GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
SESSION LAW 2025-11
HOUSE BILL 477
AN ACT TO RECODIFY AND STANDARDIZE THE LAWS RELATING TO the death benefit plan, INCLUDING BY MAKING TECHNICAL, CLARIFYING, AND CONFORMING CHANGES, UNDER THE TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM, THE LOCAL GOVERNMENTAL EMPLOYEES' RETIREMENT SYSTEM, THE CONSOLIDATED JUDICIAL RETIREMENT SYSTEM, AND THE LEGISLATIVE RETIREMENT SYSTEM, and to ENSURE SUFFICIENT FUNDING FOR LINE OF DUTY DEATH BENEFITS.
The General Assembly of North Carolina enacts:
PART I. technical RECODIFication AND STANDARDIZation of the death benefit plan for members of THE TEACHERS' AND STATE EMPLOYEES' RETIREMENT SYSTEM
SECTION 1.(a) Chapter 135 of the General Statutes is amended to add a new Article 8 to be entitled "Death Benefit Plan for State Employees and Retirees" that consists of the following new sections:
(1) G.S. 135‑153.
(2) G.S. 135‑154.
(3) G.S. 135‑155.
(4) G.S. 135‑160.
(5) G.S. 135‑165.
(6) G.S. 135‑170.
(7) G.S. 135‑175.
(8) G.S. 135‑180.
(9) G.S. 135‑185.
(10) G.S. 135‑190.
(11) G.S. 135‑195.
(12) G.S. 135‑200.
SECTION 1.(b) The first and second sentence of G.S. 135‑7(g)(2) are recodified as the first and third sentence of subsection (a) of G.S. 135‑154.
SECTION 1.(c) The first sentence of the lead‑in language in subsection 135‑7(g) is recodified as the second sentence of subsection (a) of G.S. 135‑154.
SECTION 1.(d) The third sentence of G.S. 135‑7(g)(2) is recodified as subsection (b) of G.S. 135‑154.
SECTION 1.(e) The fourth, fifth, and sixth sentences of G.S. 135‑7(g)(2) are recodified as the first three sentences of subsection (c) of G.S. 135‑154.
SECTION 1.(f) The third sentence of G.S. 135‑7(g)(3) is recodified as the fourth sentence of subsection (c) of G.S. 135‑154.
SECTION 1.(g) The first sentence of G.S.135‑7(g)(3) is recodified as subsection (d) of G.S. 135‑154.
SECTION 1.(h) The caption and the first sentence of the first paragraph of G.S. 135‑5(l) are recodified as subsection (a) of G.S. 135‑155.
SECTION 1.(i) The second, third, and fourth sentences of the first paragraph of G.S. 135‑5(l) are recodified as subsection (b) of G.S. 135‑155.
SECTION 1.(j) The seventh paragraph of G.S. 135‑5(l) is recodified as subsection (a) of G.S. 135‑160.
SECTION 1.(j1) G.S. 135‑6(e1) is recodified as subsection (b) of G.S. 135‑160.
SECTION 1.(k) The first sentence of the second paragraph of G.S. 135‑5(l) is recodified as subsection (b) of G.S. 135‑165.
SECTION 1.(l) The second sentence of the second paragraph of G.S. 135‑5(l) is recodified as subsection (c) of G.S. 135‑165.
SECTION 1.(m) The fourth sentence of the second paragraph of G.S. 135‑5(l) is recodified as subsection (d) of G.S. 135‑165.
SECTION 1.(n) Sub‑subdivision a. of subdivision (2) of the sixth paragraph of G.S. 135‑5(l) is recodified as subdivision (3) of G.S. 135‑170.
SECTION 1.(o) Sub‑subdivision b. of subdivision (2) of the sixth paragraph of G.S. 135‑5(l) is recodified as subdivision (1) of G.S. 135‑170.
SECTION 1.(p) Sub‑subdivision c. of subdivision (2) of the sixth paragraph of G.S. 135‑5(l) is recodified as sub‑subdivision a. of subdivision (2) of G.S. 135‑170.
SECTION 1.(q) Subdivision (3) of the sixth paragraph of G.S. 135‑5(l) is recodified as sub‑subdivision b. of subdivision (2) of G.S. 135‑170.
SECTION 1.(r) Subdivision (4) of the sixth paragraph of G.S. 135‑5(l) is recodified as sub‑subdivision c. of subdivision (2) of G.S. 135‑170.
SECTION 1.(s) The first sentence of the thirteenth paragraph of G.S. 135‑5(l) is recodified as subsection (b) of G.S. 135‑175.
SECTION 1.(t) The sixth and seventh sentences of the thirteenth paragraph of G.S. 135‑5(l) are recodified as subsection (c) of G.S. 135‑175.
SECTION 1.(u) The first sentence of the eighth paragraph of G.S. 135‑5(l) is recodified as subsection (a) of G.S. 135‑180.
SECTION 1.(v) The second sentence of the eighth paragraph of G.S. 135‑5(l) is recodified as subsection (c) of G.S. 135‑180.
SECTION 1.(w) The third sentence of the eighth paragraph of G.S. 135‑5(l) is recodified as subsection (d) of G.S. 135‑180.
SECTION 1.(x) The caption and first and second sentences of G.S. 135‑5(l1) are recodified as subsection (a) of G.S. 135‑190.
SECTION 1.(y) The third sentence of G.S. 135‑5(l1) is recodified as subsection (b) of G.S. 135‑190.
SECTION 1.(z) The third sentence of the second paragraph of G.S. 135‑5(l) is recodified as G.S. 135‑195.
SECTION 1.(aa) The fourth sentence of G.S. 135‑5(l1) is recodified as G.S. 135‑200.
SECTION 2.(a) The remainder of G.S. 135‑7(g) not recodified by Section 1 of this act is repealed.
SECTION 2.(b) The remainder of G.S. 135‑5(l) not recodified by Section 1 of this act is repealed.
SECTION 3. Article 8 of Chapter 135 of the General Statutes, as created by Section 1 of this act, reads as rewritten:
"Death Benefit Plan for State Employees.
"§ 135‑153. Definitions.
The following definitions apply in this Article:
(1) Benefit Trust. The North Carolina Teachers' and State Employees' Benefit Trust under G.S. 135‑154.
(2) Death Benefit Plan. The Death Benefit Plan for State Employees and Retirees under this Article.
(3) Disability Income Plan. The Disability Income Plan of North Carolina under Article 6 of this Chapter.
(4) Reserved for future codification purposes.
(5) Reserved for future codification purposes.
(6) Participating plans. All of the following:
a. The Death Benefit Plan.
b. The Local Governmental Death Benefit Plan under Part 2 of Article 3 of Chapter 128 of the General Statutes.
c. Contributory death benefits available to retired members of the Consolidated Judicial Retirement System under G.S. 135‑64.
d. Contributory death benefits available to retired members of the Legislative Retirement System under G.S. 120‑4.27.
e. The Separate Insurance Benefits Plan under G.S. 143‑166.60.
(7) Reserved for future codification purposes.
(8) Reserved for future codification purposes.
(9) Workers' compensation benefits. Excluding any payments for a permanent partial disability rating, disability income benefits provided under Chapter 97 of the General Statutes.
"§ 135‑154. North Carolina Teachers' and State Employees' Benefit Trust.
(a) Benefit Trust. A
trust fund, the North Carolina Teachers' and State Employees' Benefit Trust, is
hereby created as a master trust to which all receipts, transfers,
appropriations, contributions, investment earnings, and other income belonging
to the Plans participating plans shall be deposited, and from
which all benefits and expenses against the Plans those participating
plans shall be disbursed. It is the intent of the General Assembly that a
this master trust fund be created that provides provide an
irrevocable source of funding to be used, to the extent the fund's assets are
sufficient, only for death benefits and disability benefits payable to
the Plans' members, participants, and beneficiaries, pursuant to G.S.
120 4.27, G.S. 128 27(l), subsections (l2) through (l6) of G.S. 128 27, 135
5(l), 135 64(k), and 143 166.60. beneficiaries of the participating plans
and reasonable expenses for the administration of the participating plans. The
Boards of Trustees of the Teachers' and State Employees' Retirement System and
the Local Governmental Employees' Retirement System shall be the trustee of the
Benefit Trust.
(b) No Commingling of
Funds. Within the Benefit Trust, the funds of each of the Plans
participating plans shall be accounted for separately and not
commingled.
