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EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
SECOND REGULAR SESSION
SENATE BILL NO. 1779
103RD GENERAL ASSEMBLY
INTRODUCED BY SENATOR HENDERSON.
7387S.01I KRISTINA MARTIN, Secretary
AN ACT
To repeal sections 169.070 and 169.670, RSMo, and to enact in lieu thereof two new sections
relating to limitations on cost of living increases on retirement allowances for certain
public school employees.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 169.070 and 169.670, RSMo, are 1
repealed and two new sections enacted in lieu thereof, to be 2
known as sections 169.070 and 169.670, to read as follows:3
169.070. 1. The retirement allowance of a member 1
whose age at retirement is sixty years or more and whose 2
creditable service is five years or more, or whose sum of 3
age and creditable service equals eighty years or more, or 4
who has attained age fifty-five and whose creditable service 5
is twenty-five years or more or whose creditable service is 6
thirty years or more regardless of age, may be the sum of 7
the following items, not to exceed one hundred percent of 8
the member's final average salary: 9
(1) Two and five-tenths percent of the member's final 10
average salary for each year of membership service; 11
(2) Six-tenths of the amount payable for a year of 12
membership service for each year of prior service not 13
exceeding thirty years. 14
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In lieu of the retirement allowance otherwise provided in 15
subdivisions (1) and (2) of this subsection, a member may 16
elect to receive a retirement allowance of: 17
(3) Two and four-tenths percent of the member's final 18
average salary for each year of membership service, if the 19
member's creditable service is twenty-nine years or more but 20
less than thirty years, and the member has not attained age 21
fifty-five; 22
(4) Two and thirty-five-hundredths percent of the 23
member's final average salary for each year of membership 24
service, if the member's creditable service is twenty-eight 25
years or more but less than twenty-nine years, and the 26
member has not attained age fifty-five; 27
(5) Two and three-tenths percent of the member's final 28
average salary for each year of membership service, if the 29
member's creditable service is twenty-seven years or more 30
but less than twenty-eight years, and the member has not 31
attained age fifty-five; 32
(6) Two and twenty-five-hundredths percent of the 33
member's final average salary for each year of membership 34
service, if the member's creditable service is twenty-six 35
years or more but less than twenty-seven years, and the 36
member has not attained age fifty-five; 37
(7) Two and two-tenths percent of the member's final 38
average salary for each year of membership service, if the 39
member's creditable service is twenty-five years or more but 40
less than twenty-six years, and the member has not attained 41
age fifty-five; 42
(8) Two and fifty-five hundredths percent of the 43
member's final average salary for each year of membership 44
service, if the member's creditable service is thirty-two 45
years or more regardless of age. 46
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2. In lieu of the retirement allowance provided in 47
subsection 1 of this section, a member whose age is sixty 48
years or more on September 28, 1975, may elect to have the 49
member's retirement allowance calculated as a sum of the 50
following items: 51
(1) Sixty cents plus one and five-tenths percent of 52
the member's final average salary for each year of 53
membership service; 54
(2) Six-tenths of the amount payable for a year of 55
membership service for each year of prior service not 56
exceeding thirty years; 57
(3) Three-fourths of one percent of the sum of 58
subdivisions (1) and (2) of this subsection for each month 59
of attained age in excess of sixty years but not in excess 60
of age sixty-five. 61
3. (1) In lieu of the retirement allowance provided 62
either in subsection 1 or 2 of this section, collectively 63
called "option 1", a member whose creditable service is 64
twenty-five years or more or who has attained the age of 65
fifty-five with five or more years of creditable service may 66
elect in the member's application for retirement to receive 67
the actuarial equivalent of the member's retirement 68
allowance in reduced monthly payments for life during 69
retirement with the provision that: 70
Option 2. 71
Upon the member's death the reduced retirement 72
allowance shall be continued throughout the life of and paid 73
to such person as has an insurable interest in the life of 74
the member as the member shall have nominated in the 75
member's election of the option, and provided further that 76
if the person so nominated dies before the retired member, 77
the retirement allowance will be increased to the amount the 78
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retired member would be receiving had the retired member 79
elected option 1; or 80
Option 3. 81
Upon the death of the member three-fourths of the 82
reduced retirement allowance shall be continued throughout 83
the life of and paid to such person as has an insurable 84
interest in the life of the member and as the member shall 85
have nominated in an election of the option, and provided 86
further that if the person so nominated dies before the 87
retired member, the retirement allowance will be increased 88
to the amount the retired member would be receiving had the 89
member elected option 1; or 90
Option 4. 91
Upon the death of the member one-half of the reduced 92
retirement allowance shall be continued throughout the life 93
of, and paid to, such person as has an insurable interest in 94
the life of the member and as the member shall have 95
nominated in an election of the option, and provided further 96
that if the person so nominated dies before the retired 97
member, the retirement allowance shall be increased to the 98
amount the retired member would be receiving had the member 99
elected option 1; or 100
Option 5. 101
Upon the death of the member prior to the member having 102
received one hundred twenty monthly payments of the member's 103
reduced allowance, the remainder of the one hundred twenty 104
monthly payments of the reduced allowance shall be paid to 105
such beneficiary as the member shall have nominated in the 106
member's election of the option or in a subsequent 107
nomination. If there is no beneficiary so nominated who 108
survives the member for the remainder of the one hundred 109
twenty monthly payments, the total of the remainder of such 110
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one hundred twenty monthly payments shall be paid to the 111
surviving spouse, surviving children in equal shares, 112
surviving parents in equal shares, or estate of the last 113
person, in that order of precedence, to receive a monthly 114
allowance in a lump sum payment. If the total of the one 115
hundred twenty payments paid to the retired individual and 116
