N.Y. Education Law § 512: Withdrawal and death benefits

§ 512. Withdrawal and death benefits. Benefits upon withdrawal and

death shall be payable as follows:

a. A member who withdraws from service or ceases to be a teacher for

any cause other than death or retirement shall be paid on demand the

accumulated contributions standing to the credit of his individual

account in the annuity savings fund. A member who has no accumulated

contributions credited to his individual account in the annuity savings

fund and who ceases to be a teacher for any cause other than death or

retirement may withdraw from membership in the system by filing a notice

of withdrawal with the system pursuant to rules and regulations adopted

by the retirement board.

b. 1. Should a contributor die before retirement, his accumulated

contributions shall be paid to his estate or to such person as he shall

have nominated to receive such benefit. In the event such designated

beneficiary does not survive him, or if he shall not have so designated

a beneficiary, such benefit shall be payable to the deceased member's

estate or as provided in section one hundred three-a of the decedent

estate law. Such nomination must be by written designation duly executed

and filed with the retirement board.

2. In addition to the return of accumulated contributions, a death

benefit also shall be payable upon the death of a member who dies before

the effective date of his retirement, and was in service upon which his

membership was based when he died or was on the payroll in such service

and paid within a period of twelve months prior to his death and had not

been otherwise gainfully employed since he ceased to be on such payroll

or if, during the period that membership is valid, the retirement board

shall determine to its satisfaction that said member was physically or

mentally incapacitated for the performance of duty at the time he ceased

to be on the payroll in such service and that he had been so

incapacitated and had not been otherwise gainfully employed since he

ceased to be on such payroll; provided he had credit for one or more

years of service while actually a member. The amount of death benefit

shall be computed by multiplying one twelfth of the compensation

earnable by such member during his last twelve months of service while a

member by the number of years, not to exceed twelve, of his total credit

for service as a teacher in this state. Where the member has more than

twelve years of credited service as a teacher in this state and when his

death occurs on or after July first, nineteen hundred sixty-one, and

before July first, nineteen hundred seventy-four, there shall be added

to such benefit one twenty-fourth of such compensation multiplied by the

number of years in excess of twelve, but not to exceed twenty-four such

years, of his total credit for service as a teacher in the state. The

death benefit shall be paid to such person as he shall have nominated to

receive such benefit. In the event such designated beneficiary does not

survive him, or if he shall not have so designated a beneficiary, such

benefit shall be payable to the deceased member's estate or as provided

in section one hundred three-a of the decedent estate law. Such

nomination must be by written designation duly executed and filed with

the retirement board. The provisions of this paragraph two of

subdivision b of this section shall apply only to deaths occurring on

and after July first, nineteen hundred fifty-nine.

3. Notwithstanding any other provisions of this article or any rules

or regulations adopted thereunder by the retirement board, the death

benefit payable pursuant to paragraph two of this subdivision, in the

case of a member who dies after having become eligible to apply and be

retired for special service or superannuation pursuant to the provisions

of this article, shall be increased by the amount, if any, that the

actuarial equivalent of the pension portion of his retirement allowance,

computed as if he had been retired on the day immediately preceding his

death, and computed in accordance with the provisions of subdivision two

of section five hundred ten and subdivision four of section five hundred

eleven-a of this article, exceeds the amount of the death benefit

otherwise payable pursuant to paragraph two of this subdivision. The

provisions of this paragraph three of subdivision b of this section

shall apply only to deaths occurring after the date on which said

paragraph three becomes operative and prior to July first, nineteen

hundred seventy-four.

4. Notwithstanding any other provision of this article, the

requirement of one or more years of credited service, as set forth in

paragraph two of this subdivision, shall be deemed to have been

satisfied by any member who has credit for three or more months of

service rendered since last becoming a member. The provisions of this

paragraph shall apply only to deaths occurring after June thirtieth,

nineteen hundred seventy and before July first, nineteen hundred

seventy-five.

5. Notwithstanding any other provision of this article, the death

benefit payable pursuant to paragraph two of this subdivision shall be

increased by the excess, if any, of the greater of a or b over the sum

of c and d, where a, b, c and d are as set forth hereunder:

a. One-twelfth of the member's compensation multiplied by the number

of years, not to exceed thirty-six, of his total credited state service.

b. The lesser of three times the member's compensation or twenty

thousand dollars.

c. The death benefit which, in accordance with the provisions of

paragraph two of this subdivision, is payable in addition to the return

of accumulated contributions.

d. The reserve for increased-take-home-pay.