(c) Assets. Assets
of one participating plan cannot be used to pay for liabilities of
another participating plan within the Benefit Trust. The assets
of the trust fund Benefit Trust shall be used only for the
exclusive benefit of persons who are or may be entitled to benefits under the Plans.
participating plans. In no event, including dissolution, will the
shall any assets of the trust fund Benefit Trust be
distributed to any entity that is not a state, a political subdivision of a
state, or another entity the income of which is excludable from its gross
income by application of section 115(1) of the Internal Revenue Code. The
assets of the Benefit Trust are not subject to the claims of creditors
of the employers and non employers any of the following:
(1) An employer or nonemployer making
contributions to the Trust, are not subject to the claims of any creditors
of the Trust, trustees, and administrators, and are not subject to the claims
of creditors of members, participants, and beneficiaries.Benefit Trust.
(2) A trustee or administrator of the Benefit Trust.
(3) A member.
(4) Participants or beneficiaries of any participating plan.
(d) Contributions. Employer
and non employer nonemployer contributions to the North
Carolina Teachers' and State Employees' Benefit Trust and earnings on those
contributions are irrevocable.
"§ 135‑155. Death Benefit Plan established.
(a) Death Benefit Plan. Plan for State
Employees and Retirees. There is hereby created a Group Life Insurance
Plan (hereinafter called the "Plan") which is established as the
Death Benefit Plan for State Employees and Retirees, a group life insurance
plan that is an employee welfare benefit plan that is separate and apart
from the Retirement System and under which the members of the Retirement
System shall participate and be eligible for group life insurance benefits.System.
(b) Benefit Trust. The Death Benefit Plan
shall be part of the North Carolina Teachers' and State Employees' Benefit
Trust, as established under G.S. 135‑7(g). Trust. All
receipts, transfers, appropriations, contributions, investment earnings, and
other income belonging to the Death Benefit Plan shall be deposited in
the Benefit Trust. All benefits and expenses against the Death Benefit Plan
shall be disbursed from the Benefit Trust.
"§ 135‑160. Administration of Death Benefit Plan.
(a) Provisions Applicable. The Death Benefit Plan
is administered by the Board of Trustees. The provisions of the
Retirement System pertaining to Administration, G.S. 135‑6, and
management of funds, G.S. 135‑7, are hereby made G.S. 135‑6
and G.S. 135‑7 are applicable to the Death Benefit Plan.
(b) Effect of Vote Related
to Contributory Death Benefit. No decision of the Board of Trustees related
to the Contributory Death Benefit fully contributory death benefit
for retirees provided for under this Chapter, Chapter 120, or Chapter
127A of the General Statutes, any of the following shall take effect
unless and until this same decision has been made and voted on by the Board of
Trustees of the Local Governmental Employees Retirement System.System:
(1) G.S. 120‑4.27.
(2) G.S. 135‑64.
(3) G.S. 134‑166.60.
(c) Rulemaking. The Board of Trustees may adopt temporary or permanent rules, as necessary, for all aspects of administration of this Article.
"§ 135‑165. Death benefit for in‑service members.
(a) Eligibility. A member who is not retired and who has completed at least one full year of membership in the Retirement System is a participant in, and eligible for death benefits under, the Death Benefit Plan in accordance with this section.
(b) Benefits Upon Death
While in Service. If a member eligible for benefits under this section dies
while in service, then, upon receipt of proof, proof of the death
that is satisfactory to the Board of Trustees in their capacity as
trustees under the Group Life Insurance Plan, of the death, in service, of a
member who had completed at least one full calendar year of membership in the
Retirement System, there Trustees, a lump sum death benefit amount shall
be paid to such person as the member shall have nominated by electronic
submission in a form approved by the Board of Trustees or by written
designation duly acknowledged and filed with the Board of Trustees, if such person
is living at the time of the member's death, otherwise to the member's legal representatives,
a death benefit.paid.
(c) Such death Death
Benefit Amount. Subject to a minimum of twenty‑five thousand dollars
($25,000) and to a maximum of fifty thousand dollars ($50,000), the lump sum
death benefit shall be amount payable under this section is equal
to the greater of:of the following amounts:
(1) The compensation on which
contributions to the Retirement System were made by the member during
the calendar year preceding the year in which his the member's death
occurs, oroccurred.
(2) The greatest compensation
on which contributions to the Retirement System were made by the member
during a 12‑month period of service within the 24‑month period of
service ending on the last day of the month preceding the month in which his
the member's last day of actual service occurs;
subject to a minimum of twenty‑five thousand dollars
($25,000) and to a maximum of fifty thousand dollars ($50,000).occurred.
(d) Members Deemed to be
in Service. For the purpose of the Plan, this section, a
member shall be deemed to be in service at the date of his the member's
death if his the death occurs within 180 days from the last
day of his actual service.service, as determined in accordance
with G.S. 135‑170.
"§ 135‑170. Last day of actual service; death benefit for in‑service members.
To determine the last day of actual service for the purposes of the death benefit for in‑service members, all of the following apply:
(1) When the employee has
not been terminated, Uninterrupted service. For a member with
uninterrupted service, the last day of actual service is the date on which
an absent member's sick and annual leave expire, unless the member is on an
approved leave of absence and is deemed to be in service under the
provisions of G.S. 135‑4(h). If a member is deemed to be in
service under G.S. 135‑4(h), then the last day of actual service is
the last day for which the member made a contribution to the Retirement System.
(2) Interrupted service. All of the following apply to a member whose service has been interrupted:
a. When a member's For a member whose service
is interrupted by reason of service in the Uniformed Services, as that term is
defined in section 4303(16) of the Uniformed Services Employment and
Reemployment Rights Act, Public Law 103‑353, and the participant member
does not return immediately after that service to employment with a covered
employer in this the Retirement System, the last day of actual
service is the date on which the participant member was first
eligible to be separated or released from his or her involuntary military
service.
b. For a period when a
member who is on an approved leave of absence, his status with
respect to the death benefit will be determined by the provisions of
G.S. 135-4(h).but is not deemed to be in service under G.S. 135‑4(h),
the last day of actual service is either the last day for which the member made
a contribution to the Retirement System or the date on which the member's sick
and annual leave expired, whichever is later.
c. A member on leave of
absence from his a position as a teacher or State employee for
the purpose of serving as a member or officer of the North Carolina General
Assembly shall be deemed to be in service during sessions of the General
Assembly and thereby covered by the provisions of the death benefit. The eligible
for the death benefit under G.S. 135‑165. The last day of actual
service shall be the most recent legislative day of the applicable General
Assembly session or the last day the member performed work as a teacher or
State employee, whichever is later. Notwithstanding G.S. 135‑165(c),
the amount of the death benefit for such a member who is
on a leave of absence due to General Assembly service shall be the
equivalent of the salary to which the member would have been entitled as a teacher
or State employee during the 12‑month period immediately prior to the
month in which death occurred, not to be less than subject to a
minimum of twenty‑five thousand dollars ($25,000) nor to exceed and
a maximum of fifty thousand dollars ($50,000).
d. All of the following apply for a member who is either (i) receiving workers' compensation benefits during the period for which the member would have been otherwise eligible to receive short‑term benefits or extended short‑term benefits under G.S. 135‑105 or (ii) a beneficiary under the Disability Income Plan:
1. If the date the member last performed work as a teacher or State employee occurred within 180 days of the date the member died, then the last day of actual service is the last day the member performed that work.
2. If the date the member last performed worked as a teacher or State employee occurred more than 180 days from the date the member died, then that member shall not be deemed in active service for the purposes of G.S. 135‑165.
(3) When the employee Terminated
service. For a member whose employment has been terminated, terminated
for reasons other than retirement, whether by the employer or the employee, the
last day of actual service is the last day the member actually worked.performed
work as a teacher or State employee.
"§ 135‑175. Fully contributory death benefit for retired members.
(a) Participation and Premiums. All retired members may elect to participate in the Death Benefit Plan and therefore become eligible to receive death benefits under the Death Benefit Plan in accordance with this section. Elections shall be made prior to death and no later than 60 calendar days from the effective date of the member's retirement. Elections shall be received by the Board of Trustees prior to the death of the retired member. Retired members electing to receive a fully contributory death benefit under the Death Benefit Plan shall continuously pay monthly premiums on a fully contributory basis, as determined by the Board of Trustees, to the Benefit Trust. Premium payments shall be made through retirement allowance deductions or other methods adopted by the Board of Trustees.
(b) Benefits Upon Death.