the beneficiary of the retired individual is less than the 117
total of the member's accumulated contributions, the 118
difference shall be paid to the beneficiary in a lump sum; or 119
Option 6. 120
Upon the death of the member prior to the member having 121
received sixty monthly payments of the member's reduced 122
allowance, the remainder of the sixty monthly payments of 123
the reduced allowance shall be paid to such beneficiary as 124
the member shall have nominated in the member's election of 125
the option or in a subsequent nomination. If there is no 126
beneficiary so nominated who survives the member for the 127
remainder of the sixty monthly payments, the total of the 128
remainder of such sixty monthly payments shall be paid to 129
the surviving spouse, surviving children in equal shares, 130
surviving parents in equal shares, or estate of the last 131
person, in that order of precedence, to receive a monthly 132
allowance in a lump sum payment. If the total of the sixty 133
payments paid to the retired individual and the beneficiary 134
of the retired individual is less than the total of the 135
member's accumulated contributions, the difference shall be 136
paid to the beneficiary in a lump sum. 137
(2) The election of an option may be made only in the 138
application for retirement and such application must be 139
filed prior to the date on which the retirement of the 140
member is to be effective. If either the member or the 141
person nominated to receive the survivorship payments dies 142
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before the effective date of retirement, the option shall 143
not be effective, provided that: 144
(a) If the member or a person retired on disability 145
retirement dies after acquiring twenty-five or more years of 146
creditable service or after attaining the age of fifty-five 147
years and acquiring five or more years of creditable service 148
and before retirement, except retirement with disability 149
benefits, and the person named by the member as the member's 150
beneficiary has an insurable interest in the life of the 151
deceased member, the designated beneficiary may elect to 152
receive either survivorship benefits under option 2 or a 153
payment of the accumulated contributions of the member. If 154
survivorship benefits under option 2 are elected and the 155
member at the time of death would have been eligible to 156
receive an actuarial equivalent of the member's retirement 157
allowance, the designated beneficiary may further elect to 158
defer the option 2 payments until the date the member would 159
have been eligible to receive the retirement allowance 160
provided in subsection 1 or 2 of this section; 161
(b) If the member or a person retired on disability 162
retirement dies before attaining age fifty-five but after 163
acquiring five but fewer than twenty-five years of 164
creditable service, and the person named as the member's 165
beneficiary has an insurable interest in the life of the 166
deceased member, the designated beneficiary may elect to 167
receive either a payment of the member's accumulated 168
contributions, or survivorship benefits under option 2 to 169
begin on the date the member would first have been eligible 170
to receive an actuarial equivalent of the member's 171
retirement allowance, or to begin on the date the member 172
would first have been eligible to receive the retirement 173
allowance provided in subsection 1 or 2 of this section. 174
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4. If the total of the retirement or disability 175
allowance paid to an individual before the death of the 176
individual is less than the accumulated contributions at the 177
time of retirement, the difference shall be paid to the 178
beneficiary of the individual, or to the surviving spouse, 179
surviving children in equal shares, surviving parents in 180
equal shares, or estate of the individual in that order of 181
precedence. If an optional benefit as provided in option 2, 182
3 or 4 in subsection 3 of this section had been elected, and 183
the beneficiary dies after receiving the optional benefit, 184
and if the total retirement allowance paid to the retired 185
individual and the beneficiary of the retired individual is 186
less than the total of the contributions, the difference 187
shall be paid to the surviving spouse, surviving children in 188
equal shares, surviving parents in equal shares, or estate 189
of the beneficiary, in that order of precedence, unless the 190
retired individual designates a different recipient with the 191
board at or after retirement. 192
5. If a member dies and his or her financial 193
institution is unable to accept the final payment or 194
payments due to the member, the final payment or payments 195
shall be paid to the beneficiary of the member or, if there 196
is no beneficiary, to the surviving spouse, surviving 197
children in equal shares, surviving parents in equal shares, 198
or estate of the member, in that order of precedence, unless 199
otherwise stated. If the beneficiary of a deceased member 200
dies and his or her financial institution is unable to 201
accept the final payment or payments, the final payment or 202
payments shall be paid to the surviving spouse, surviving 203
children in equal shares, surviving parents in equal shares, 204
or estate of the member, in that order of precedence, unless 205
otherwise stated. 206
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6. If a member dies before receiving a retirement 207
allowance, the member's accumulated contributions at the 208
time of the death of the member shall be paid to the 209
beneficiary of the member or, if there is no beneficiary, to 210
the surviving spouse, surviving children in equal shares, 211
surviving parents in equal shares, or to the estate of the 212
member, in that order of precedence; except that, no such 213
payment shall be made if the beneficiary elects option 2 in 214
subsection 3 of this section, unless the beneficiary dies 215
before having received benefits pursuant to that subsection 216
equal to the accumulated contributions of the member, in 217
which case the amount of accumulated contributions in excess 218
of the total benefits paid pursuant to that subsection shall 219
be paid to the surviving spouse, surviving children in equal 220
shares, surviving parents in equal shares, or estate of the 221
beneficiary, in that order of precedence. 222
7. If a member ceases to be a public school employee 223
as herein defined and certifies to the board of trustees 224
that such cessation is permanent, or if the membership of 225
the person is otherwise terminated, the member shall be paid 226
the member's accumulated contributions with interest. 227
8. Notwithstanding any provisions of sections 169.010 228
to 169.141 to the contrary, if a member ceases to be a 229
public school employee after acquiring five or more years of 230
membership service in Missouri, the member may at the option 231
of the member leave the member's contributions with the 232