The term "compensation", as used in this subparagraph, shall mean (1)

in the case of a member who has credit for one or more years of service

rendered since last becoming a member, the compensation earned by such

member during his last twelve months of service, and (2) in the case of

a member who has credit for less than one year of service rendered since

last becoming a member, it shall mean his annual rate of compensation at

the time of his death. The provisions of this paragraph shall apply only

to deaths occurring after June thirtieth, nineteen hundred seventy and

before July first, nineteen hundred seventy-five. The additional death

benefits payable hereunder shall be construed as being payable under

paragraph two of this subdivision for the purpose of computing benefits

payable under paragraph three of this subdivision.

c. The member or, within ninety days after his death, the person

nominated by him to receive any benefit payable on his account, may file

with the retirement board a written designation, duly executed,

providing that such benefit shall be paid in the form of an annuity to

the person so nominated. Such annuity shall be determined as the

actuarial equivalent of the benefit otherwise payable, on the basis of

the interest rate and the mortality tables adopted by the retirement

board for use in the calculations of such annuities. Such annuity shall

be payable throughout the life of the person so nominated, with no

payments at his death unless the member or, within ninety days after his

death, the person nominated by him to receive his benefit, shall elect

to have the actuarial equivalent of such annuity paid in the form of a

reduced annuity payable for life with the provision that if the person

so nominated should die before the annuity payments received by him are

equal to such actuarial equivalent, the balance thereof shall be paid in

a lump sum to such beneficiary's estate or to such person as such member

or his nominee shall have designated. Such designation of a beneficiary

to receive such benefit may be made or changed at any time by the person

who made it. Such election or change shall be made by written

designation duly executed and filed with the retirement board.

Notwithstanding the foregoing provisions, the retirement board reserves

the right to pay any benefit in the form of a lump sum payment if the

annuity determined as the actuarial equivalent of the benefit otherwise

payable is less than one hundred dollars per month.

d. 1. The retirement board may adopt rules and regulations providing

that a trustee of an inter vivos or testamentary trust shall be eligible

to be nominated to receive a lump sum benefit pursuant to subdivision b

of this section.

2. Any proceeds received by a trustee under this section shall not be

subject to the debts of the member or to transfer or estate taxes to any

greater extent than if such proceeds were payable to the beneficiaries

named in the trust and not to the estate of the member.

3. A payment made in good faith under this section to either a

designated trustee of an inter vivos trust, a successor trustee of an

inter vivos trust who provides a copy of his appointment or a trustee of

successor trustee of a testamentary trust who provides a copy of the

letters of trusteeship shall be a complete discharge to the system to

the extent of the payment.

4. If no qualified trustee claims the proceeds within eighteen months

after the death of the member, or if satisfactory evidence is furnished

within such period showing that there is or will be no trustee to

receive the proceeds, payment shall be made to the deceased member's

estate.

e. Notwithstanding any other provision of law, a member with ten or

more years of credited service in such system who dies before a

retirement benefit becomes payable and who is otherwise not entitled to

a death benefit from the retirement system shall be deemed to have died

on the last day that he or she was in service upon which his or her

membership was based for purposes of eligibility for the payment of a

death benefit pursuant to the provisions of this section. The death

benefit payable in such case shall be one-half of that which would have

been payable had such member died on the last day that service was

rendered.

f. Notwithstanding the provisions of any other law to the contrary and

solely for the purpose of determining eligibility for the death benefit

payable pursuant to this section, a person subject to this section shall

be considered to have died while in teaching service provided such

person was in such service at the time he or she was ordered to active

duty pursuant to Title 10 of the United States Code, with the armed

forces of the United States or to service in the uniformed services

pursuant to Chapter 43 of Title 38 of the United States Code and died

while on such active duty or service in the uniformed services on or

after June fourteenth, two thousand five. Provided, further, that any

such person ordered to active duty pursuant to Title 10 of the United

States Code, with the armed forces of the United States or to service in

the uniformed servicers pursuant to Chapter 43 of Title 38 of the United

States Code who died prior to rendering the minimum amount of service

necessary to be eligible for this benefit shall be considered to have

satisfied the minimum service requirement.

g. Notwithstanding any other provision of law to the contrary, any

member of the retirement system subject to article fourteen or fifteen

of the retirement and social security law who has permanently ceased

teaching shall have the right to elect the return of his or her

accumulated contributions and thereby terminate his or her membership in

the retirement system without regard to the amount of service to his or

her credit, provided a public employee retirement system in another

state has certified in a manner satisfactory to the system that such

member is a member of such other retirement system, has at least five

years of retirement credit in such other system, and is eligible, upon

the termination of his or her membership in the system, to obtain

retirement credit in such other retirement system for the service which

has been credited to his or her membership in the system. Upon refund of

such accumulated contributions, any and all obligations of the

retirement system to such member shall be totally discharged. The

retirement board is authorized to adopt such rules and regulations as

may be necessary to implement this subdivision.