If a retired member who has elected to receive a fully contributory death benefit
under to this section dies, then, upon receipt of proof, proof of
the death that is satisfactory to the Board of Trustees in its capacity
under this subsection, of the death of a retired member of the Retirement
System on or after January 1, 2015, there Trustees, a lump sum death benefit
amount shall be paid a death benefit to the person or persons designated
by the member or, if not survived by a designated beneficiary, to the deceased
retired member's legal representative; provided the retired member has elected,
when first eligible, to make, and has continuously made, in advance of the
member's death required contributions as determined by the Board of Trustees on
a fully contributory basis, through retirement allowance deductions or other
methods adopted by the Board of Trustees, to a group death benefit trust fund, the
North Carolina Teachers' and State Employees' Benefit Trust, administered by
the Board of Trustees Fund and Pension Accumulation Fund.paid.
(c) This Death
Benefit Amount. The lump sum death benefit payable under this section shall
be a lump‑sum payment in the amount of one of the following
amounts:
(1) If the death occurred on or after the first day
of the twenty‑fifth month of coverage under this section, the amount
payable is ten thousand dollars ($10,000) upon the completion of 24
months of contributions required under this subsection. Should death occur ($10,000).
(2) If the death occurred before the completion
of 24 months of contributions required under this subsection, the deceased
retired member's designated beneficiary or beneficiaries, or legal
representative if not survived by a designated beneficiary, shall be paid first
day of the twenty‑fifth month of coverage under this section, the amount payable
is the sum of the retired member's contributions required by this
subsection premium payments made in accordance with this section plus
interest in an amount to be determined by the Board of Trustees.
"§ 135‑180. Death benefits; workers' compensation benefits and Disability Income Plan beneficiaries.
(a) Eligibility. A
member who is a beneficiary of the Disability Income Plan provided for in
Article 6 of this Chapter, or a member who is in receipt of Workers'
Compensation workers' compensation benefits during the period for
which he or she the member would have otherwise been eligible to
receive short‑term benefits or extended short‑term benefits and as
provided in G.S. 135‑105 benefits under G.S. 135‑105
is eligible for death benefits under the Death Benefit Plan in accordance with
this section if all of the following criteria are met:
(1) The member is not retired.
(2) The member is not eligible for death benefits under G.S. 135‑165.
(3) The member dies on or after 181 days from
the last day of his or her actual service the member performed work
as a teacher or State employee but prior to the date the workers'
compensation benefits or benefits as provided in G.S. 135‑105
under the Disability Income Plan would have ended, shall be
eligible for group life insurance benefits as provided in this subsection,
notwithstanding that the member is no longer an employee or teacher or that the
member's death occurs after the eligibility period after active service.ended.
(b) Benefits Upon Death. Upon receipt of proof of the death of a member eligible for benefits under subsection (a) of this section that is satisfactory to the Board of Trustees, a lump sum death benefit amount shall be paid.
(c) Benefit Amount. The
basis of the death benefit payable hereunder under this section shall
be the higher of the death benefit computed as above amount
calculated in accordance with G.S. 135‑165(c) or a the
death benefit amount based on compensation used in computing the benefit
payable under G.S. 135‑105 and G.S. 135‑106, as may be
adjusted for percentage post‑disability increases, all subject to but
shall not exceed the maximum dollar limitation as provided above.for
the death benefit for in‑service members under G.S. 135‑165.
"§ 135‑185. Beneficiaries under the Death Benefit Plan.
(a) Designation. A member shall designate a beneficiary or beneficiaries for each applicable benefit payable under this Article by electronic submission in a form approved by the Board of Trustees or by written designation duly acknowledged and filed with the Board of Trustees.
(b) Benefits Payable. Each applicable benefit payable under this Article shall be paid to the designated beneficiary or beneficiaries to receive the benefit. If no beneficiaries are designated or living at the time of the member's death, then the benefit shall be paid to the member's legal representative.
"§ 135‑190. Reciprocity of Death Benefit Plan.
(a) Reciprocity of Death
Benefit Plan. Only for the purpose of determining eligibility for the death benefit
benefits provided for in subsection (l) of this section, under
this Article, membership service standing to the credit of (i) a
member of the Legislative Retirement System or the Consolidated Judicial
Retirement System or (ii) a retired member of the Legislative Retirement
System or the Consolidated Judicial Retirement System whose retirement benefit
was suspended upon entrance into membership in the Teachers' and State
Employees' Retirement System shall be added to the membership service
standing to the credit of a member of the Teachers' and State Employees'
Retirement System. However, in the event that a participant or beneficiary is
a retired member of the Legislative Retirement System or the Consolidated
Judicial Retirement System whose retirement benefit was suspended upon entrance
into membership in the Teachers' and State Employees' Retirement System, such membership
service standing to the credit of the retired member prior to retirement shall
be likewise counted.
(b) Prohibitions. Membership service under this section shall not be counted twice for the same period of time.
"§ 135‑195. Accumulated contributions separate.
Such death benefit Death benefit amounts payable under this Article shall be payable apart and separate from the payment of the
member's accumulated contributions under the Retirement System on his
the member's death pursuant to the provisions of subsection (f) of this
section.G.S. 135‑5.
"§ 135‑200. Benefits disallowed under this Article.
In Notwithstanding anything in this Article to the contrary, no event shall a death benefit provided for in G.S. 135‑5(l)
under this Article shall be paid at the death of a member if
a death benefit is paid related to that member under G.S. 135‑63."
PART II. technical RECODIFication AND STANDARDization of the death benefit plan for members of THE LOCAL GOVERNMENTAL EMPLOYEES' RETIREMENT SYSTEM
SECTION 4.(a) Article 3 of Chapter 128 of the General Statutes is amended to add a new Part 1 to be entitled "Local Governmental Employees Retirement System" consisting of G.S. 128‑21 through G.S. 128‑38.29.
SECTION 4.(a1) Article 3 of Chapter 128 of the General Statutes is amended to add a new Part 2 to be entitled "Local Governmental Death Benefit Plan" that consists of the following new sections:
(1) G.S. 128‑38.30.
(2) G.S. 128‑38.31.
(3) G.S. 128‑38.35.
(4) G.S. 128‑38.36.
(5) G.S. 128‑38.40.
(6) G.S. 128‑38.45.
(7) G.S. 128‑38.46.
SECTION 4.(b) The caption and the second sentence of G.S. 128‑27(l) are recodified as subsection (a) of G.S. 128‑38.30.
SECTION 4.(c) The third, fourth, and fifth sentences of the first paragraph of G.S. 128‑27(l) are recodified as subsection (b) of G.S. 128‑38.30.
SECTION 4.(d) The seventh paragraph of G.S. 128‑27(l) is recodified as subsection (a) of G.S. 128‑38.31.
SECTION 4.(d1) G.S. 128‑28(f1) is recodified as subsection (b) of G.S. 128‑38.31.
SECTION 4.(e) The first sentence of the first paragraph of G.S. 128‑27(l) is recodified as the first sentence of subsection (a) of G.S. 128‑38.35.
SECTION 4.(f) The first sentence of G.S. 128‑27(l1) is recodified as the second sentence of subsection (a) of G.S. 128‑38.35.
SECTION 4.(g) The first sentence of the second paragraph of G.S. 128‑27(l) is recodified as subsection (b) of G.S. 128‑38.35.
SECTION 4.(h) The second sentence of the second paragraph of G.S. 128‑27(l) is recodified as subsection (c) of G.S. 128‑38.35.
SECTION 4.(i) The fourth sentence of the second paragraph of G.S. 128‑27(l) is recodified as subsection (d) of G.S. 128‑38.35.
SECTION 4.(j) Sub‑subdivision a. of subdivision (2) of the sixth paragraph of G.S. 128‑27(l) is recodified as subdivision (3) of G.S. 128‑38.36.
SECTION 4.(k) Sub‑subdivision b. of subdivision (2) of the sixth paragraph of G.S. 128‑27(l) is recodified as subdivision (1) of G.S. 128‑38.36.
SECTION 4.(l) Sub‑subdivision c. of subdivision (2) of the sixth paragraph of G.S. 128‑27(l) is recodified as sub‑subdivision a. of subdivision (2) of G.S. 128‑38.36.
SECTION 4.(m) Subdivision (3) of the sixth paragraph of G.S. 128‑27(l) is recodified as sub‑subdivision b. of subdivision (2) of G.S. 128‑38.36.
SECTION 4.(n) Subdivision (4) of the sixth paragraph of G.S. 128‑27(l) is recodified as sub‑subdivision c. of subdivision (2) of G.S. 128‑38.36.