retirement system and claim a retirement allowance any time 233
after reaching the minimum age for voluntary retirement. 234
When the member's claim is presented to the board, the 235
member shall be granted an allowance as provided in sections 236
169.010 to 169.141 on the basis of the member's age, years 237
of service, and the provisions of the law in effect at the 238
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time the member requests the member's retirement to become 239
effective. 240
9. The retirement allowance of a member retired 241
because of disability shall be nine-tenths of the allowance 242
to which the member's creditable service would entitle the 243
member if the member's age were sixty, or fifty percent of 244
one-twelfth of the annual salary rate used in determining 245
the member's contributions during the last school year for 246
which the member received a year of creditable service 247
immediately prior to the member's disability, whichever is 248
greater, except that no such allowance shall exceed the 249
retirement allowance to which the member would have been 250
entitled upon retirement at age sixty if the member had 251
continued to teach from the date of disability until age 252
sixty at the same salary rate. 253
10. Notwithstanding any provisions of sections 169.010 254
to 169.141 to the contrary, from October 13, 1961, the 255
contribution rate pursuant to sections 169.010 to 169.141 256
shall be multiplied by the factor of two-thirds for any 257
member of the system for whom federal Old Age and Survivors 258
Insurance tax is paid from state or local tax funds on 259
account of the member's employment entitling the person to 260
membership in the system. The monetary benefits for a 261
member who elected not to exercise an option to pay into the 262
system a retroactive contribution of four percent on that 263
part of the member's annual salary rate which was in excess 264
of four thousand eight hundred dollars but not in excess of 265
eight thousand four hundred dollars for each year of 266
employment in a position covered by this system between July 267
1, 1957, and July 1, 1961, as provided in subsection 10 of 268
this section as it appears in RSMo, 1969, shall be the sum 269
of: 270
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(1) For years of service prior to July 1, 1946, six- 271
tenths of the full amount payable for years of membership 272
service; 273
(2) For years of membership service after July 1, 274
1946, in which the full contribution rate was paid, full 275
benefits under the formula in effect at the time of the 276
member's retirement; 277
(3) For years of membership service after July 1, 278
1957, and prior to July 1, 1961, the benefits provided in 279
this section as it appears in RSMo, 1959; except that if the 280
member has at least thirty years of creditable service at 281
retirement the member shall receive the benefit payable 282
pursuant to that section as though the member's age were 283
sixty-five at retirement; 284
(4) For years of membership service after July 1, 285
1961, in which the two-thirds contribution rate was paid, 286
two-thirds of the benefits under the formula in effect at 287
the time of the member's retirement. 288
11. The monetary benefits for each other member for 289
whom federal Old Age and Survivors Insurance tax is or was 290
paid at any time from state or local funds on account of the 291
member's employment entitling the member to membership in 292
the system shall be the sum of: 293
(1) For years of service prior to July 1, 1946, six- 294
tenths of the full amount payable for years of membership 295
service; 296
(2) For years of membership service after July 1, 297
1946, in which the full contribution rate was paid, full 298
benefits under the formula in effect at the time of the 299
member's retirement; 300
(3) For years of membership service after July 1, 301
1957, in which the two-thirds contribution rate was paid, 302
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two-thirds of the benefits under the formula in effect at 303
the time of the member's retirement. 304
12. Any retired member of the system who was retired 305
prior to September 1, 1972, or beneficiary receiving 306
payments under option 1 or option 2 of subsection 3 of this 307
section, as such option existed prior to September 1, 1972, 308
will be eligible to receive an increase in the retirement 309
allowance of the member of two percent for each year, or 310
major fraction of more than one-half of a year, which the 311
retired member has been retired prior to July 1, 1975. This 312
increased amount shall be payable commencing with January, 313
1976, and shall thereafter be referred to as the member's 314
retirement allowance. The increase provided for in this 315
subsection shall not affect the retired member's eligibility 316
for compensation provided for in section [169.580 or] 317
169.585, nor shall the amount being paid pursuant to these 318
sections be reduced because of any increases provided for in 319
this section. 320
13. (1) If the board of trustees determines that the 321
cost of living, as measured by generally accepted standards, 322
increases two percent or more in the preceding fiscal year, 323
the board shall increase the retirement allowances which the 324
retired members or beneficiaries are receiving by two 325
percent of the amount being received by the retired member 326
or the beneficiary at the time the annual increase is 327
granted by the board with the provision that the increases 328
provided for in this subsection shall not become effective 329
until the fourth January first following the member's 330
retirement or January 1, 1977, whichever later occurs, or in 331
the case of any member retiring on or after July 1, 2000, 332
the increase provided for in this subsection shall not 333
become effective until the third January first following the 334
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member's retirement, or in the case of any member retiring 335
on or after July 1, 2001, the increase provided for in this 336
subsection shall not become effective until the second 337
January first following the member's retirement. Commencing 338
with January 1, 1992, if the board of trustees determines 339
that the cost of living has increased five percent or more 340
in the preceding fiscal year, the board shall increase the 341
retirement allowances by five percent. The total of the 342
increases granted to a retired member or the beneficiary 343
after December 31, 1976, may not exceed eighty percent of 344
the retirement allowance established at retirement or as 345
previously adjusted by other subsections. 346
(2) Notwithstanding any other provision of this 347
chapter to the contrary, the limitation on the total of the 348
increases granted to a retired member or beneficiary as 349
provided by subdivision (1) of this subsection shall be 350
subject to an annual increase approved by the board of 351
trustees beginning on December 31, 2026, and on each 352
