1. (a) Generally.

   1. (1)

      1. (A) A DROP participant who is called to active duty will provide the State Police Retirement System with a copy of his or her orders that will be maintained in the member's file.
      2. (B) A copy of the orders will be utilized to verify the date that the member is called to active duty.

   2. (2)

      1. (A) The employer will continue to report the DROP participant on the monthly DROP report.
      2. (B) The agency representative will indicate that the member is on military leave.
   3. (3) The employer will continue to pay in to the system employer contributions on behalf of the DROP participant.
   4. (4) When the member is released from active duty, he or she will submit a copy of the DD214 Form or other appropriate documents to the system to verify that the member has returned to covered employment and/or been released from active duty.

2. (b) Maximum participation period.

   1. (1) A DROP participant who is on active duty shall continue to receive his or her monthly DROP payment (which includes any benefit enhancements awarded to eligible retirees) until the maximum allowable time in the DROP has occurred or the member requests retirement and distribution of his or her DROP account, whichever occurs first.

   2. (2)

      1. (A) If the member has participated in the DROP for at least three (3) years, he or she must:

3. (i) Complete a retirement application packet and DROP distribution form or forms prior to his or her departure for active duty; and

   1. (ii) Deliver the completed forms to the system office along with a copy of his or her orders.

      1. (B) The retirement application and DROP distribution forms will be held and processed on the effective date indicated unless he or she returns to covered employment within the DROP term under Arkansas Code §§ 24-6-306 and 24-6-507.

   2. (3) Should the DROP member not deliver a retirement application packet and DROP distribution form or forms to the system and the maximum period of DROP participation under Arkansas Code §§ 24-6-306 and 24-6-507 expires prior to the member returning to covered employment and/or requesting retirement:

      1. (A) The monthly DROP accrual will cease on the fifth anniversary of the member's beginning DROP date and no additional interest will be paid;
      2. (B) The monthly retirement benefit will not become effective until the member files a completed retirement application and complies with applicable deadlines; and

      3. (C) The DROP account balance shall be distributed upon the member's filing of the required DROP distribution form or forms.

         1. (c) Death while on active duty.
   3. (1) In the event a DROP participant on active duty dies during the period of DROP participation, a lump-sum payment equal to the account balance of the participant shall be paid to the participant's survivor.

   4. (2) If survivor benefits are payable, the surviving spouse, dependent children, or dependent parents will receive monthly benefits.

      1. (d) Becoming eligible for DROP participation while on active duty.
   5. (1) If a member becomes eligible to participate in the DROP while on active duty, he or she will be placed in the plan retroactive to the date of initial eligibility providing the application is received within one (1) month of the member returning to covered employment.
   6. (2) Such participation will also be contingent upon the necessary employee (if applicable) and employer contributions being made to the system for the period of active duty prior to the employee entering the DROP.

4. (e) Reemployment.

   1. (1) After release from active duty, should a DROP member fail to apply for reemployment or fail to accept reemployment pursuant to the provisions of 38 U.S.C. § 4312 as amended, the employer shall promptly notify the system.

   2. (2) After notice to the member and opportunity for hearing, should the system determine that the member failed to apply for or accept reemployment as provided above, the system shall:

      1. (A) Determine that the member's retirement application and DROP distribution form required under maximum participation period, subdivision (b)(2)(A) of this section, are void as of the date of the member's release from active duty;
      2. (B) Terminate payments of the deferred benefit into the member's DROP account;
      3. (C) Deduct any payments of the deferred benefit into the member's DROP account after date of the member's release from active duty and interest thereon and pay said amount of the deferred benefit without interest thereon to the member as accumulated monthly annuity payments upon the member's filing a completed retirement application and DROP distribution form in compliance with applicable deadlines;
      4. (D) Not pay interest on the member's DROP account after the date of the member's release from active duty and hold said account balance pending the member's filing of the DROP distribution forms; and
      5. (E) Pay the member's monthly retirement annuity to the member upon his or her filing a completed retirement application and in compliance with applicable deadlines.

5. (f) Procedures applicable to DROP/active duty issues.

   1. (1) The Executive Secretary of the State Police Retirement System shall:

      1. (A) Determine all issues of interpretation or implementation of this section in regard to DROP members and active military duty; and
      2. (B) Conduct any hearings provided for herein or required by other law.

   2. (2)

      1. (A) If the member is not satisfied with the executive secretary’s decision on matters that were not decided in conjunction with a hearing, the member may request that the issue be presented to the Board of Trustees of the State Police Retirement System.

      2. (B) The board shall:

         1. (i) Review the:
6. (a) (a) Member’s request for review;

7. (b) (b) Record considered by the executive secretary; and

   1. (c) (c) Executive secretary’s decision;

      1. (ii) Afford the member the opportunity to present additional information or documentation and to appear before the board; and

         1. (iii) Determine whether to:
8. (a) (a) Affirm or modify the executive secretary’s decision; or

9. (b) (b) Return the case to the executive secretary for further consideration.

   1. (3)

      1. (A) A member who was a party to a hearing by the executive secretary concerning DROP/active duty issues and who is not satisfied with the executive secretary’s decision may file an appeal to the board.
      2. (B) The member shall file notice of appeal in writing, stating the grounds therefore, with the executive secretary on or before thirty (30) days following the date of record of the executive secretary’s decision.
      3. (C) The executive secretary’s written decision shall be mailed to the member by certified mail, return receipt requested, restricted delivery to the member's last known address of record.

   2. (4) Upon appeal, the review by the board shall be confined to the record considered by the executive secretary, provided, however:

      1. (A)

         1. (i) The member may apply to present additional evidence and should the board find that the evidence is material and that there were good reasons for failure to present it in the proceeding before the executive secretary, the board may order that the additional evidence be taken before the executive secretary upon any conditions that may be just.
         2. (ii) The executive secretary may modify the findings and decision by reason of the additional evidence and shall file that evidence and any modification, new findings, or decisions with the board;

      2. (B)

         1. (i) Should the member assert any alleged irregularity in procedure before the executive secretary not shown in the record, the board may hear testimony on that issue or in its discretion may remand the matter to the executive secretary to conduct further proceedings on the record on the member's allegation of procedural irregularity.
         2. (ii) After any further proceeding by the executive secretary regarding any procedural irregularity, the executive secretary:
10. (a) (a) May modify the findings and decision by reason of the additional evidence; and

11. (b) (b) Shall file that evidence and any modifications, new findings, or decisions with the board; and

    1. (C) The member may request the opportunity to make an oral presentation to the board.
    2. (5) The board may affirm or reverse the executive secretary’s decision or remand the case for further proceedings.

Codification Notes: This section as promulgated prior to codification into the Code of Arkansas Rules provided as follows: "BOARD RULE 14 - Nov. 2003 - DEFERRED RETIREMENT OPTION PLAN (DROP) PROVISIONS FOR MEMBERS CALLED TO ACTIVE DUTY"