allowance. Benefits may be paid to a surviving parent or lawful custodian of such children for the use and benefit of the children without the necessity of appointment as guardian. Such retirement allowance shall cease to the spouse upon remarriage but continue to be payable for each dependent child until the age of nineteen (19) years.

(4) All benefits accruing to any child under the provisions of this chapter shall be paid to the parent custodian of the children or the legal guardian. Benefits paid due to the death of a member before or after retirement shall be paid in accordance with the statutory provisions set forth as of the date of death.

(5) Children receiving the benefits provided herein, who are permanently or totally disabled, shall continue to receive such benefits for as long as the medical board or other designated governmental agency certifies that such disability continues. The age limitation for benefits payable to a child under any provision of this section shall be extended beyond age nineteen (19), but in no event beyond the attainment of age twenty-three (23), as long as the child is a student regularly pursuing a full-time course of resident study or training in an accredited high school, trade school, technical or vocational institute, junior or community college, college, university or comparable recognized educational institution duly licensed by a state. A student child whose birthday falls during the school year (September 1 through June 30) is considered not to reach age twenty-three (23) until the July 1 following the actual twenty-third birthday. A full-time course of resident study or training means a day or evening noncorrespondence course that includes school attendance at the rate of a least thirty-six (36) weeks per academic year or other applicable period with a subject load sufficient, if successfully completed, to attain the educational or training objective within the period generally accepted as minimum for completion, by a full-time day student, of the academic or training program concerned.

(6) If all the annuities provided for in this section payable on the account of the death of a member terminate before there has been paid an aggregate amount equal to the member's accumulated contributions standing to the member's credit in the annuity savings account at the time of the member's death, the difference between the accumulated contributions and the aggregate amount of annuity payments shall be paid to such person as the member has nominated by written designation duly executed and filed with the board of trustees in the office of the Public Employees' Retirement System. If there is no designated beneficiary surviving at termination of benefits, the difference shall be payable in the following statutory succession: spouse, children, parents, estate.

SECTION 14. Section 25-13-16, Mississippi Code of 1972, is amended as follows:

25-13-16. (1) Upon application for superannuation or disability retirement, any member who retires after July 1, 1990, may elect to receive his benefit pursuant to the provisions of Sections 25-13-11 and 25-13-13 or may elect to receive his benefit in a retirement allowance payable throughout life with no further payments to anyone at his death, except that in the event his total retirement payments under this article do not equal his total contributions under this article, his named beneficiary shall receive the difference in cash at his death. Or he may elect upon retirement, or upon becoming eligible for retirement, to receive the actuarial equivalent, subject to the provisions of subsection (3) of this section, of his retirement allowance in a reduced retirement allowance payable throughout life with the provision that:

Option 1. If he dies before he has received in annuity payment the value of the member's annuity savings account as it was at the time of his retirement, the balance shall be paid to his legal representative or to such person as he shall nominate by written designation duly acknowledged and filed with the board; or

Option 2. Upon his death, his reduced retirement allowance shall be continued throughout the life of, and paid to, such person as he has nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement;

Option 3. Upon his death, one-half (1/2) of his reduced retirement allowance shall be continued throughout the life of, and paid to, such person as he shall have nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement, and the other one-half (1/2) of his reduced retirement allowance to some other designated beneficiary;

Option 4-A. Upon his death, one-half (1/2) of his reduced retirement allowance, or such other specified amount, shall be continued throughout the life of, and paid to, such person as he shall have nominated by written designation duly acknowledged and filed with the board of trustees at the time of his retirement; or

Option 4-B. A reduced retirement allowance shall be continued throughout the life of the retirant, but with the further guarantee of payments to the named beneficiary, beneficiaries or to the estate for a specified number of years certain. If the retired member or the last designated beneficiary receiving annuity payments dies prior to receiving all guaranteed payments due, the actuarial equivalent of the remaining payments would be paid to the estate of the retired member as intestate property.

Option 4-C. Such retirement allowance otherwise payable may be converted into a retirement allowance of equivalent actuarial value in such an amount that, with the member's benefit under Title II of the federal Social Security Act, the member will receive, so far as possible, approximately the same amount annually before and after the earliest age at which the member becomes eligible to receive a social security benefit.