December thirty-first thereafter, except that such annual 353
increase shall not exceed two percent per year. Any 354
increase to the limitation shall depend on the performance 355
of the system's investments. If the system's investments 356
earn two percent or greater returns in excess of the 357
investment return rate adopted by the board of trustees in 358
the immediately prior fiscal year, the percentage of the 359
retirement allowance for the total of increases granted to a 360
retired member or beneficiary shall be increased by two 361
percent. The two percent increase shall be incorporated in 362
the calculation applicable to the retirement allowances in 363
the calendar year that immediately follows the fiscal year 364
in which the system's investments met or exceeded by two 365
percent the investment return rate. The total of the 366
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increases granted to a retired member or beneficiary shall 367
not exceed eighty percent of the retirement allowance 368
established at retirement or as previously adjusted by other 369
sections. If a retired member or beneficiary has already 370
reached the eighty percent cap under this subdivision, such 371
retired member or beneficiary shall be granted a two percent 372
cost of living adjustment for such year, but such increases 373
shall not be cumulative. In a year that the system's 374
investments fail to earn at least two percent returns in 375
excess of the investment return rate adopted by the board of 376
trustees in the immediately prior fiscal year, the retired 377
member or beneficiary that has already reached the eighty 378
percent cap under this subdivision shall not be granted a 379
cost of living adjustment for that year. The percentage of 380
the retirement allowance for the total of increases granted 381
to a retired member or beneficiary shall not be decreased. 382
Any reference to the limitation on the total of increases 383
granted to a retired member or beneficiary in any other 384
section of this chapter shall be construed to be the 385
percentage of the retirement allowance in effect as 386
increased pursuant to this subdivision unless such increase 387
to the percentage of the retirement allowance is otherwise 388
expressly excluded. 389
(3) If the cost of living increases less than five 390
percent, the board of trustees may determine the percentage 391
of increase to be made in retirement allowances, but at no 392
time can the increase exceed five percent per year. If the 393
cost of living decreases in a fiscal year, there will be no 394
increase in allowances for retired members on the following 395
January first. 396
14. The board of trustees may reduce the amounts which 397
have been granted as increases to a member pursuant to 398
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subsection 13 of this section if the cost of living, as 399
determined by the board and as measured by generally 400
accepted standards, is less than the cost of living was at 401
the time of the first increase granted to the member; except 402
that, the reductions shall not exceed the amount of 403
increases which have been made to the member's allowance 404
after December 31, 1976. 405
15. Any application for retirement shall include a 406
sworn statement by the member certifying that the spouse of 407
the member at the time the application was completed was 408
aware of the application and the plan of retirement elected 409
in the application. 410
16. Notwithstanding any other provision of law, any 411
person retired prior to September 28, 1983, who is receiving 412
a reduced retirement allowance under option 1 or option 2 of 413
subsection 3 of this section, as such option existed prior 414
to September 28, 1983, and whose beneficiary nominated to 415
receive continued retirement allowance payments under the 416
elected option dies or has died, shall upon application to 417
the board of trustees have his or her retirement allowance 418
increased to the amount he or she would have been receiving 419
had the option not been elected, actuarially adjusted to 420
recognize any excessive benefits which would have been paid 421
to him or her up to the time of application. 422
17. Benefits paid pursuant to the provisions of the 423
public school retirement system of Missouri shall not exceed 424
the limitations of Section 415 of Title 26 of the United 425
States Code except as provided pursuant to this subsection. 426
Notwithstanding any other law to the contrary, the board of 427
trustees may establish a benefit plan pursuant to Section 428
415(m) of Title 26 of the United States Code. Such plan 429
shall be created solely for the purpose described in Section 430
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415(m)(3)(A) of Title 26 of the United States Code. The 431
board of trustees may promulgate regulations necessary to 432
implement the provisions of this subsection and to create 433
and administer such benefit plan. 434
18. Notwithstanding any other provision of law to the 435
contrary, any person retired before, on, or after May 26, 436
1994, shall be made, constituted, appointed and employed by 437
the board as a special consultant on the matters of 438
education, retirement and aging, and upon request shall give 439
written or oral opinions to the board in response to such 440
requests. As compensation for such duties the person shall 441
receive an amount based on the person's years of service so 442
that the total amount received pursuant to sections 169.010 443
to 169.141 shall be at least the minimum amounts specified 444
in subdivisions (1) to (4) of this subsection. In 445
determining the minimum amount to be received, the amounts 446
in subdivisions (3) and (4) of this subsection shall be 447
adjusted in accordance with the actuarial adjustment, if 448
any, that was applied to the person's retirement allowance. 449
In determining the minimum amount to be received, beginning 450
September 1, 1996, the amounts in subdivisions (1) and (2) 451
of this subsection shall be adjusted in accordance with the 452
actuarial adjustment, if any, that was applied to the 453
person's retirement allowance due to election of an optional 454
form of retirement having a continued monthly payment after 455
the person's death. Notwithstanding any other provision of 456
law to the contrary, no person retired before, on, or after 457
May 26, 1994, and no beneficiary of such a person, shall 458
receive a retirement benefit pursuant to sections 169.010 to 459
169.141 based on the person's years of service less than the 460
following amounts: 461
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(1) Thirty or more years of service, one thousand two 462
hundred dollars; 463
(2) At least twenty-five years but less than thirty 464
years, one thousand dollars; 465
(3) At least twenty years but less than twenty-five 466
years, eight hundred dollars; 467
(4) At least fifteen years but less than twenty years, 468
six hundred dollars. 469