SECTION 4.(o) The first sentence of the first paragraph of G.S. 128‑27(l6) is recodified as subsection (b) of G.S. 128‑38.40.
SECTION 4.(p) The second paragraph of G.S. 128‑27(l6) is recodified as subsection (c) of G.S. 128‑38.40.
SECTION 4.(q) The third sentence of the second paragraph of G.S. 128‑27(l) is recodified as G.S. 128‑38.46.
SECTION 5.(a) The remainder of subsections (l), (l1), and (l6) of G.S. 128‑27 not recodified by Section 4 of this act are repealed.
SECTION 5.(b) Subsections (l2), (l3), (l4), and (l5) of G.S. 128‑27 are repealed.
SECTION 6.(a) G.S. 128‑21 reads as rewritten:
"§ 128‑21. Definitions.
The following words and phrases
as used definitions apply in this Article, unless a different
meaning is plainly required by the context, shall have the following
meanings:context:
(6a) "Benefit Trust" means the North Carolina Teachers' and State Employees' Benefit Trust under G.S. 135‑154.
(8a) "Death Benefit Plan" means the Local Governmental Death Benefit Plan established under Part 2 of this Article.
(8b) "Duly acknowledged" means notarized, including electronic notarization, or verified through an identity authentication service approved by the Department of State Treasurer.
."
SECTION 6.(b) Part 2 of Article 3 of Chapter 128 of the General Statutes, as created by Section 4 of this act, reads as rewritten:
"Part 2. Local Governmental Death Benefit Plan.
"§ 128‑38.30. Death Benefit Plan established.
(a) Death Benefit Plan.
There is hereby created a Group Life Insurance Plan (hereinafter called the
"Plan") which is established as the Local Governmental
Death Benefit Plan, a group life insurance plan that is an employee welfare
benefit plan that is separate and apart from the Retirement System and under
which the members of the Retirement System shall participate and be eligible
for group life insurance benefits.System.
(b) Benefit Trust. The
Death Benefit Plan shall be part of the North Carolina Teachers' and
State Employees' Benefit Trust, as established under G.S. 135‑7(g).
Trust. All receipts, transfers, appropriations, contributions,
investment earnings, and other income belonging to the Death Benefit Plan
shall be deposited in the Benefit Trust. All benefits and expenses against the Death
Benefit Plan shall be disbursed from the Benefit Trust.
"§ 128‑38.31. Administration of Death Benefit Plan.
(a) Provisions
Applicable. The Death Benefit Plan is administered by the Board of Trustees. The
provisions of the Retirement System pertaining to administration,
G.S. 128‑28, and management of funds, G.S. 128‑29, are
hereby made G.S. 128‑28 and G.S. 128‑29 are applicable
to the Death Benefit Plan.
(b) Effect of Vote Related
to Contributory Death Benefit. No decision of the Board of Trustees related
to the Contributory Death Benefit fully contributory death benefit
for retirees provided for under this Article Part shall take
effect unless and until this same decision has been made and voted on by the
Board of Trustees of the Teachers' and State Employees' Retirement System.
(c) Rulemaking. The Board of Trustees may adopt temporary or permanent rules, as necessary, for all aspects of administration of this Part.
"§ 128‑38.35. Death benefit for in‑service members.
(a) The provisions of
this subsection shall become effective for any employer only after Participation.
Benefits under this section are only available to an otherwise eligible in‑service
member if that member's employer has opted to participate in the Death Benefit
Plan or if the member is a law enforcement officer. All of the following apply:
(1) If an employer elects to participate in the
Death Benefit Plan with regards to in‑service members who are not law
enforcement officers employed by the employer, then an agreement to that
effect has been shall be executed by the employer and the Executive
Director of the Retirement System. Under all requirements and conditions
as otherwise provided for in subsection (l) of this section, except for
the requirement that the provisions are effective only after an agreement has
been executed by the employer and the Executive Director of the Retirement
Systems Division, Participation in, and eligibility for death benefits
under, the Death Benefit Plan in accordance with this section shall be begin
only after this agreement has been executed.
(2) Employers are required to participate in the
Death Benefit Plan with regard to all law enforcement officers employed
by the employer who are members of the Retirement System shall
participate and be eligible for group life insurance benefits under the Group
Life Insurance Plan, and employers shall fund the cost of these benefits.
(a1) Eligibility. Subject to employer participation in the Death Benefit Plan for members who are not law enforcement officers, a member who has not retired and who has completed at least one full year of membership in the Retirement System is a participant in, and eligible for the death benefits under, the Death Benefit Plan in accordance with this section.
(b) Benefits Upon Death
While in Service. If a member eligible for benefits under this section dies
while in service, then, upon receipt of proof, proof of the death
that is satisfactory to the Board of Trustees in their capacity as
trustees under the Group Life Insurance Plan, of the death, in service, of a
member who had completed at least one full calendar year of membership in the
Retirement System, there Trustees, a lump sum death benefit amount shall
be paid to such person as the member shall have nominated by electronic
submission in a form approved by the Board of Trustees or by written
designation duly acknowledged and filed with the Board of Trustees, if such
person is living at the time of the member's death, otherwise to the member's legal
representatives, a death benefit.paid.
(c) Such death Death
Benefit Amount. Subject to a minimum of twenty‑five thousand dollars
($25,000) and to a maximum of fifty thousand dollars ($50,000), the lump sum
death benefit shall be amount payable under this section is equal
to the greater of:of the following amounts:
(1) The compensation on which
contributions to the Retirement System were made by the member during
the calendar year preceding the year in which his the member's death
occurs, oroccurred.
(2) The greatest compensation
on which contributions to the Retirement System were made by the member
during a 12‑month period of service within the 24‑month period of
service ending on the last day of the month preceding the month in which his
the member's last day of actual service occurs;
subject
to a minimum of twenty‑five thousand dollars ($25,000) and a maximum of
fifty thousand dollars ($50,000).occurred.
(d) Members Deemed to be
in Service. For the purpose of the Plan, section, a member
shall be deemed to be in service at the date of his the member's death
if his the death occurs within 180 days from the last day of his
actual service.service, as determined in accordance with G.S. 128‑38.36.
"§ 128‑38.36. Last day of actual service; death benefit for in‑service members.
To determine the last day of actual service for the purposes of a death benefit for in‑service members, all of the following apply:
(1) When the employee has
not been terminated, Uninterrupted service. For members with
uninterrupted service, the last day of actual service is the date on which
an absent member's sick and annual leave expire.expire unless the
member is on an approved leave of absence and is deemed to be in service under G.S. 128‑26(g).
If a member is deemed to be in service under G.S. 128‑26(g), then
the last day of actual service is the last day for which the member made a
contribution to the Retirement System.
(2) Interrupted service. All of the following apply to a member whose service has been interrupted:
a. When a member's For a member whose service
is interrupted by reason of service in the Uniformed Services, as that term is
defined in section 4303(16) of the Uniformed Services Employment and
Reemployment Rights Act, Public Law 103‑353, and the participant member
does not return immediately after that service to employment with a covered
employer in this the Retirement System, the last day of actual
service is the date on which the participant member was first
eligible to be separated or released from his or her involuntary military
service.
b. For a period when a
member who is on an approved leave of absence, his status with
respect to the death benefit will be determined by the provisions of
G.S. 128‑26(g).but who is not deemed to be in service under G.S. 128‑26(g),
the last day of actual service is either the last day for which the member made
a contribution to the Retirement System or the date on which the member's sick
and annual leave expired, whichever is later.
c. A member on leave of
absence from his a position as a local governmental employee for
the purpose of serving as a member or officer of the North Carolina General
Assembly shall be deemed to be in service during sessions of the General
Assembly and thereby covered by the provisions of the death benefit, if
applicable. The eligible for the death benefit under G.S. 128‑38.35.
The last day of actual service shall be the most recent legislative day of the
applicable General Assembly session or the last day the member performed work
as a local governmental employee, whichever is later. Notwithstanding G.S. 128‑38.35(c),
the amount of the death benefit for such a member who is
on a leave of absence due to General Assembly service shall be the
equivalent of the salary to which the member would have been entitled as a
local governmental employee during the 12‑month period immediately prior
to the month in which death occurred, not to be less than subject to
a minimum of twenty‑five thousand dollars ($25,000) nor to exceed and
a maximum of fifty thousand dollars ($50,000).
(3) When the employee Terminated
service. For a member whose employment has been terminated, terminated
for reasons other than retirement, whether by the employer or the employee, the
last day of actual service is the last day the member actually worked.performed
work as a local governmental employee.
