1. (a) A member entitled to retirement may elect to receive, in lieu of a standard service or disability retirement benefit, one of the following optional benefits, each of which is a reduced monthly allowance that is the actuarial equivalent of the standard retirement benefit, payable during the lifetime of the retiree, but with the provision that:

   1. (1) Option 1: after the retiree's death, the reduced annuity is payable throughout the life of a person designated by the retiree;
   2. (2) Option 2: after the retiree's death, one-half of the reduced annuity is payable throughout the life of a person designated by the retiree;
   3. (3) Option 3: if the retiree dies before 60 monthly annuity payments have been made, the remainder of the 60 payments are payable to the retiree's beneficiary or, if one does not exist, to the retiree's estate;
   4. (4) Option 4A: if the retiree dies before 120 monthly annuity payments have been made, the remainder of the 120 payments are payable to the retiree's beneficiary or, if one does not exist, to the retiree's estate;
   5. (5) Option 4B: after the retiree's death, one-fourth of the reduced annuity is payable throughout the life of a person designated by the retiree;
   6. (6) Option 4C: after the retiree's death, three-fourths of the reduced annuity is payable throughout the life of a person designated by the retiree;
   7. (7) Option 4D: if the retiree dies before 180 monthly annuity payments have been made, the remainder of the 180 payments are payable to the retiree's beneficiary or, if one does not exist, to the retiree's estate.

2. (b) If monthly payments under an optional retirement annuity described in subsection (a) of this section cease before the sum of all the monthly payments equals or exceeds the amount of accumulated contributions in the individual account in the employee saving fund at the time of retirement of the member on whose service the annuity was based, a lump-sum benefit equal to the amount by which the accumulated contributions exceed the sum of all monthly payments made under the annuity is payable:

   1. (1) to the designated beneficiary, if living, or if not living, to the estate of the designated beneficiary, if the designated beneficiary survived the retiree; or
   2. (2) to the estate of the retiree, if the designated beneficiary predeceased the retiree.

Source Note:The provisions of this §103.2 adopted to be effective July 27, 1976, 1 TexReg 1929; amended to be effective August 28, 1989, 14 TexReg 3352; amended to be effective May 1, 1993, 18 TexReg 2415.