19. Notwithstanding any other provisions of law to the 470
contrary, any person retired prior to May 26, 1994, and any 471
designated beneficiary of such a retired member who was 472
deceased prior to July 1, 1999, shall be made, constituted, 473
appointed and employed by the board as a special consultant 474
on the matters of education, retirement or aging and upon 475
request shall give written or oral opinions to the board in 476
response to such requests. Beginning September 1, 1996, as 477
compensation for such service, the member shall have added, 478
pursuant to this subsection, to the member's monthly annuity 479
as provided by this section a dollar amount equal to the 480
lesser of sixty dollars or the product of two dollars 481
multiplied by the member's number of years of creditable 482
service. Beginning September 1, 1999, the designated 483
beneficiary of the deceased member shall as compensation for 484
such service have added, pursuant to this subsection, to the 485
monthly annuity as provided by this section a dollar amount 486
equal to the lesser of sixty dollars or the product of two 487
dollars multiplied by the member's number of years of 488
creditable service. The total compensation provided by this 489
section including the compensation provided by this 490
subsection shall be used in calculating any future cost-of- 491
living adjustments provided by subsection 13 of this section. 492
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20. Any member who has retired prior to July 1, 1998, 493
and the designated beneficiary of a deceased retired member 494
shall be made, constituted, appointed and employed by the 495
board as a special consultant on the matters of education, 496
retirement and aging, and upon request shall give written or 497
oral opinions to the board in response to such requests. As 498
compensation for such duties the person shall receive a 499
payment equivalent to eight and seven-tenths percent of the 500
previous month's benefit, which shall be added to the 501
member's or beneficiary's monthly annuity and which shall 502
not be subject to the provisions of subsections 13 and 14 of 503
this section for the purposes of the limit on the total 504
amount of increases which may be received. 505
21. Any member who has retired shall be made, 506
constituted, appointed and employed by the board as a 507
special consultant on the matters of education, retirement 508
and aging, and upon request shall give written or oral 509
opinions to the board in response to such request. As 510
compensation for such duties, the beneficiary of the retired 511
member, or, if there is no beneficiary, the surviving 512
spouse, surviving children in equal shares, surviving 513
parents in equal shares, or estate of the retired member, in 514
that order of precedence, shall receive as a part of 515
compensation for these duties a death benefit of five 516
thousand dollars. 517
22. Any member who has retired prior to July 1, 1999, 518
and the designated beneficiary of a retired member who was 519
deceased prior to July 1, 1999, shall be made, constituted, 520
appointed and employed by the board as a special consultant 521
on the matters of education, retirement and aging, and upon 522
request shall give written or oral opinions to the board in 523
response to such requests. As compensation for such duties, 524
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the person shall have added, pursuant to this subsection, to 525
the monthly annuity as provided by this section a dollar 526
amount equal to five dollars times the member's number of 527
years of creditable service. 528
23. Any member who has retired prior to July 1, 2000, 529
and the designated beneficiary of a deceased retired member 530
shall be made, constituted, appointed and employed by the 531
board as a special consultant on the matters of education, 532
retirement and aging, and upon request shall give written or 533
oral opinions to the board in response to such requests. As 534
compensation for such duties, the person shall receive a 535
payment equivalent to three and five-tenths percent of the 536
previous month's benefit, which shall be added to the member 537
or beneficiary's monthly annuity and which shall not be 538
subject to the provisions of subsections 13 and 14 of this 539
section for the purposes of the limit on the total amount of 540
increases which may be received. 541
24. Any member who has retired prior to July 1, 2001, 542
and the designated beneficiary of a deceased retired member 543
shall be made, constituted, appointed and employed by the 544
board as a special consultant on the matters of education, 545
retirement and aging, and upon request shall give written or 546
oral opinions to the board in response to such requests. As 547
compensation for such duties, the person shall receive a 548
dollar amount equal to three dollars times the member's 549
number of years of creditable service, which shall be added 550
to the member's or beneficiary's monthly annuity and which 551
shall not be subject to the provisions of subsections 13 and 552
14 of this section for the purposes of the limit on the 553
total amount of increases which may be received. 554
169.670. 1. The retirement allowance of a member 1
whose age at retirement is sixty years or more and whose 2
SB 1779 19
creditable service is five years or more, or whose sum of 3
age and creditable service equals eighty years or more, or 4
whose creditable service is thirty years or more regardless 5
of age, shall be the sum of the following items: 6
(1) For each year of membership service, one and sixty- 7
one hundredths percent of the member's final average salary; 8
(2) Six-tenths of the amount payable for a year of 9
membership service for each year of prior service; 10
(3) Eighty-five one-hundredths of one percent of any 11
amount by which the member's average compensation for 12
services rendered prior to July 1, 1973, exceeds the average 13
monthly compensation on which federal Social Security taxes 14
were paid during the period over which such average 15
compensation was computed, for each year of membership 16
service credit for services rendered prior to July 1, 1973, 17
plus six-tenths of the amount payable for a year of 18
membership service for each year of prior service credit; 19
(4) In lieu of the retirement allowance otherwise 20
provided by subdivisions (1) to (3) of this subsection, a 21
member may elect to receive a retirement allowance of: 22
(a) One and fifty-nine hundredths percent of the 23
member's final average salary for each year of membership 24
service, if the member's creditable service is twenty-nine 25
years or more but less than thirty years and the member has 26
not attained the age of fifty-five; 27
(b) One and fifty-seven hundredths percent of the 28
member's final average salary for each year of membership 29
service, if the member's creditable service is twenty-eight 30
years or more but less than twenty-nine years, and the 31
member has not attained the age of fifty-five; 32
