Senate Bill No. 214

(By Senators Plymale, Fanning, Walker,

Sprouse, Jackson, Edgell, McCabe, Minard, Snyder, Ross, Ball, Love and Dawson)


[Introduced January 26, 2000; referred to the Committee on Pensions; and then to the Committee on Finance.]




A BILL to amend and reenact section twelve, article fourteen-d, chapter seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to the deputy sheriff retirement act; and changes in annuity options.

Be it enacted by the Legislature of West Virginia:

That section twelve, article fourteen-d, chapter seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted to read as follows:

ARTICLE 14D. WEST VIRGINIA DEPUTY SHERIFF RETIREMENT SYSTEM ACT.

§7-14D-12. Annuity options.

Prior to the effective date of retirement, but not thereafter,
a member may elect to receive retirement income payments in the normal form, or the actuarial equivalent of the normal form from the following options:
(a) Option A -- Joint and Survivor Annuity. -- A life annuity payable during the joint lifetime of the member and his or her beneficiary who is a natural person with an insurable interest in the member's life. Upon the death of either the member of his or her beneficiary, the benefit shall continue as a life annuity to the survivor in an amount equal to fifty percent, sixty-six and two-thirds percent, seventy-five percent or one hundred percent of the amount paid while both were living as selected by the member. If the retiring member is married, the spouse shall sign a waiver of benefit rights if the beneficiary is to be other than the spouse.

(b) Option B -- Contingent Joint and Survivor Annuity. -- A life annuity payable during the joint lifetime of the member and his or her beneficiary who must be a natural person with an insurable interest in the member's life. Upon the death of the member, the benefit shall continue as a life annuity to the beneficiary in an amount equal to fifty percent, sixty-six and two-thirds percent, seventy-five percent or one hundred percent of
the amount paid while both were living as selected by the member. If the beneficiary dies first, the monthly amount of benefits shall may not be reduced, but shall be paid at the amount that was in effect before the death of the beneficiary. If the retiring member is married, the spouse shall sign a waiver of benefit rights if the beneficiary is to be other than the spouse.
(c) Option C -- Ten Years Certain and Life Annuity. -- A life annuity payable during the member's lifetime but in any event for a minimum of ten years. If the member dies before the expiration of ten years, the remaining payments shall be made to a designated beneficiary, if any, or otherwise to the member's estate.

(d) Option D -- Level Income Annuity. -- A life annuity payable monthly in an increased amount "A" from the time of retirement until the member is social security retirement age, and then a lesser amount "B" payable for the member's lifetime thereafter, with these amounts computed actuarially to satisfy the following two conditions:

(1) Actuarial equivalence. -- The actuarial present value at the date of retirement of the member's annuity if taken in the normal form must equal the actuarial present value of the term life annuity in amount "A" plus the actual present value of the deferred
life annuity in amount "B".
(2) Level income. -- The amount "A" equals the amount "B" plus the amount of the member's estimated monthly social security primary insurance amount that would commence at the date amount "B" becomes payable. For this calculation, the primary insurance amount is estimated when the member applies for retirement, using social security law then in effect, using assumptions established by the board.

(e) Option E -- Level Income Joint and Survivor Annuity. -- An annuity structured under the same methodology as in subdivision (d) of this section, with the term annuity amount "A" payable until the member's social security retirement age and the amount "B" payable as a fifty percent, sixty-six and two-thirds percent, seventy-five percent or one hundred percent joint and survivor annuity upon the member's attaining social security retirement age with the members selecting the applicable percentage rate, if the retiring member is married, the spouse shall sign a waiver of benefit rights if the beneficiary is to be other than the spouse.

(f) Option F -- Increasing Annuity. -- A life annuity payable in any of the forms described in this section, and subject to the corresponding conditions, with the amount of monthly payment
increasing at one and one-half percent, two percent or two and one-half percent compounded annually throughout the life of the annuity. Annuities taken in this form shall be adjusted the first day of April of each year following the member's annuity starting date with a prorated increase given on the first day of April to retirees who have not yet been retired a full year on that date.
In the case of a member who has elected the options set forth in subdivisions (b) (a) and (e) (b) of this section, respectively, and whose beneficiary dies prior to the member's death, the member may name an alternative beneficiary. If an alternative beneficiary is named within eighteen months following the death of the prior beneficiary, the benefit shall be adjusted to be the actuarial equivalent of the member's normal form of benefit the member is receiving just following the death of the member's named beneficiary. If the election is not made until eighteen months after the death of the prior beneficiary, the amount shall be reduced so that it is only ninety percent of the actuarial equivalent of the member's normal form of benefit the member is receiving just following the death of the member's beneficiary.




NOTE: The purpose of this bill is the manner of selecting annuity options under the Deputy Sheriff Retirement Act.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.