"§ 128‑38.40. Fully contributory death benefit for retired members.
(a) Participation and Premiums. All retired members may elect to participate in the Death Benefit Plan and therefore become eligible to receive death benefits under the Death Benefit Plan in accordance with this section. Elections shall be made prior to death and no later than 60 calendar days from the effective date of the member's retirement. Elections shall be received by the Board of Trustees prior to the death of the retired member. Retired members electing to receive a fully contributory death benefit under the Death Benefit Plan shall continuously pay monthly premiums on a fully contributory basis, as determined by the Board of Trustees, to the North Carolina Teachers' and State Employees' Benefit Trust established under G.S. 135‑7(g). Premium payments shall be made through retirement allowance deductions or other methods adopted by the Board of Trustees.
(b) Benefits Upon Death.
If a retired member who has elected to receive a fully contributory death
benefit under this section dies, then, upon receipt of proof, proof
of the death that is satisfactory to the Board of Trustees in its
capacity under this subsection, of the death of a retired member of the
Retirement System on or after January 1, 2015, there Trustees, a lump
sum death benefit amount shall be paid a death benefit to the person or
persons designated by the member or, if not survived by a designated
beneficiary, to the deceased retired member's legal representative; provided
the retired member has elected, when first eligible, to make, and has
continuously made, in advance of the member's death required contributions as
determined by the Board of Trustees on a fully contributory basis, through
retirement allowance deductions or other methods adopted by the Board of
Trustees, to a group death benefit trust fund, the North Carolina Teachers' and
State Employees' Benefit Trust, administered by the Board of Trustees separate
and apart from the Retirement System's Annuity Savings Fund and Pension
Accumulation Fund.paid.
(c) The Death
Benefit Amount. The lump sum death benefit payable under this subsection
section shall be a lump‑sum payment in the amount of one
of the following amounts:
(1) If the death occurred on or after the first day
of the twenty‑fifth month of coverage under this section, then the amount
payable is ten thousand dollars ($10,000) upon the completion of 24
months of contributions required under this subsection. Should death occur ($10,000).
(2) If the death occurred before the completion
of 24 months of contributions required under this subsection, the deceased
retired member's designated beneficiary or beneficiaries, or legal
representative if not survived by a designated beneficiary, shall be paid first
day of the twenty‑fifth month of coverage under this section, then the
amount payable is the sum of the retired member's contributions required
by this subsection premium payments made in accordance with this section
plus interest in an amount to be determined by the Board of
Trustees.
"§ 128‑38.45. Beneficiaries under the Death Benefit Plan.
(a) Designation. A member shall designate a beneficiary or beneficiaries for each applicable benefit payable under this Part by electronic submission in a form approved by the Board of Trustees or by written designation duly acknowledged and filed with the Board of Trustees.
(b) Benefits Payable. Each applicable benefit payable under this Part shall be paid to the designated beneficiary or beneficiaries to receive the benefit. If no beneficiaries are designated or living at the time of the member's death, then the benefit shall be paid to the member's legal representative.
"§ 128‑38.46. Accumulated contributions separate.
Such death benefit Death benefit amounts payable under this Part shall be payable apart and separate from the payment of the
member's accumulated contributions under the Retirement System on his
the member's death pursuant to the provisions of subsection (f)
of this section.G.S. 128‑27(f)."
PART III. STANDARDIZation of death benefits for members of THE consolidated judicial retirement system
SECTION 7.(a) G.S. 135‑53 is amended by adding a new subdivision to read:
"(3a) "Benefit Trust" means the North Carolina Teachers' and State Employees' Benefit Trust under G.S. 135‑154."
SECTION 7.(b) G.S. 135‑52 is amended by adding a new subsection to read:
"(c) Fully contributory death benefits under this Article are established as a group life insurance plan that is an employee welfare benefit plan that is separate and apart from the Retirement System and administered by the Board of Trustees. Fully contributory death benefits for retirees under this Article are part of the Benefit Trust. All receipts, transfers, appropriations, contributions, investment earnings, and other income associated with the fully contributory death benefits for retirees under this Article shall be deposited in the Benefit Trust. All benefits and expenses against the fully contributory death benefits for retirees under this Article shall be disbursed from the Benefit Trust."
SECTION 7.(c) Subsections (b) and (d) of G.S. 135‑63 are repealed.
SECTION 7.(d) G.S. 135‑63, as amended by subsection (c) of this section, reads as rewritten:
"§ 135‑63. Benefits on death before retirement.
(a) Upon In‑Service
Benefit. If a member dies while in service, then, upon receipt of proof,
proof of the death that is satisfactory to the Board of Trustees, of
the death of a member in service, there shall be paid in a lump sum death
benefit shall be paid to such person as the beneficiary or
beneficiaries that the member shall have nominated designated by
electronic submission in a form approved by the Board of Trustees or by written
designation duly acknowledged and filed with the Board of Trustees, if such
person is Trustees. If no beneficiaries are designated or living at
the time of the member's death, otherwise then the death benefit
shall be paid to the member's legal representatives, a representative.
The amount of the death benefit payable under this subsection is equal
to the sum of (i) the member's accumulated contributions, plus (ii) the
member's final compensation; provided, however, that if the member has
attained his or her fiftieth birthday with at least five years of membership
service at the member's date of death, and if the designated recipient of the
death benefits is the compensation, unless a member's surviving spouse
who survives him or her, and if the spouse so elects, is eligible for
and elects to receive a survivor's alternate benefit under subsection (a1) of
this section.
(a1) Survivor's Alternate Benefit. The surviving
spouse of a member who was age 50 or older with at least five years of
membership service at the time of death may elect a survivor's alternate
benefit. If the surviving spouse elects a survivor's alternate benefit, then
the lump‑sum death benefit provided for herein under subsection
(a) of this section shall consist only of a payment equal to the member's
final compensation and there shall be paid to the surviving spouse an annual
retirement allowance, payable monthly, which monthly. The monthly
payments shall commence on the first day of the calendar month coinciding
with or next following the death of the member and shall be continued member.
All of the following apply to the survivor's alternate benefit:
(1) The survivor's alternate benefit shall continue on the first day of each month thereafter until the remarriage or death of the spouse.
(2) The amount of any such the survivor's alternate
benefit retirement allowance shall be equal to one half of the amount of
the retirement allowance to which the member would have been entitled had the
member retired under the provisions of G.S. 135‑57(a) on the first
day of the calendar month coinciding with or next following the member's date
of death, reduced by two percent (2%) thereof for each full year, if any, by
which the age of the member at his or her date of death exceeds that of the
member's spouse.
(3) If the retirement allowance to the spouse shall
terminate terminates on the remarriage or death of the spouse before
the total of the retirement allowance payments made equals the amount of the
member's accumulated contributions at date of death, then the excess of such
those accumulated contributions over the total of the retirement
allowances paid to the spouse shall be paid in a lump sum to such person as the
beneficiary or beneficiaries the member shall have nominated designated
by electronic submission in a form approved by the Board of Trustees or by
written designation duly acknowledged and filed with the Board of Trustees,
if such person is Trustees. If no beneficiary is designated or living
at the time such payment falls due, otherwise the lump sum payment becomes
due under this subdivision, then the lump sum payment shall be made to the
former member's legal representatives.
(c) Not in Service
Benefit. 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 such
person as the beneficiary that the member shall have nominated designated
by electronic submission in a form approved by the Board of Trustees or by
written designation duly acknowledged and filed with the Board of Trustees,
if such person is Trustees. If no beneficiary is designated or living
at the time of the member's death, otherwise the lump sum death
benefit shall be paid to the member's legal representatives, a representatives.
The lump sum death benefit payable under this subsection is equal to
the member's accumulated contributions.
."
SECTION 7.(e) Subsections (f) through (j) of G.S. 135‑64 are repealed.
SECTION 7.(f) G.S. 135‑64, as amended by subsection (e) of this section, reads as rewritten:
"§ 135‑64. Benefits on death after retirement.
(a) In the event of the
death of If a former member while in receipt of dies after
a service retirement allowance pursuant to his retirement under
the provisions of G.S. 135‑57, G.S. 135‑57 or
after a the former member's sixty‑fifth birthday while
in receipt of a retirement allowance pursuant to his retirement under the
provisions of after a disability retirement under G.S. 135‑59,
then there shall be paid to the former member's surviving spouse, if
any, an annual retirement allowance, payable monthly, which monthly. The
monthly payments shall commence on the first day of the calendar month next
following the date of death of the former member and shall be continued on the
first day of each month thereafter until the remarriage or death of the spouse.