(c) One and fifty-five hundredths percent of the 33
member's final average salary for each year of membership 34
SB 1779 20
service, if the member's creditable service is twenty-seven 35
years or more but less than twenty-eight years and the 36
member has not attained the age of fifty-five; 37
(d) One and fifty-three hundredths percent of the 38
member's final average salary for each year of membership 39
service, if the member's creditable service is twenty-six 40
years or more but less than twenty-seven years and the 41
member has not attained the age of fifty-five; 42
(e) One and fifty-one hundredths percent of the 43
member's final average salary for each year of membership 44
service, if the member's creditable service is twenty-five 45
years or more but less than twenty-six years and the member 46
has not attained the age of fifty-five; and 47
(5) In addition to the retirement allowance provided 48
in subdivisions (1) to (3) of this subsection, a member 49
retiring on or after July 1, 2001, whose creditable service 50
is thirty years or more or whose sum of age and creditable 51
service is eighty years or more, shall receive a temporary 52
retirement allowance equivalent to eight-tenths of one 53
percent of the member's final average salary multiplied by 54
the member's years of service until such time as the member 55
reaches the minimum age for Social Security retirement 56
benefits. 57
2. (1) If the board of trustees determines that the 58
cost of living, as measured by generally accepted standards, 59
increases five percent or more in the preceding fiscal year, 60
the board shall increase the retirement allowances which the 61
retired members or beneficiaries are receiving by five 62
percent of the amount being received by the retired member 63
or the beneficiary at the time the annual increase is 64
granted by the board; provided that, the increase provided 65
in this subsection shall not become effective until the 66
SB 1779 21
fourth January first following a member's retirement or 67
January 1, 1982, whichever occurs later, and the total of 68
the increases granted to a retired member or the beneficiary 69
after December 31, 1981, may not exceed eighty percent of 70
the retirement allowance established at retirement or as 71
previously adjusted by other provisions of law. 72
(2) Notwithstanding any other provision of this 73
chapter to the contrary, the limitation on the total of the 74
increases granted to a retired member or beneficiary as 75
provided by subdivision (1) of this subsection shall be 76
subject to an annual increase approved by the board of 77
trustees beginning on December 31, 2026, and on each 78
December thirty-first thereafter, except that such annual 79
increase shall not exceed two percent per year. Any 80
increase to the limitation shall depend on the performance 81
of the system's investments. If the system's investments 82
earn two percent or greater returns in excess of the 83
investment return rate adopted by the board of trustees in 84
the immediately prior fiscal year, the percentage of the 85
retirement allowance for the total of increases granted to a 86
retired member or beneficiary shall be increased by two 87
percent. The two percent increase shall be incorporated in 88
the calculation applicable to the retirement allowances in 89
the calendar year that immediately follows the fiscal year 90
in which the system's investments met or exceeded by two 91
percent the investment return rate. The total of the 92
increases granted to a retired member or beneficiary shall 93
not exceed eighty percent of the retirement allowance 94
established at retirement or as previously adjusted by other 95
sections. If a retired member or beneficiary has already 96
reached the eighty percent cap under this subdivision, such 97
retired member or beneficiary shall be granted a two percent 98
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cost of living adjustment for such year, but such increases 99
shall not be cumulative. In a year that the system's 100
investments fail to earn at least two percent returns in 101
excess of the investment return rate adopted by the board of 102
trustees in the immediately prior fiscal year, the retired 103
member or beneficiary that has already reached the eighty 104
percent cap under this subdivision shall not be granted a 105
cost of living adjustment for that year. The percentage of 106
the retirement allowance for the total of increases granted 107
to a retired member or beneficiary shall not be decreased. 108
Any reference to the limitation on the total of increases 109
granted to a retired member or beneficiary in any other 110
section of this chapter shall be construed to be the 111
percentage of the retirement allowance in effect as 112
increased pursuant to this subdivision unless such increase 113
to the percentage of the retirement allowance is otherwise 114
expressly excluded. 115
(3) If the cost of living increases less than five 116
percent, the board of trustees may determine the percentage 117
of increase to be made in retirement allowances, but at no 118
time can the increase exceed five percent per year. If the 119
cost of living decreases in a fiscal year, there will be no 120
increase in allowances for retired members on the following 121
January first. 122
3. The board of trustees may reduce the amounts which 123
have been granted as increases to a member pursuant to 124
subsection 2 of this section if the cost of living, as 125
determined by the board and as measured by generally 126
accepted standards, is less than the cost of living was at 127
the time of the first increase granted to the member; 128
provided that, the reductions shall not exceed the amount of 129
SB 1779 23
increases which have been made to the member's allowance 130
after December 31, 1981. 131
4. (1) In lieu of the retirement allowance provided 132
in subsection 1 of this section, called option 1, a member 133
whose creditable service is twenty-five years or more or who 134
has attained age fifty-five with five or more years of 135
creditable service may elect, in the application for 136
retirement, to receive the actuarial equivalent of the 137
member's retirement allowance in reduced monthly payments 138
for life during retirement with the provision that: 139
Option 2. 140
Upon the member's death, the reduced retirement 141
allowance shall be continued throughout the life of and paid 142
to such person as has an insurable interest in the life of 143
the member as the member shall have nominated in the 144
member's election of the option, and provided further that 145
if the person so nominated dies before the retired member, 146
the retirement allowance will be increased to the amount the 147
retired member would be receiving had the member elected 148
option 1; or 149
Option 3. 150
Upon the death of the member three-fourths of the 151
reduced retirement allowance shall be continued throughout 152
the life of and paid to such person as has an insurable 153
interest in the life of the member and as the member shall 154
