CHAPTER 560

An Act to amend and reenact §§ 51-111.86, 51-111.40, 51-111.42,
§1-111.46, 51-111.50, 51-111.55, 51-111.57, 51-111.60 and 51-111.64,
relating, respectively, to computation of employer rates of contribu-
tion, year of service, conclusiveness of prior service certificate, mem-
bership contributions, retirement allowance account, service retire-
ment allowance, disability retirement allowance, optional benefits,
and restoration to active service of former members of abolished
system under the Virginia Supplemental Retirement Act. tH 1

41

Approved March 31, 1956

Be it enacted by the General Assembly of Virginia:
1. That §§ 651-111.36, 51-111.40, 61-111.42, 51-111.46 51-111.50,
51-111.55, 51-111.57, 51-111.60 and 51-111.64 of the Code of Virginia be
amended and reenacted as follows:

§ 51-111.36. The actuary of the retirement system shall compute,
at least once in each two year period, the rates of contributions payable
CH. 560] ACTS OF ASSEMBLY 915

annually by the employer on behalf of those employees who become mem-
bers under the provisions of this article, which shall be determined by an
actuarial valuation of the retirement allowances and other benefits which
will be payable on account of the employees of such employer who become
members. Such contributions shall be payable in lieu of contributions
payable on account of other members in the system. The expense of mak-
ing such initial and subsequent valuations shall be assessed against and
paid by the employer on whose account it is necessary. The contributions
so computed together with a pro rata share of the cost of the administra-
tion of the retirement system, based upon * proportionate total member-
ship, shall be certified by the Board to the chief fiscal officer of the em-
ployer. The amounts so certified shall be a charge against the employer.
The chief fiscal officer of each such employer shall pay to the State Treas-
urer the amount certified by the Board as payable under the provisions
of this article, and the State Treasurer shall credit such amounts to the
appropriate accounts of the retirement system.

§ 51-111.40. The Board shall determine by appropriate rules and
regulations how much service in any month is the equivalent of a month
of service or how much service in any year is the equivalent of a year of
service, but in no case shall it allow credit for more than one year of
service for all service rendered in any period of twelve consecutive months.

§ 51-111.42. A prior service certificate shall be conclusive as to such
prior service credit unless and until it is modified by the Board upon
application made by the member to whom it is issued * or upon discovery
by the Board of material error or fraud.

§ 51-111.46. (a) Each member shall contribute for each pay period
for which he receives compensation four per centum of his creditable
compensation.

(b) The Comptroller, in the case of all State employees paid by war-
rants on the State Treasurer, or, in the case of any other State employee,
the department, institution or agency by which the salary is paid, or the
employer in the case of teachers and other employees shall cause to be
deducted from the salary of each member for each and every payroll
period subsequent to the date of establishment of the retirement system,
the contribution payable by such member as provided in this chapter, but
in no case shall any deduction be made from the compensation of a member
after his normal retirement date if such member elects not to contribute.

(c) In determining the creditable compensation of a member in a
payroll period, whether semimonthly or monthly, the Board may consider
the rate of compensation payable to such member on the * date of entry
or removal of name from payroll as having been received throughout the
month if service for the month is creditable. If service for the month is
not creditable, the Board may consider any compensation payable during
the month as not being creditable compensation.

(d) The deductions provided for herein shall be made notwithstand-
ing 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 as provided herein; and payment of salary
or compensation less such deductions shall be a full and complete discharge
of all claims for services rendered by such person during the period cov-
ered by such payment, except as to any benefits provided by this chapter.

(e) Notwithstanding any other provisions of this section, no deduc-
tions shall be made from any member’s compensation if the employer’s
contribution required hereunder is in default.

(f) Any member who was a former member of the abolished system
and who transferred his accumulated contributions to the retirement sys-
tem as provided in § 51-111.41 and who has not withdrawn such contribu-
916 ACTS OF ASSEMBLY [vA., 1956

tions may at the time of filing his notice of retirement deposit in his
account in the members’ contribution account by a single payment such
amount as will increase his total retirement allowance to an amount not
greater than the largest amount obtainable under the applicable provisions
of subsection (e) of § 51-111.55.

(g) The Board may modify the method of collecting the contributions
of members so that the employers, departments, institutions and agencies
required to remit to the State Treasurer as provided in subsection (b) of
this section may retain the amounts deducted by them from members’
salaries and have a corresponding amount deducted from State funds
otherwise payable to them.

§ 51-111.50. (a) The retirement allowance account shall be the
account in which shall be accumulated all employer contributions, amounts
transferred from the members’ contribution account, and to which all
income from the invested assets of the retirement system shall be cred-
ited; from this account shall be paid retirement allowances and any other
benefits payable after a member’s retirement; from this account may be
paid administrative expenses.

(b) The amount of the interest allowances provided for in § 51-111.49
shall be transferred each year from the retirement allowance account to
the members’ contribution account.

