OFA Bill Analysis
AN ACT CONCERNING BENEFITS FOR SURVIVING SPOUSES UNDER THE TEACHERS' RETIREMENT SYSTEM.
The bill allows the surviving spouse of a Teachers' Retirement System (TRS) member to choose the following options in the settlement of the retirement account if the member 1) at the time of death was eligible for a retirement benefit, and 2) had not filed a waiver of the co-participant option:
● Monthly 100% co-participant benefit (the 100% co-participant option provides an actuarially reduced monthly benefit to a retired teacher for life with the same amount continuing after the teacher's death to his or her designated co-participant) or
● Lump sum refund of the member's accumulated contributions plus credited interest.
EFFECTIVE DATE: Upon passage and applicable with respect to members who died on or after January 1, 2008.
Survivorship Benefits Issued Before Retirement
Under current law, if a teacher dies after meeting the age and service requirements for a retirement benefit and their spouse is named the sole designated beneficiary, the spouse has the option of choosing the 100% co-participant benefit or the refund of contributions. However, if the teacher did not name their surviving spouse as the sole designated beneficiary, the spouse is limited to the survivorship benefit.
The bill allows the surviving spouse of a teacher who failed to name their spouse as the sole designated beneficiary the same benefit options available to those surviving spouses who were named sole designated beneficiary. There are two surviving spouses who are impacted by the bill.
Statutory Survivorship Benefits
Survivorship Benefits are provided as follows:
● $ 300 monthly – each minor child under age 18,
● $ 300 monthly – each disabled child,
● $ 300 to $ 600 monthly – surviving spouse,
● $ 1,500 monthly maximum family survivorship benefit,
● $ 2,000 maximum lump sum death benefit payment paid to the surviving spouse.