have nominated in an election of the option, and provided 155
further that if the person so nominated dies before the 156
retired member, the retirement allowance will be increased 157
to the amount the retired member would be receiving had the 158
member elected option 1; or 159
Option 4. 160
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Upon the death of the member one-half of the reduced 161
retirement allowance shall be continued throughout the life 162
of, and paid to, such person as has an insurable interest in 163
the life of the member and as the member shall have 164
nominated in an election of the option, and provided further 165
that if the person so nominated dies before the retired 166
member, the retirement allowance shall be increased to the 167
amount the retired member would be receiving had the member 168
elected option 1; or 169
Option 5. 170
Upon the death of the member prior to the member having 171
received one hundred twenty monthly payments of the member's 172
reduced allowance, the remainder of the one hundred twenty 173
monthly payments of the reduced allowance shall be paid to 174
such beneficiary as the member shall have nominated in the 175
member's election of the option or in a subsequent 176
nomination. If there is no beneficiary so nominated who 177
survives the member for the remainder of the one hundred 178
twenty monthly payments, the reserve for the remainder of 179
such one hundred twenty monthly payments shall be paid to 180
the surviving spouse, surviving children in equal shares, 181
surviving parents in equal shares, or estate of the last 182
person, in that order of precedence, to receive a monthly 183
allowance in a lump sum payment. If the total of the one 184
hundred twenty payments paid to the retired individual and 185
the beneficiary of the retired individual is less than the 186
total of the member's accumulated contributions, the 187
difference shall be paid to the beneficiary in a lump sum; or 188
Option 6. 189
Upon the death of the member prior to the member having 190
received sixty monthly payments of the member's reduced 191
allowance, the remainder of the sixty monthly payments of 192
SB 1779 25
the reduced allowance shall be paid to such beneficiary as 193
the member shall have nominated in the member's election of 194
the option or in a subsequent nomination. If there is no 195
beneficiary so nominated who survives the member for the 196
remainder of the sixty monthly payments, the reserve for the 197
remainder of such sixty monthly payments shall be paid to 198
the surviving spouse, surviving children in equal shares, 199
surviving parents in equal shares, or estate of the last 200
person, in that order of precedence, to receive a monthly 201
allowance in a lump sum payment. If the total of the sixty 202
payments paid to the retired individual and the beneficiary 203
of the retired individual is less than the total of the 204
member's accumulated contributions, the difference shall be 205
paid to the beneficiary in a lump sum; or 206
Option 7. 207
A plan of variable monthly benefit payments which 208
provides, in conjunction with the member's retirement 209
benefits under the federal Social Security laws, level or 210
near-level retirement benefit payments to the member for 211
life during retirement, and if authorized, to an appropriate 212
beneficiary designated by the member. Such a plan shall be 213
actuarially equivalent to the retirement allowance under 214
option 1 and shall be available for election only if 215
established by the board of trustees under duly adopted 216
rules. 217
(2) The election of an option may be made only in the 218
application for retirement and such application must be 219
filed prior to the date on which the retirement of the 220
member is to be effective. If either the member or the 221
person nominated dies before the effective date of 222
retirement, the option shall not be effective, provided that: 223
SB 1779 26
(a) If the member or a person retired on disability 224
retirement dies after attaining age fifty-five and acquiring 225
five or more years of creditable service or after acquiring 226
twenty-five or more years of creditable service and before 227
retirement, except retirement with disability benefits, and 228
the person named by the member as the member's beneficiary 229
has an insurable interest in the life of the deceased 230
member, the designated beneficiary may elect to receive 231
either survivorship payments under option 2 or a payment of 232
the member's accumulated contributions. If survivorship 233
benefits under option 2 are elected and the member at the 234
time of death would have been eligible to receive an 235
actuarial equivalent of the member's retirement allowance, 236
the designated beneficiary may further elect to defer the 237
option 2 payments until the date the member would have been 238
eligible to receive the retirement allowance provided in 239
subsection 1 of this section. 240
(b) If the member or a person retired on disability 241
retirement dies before attaining age fifty-five but after 242
acquiring five but fewer than twenty-five years of 243
creditable service, and the person named as the beneficiary 244
has an insurable interest in the life of the deceased member 245
or disability retiree, the designated beneficiary may elect 246
to receive either a payment of the person's accumulated 247
contributions or survivorship benefits under option 2 to 248
begin on the date the member would first have been eligible 249
to receive an actuarial equivalent of the person's 250
retirement allowance, or to begin on the date the member 251
would first have been eligible to receive the retirement 252
allowance provided in subsection 1 of this section. 253
5. If the total of the retirement or disability 254
allowances paid to an individual before the person's death 255
SB 1779 27
is less than the person's accumulated contributions at the 256
time of the person's retirement, the difference shall be 257
paid to the person's beneficiary or, if there is no 258
beneficiary, to the surviving spouse, surviving children in 259
equal shares, surviving parents in equal shares, or person's 260
estate, in that order of precedence; provided, however, that 261
if an optional benefit, as provided in option 2, 3 or 4 in 262
subsection 4 of this section, had been elected and the 263
beneficiary dies after receiving the optional benefit, then, 264
if the total retirement allowances paid to the retired 265
individual and the individual's beneficiary are less than 266
the total of the contributions, the difference shall be paid 267
to the surviving spouse, surviving children in equal shares, 268
surviving parents in equal shares, or estate of the 269
beneficiary, in that order of precedence, unless the retired 270
individual designates a different recipient with the board 271
at or after retirement. 272
6. If a member dies and his or her financial 273
institution is unable to accept the final payment or 274
payments due to the member, the final payment or payments 275