(c) The Board shall certify the total of such amounts so ascertained
and appropriated for each year of the biennium to the Comptroller on or
before the beginning of each fiscal year; whereupon the Comptroller at
the beginning of each fiscal year shall transfer the amount so certified to
the retirement allowance account. At the * beginning of each fiscal year
any amounts determined by the Board to be * payable out of any special
funds under subsection (h) of § 51-111.47 shall be transferred by the
Comptroller from such special funds to the * retirement allowance account.

(d) On or before the first day of May in each year the Board shall
certify to each employer other than the State, the amount which will
become due from such employer on account of contributions under this
chapter during the fiscal year beginning July first of each such year.
Every such employer shall make provision for the payment of such
amounts, which shall be paid * as the Board may determine by warrants
of the employer transmitted and payable to the State Treasurer. All
moneys collected on such warrants shall be credited to the retirement
allowance account. The Treasurer shall transmit to the Comptroller and
to the Board a record of all moneys so collected.

§ 51-111.55. Service retirement allowance. Subject to paragraph
(h), upon service retirement a member shall receive an annual retirement
slowanee, payable monthly to him for life, which shall consist in the
case of:

(a) Normal retirement.—An amount equal to one per centum of his
average final compensation multiplied by his number of years of credit-
able service subject, however, to the provisions of subsections (c) and
(d) of this section.

(b) Early retirement.—An amount which shall be determined in the
same manner as for retirement at his normal retirement date with years
of creditable service and average final compensation being determined as
of the date of his actual retirement, and the amount of the retirement
allowance so determined being reduced on an actuarial equivalent basis
for the period that the actual retirement date precedes the normal retire-
ment date subject, however, to the provisions of subsections (c) and (e)
of this section.

(c) Normal or early retirement.—An amount additional to (a) or
(b) above which shall be the actuarial equivalent, for his attained age at
time of retirement, of the excess, if any, of his accumulated contributions
CH. 560] ACTS OF ASSEMBLY 917

transferred from the abolished system to the retirement system, includ-
ing interest credit since such transfer to the date of retirement, over the
amount obtained by accumulating at the rate of two per centum com-
pounded annually, annual amounts equal to four per centum of his annual
creditable compensation at the date of abolition of the Virginia Retire-
ment System for a period equal to his period of membership in the
abolished system and with interest credited at two per centum annually
from the date of such transfer to the date of retirement.

(d) Normal retirement guarantee.—The retirement allowance pay-
able upon normal retirement to a former member of the abolished system
who transferred his accumulated contributions to the retirement system
as provided in § 51-111.41 and who has not withdrawn such contribu-
tions prior to retirement, shall be at least an amount which when added
to the primary Social Security benefits to which the member may become
entitled under the Federal Social Security Act in effect at his retirement
date, would equal the service retirement allowance to which the member
would have been entitled under the provisions of the abolished system if
he had continued contributions at the amount in effect at the date of
abolition of the Virginia Retirement System.

(e) Early retirement guarantee.—The retirement allowance payable
upon early retirement to a former member of the abolished system who
transferred his accumulated contributions to the retirement system as
provided in § 51-111.41 and who has not withdrawn such contributions
prior to retirement shall not be less than the service retirement allow-
ance determined in accordance with the provisions of the abolished system
in the case of any member who would have qualified prior to his normal
retirement date for such service retirement allowance if the Virginia
Retirement System had not been abolished; provided, however, that the
total retirement allowance payable in accordance with this subsection
after any such member attains his sixty-fifth birthday shall be reduced
by the amount of any primary Social Security benefits to which such
member becomes entitled under the Federal Social Security Act then in
effect, but the retirement allowance shall in no case be reduced below the
amount that would be payable to such member except for the provisions
of this subsection.

(f) Minimum service retirement allowance.—Anything in this sec-
tion to the contrary notwithstanding the amount of annual retirement
allowance as determined under subsection (a) or (e) of this section shall
be at least an amount which when added to the primary Social Security
benefits to which the member may become entitled under the Federal
Social Security Act in effect at his retirement date would equal twenty
dollars times the number of years of creditable service of the member
subject to a maximum of six hundred dollars.

(g) Determination of retirement allowance.—For the purpose of this
section the retirement allowance shall be determined on the assumption
that the retirement allowance is payable to the member alone and that no
optional retirement allowance is elected.

) Should a beneficiary of a service retirement allowance under this
Chapter or the abolished System be at any time in service in a position
covered under the provisions of this Chapter, his retirement allowance
shall cease while so employed.

§ 51-111.57. Upon retirement as provided in § 51-111.56, a member
shall receive an annual retirement allowance payable monthly during his
lifetime and continued disability which shall consist in the case of:

(a) Any allowance payable prior to the member’s normal retirement
date.—An amount equal to one and one-quarter per centum of his average
final compensation multiplied by his number of years of creditable service.

