A BILL TO BE ENTITLED
AN ACT to provide that the beneficiary of a return of contributions upon the death of a member prior to retirement from the state retirement systems, the optional retirement plans for the university of north carolina system or the community college system, or before withdrawal from the state supplemental retirement income plan or the state deferred compensation plan shall be the member's spouse unless the member provided otherwise before the member's death.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 135‑5(f) reads as rewritten:
"(f)	Return of Accumulated Contributions. – Should a member cease to be a teacher or State employee except by death or retirement under the provisions of this Chapter, he shall upon submission of an application be paid, not earlier than 60 days from the date of termination of service, his contributions, and if he has attained at least five years of membership service or if termination of his membership service is involuntary as certified by the employer, the accumulated regular interest thereon, provided that he has not in the meantime returned to service. Upon payment of such sum his membership in the System shall cease and, if he thereafter again becomes a member, no credit shall be allowed for any service previously rendered except as provided in G.S. 135‑4, and such payment shall be in full and complete discharge of any rights in or to any benefits otherwise payable hereunder. Upon receipt of proof satisfactory to the Board of Trustees of the death, prior to retirement, of a member or former member there shall be paid to  the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Trustees on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, the amount of his accumulated contributions at the time of his death, unless the beneficiary elects to receive the alternate benefit under the provisions of (m) below. An extension service employee who made contributions to the Local Governmental Employees' Retirement System and the Teachers' and State Employees' Retirement System as a result of dual employment may not be paid his accumulated contributions unless he is eligible to be paid his accumulated contributions in both systems for the same period of service.
Pursuant to the provisions of G.S. 135‑56.2, a member who is also a member of the Consolidated Judicial Retirement System may irrevocably elect to transfer any accumulated contributions to the Consolidated Judicial Retirement System or to the Supplemental Retirement Income Plan and forfeit any rights in or to any benefits otherwise payable hereunder.
A member who is a participant or beneficiary of the Disability Income Plan of North Carolina as is provided in Article 6 of this Chapter shall not be paid a return of accumulated contributions, notwithstanding the member's status as an employee or teacher. Notwithstanding any other provision of law to the contrary, a member who is a beneficiary of the Disability Income Plan of North Carolina as provided in Article 6 of this Chapter and who is receiving disability benefits under the transition provisions as provided in G.S. 135‑112, shall not be prohibited from receiving a return of accumulated contributions as provided in this subsection."
SECTION 2.  G.S. 128‑27(f) reads as rewritten:
"(f)	Return of Accumulated Contributions. – Should a member cease to be an employee except by death or retirement under the provisions of this Chapter, he shall upon submission of an application be paid, not earlier than 60 days from the date of termination of service, his contributions and, if he has attained at least five years of membership service or if termination of his membership service is involuntary as certified by the employer, the accumulated regular interest thereon, provided that he has not in the meantime returned to service. Upon payment of such sum his membership in the System shall cease and, if he thereafter again becomes a member, no credit shall be allowed for any service previously rendered except as provided in G.S. 128‑26; and such payment shall be in full and complete discharge of any rights in or to any benefits otherwise payable hereunder. Upon receipt of proof satisfactory to the Board of Trustees of the death, prior to retirement, of a member or former member there shall be paid to  the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Trustees on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, the amount of his accumulated contributions at the time of his death, unless the beneficiary elects to receive the alternate benefit under the provisions of (m) below. An extension service employee who made contributions to the Local Governmental Employees' Retirement System and the Teachers' and State Employees' Retirement System as a result of dual employment may not be paid his accumulated contributions unless he is eligible to be paid his accumulated contributions in both systems for the same period of service.
Pursuant to the provisions of G.S. 135‑56.2, a member who is also a member of the Consolidated Judicial Retirement System may irrevocably elect to transfer any accumulated contributions to the Consolidated Judicial Retirement System or to the Supplemental Retirement Income Plan and forfeit any rights in or to any benefits otherwise payable hereunder."
SECTION 3.  G.S. 120‑4.25 reads as rewritten:
"§ 120‑4.25.  Return of accumulated contributions.
If a member ceases to be a member of the General Assembly except by death or retirement, he shall, upon submission of an application, be paid not earlier than 60 days following the date of termination of service, the sum of his contributions if he has less than five years of creditable service, or the sum of his accumulated contributions if he has five or more years of creditable service, provided he has not in the meantime returned to service. Upon payment of this sum his membership in the System ceases. If he becomes a member afterwards, no credit shall be allowed for any service previously rendered except as provided in G.S. 120‑4.14 and the payment shall be in full and complete discharge of any rights in or to any benefits otherwise payable under this Article. Upon receipt of proof satisfactory to the Board of Trustees of the death, prior to retirement, of a member or former member, there shall be paid to  the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Trustees on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, the amount of his accumulated contributions at the time of his death, unless the beneficiary elects to receive the alternate benefit under the provisions of G.S. 120‑4.28."
SECTION 4.  G.S. 135‑63(c) reads as rewritten:
"(c)	Upon receipt of proof, satisfactory to the Board of Trustees, of the death of a member not in service, there shall be paid in a lump sum to  the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Trustees on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, a death benefit equal to the member's accumulated contributions."
SECTION 5.  G.S. 135‑5.1 is amended by adding a new subsection to read:
"(e1)	Upon receipt of proof satisfactory to the Board of Governors of the death, prior to retirement, of an employee participating in the Optional Retirement Program, there shall be paid in a lump sum to the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Governors on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, a death benefit equal to the member's accumulated contributions."SECTION 6.  G.S. 135‑5.4 is amended by adding a new subsection to read:
"(e1)	Upon receipt of proof satisfactory to the State Board of Community Colleges of the death, prior to retirement, of an employee participating in the Optional Retirement Program, there shall be paid in a lump sum to the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the State Board on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, a death benefit equal to the member's accumulated contributions."
SECTION 7.  G.S. 135‑94 is amended by adding a new subsection to read:
"(e)	Upon receipt of proof satisfactory to the Board of Trustees of the death, prior to withdrawal, of a member of the Supplemental Retirement Income Plan, there shall be paid in a lump sum to the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board of Trustees on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, a death benefit equal to the member's accumulated contributions."
SECTION 8.  G.S. 143B‑426.24 is amended by adding a new subsection to read:
"(j1)	Upon receipt of proof satisfactory to the Board of the death, prior to withdrawal, of a Plan participant, there shall be paid in a lump sum to the member's spouse, or to a person or persons other than the member's spouse that the member nominated by written designation duly acknowledged and filed with the Board on or after January 1, 2006, but before the member's death, if the spouse or designated other person is living at the time of the member's death, otherwise to the member's legal representatives, a death benefit equal to the member's accumulated contributions."SECTION 9.  This act becomes effective January 1, 2006, and applies to returns of contributions on or after that date.