shall be paid to the beneficiary of the member or, if there 276
is no beneficiary, to the surviving spouse, surviving 277
children in equal shares, surviving parents in equal shares, 278
or estate of the member, in that order of precedence, unless 279
otherwise stated. If the beneficiary of a deceased member 280
dies and his or her financial institution is unable to 281
accept the final payment or payments, the final payment or 282
payments shall be paid to the surviving spouse, surviving 283
children in equal shares, surviving parents in equal shares, 284
or estate of the member, in that order of precedence, unless 285
otherwise stated. 286
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7. If a member dies before receiving a retirement 287
allowance, the member's accumulated contributions at the 288
time of the member's death shall be paid to the member's 289
beneficiary or, if there is no beneficiary, to the surviving 290
spouse, surviving children in equal shares, surviving 291
parents in equal shares, or to the member's estate; 292
provided, however, that no such payment shall be made if the 293
beneficiary elects option 2 in subsection 4 of this section, 294
unless the beneficiary dies before having received benefits 295
pursuant to that subsection equal to the accumulated 296
contributions of the member, in which case the amount of 297
accumulated contributions in excess of the total benefits 298
paid pursuant to that subsection shall be paid to the 299
surviving spouse, surviving children in equal shares, 300
surviving parents in equal shares, or estate of the 301
beneficiary, in that order of precedence. 302
8. If a member ceases to be an employee as defined in 303
section 169.600 and certifies to the board of trustees that 304
such cessation is permanent or if the person's membership is 305
otherwise terminated, the person shall be paid the person's 306
accumulated contributions with interest. 307
9. Notwithstanding any provisions of sections 169.600 308
to 169.715 to the contrary, if a member ceases to be an 309
employee as defined in section 169.600 after acquiring five 310
or more years of creditable service, the member may, at the 311
option of the member, leave the member's contributions with 312
the retirement system and claim a retirement allowance any 313
time after the member reaches the minimum age for voluntary 314
retirement. When the member's claim is presented to the 315
board, the member shall be granted an allowance as provided 316
in sections 169.600 to 169.715 on the basis of the member's 317
age and years of service. 318
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10. The retirement allowance of a member retired 319
because of disability shall be nine-tenths of the allowance 320
to which the member's creditable service would entitle the 321
member if the member's age were sixty. 322
11. Notwithstanding any provisions of sections 169.600 323
to 169.715 to the contrary, any member who is a member prior 324
to October 13, 1969, may elect to have the member's 325
retirement allowance computed in accordance with sections 326
169.600 to 169.715 as they existed prior to October 13, 1969. 327
12. Any application for retirement shall include a 328
sworn statement by the member certifying that the spouse of 329
the member at the time the application was completed was 330
aware of the application and the plan of retirement elected 331
in the application. 332
13. Notwithstanding any other provision of law, any 333
person retired prior to August 14, 1984, who is receiving a 334
reduced retirement allowance under option 1 or 2 of 335
subsection 4 of this section, as the option existed prior to 336
August 14, 1984, and whose beneficiary nominated to receive 337
continued retirement allowance payments under the elected 338
option dies or has died, shall upon application to the board 339
of trustees have the person's retirement allowance increased 340
to the amount the person would have been receiving had the 341
person not elected the option actuarially adjusted to 342
recognize any excessive benefits which would have been paid 343
to the person up to the time of the application. 344
14. Benefits paid pursuant to the provisions of the 345
public education employee retirement system of Missouri 346
shall not exceed the limitations of Section 415 of Title 26 347
of the United States Code, except as provided under this 348
subsection. Notwithstanding any other law, the board of 349
trustees may establish a benefit plan under Section 415(m) 350
SB 1779 30
of Title 26 of the United States Code. Such plan shall be 351
credited solely for the purpose described in Section 352
415(m)(3)(A) of Title 26 of the United States Code. The 353
board of trustees may promulgate regulations necessary to 354
implement the provisions of this subsection and to create 355
and administer such benefit plan. 356
15. Any member who has retired prior to July 1, 1999, 357
and the designated beneficiary of a deceased retired member 358
upon request shall be made, constituted, appointed and 359
employed by the board as a special consultant on the matters 360
of education, retirement and aging. As compensation for 361
such duties the person shall receive a payment equivalent to 362
seven and four-tenths percent of the previous month's 363
benefit, which shall be added to the member's or 364
beneficiary's monthly annuity and which shall not be subject 365
to the provisions of subsections 2 and 3 of this section for 366
the purposes of the limit on the total amount of increases 367
which may be received. 368
16. Any member who has retired prior to July 1, 2000, 369
and the designated beneficiary of a deceased retired member 370
upon request shall be made, constituted, appointed and 371
employed by the board as a special consultant on the matters 372
of education, retirement and aging. As compensation for 373
such duties the person shall receive a payment equivalent to 374
three and four-tenths percent of the previous month's 375
benefit, which shall be added to the member's or 376
beneficiary's monthly annuity and which shall not be subject 377
to the provisions of subsections 2 and 3 of this section for 378
the purposes of the limit on the total amount of increases 379
which may be received. 380
17. Any member who has retired prior to July 1, 2001, 381
and the designated beneficiary of a deceased retired member 382
SB 1779 31
upon request shall be made, constituted, appointed and 383
employed by the board as a special consultant on the matters 384
of education, retirement and aging. As compensation for 385
such duties the person shall receive a payment equivalent to 386
seven and one-tenth percent of the previous month's benefit, 387
which shall be added to the member's or beneficiary's 388
monthly annuity and which shall not be subject to the 389
provisions of subsections 2 and 3 of this section for the 390
purposes of the limit on the total amount of increases which 391
may be received. 392
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