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(2) No change in the option selected shall be permitted after the member's death or after the member has received his first retirement check, except as provided in subsections (3) and (4) of this section. However, any retired member who is receiving a retirement allowance under Option 2 or Option 4-A upon July 1, 1998, and whose designated beneficiary predeceased him or whose marriage to a spouse who is his designated beneficiary is terminated by divorce or other dissolution, upon written notification to the retirement system of the death of the designated beneficiary or of the termination of his marriage to his designated beneficiary, the retirement allowance payable to the member after receipt of such notification by the retirement system shall be equal to the retirement allowance that would have been payable if the member had not elected the option. In addition, any retired member who is receiving the maximum retirement allowance for life, a retirement allowance under Option 1 or who is receiving a retirement allowance under Option 2 or Option 4-A on July 1, 1998, may elect to provide survivor benefits under Option 2 or Option 4-A to a spouse who was not previously the member's beneficiary and who the member married before July 1, 1998. Should a member retired on disability be returned to active service, the option previously selected shall be null and void. Upon subsequent retirement a new option may be selected.

(3) Any retired member who is receiving a reduced retirement allowance under Option 2 or Option 4-A whose designated beneficiary predeceases him, or whose marriage to a spouse who is his designated beneficiary is terminated by divorce or other dissolution, may elect to cancel his reduced retirement allowance and receive the maximum retirement allowance for life in an amount equal to the amount that would have been payable if the member had not elected Option 2 or Option 4-A. Such election must be made in writing to the office of the executive director of the system on a form prescribed by the board. Any such election shall be effective the first of the month following the date the election is received by the system.

(4) Any retired member who is receiving the maximum retirement allowance for life, or a retirement allowance under Option 1, and who marries after his retirement may elect to cancel his maximum retirement allowance and receive a reduced retirement allowance under Option 2 or Option 4-A to provide continuing lifetime benefits to his spouse. Such election must be made in writing to the office of the executive director of the system on a form prescribed by the board not earlier than the date of the marriage. Any such election shall be effective the first of the month following the date the election is received by the system. The amount of the reduced retirement allowance shall be the actuarial equivalent, taking into account that the member received the maximum retirement allowance for a period of time before electing to receive a reduced retirement allowance. However, if a retiree marries or remarries after retirement and elects either Option 2 or Option 4-A as provided in subsection (2) or (4) of this section, the actuarial equivalent factor used to compute the reduced retirement allowance shall be the factor for the age of the retiree and his or her beneficiary at the time such election for recalculation of benefits is made.

(5) Any member in service who has qualified for retirement benefits may select any optional method of settlement of retirement benefits by notifying the Executive Director of the Board of Trustees of the Public Employees' Retirement System in writing, on a form prescribed by the board, of the option he has selected and by naming the beneficiary of such option and furnishing necessary proof of age. Such option, once selected, may be changed at any time prior to actual retirement or death, but upon the death or retirement of the member, the optional settlement shall be placed in effect upon proper notification to the executive director.

(6) Notwithstanding any provision of Section 25-13-1 et seq., no payments may be made for a retirement allowance on a monthly basis for a period of time in excess of that allowed by federal law.

(7) If a retirant and his eligible beneficiary, if any, both die before they have received in annuity payments a total amount equal to the accumulated contributions standing to the retirant's credit in the annuity savings account at the time of his retirement, the difference between the accumulated contributions and the total amount of annuities received by them shall be paid to such persons as the retirant has nominated by written designation duly executed and filed in the office of the executive director. If no designated person survives the retirant and his beneficiary, the difference, if any, shall be paid to the estate of the survivor of the retirant and his beneficiary.

(8) Any retired member who retired on Option 2(5) or 4-A(5) before July 1, 1998, who is still receiving a retirement allowance as of July 1, 1998, shall receive an increase in the annual retirement allowance effective July 1, 1998, equal to the amount they would have received under Option 2 or Option 4-A without a reduction for Option 5 based on the ages at retirement of the retiree and beneficiary and option factors in effect on July 1, 1998. Such increase shall be prospective only.

(9) For purposes of this section:

(a) "Beneficiary" means any person designated to receive a retirement allowance, an annuity or other benefit as provided by this chapter. Such designation shall be in writing filed in the office of the Executive Director of the Board of Trustees of the Public Employees' Retirement System, and no designation or change of beneficiary shall be made in any other manner; however, notwithstanding any provision of this chapter to the contrary, the lawful spouse of a member at the time of the death of a member shall be the beneficiary of such member unless the member has designated another beneficiary subsequent to the date of marriage.

(b) "Actuarial equivalent" shall mean a benefit of equal value to the accumulated contributions, annuity or benefit, as the case may be, when computed upon the basis of such mortality tables as shall be adopted by the board of trustees, and regular interest.