The amount of any such the retirement allowance under this
subsection shall be equal to one half of the allowance that was payable to
the former member for the month immediately prior to his the member's
month of death, or which that would have been so payable
had an optional mode of payment not been elected under the provisions of
G.S. 135‑61, reduced by two percent (2%) thereof for each full year,
if any, by which the age of the former member at date of death exceeds that of his
the spouse.
(b) In the event of the
death of If a former member dies prior to his the
former member's sixty‑fifth birthday while in receipt of a after
a disability retirement allowance pursuant to his retirement under the
provisions of G.S. 135‑59, then there shall be paid to
the former member's surviving spouse, if any, an annual retirement allowance,
payable monthly, which monthly. The monthly payments shall
commence on the first day of the calendar month next following the date of
death of the former member and shall be continued on the first day of each
month thereafter until the remarriage or death of the spouse. The amount of any
such the retirement allowance under this subsection shall be
equal to one half of the allowance to which the former member would have been
entitled under the provisions of G.S. 135‑58 if he the
member had remained in service from his the disability
retirement date to his the date of death with no change in his
the former member's final compensation or status and had then
retired, reduced by two percent (2%) thereof for each full year, if any, by
which the age of the former member at date of death exceeds that of his the
spouse.
(c) In the event of the
death of If a former member dies while in receipt of a
retirement allowance under the provisions of G.S. 135‑58, 135‑60,
or 135‑61, and if such that former member is not
survived by a spouse to whom a retirement allowance is payable under the
provisions of subsection (a) or subsection (b) above, of this section
nor survived by a beneficiary to whom a monthly survivorship benefit is
payable under one of the optional modes of payment under G.S. 135‑61,
then there shall be paid to such person as a lump sum death
benefit to the beneficiary that the member shall have nominated designated
by electronic submission in a form approved by the Board of Trustees or by
written designation duly acknowledged and filed with the Board of Trustees,
if such person is Trustees. If no beneficiary is designated or living
at the time of the member's death, otherwise then the lump sum death
benefit shall be paid to the member's legal representatives, a representative.
The lump sum death benefit payable under this subsection shall be equal
to the excess, if any, of the accumulated contributions of the member at his
the member's date of retirement over the total of the retirement
allowances paid to him the member prior to his death.
(d) In the event that If
a retirement allowance becomes payable to the spouse of a former member
under the provisions of subsection (a) or subsection (b) above, of
this section or to the designated survivor of a former member under one of
the optional modes of payment under G.S. 135‑61, and such that
retirement allowance to the spouse shall terminate terminated on
the remarriage or death of the spouse, or on the death of spouse or the
designated survivor, survivor before the total of the retirement
allowances paid to the former member and his the spouse or the
designated survivor combined equals the amount of the member's accumulated
contributions at his the member's date of retirement, then the
excess of such those accumulated contributions over the total of
the retirement allowances paid to the former member and his the spouse
or the designated survivor combined shall be paid in a lump sum to such
person as the beneficiary that the member shall have nominated designated
by electronic submission in a form approved by the Board of Trustees or by
written designation duly acknowledged and filed with the Board of Trustees,
if such person Trustees. If no beneficiary is designated or is
living at the time such payment under this subsection falls due, otherwise
then the lump sum shall be paid to the former member's legal
representatives.
(e) In the event of the
death of If a retired former judge dies while in receipt of a
retirement allowance under the provisions of G.S. 135‑58(d), then
there shall be paid to the former judge's surviving spouse, if any, an
annual retirement allowance payable monthly, which monthly. The
monthly payments shall commence on the first day of the calendar month next
following the date of death of the former judge and shall be continued on the
first day of each month thereafter until the remarriage or death of the spouse.
The amount of any such the retirement allowance under this
subsection shall be equal to one half of the allowance that was payable to
the former judge for the month immediately prior to his the month
of death, reduced by two percent (2%) thereof for each full year, if any, by
which the age of the former judge at date of death exceeds that of his the
spouse.
(k) Upon the death of a
retired member on or after January 1, 2015, there All retired members
may elect to participate in the fully contributory death benefit for retirees. All
of the following apply to the fully contributory death benefit for retirees:
(1) Elections to participate in the fully contributory death benefit for retirees shall be made prior to the member's death and no later than 60 calendar days from the effective date of the member's retirement. Elections shall be received by the Board of Trustees prior to the death of the retired member.
(2) Retired members electing to receive a fully contributory death benefit under this subsection shall continuously pay monthly premiums on a fully contributory basis, as determined by the Board of Trustees. Premium payments shall be made through retirement allowance deductions or other methods adopted by the Board of Trustees.
(3) If a retired member who has elected to receive a
fully contributory death benefit under this subsection dies, then, upon receipt
of proof of death that is satisfactory to the Board of Trustees, a lump sum death
benefit amount shall be paid a death benefit to the person or
persons beneficiary or beneficiaries designated by the member or,
if not survived by a designated beneficiary, member. If no beneficiary is
designated or living, then the death benefit shall be paid to the deceased
retired member's legal representative; provided the retired member has
elected, when first eligible, to make, and has continuously made, in advance of
the member's death required contributions as determined by the Board of
Trustees on a fully contributory basis, through retirement allowance deductions
or other methods adopted by the Board of Trustees, to a group death benefit
trust fund, the North Carolina Teachers' and State Employees' Benefit Trust,
administered by the Board of Trustees separate and apart from the Retirement
System's Annuity Savings Fund and Pension Accumulation Fund. Employer and non‑employer
contributions to the Benefit Trust and earnings on those contributions are
irrevocable. The assets of the Benefit Trust are dedicated to providing
benefits to members and beneficiaries in accordance with the Plan's benefit
terms. The assets of the Benefit Trust are not subject to the claims of
creditors of the employees and non‑employees making contributions to the
Benefit Trust, are not subject to the claims of any creditors of the Benefit
Trust's trustees and administrators, and are not subject to the claims of
creditors of members and beneficiaries. Benefit Trust assets may be used for
reasonable expenses to administer benefits provided by the Fund as approved by
the Board of Trustees.representative.
(4) The amount of the lump sum fully contributory death
benefit payable under this subsection shall be a lump‑sum payment in
the amount of is one of the following:
a. If the death occurred on or after the first day
of the twenty‑fifth month of coverage under this subsection, then the
amount payable is ten thousand dollars ($10,000) upon the completion of
24 months of contributions required under this subsection. Should death occur ($10,000).
b. If the death occurred before the completion
of 24 months of contributions required under this subsection, the deceased
retired member's designated beneficiary or beneficiaries, or legal
representative if not survived by a designated beneficiary, shall be paid first
day of the twenty‑fifth month of coverage under this subsection, then the
amount payable is the sum of the retired member's contributions required
by this subsection premium payments made in accordance with this subsection
plus interest in an amount to be determined by the Board of
Trustees."
PART IV. STANDARDIZation of death benefits for members of THE legislative retirement system
SECTION 8.(a) G.S. 120‑4.8 is amended by adding a new subdivision to read:
"(4d) Benefit Trust. The North Carolina Teachers' and State Employees' Benefit Trust under G.S. 135‑154."
SECTION 8.(b) G.S. 120‑4.10 reads as rewritten:
"§ 120‑4.10. Administration of retirement system.Article.
(a) The Board of Trustees of the Teachers' and State Employees' Retirement System shall be the trustee of the Retirement System. The provisions of this Article shall be administered by the Board of Trustees.
(b) Fully contributory death benefits under this Article are established as a group life insurance plan that is an employee welfare benefit plan that is separate and apart from the Retirement System and administered by the Board of Trustees. Fully contributory death benefits for retirees under this Article are part of the Benefit Trust. All receipts, transfers, appropriations, contributions, investment earnings, and other income associated with the fully contributory death benefits for retirees under this Article shall be deposited in the Benefit Trust. All benefits and expenses against the fully contributory death benefits for retirees under this Article shall be disbursed from the Benefit Trust."
SECTION 8.(c) G.S. 120‑4.26A reads as rewritten:
"§ 120‑4.26A. Benefits on death after retirement.
