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Laws and Legislation​

 Legislation that Affects You

This page is designed to give you information about changes enacted by the North Carolina General Assembly that affect the Retirement Systems Division and, in some cases, your benefits.

 

2018 Legislative Session

In the 2018 legislative short session, the General Assembly made several changes that affect the Retirement Systems. Below is a brief explanation of the changes, along with a link to the actual legislation. An entire list of all legislation that impacts the Retirement Systems Division, including minor technical corrections and member-related changes, can be found here.

 

One-Time Pension Supplement for TSERS/CJRS/LRS Retirees

Retirees of the Teachers’ and State Employees’ Retirement System, Consolidated Judicial Retirement System and Legislative Retirement System will see a special one-time payment included within their October retirement benefit. A one-time pension supplement has been granted by the General Assembly for members who retire on or before September 1, 2018, in the amount of one percent (1.0%) of the annualized benefit. This one-time supplement will be paid on October 25, 2018, and will not change the ongoing monthly benefit going forward.

More information about one-time supplements and cost-of-living adjustments can be found here.

Click here to read the full legislation.

Audience: Employers, Retired Members of TSERS/CJRS/LRS only

 

Increase and Expansion of Line-of-Duty Death Benefit for Public Safety Workers

The line-of-duty death benefit for public safety workers increased from $50,000 to $100,000, retroactive to April 1, 2017. This benefit now extends coverage to noncustodial employees of the Division of Adult Correction and Juvenile Justice who are killed by inmates. The line-of-duty death benefit is administered jointly by the NC Industrial Commission and the NC Department of State Treasurer.

Click here to read the full legislation.

Audience: Employers, Active Members

 

Expansion of Garnishment of Wages to Recover Overpayments

In the past, if a state or local government employee owed money to the State Health Plan or the Retirement Systems Division, participation in the garnishment of wages was considered optional by employers. Current law now requires employer participation in the garnishment of wages if a member or beneficiary who is employed by a system employer receives an overpayment or erroneous payment.  In such cases, the State Health Plan or the Retirement Systems Division will now notify the employer, and the amount owed will be offset against not less than 10 percent of the employee’s net wages until it is fully paid.

Click here to read the full legislation.

Audience: Employers, Active Members

 

Interception of Credit Card Receipts for Funds Owed

When the State Health Plan prevails in a civil action against a provider, or when the Retirement Systems Division prevails in a civil action against a participating employer to collect monies owed, this law provides that the State Health Plan or the Retirement Systems Division may garnish the provider’s or employer’s credit card receipts or other third-party payments in the amount owed.

Click here to read the full legislation.

Audience: Employers

 

Elimination of ORP Reciprocity with TSERS for New Hires

For members first hired on or after January 1, 2021, membership service in the University Optional Retirement Program (ORP) cannot be counted toward determining the benefit eligibility for the Teachers’ and State Employees’ Retirement System (TSERS). Prior to this change, ORP membership service is counted toward determining eligibility for TSERS, but it is not counted as creditable service in the calculation of the TSERS benefit.

Click here to read the full legislation.

Audience: Employers

 

Anti-Pension Spiking Liability Related to Members with Multiple Employers

When a member has multiple simultaneous employers, the contribution based benefit cap (CBBC) liability applies only if it is generated because of a member’s service to one employer at a time, or if the average final compensation (AFC) earned by the member attributable to one of the member’s employers exceeds the CBBC AFC thresholds.

Click here to read the full legislation.

Audience: Employers

 

Establishment of Filing Period for Short-Term Disability

To synchronize short-term with the long-term disability filing period, members wishing to file an application for Disability Income Plan of North Carolina short-term disability will need to do so within one year of the end of the 60-day waiting period for short-term benefits.

Click here to read the full legislation.

Audience: Employers, Active Members

 

Employers Pay for Entire Short-Term Disability Period

For short term disability benefits from the Disability Income Plan of North Carolina that begin on or after July 1, 2019, employers will no longer be reimbursed for the second six months of short term disability benefits. This will result in the employer paying for the entire short term disability period.

Click here to read the full legislation.

Audience: Employers

 

Felony Forfeiture Modifications

Currently, elected government officials will forfeit their right to a monthly benefit from the Teachers’ and State Employees’ Retirement System or the Local Governmental Employees’ Retirement System if they are convicted of certain state or federal offenses related to their service as an elected official. As of June 26, 2018, convictions on state charges of embezzlement were added to the list of offenses. Also, if any portion of a register of deeds’ Local Governmental Employees’ Retirement System benefit is forfeited, then that member’s entire Registers of Deeds Supplemental Pension Fund benefit is also forfeited.

Click here to read the full legislation.

Audience: Employers

 

Clarify that Board Members are not Employees for Retirement Purposes

Members of boards or commissions are generally not considered employees for retirement purposes and are able to serve on a board or commission without affecting their retirement status.

Click here to read the full legislation.

Audience: Employers, Retired Members

 

Special Separation Allowance Buyouts

Effective June 22, 2018, state agencies and local governments may offer separation buyouts to law enforcement officers who leave employment before reaching eligibility for the special separation allowance. The buyout must be paid from funds available and may not exceed the total amount that otherwise would have been paid if the officer had been eligible for the special separation allowance at the time of retirement. The special separation allowance is currently paid by the agency or local government beginning at the officer’s retirement with full (“unreduced”) benefits and ending when the officer reaches age 62. Click here for more information on this topic.

Click here to read the full legislation.

Audience: Employers, Active Members

 

Employers Pay Directly to Transfer Benefit

Currently, a transfer benefit can be funded only with assets in an employee’s qualified retirement account. Effective July 1, 2019, TSERS and LGERS employers may also transfer employer contributions to the Retirement Systems Division to establish a separate lifetime monthly benefit payment. See the Transfer Benefit information on our website for more information on this option.

Click here to read the full legislation.

Audience: Employers, Active Members

 

New Reduced Benefit Eligibility for Law Enforcement Officers

Currently, TSERS and LGERS law enforcement officers (LEOs) may retire with a reduced benefit after reaching age 50 with 15 years of creditable service as an officer. Effective July 1, 2019, LEOs will be able to retire with reduced benefits at any age with 25 years of service. There are several things to consider when contemplating this reduced benefit. For more information, click here.

Click here to read the full legislation.

Audience: Employers, Active Members

 

Election Day Service Rules for Retired Law Enforcement Officers

Currently, special separation allowances for retired local law enforcement officers (LEOs) must be suspended if they are re-employed by a local government employer in any capacity. Effective June 14, 2018, retired LEOs will be able to be able to work for county boards of elections in connection with Election Day service without affecting their special separation allowances. Please note that retired LEOs opting to participate in Election Day service will still be subject to return-to-work laws and earnable allowance restrictions for the Teachers’ and State Employees’ Retirement System or the Local Governmental Employees’ Retirement System.

Click here to read the full legislation.

Audience: Employers, Retired Members

 Retirement Systems Laws

​The 2017 Edition of North Carolina Retirement Systems Laws is available online.

View the 2017 Edition