Okla. Stat. tit. 47, § 2-307.7 – Termination Credit

A. A member of the Oklahoma Law Enforcement Retirement System who has ten (10) or more years of full-time-equivalent employment with a participating employer, and who is terminated by a state agency or other state governmental entity because the member’s position is eliminated through a reduction-in-force after July 1, 1998, and is within three (3) years of a normal retirement date as defined in paragraph 7 of Section 2-300 of this title may purchase termination credit of a period not to exceed the lesser of three (3) years or the number of years or months or both years and months required in order for the member to reach normal retirement date in the same period of time and with the same service credit which would have otherwise accrued if the termination had not occurred.
B. In order to receive the termination credit authorized by this section, the member shall be required to file an election with the System indicating an intent to purchase the credit. The member shall have a period of six (6) months from the date the member is terminated as described in subsection A of this section within which to file the election.
C. To purchase the termination credit, the member shall be required to make payment to the System of an amount equal to both the employer and employee contributions which would have been paid to the System based upon the actual paid base salary as defined in paragraph 8 of Section 2-300 of this title, which was received by the member in the last full month that the member was employed by the state agency or other state governmental entity multiplied by the number of months required in order for the combination of the participating service and member’s age to equal the amount required for the member to reach normal retirement date with an unreduced benefit as if the member had not been terminated.
D. The member must make full payment to the System of all required contribution amounts within sixty (60) days of filing the election to purchase the credit. The member must vest his or her benefits with a declared future retirement date as of the first month the member is eligible for normal retirement. Failure to make the full payment to the System of the required contribution amounts, for any reason, within the time prescribed, shall result in cancellation of the election provided pursuant to this section, and return of the purchase amount tendered, without interest. Notwithstanding anything herein to the contrary, termination credit purchases may be made by:
1. 1. A cash lump-sum payment;
2. 2. A trustee-to-trustee transfer from a Code Section 401(a) qualified plan;
3. 3. A direct rollover of tax-deferred funds from a Code Section 403(b) annuity or custodial account, an eligible deferred compensation plan described in Code Section 457(b) which is maintained by an eligible employer described in Code Section 457(e)(1)(A), a Code Section 401(a) qualified plan, and/or a Code Section 408(a) or 408(b) traditional or conduit Individual Retirement Account or Annuity (IRA). Roth IRAs, Coverdell Education Savings Accounts and after-tax contributions shall not be used to purchase such service credit; or
4. 4. Any combination of the above methods of payment.
E. Purchased termination credit may only be used as service credit to qualify the member for normal retirement.
F. If the member chooses to retire at any time prior to the member’s normal retirement date or returns to employment with a participating employer of the System at any time prior to retirement, the purchase of termination credit pursuant to this section shall be void and the System will return the purchase amount tendered, without interest.
G. In the event of the death of the member prior to retirement, the member’s spouse, if otherwise eligible for benefits pursuant to Section 2-306 of this title, may elect to receive benefits which include the termination credit on the member’s declared future retirement date, or may elect to receive a return of the purchase amount tendered, without interest.
Historical Data Laws 1998, HB 2825, c. 256, § 8, emerg. eff. July 1, 1998; Amended by Laws 2003, HB 1647, c. 406, § 13, emerg. eff. July 1, 2003 (superseded document available); Amended by Laws 2004, SB 1261, c. 542, § 7, emerg. eff. July 1, 2004 (superseded document available); Amended by Laws 2006, 2nd Extr. Sess., HB 1179, c. 46, § 28, emerg. eff. July 1, 2006 (superseded document available).