(a) In the event of the death of If a
retired member dies while in receipt of a retirement allowance under the
provisions of this Article, there a lump sum death benefit shall
be paid to such person or persons as the beneficiary that the
retiree shall have nominated designated by electronic submission
in a form approved by the Board of Trustees or by written designation duly
acknowledged and filed with the Board of Trustees, if such person or persons
Trustees. If no beneficiary or beneficiaries are designated or are
living at the time of the retiree's death, otherwise then the lump
sum death benefit shall be paid to the retiree's legal representatives,
a representative. The lump sum death benefit payable under this
subsection is equal to the excess, if any, of the accumulated contributions
of the retiree at the date of retirement over the total of the retirement
allowances paid prior to the death of the retiree.
(b) In the event that If a retirement
allowance becomes that became payable to the designated survivor
of a retired member under the provisions of G.S. 120‑4.26 and
such retirement allowance to the survivor shall terminate terminates upon
the death of the survivor before the total of the retirement allowances paid to
the retiree and the designated survivor combined equals the amount of the
accumulated contributions of the retiree at the date of retirement, then the
excess, if any, excess of such those accumulated
contributions over the total of the retirement allowances paid to the retiree
and the survivor combined shall be paid in a lump sum to such person or
persons as the beneficiary that the retiree shall have nominated designated
by electronic submission in a form approved by the Board of Trustees or by
written designation duly acknowledged and filed with the Board of Trustees,
if such person or persons are Trustees. If no beneficiary is designated
or living at the time such payment falls due, otherwise the lump
sum payment becomes due under this subsection, then the payment shall be made to
the retiree's legal representative."
SECTION 8.(d) G.S. 120‑4.27 reads as rewritten:
"§ 120‑4.27. Death benefit.while in
service; fully contributory death benefit for retirees.
(a) The designated beneficiary of a member who dies while in service after completing one year of creditable service shall receive a lump‑sum payment of an amount equal to the deceased member's highest annual salary, to a maximum of fifteen thousand dollars ($15,000). For purposes of this death benefit "in service" means currently serving as a member of the North Carolina General Assembly. "In service" also means service in the Uniformed Services, as that term is defined in section 4303(16) of the Uniformed Services Employment and Reemployment Rights Act, Public Law 103‑353, if that service begins during the member's term of office. If the participant does not return immediately after that service to employment with a covered employer in this Retirement System, then the participant shall be deemed "in service" until the date on which the participant was first eligible to be separated or released from his or her involuntary military service.
The death benefit provided by
this section shall be designated a group life insurance benefit payable under
an employee welfare benefit plan that is separate and apart from the Retirement
System but under which the members of the Retirement System shall participate
and be eligible for group life insurance benefits. The Board of Trustees is
authorized to provide the death benefit in the form of group life insurance
either by purchasing a contract or contracts of group life insurance with any
life insurance company or companies licensed and authorized to transact
business in the State of North Carolina for the purpose of insuring the lives
of qualified members in service, or by establishing or affiliating with a
separate trust fund.
Upon receipt of proof,
satisfactory to the Board of Trustees, of the death of a retired member of the
Retirement System or Retirement Fund on or after July 1, 1988, but before
January 1, 1999, there shall be paid a death benefit to the surviving spouse of
a deceased retired member, or to the deceased retired member's legal
representative if not survived by a spouse; provided the retired member has
elected, when first eligible, to make, and has continuously made, in advance of
his death required contributions as determined by the Retirement System on a
fully contributory basis, through retirement allowance deductions or other
methods adopted by the Retirement System, to a group death benefit trust fund
administered by the Board of Trustees separate and apart from the Retirement
System's Annuity Savings Fund and Pension Accumulation Fund. This death benefit
shall be a lump‑sum payment in the amount of five thousand dollars
($5,000) upon the completion of twenty‑four months of contributions
required under this subsection. Should death occur before the completion of twenty‑four
months of contributions required under this subsection, the deceased retired
member's surviving spouse or legal representative if not survived by a spouse
shall be paid the sum of the retired member's contributions required by this
subsection plus interest to be determined by the Board of Trustees.
Upon receipt of proof,
satisfactory to the Board of Trustees, of the death of a retired member of the
Retirement System or Retirement Fund on or after January 1, 1999, but before
July 1, 2004, there shall be paid a death benefit to the surviving spouse of a
deceased retired member, or to the deceased retired member's legal
representative if not survived by a spouse; provided the retired member has
elected, when first eligible, to make, and has continuously made, in advance of
his death required contributions as determined by the Retirement System on a
fully contributory basis, through retirement allowance deductions or other
methods adopted by the Retirement System, to a group death benefit trust fund administered
by the Board of Trustees separate and apart from the Retirement System's
Annuity Savings Fund and Pension Accumulation Fund. This death benefit shall be
a lump‑sum payment in the amount of six thousand dollars ($6,000) upon
the completion of 24 months of contributions required under this subsection.
Should death occur before the completion of 24 months of contributions required
under this subsection, the deceased retired member's surviving spouse or legal
representative if not survived by a spouse shall be paid the sum of the retired
member's contributions required by this subsection plus interest to be
determined by the Board of Trustees.
Upon receipt of proof,
satisfactory to the Board of Trustees, of the death of a retired member of the
Retirement System or Retirement Fund on or after July 1, 2004, but before July
1, 2007, there shall be paid a death benefit to the surviving spouse of a
deceased retired member, or to the deceased retired member's legal
representative if not survived by a spouse; provided the retired member has
elected, when first eligible, to make, and has continuously made, in advance of
his death required contributions as determined by the Retirement System on a
fully contributory basis, through retirement allowance deductions or other
methods adopted by the Retirement System, to a group death benefit trust fund
administered by the Board of Trustees separate and apart from the Retirement
System's Annuity Savings Fund and Pension Accumulation Fund. This death benefit
shall be a lump‑sum payment in the amount of nine thousand dollars
($9,000) upon the completion of 24 months of contributions required under this
subsection. Should death occur before the completion of 24 months of
contributions required under this subsection, the deceased retired member's
surviving spouse or legal representative if not survived by a spouse shall be
paid the sum of the retired member's contributions required by this subsection
plus interest to be determined by the Board of Trustees.
Upon receipt of proof,
satisfactory to the Board of Trustees, of the death of a retired member of the
Retirement System or Retirement Fund on or after July 1, 2007, but before
January 1, 2015, there shall be paid a death benefit to the surviving spouse of
a deceased retired member, or to the deceased retired member's legal
representative if not survived by a spouse; provided the retired member has
elected, when first eligible, to make, and has continuously made, in advance of
his death required contributions as determined by the Retirement System on a
fully contributory basis, through retirement allowance deductions or other
methods adopted by the Retirement System, to a group death benefit trust fund
administered by the Board of Trustees separate and apart from the Retirement
System's Annuity Savings Fund and Pension Accumulation Fund. This death benefit
shall be a lump‑sum payment in the amount of ten thousand dollars
($10,000) upon the completion of 24 months of contributions required under this
subsection. Should death occur before the completion of 24 months of
contributions required under this subsection, the deceased retired member's
surviving spouse or legal representative if not survived by a spouse shall be
paid the sum of the retired member's contributions required by this subsection
plus interest to be determined by the Board of Trustees.
Upon receipt of proof,
satisfactory to the Board of Trustees, of the death of a retired member of the
Retirement System or Retirement Fund on or after January 1, 2015, there
(b) All retired members may elect to participate in a fully contributory death benefit for retirees. All of the following apply to the fully contributory death benefit for retirees:
(1) Elections to participate in the fully contributory death benefit for retirees shall be made prior to the member's death and no later than 60 calendar days from the effective date of the member's retirement. Elections shall be received by the Board of Trustees prior to the death of the retired member.
(2) Retired members electing to receive a fully contributory death benefit under this subsection shall continuously pay monthly premiums on a fully contributory basis, as determined by the Board of Trustees. Premium payments shall be made through retirement allowance deductions or other methods adopted by the Board of Trustees.
(3) If a retired member who has elected to receive a
fully contributory death benefit under this subsection dies, then, upon receipt
of proof of the death that is satisfactory to the Board of Trustees, a lump sum
death benefit amount shall be paid a death benefit to the person
or persons beneficiary or beneficiaries designated by the member
or, if not survived by a designated beneficiary, member. If no
beneficiary is designated or living, then the death benefit shall be paid to
the deceased retired member's legal representative; provided the retired
member has elected, when first eligible, to make, and has continuously made, in
advance of the member's death required contributions as determined by the
Retirement System on a fully contributory basis, through retirement allowance
deductions or other methods adopted by the Retirement System, to a group death
benefit trust fund, the North Carolina Teachers' and State Employees' Benefit
Trust, administered by the Board of Trustees separate and apart from the
Retirement System's Annuity Savings Fund and Pension Accumulation Fund.