(b) Any allowance payable on or after the member’s normal retire-
ment date—An amount equal to the service retirement allowance for
normal retirement determined on the assumption that the member’s cred-
itable compensation on the date of disability retirement continued in the
same amount up to his normal retirement date and on the assumption of
years of creditable service up to his normal retirement date including in
creditable service the period of disability retirement prior to normal
retirement date.

(c) Disability retirement guarantee.—The disability retirement al-
lowance payable on or after a member’s normal retirement date to a
former member of the abolished system who transferred his accumulated
contributions to the retirement system and who has not withdrawn such
contributions prior to such retirement, shall be at least an amount which,
when added to the primary Social Security benefits to which the member
may become entitled under the Federal Social Security Act in effect at
his retirement date, would equal the disability retirement allowance to
which the individual would have been entitled under the provisions of
the abolished system. The provisions of subsection (d) of § 51-111.55
shall not be applicable in the determination of the benefits guaranteed
under this paragraph.

_(d) Minimum disability retirement allowance.—Anything in this
section to the contrary notwithstanding the amount of annual retirement
allowance as determined under this section shall be at least an amount
which when added to the primary Social Security benefits to which the
member may become entitled under the Federal Social Security Act in
effect at his retirement date would equal thirty dollars times the number
of years of creditable service of the member subject to a maximum of six
hundred dollars.

_ (e) Determination of retirement allowance.—For the purposes of
this section the retirement allowance shall be determined on the assump-
tion that the retirement allowance is payable to the member alone and
that no optional retirement allowance is elected.

§ 51-111.60. (a) Each member shall have the right at any time, not
subsequent to the later of the effective date of the member’s retirement
or the date of written notification to the Board of the retirement of the
member, to elect to have his retirement allowance payable under any one
of the options set forth in this section in lieu of the retirement allowance
otherwise payable to him upon retirement under any of the provisions of
this chapter. The amount of any such optional retirement allowance shall
be the actuarial equivalent of the amount of such retirement allowance
otherwise payable to him. The member shall make such an election by
written request to the Board and such an election shall be subject to the
approval of the Board.

(1) Straight life option—A member may elect to receive an increased
ren allowance in lieu of any death benefits as provided in §
51-111.59.

(2) Joint and last survivor option.—The member may elect to receive
a decreased retirement allowance during his lifetime and have such re-
tirement allowance (or one-half thereof if so designated) continued
after his death to another person during the lifetime of such person. In
case of such an election death benefits that might otherwise be provided
under § 51-111.59 shall not be payable upon the death of the member.
This option may not be elected by a member if the Social Security option
of paragraph (a) (3) hereof has previously been elected.

(3) Social Security option.—If a member retires for service prior to
his normal retirement date, he may elect to receive an increased retire-
ment allowance up to his normal retirement date and a decreased retire-
ment allowance thereafter, thereby providing a more nearly level retire-
ment allowance when such decreased retirement allowance is added to
CHS. 560, 561] ACTS OF ASSEMBLY 919

his anticipated primary benefits under the Federal Social Security Act.
The election of this apnien shall automatically revoke any previous election
under the joint and last survivor option of paragraph (a) (2) hereof.

. (4) Other options.—Some other benefits shall be paid either to the
member or to such person or persons as he shall select. .

_ (b) The election by a member of any one of the options stated in
this section shall be null and void if the member dies prior to retirement,
and the election of a member of the option stated in paragraph (a) (2)
hereof shall be null and void if the designated person dies before the
member’s retirement.

.(c) A member who has elected any one of the options stated in this
section may, at any time prior to the later of the effective date of the
member’s retirement or the date of written notification to the Board of
retirement of the member, revoke such an election by written notification
to the Board.

§ 51-111.64. (a) Should a former member of the abolished system
who was receiving a disability retirement allowance under such system
at the date of its abolition be at any time prior to his normal retirement
date in service*, he shall become a member of the retirement system and
shall thereafter contribute. ._

(b) In the event of the restoration to service of a former member of
the abolished system as stated in paragraph (a) hereof an amount shall
be transferred from Fund B to the retirement allowance account equal
to the reserve value at the time of cessation of such former member’s
disability retirement allowance under the abolished system which was
attributable to the State annuity thereunder, and the balance of any
contributions under the abolished system of such former member not used
to provide part of the disability retirement allowance such former mem-
ber received under the abolished system shall be transferred from Fund
B to Fund A.

(c) Said former member as stated in paragraph (a) of this section
shall have the right to receive such balance of his contributions as stated
in paragraph (b) hereof or, if he authorizes the transfer within one year
of restoration to service of such balance from Fund A to the member’s
contribution account, he shall be entitled to prior service credit for all
years of service prior to the date of establishment of the retirement sys-
tem including the period of disability retirement.

In addition, such former member authorizing such transfer of balance
of his contributions shall be entitled to membership credit in the retire-
ment system for the period prior to his restoration to service during
which he was on disability retirement under the abolished system.