(c) "Actuarial tables" shall mean such tables of mortality and rates of interest as shall be adopted by the board in accordance with the recommendation of the actuary.

SECTION 15. Section 25-13-21, Mississippi Code of 1972, is amended as follows:

25-13-21. In the event a highway patrolman ceases to work for the Highway Safety Patrol for any reason other than occupational disease contracted or for any accident sustained by the patrolman by reason of his service or discharge of his duty in the Highway Patrol, and if the highway patrolman is not eligible for retirement either for service or disability, he shall be refunded the amount of his total contribution under the provisions of this chapter, including any credit transferred to his account in this system from any other system, at his request; and should he die before retirement, such fund is to be refunded to any beneficiary he may name.

Pursuant to the Unemployment Compensation Amendments of 1992 (P.L. 102-318 (UCA)), a member or eligible beneficiary eligible for a refund under this section may elect on a form prescribed by the board under rules and regulations established by the board, to have an eligible roll over distribution of accumulated contributions payable under this section paid directly to an eligible retirement plan or individual retirement account. If the member or eligible beneficiary makes such election and specifies the eligible retirement plan or individual retirement account to which such distribution is to be paid, the distribution will be made in the form of a direct trustee to trustee transfer to the specified eligible retirement plan. Flexible roll overs under this subsection shall not be considered assignments under Section 25-13-31.

If any highway patrolman who shall receive a refund reenters the service of the Highway Safety Patrol and again becomes a member of the system * * *, he may repay all amounts previously received by him as a refund, together with regular interest covering the period from the date of refund to the date of repayment; however, the amounts that are repaid by the member and the creditable service related thereto shall not be used in any benefit calculation or determination until the member has remained a contributor to the system for a period of at least five (5) years after such member's reentry into state service. Repayment for such time shall be made in increments of not less than one-quarter (1/4) year of creditable service beginning with the most recent service for which refund has been made. Upon the repayment of all or part of such refund and interest, the highway patrolman shall again receive credit for the * * * period of creditable service for which full repayment has been made to the system.

SECTION 16. The following shall be codified as Section 25-13-22, Mississippi Code of 1972:

25-13-22. Effective July 1, 1999, and subject to the rules adopted by the board of trustees, the system shall accept an eligible roll over distribution or a direct transfer of funds from another qualified plan in payment of all or a portion of the cost to purchase optional service credit or to reinstate previously withdrawn service credit as permitted by the system. The system may only accept roll over payments in an amount equal to or less than the balance due for purchase or reinstatement of service credit. The rules adopted by the board shall condition the acceptance of a roll over or transfer from another qualified plan on the receipt from the other plan of information necessary to enable the system to determine the eligibility of any transferred funds for tax-free roll over treatment or other treatment under federal income tax law.

SECTION 17. Section 25-13-35, Mississippi Code of 1972, is amended as follows:

25-13-35. Any person who has been retired under the provisions of this chapter and who is later reemployed in a law enforcement position under either the Department of Public Safety or the Mississippi Bureau of Narcotics must reenter membership in the Mississippi Highway Safety Patrol Retirement System. The person shall cease to receive benefits under this chapter and shall again become a contributing member of the retirement system. Upon again retiring, if such member's reemployment exceeds six (6) months, he shall have his benefit recomputed, including service after again becoming a member. * * * The Administrative Board of the Mississippi Highway Safety Patrol Retirement System shall have the right to prescribe rules and regulations for the carrying out of this provision.

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SECTION 18. The following shall be codified as Section 21-29-323, Mississippi Code of 1972:

21-29-323. Monthly benefits payable to a spouse in the event of the death of a member before retirement or a retiree after retirement, shall be divided and paid to or for the benefit of any dependent children of the deceased member or retiree in an amount equal to ten percent (10%) of the annual benefit payable to one (1) dependent child, twenty percent (20%) for two (2) or more dependent children, and thirty percent (30%) to three (3) or more dependent children. If there are more than three (3) dependent children, upon a child ceasing to be a dependent, his annuity shall terminate and there shall be a redetermination of the amounts payable to any remaining dependent children. Such benefits shall be paid to a surviving parent or lawful custodian of such children for the use and benefit of the children without the necessity of appointment of guardian. The remaining amount shall be paid to the spouse as otherwise provided.

SECTION 19. This act shall take effect and be in force from and after July 1, 1998, with the exception of Section 5, Section 6, Section 15 and Section 16, which shall take effect and be in force from and after July 1, 1999.