Employer and non‑employer contributions to the Benefit Trust and earnings
on those contributions are irrevocable. The assets of the Benefit Trust are
dedicated to providing benefits to members and beneficiaries in accordance with
the Plan's benefit terms. The assets of the Benefit Trust are not subject to
the claims of creditors of the employees and non‑employees making
contributions to the Benefit Trust, are not subject to the claims of any
creditors of the Benefit Trust's trustees and administrators, and are not
subject to the claims of creditors of members and beneficiaries. Benefit Trust
assets may be used for reasonable expenses to administer benefits provided by
the Fund as approved by the Board of Trustees.representative.
(4) A member shall designate a beneficiary or beneficiaries for the death benefit payable under this subsection by electronic submission in a form approved by the Board of Trustees or by written designation duly acknowledged and filed with the Board of Trustees.
(5) The amount of the lump sum fully contributory death
benefit payable under this subsection shall be a lump‑sum payment in
the amount of is one of the following:
a. If the death occurred on or after the first day
of the twenty‑fifth month of coverage under this subsection, then the
amount payable is ten thousand dollars ($10,000) upon the completion of
24 months of contributions required under this subsection. Should death occur ($10,000).
b. If the death occurred before the completion
of 24 months of contributions required under this subsection, the deceased
retired member's designated beneficiary or beneficiaries, or legal
representative if not survived by a designated beneficiary, shall be paid first
day of the twenty‑fifth month of coverage under this subsection, then the
amount payable is the sum of the retired member's contributions required
by premium payments made in accordance with this subsection plus
interest in an amount to be determined by the Board of Trustees."
PART V. Technical and conforming changes related to recodification and standardization
SECTION 9.(a) G.S. 135‑5(m) reads as rewritten:
"(m) Survivor's Alternate
Benefit. Upon the death of a member in service, the beneficiary designated to
receive a return of accumulated contributions shall have the right to elect to
receive in lieu thereof the reduced retirement allowance provided by Option 2
of subsection (g) above of this section computed by assuming that
the member had retired on the first day of the month following the date of the
member's death, provided that all four of the following conditions apply:
For the purpose of this benefit, a
member is considered to be in service at the date of his the member's
death if his the death occurs within 180 days from the last
day of his the member's actual service. The last day of actual
service shall be determined as provided in subsection (l) of this
section. G.S. 135‑170. Upon the death of a member in
service, the surviving spouse may make all purchases for creditable service as
provided for under this Chapter Article for which the member had
made application in writing prior to the date of death, provided that the date
of death occurred prior to or within 60 days after notification of the cost to
make the purchase. The term "in service" as used in this subsection
includes a member in receipt of a benefit under the Disability Income Plan as
provided in Article 6 of this Chapter.
."
SECTION 9.(b) G.S. 128‑27(m) reads as rewritten:
"(m) Survivor's Alternate
Benefit. Upon the death of a member in service, the beneficiary designated to
receive a return of accumulated contributions shall have the right to elect to
receive in lieu thereof the reduced retirement allowance provided by Option two
of subsection (g) above of this section computed by assuming that
the member had retired on the first day of the month following the date of the
member's death, provided that all four of the following conditions apply:
For the purpose of this benefit, a
member is considered to be in service at the date of his the member's
death if his the death occurs within 180 days from the last
day of his the member's actual service. The last day of actual
service shall be determined as provided in subsection (l) of this
section. G.S. 128‑38.36. Upon the death of a member in
service, the surviving spouse may make all purchases for creditable service as
provided for under this Chapter for which the member had made application in
writing prior to the date of death, provided that the date of death occurred
prior to or within 60 days after notification of the cost to make the purchase.
."
SECTION 10.(a) G.S. 135‑3(c) reads as rewritten:
"(c) Members who are
participating in an intergovernmental exchange of personnel under the
provisions of Article 10 of Chapter 126 may retain their membership status and
receive all benefits provided by this Chapter during the period of the exchange
provided the requirements of Article 10 of Chapter 126 are met; provided
further, that a met. A member participating in an intergovernmental
exchange of personnel under Article 10 of Chapter 126 shall, notwithstanding
whether the member and the member's employer are making contributions to the
member's account during the exchange period, be entitled to the death benefit and,
if applicable, benefits under the Death Benefit Plan under Article 8 of this
Chapter, if the member otherwise qualifies under the provisions of this Article
and provided further Article, except that no duplicate benefits
shall be paid."
SECTION 10.(b) G.S. 128‑24(6) reads as rewritten:
"(6) Employees of a
sending agency participating in an intergovernmental exchange of personnel
under the provisions of Article 10 of Chapter 126 shall remain members entitled
to all benefits of the Retirement System provided that the requirements
of Article 10 of Chapter 126 are met; provided further, that a met. A
member may retain membership status while serving as an assigned employee
or employee on leave under the provisions of Article 10 of Chapter 126 for
purposes of receiving the death benefit and, if applicable, benefits under
the Death Benefit Plan regardless of whether he and his the
member and the member's employer are contributing to his the
member's account during the exchange period period, except
that no duplicate benefits shall be paid."
SECTION 11.(a) G.S. 135‑8(f) reads as rewritten:
"(f) Collection of
Contributions. The following shall apply apply to the
collection of contributions:contributions under this Chapter:
."
SECTION 11.(b) G.S. 128‑30(g) reads as rewritten:
"(g) Collection of
Contributions. The following shall apply apply to the
collection of contributions:contributions under this Article:
."
SECTION 12.(a) G.S. 143‑166.60(b) reads as rewritten:
"(b) The Boards of
Trustees of the Teachers' and State Employees' Retirement System and the Local
Governmental Employees' Retirement System shall jointly administer the Plan
and shall, under the terms and conditions otherwise appearing in this Article,
provide Plan benefits either (i) by establishing a separate trust fund or, (ii)
by causing the Plan to affiliate with a master trust, Plan. The Separate
Insurance Benefits Plan is part of the North Carolina Teachers' and State
Employees' Benefits Trust, providing the same benefits for participants.
Employer and non‑employer contributions to the Benefit Trust and earnings
on those contributions are irrevocable. The assets of the Benefit Trust are
dedicated to providing benefits to participants, surviving spouses, participants'
estates, and persons named by the participant to receive the benefit. The
assets of the Benefit Trust are not subject to the claims of creditors of the
employees and non‑employees making contributions to the Benefit Trust,
are not subject to the claims of any creditors of the Benefit Trust's trustees
and administrators, and are not subject to the claims of creditors of
participants. Benefit Trust assets may be used for reasonable expenses to
administer benefits provided by the Fund as approved by the Board of Trustees.Benefit
Trust established under G.S. 135‑154. All receipts, transfers,
appropriations, contributions, investment earnings, and other income belonging
to the Separate Insurance Benefits Plan shall be deposited in the Benefit
Trust. All benefits and expenses against the Separate Insurance Benefits Plan for
retirees shall be disbursed from the Benefit Trust."
SECTION 12.(b) G.S. 143‑166.70(5) is expired.
part vii. ensure sufficient funding for line of duty death benefits
"(e) Separate Fund for Line of Duty Death Benefits. The Board of Trustees may make additional funding available to the Department of State Treasurer to ensure the timely payment of death benefits awarded by the Industrial Commission under the Public Safety Employees' Death Benefits Act, Article 12A of Chapter 143 of the General Statutes, by depositing a percentage of the State's employer contribution rate established for the benefits provided under G.S. 135‑165 into a separate fund from the Benefits Trust. This percentage shall not exceed four hundredths percent (0.04%) in any given fiscal year. The Department of State Treasurer is authorized to use the funds deposited into this separate fund for the sole purpose of paying for death benefits awarded by the Industrial Commission under the Public Safety Employees' Death Benefits Act and may do so only if all other State funds appropriated to the Department for the fiscal year for the payment of those death benefits have been fully expended. Any funds deposited by the Department of State Treasurer into a separate fund in accordance with this subsection that remain unspent as of June 30 of the same fiscal year shall be transferred to the Benefit Fund as an additional employer contribution."
SECTION 16.(b) This section becomes effective July 1, 2025.
PART VIII. EFFECTIVE DATE
SECTION 17. Except as otherwise provided, this act is effective when it becomes law.
In the General Assembly read three times and ratified this the 4th day of June, 2025.
s/ Rachel Hunt
President of the Senate
s/ Destin Hall
Speaker of the House of Representatives
s/ Josh Stein
Governor
Approved 8:53 a.m. this 13th day of June, 2025