Qualified Governmental Excess Benefit Arrangement

PURPOSE: This rule implements section 169.070.16, RSMo and section 415(m) of Title 26 of the United States Code and allows for the payment of benefits in excess of the limits imposed by section 415 of Title 26 of the United States Code and section 169.070.16, RSMo to which retirees and beneficiaries are otherwise entitled pursuant to Chapter 169, RSMo. (1) Definitions. (A) “Maximum benefit” shall mean the benefit a retiree or beneficiary is entitled to receive from the retirement system in any month after giving effect to section 169.070.16, RSMo designed to conform to the annual benefit limit set forth in section 415 of Title 26 of the United States Code as amended. (B) “Retirement system” shall mean The Public School Retirement System of Missouri established pursuant to Chapter 169, RSMo. (C) “Section 415(m) benefit participant” shall mean any retiree or beneficiary whose benefits otherwise payable pursuant to Chapter 169, RSMo without giving effect to the limitations of section 169.070.16, RSMo designed to conform to section 415 of Title 26 of the United States Code, would exceed the maximum benefit permitted under section 415 of Title 26 of the United States Code. Eligibility as a section 415(m) benefit plan participant shall be determined by the retirement system at retirement and annually thereafter. (D) “Section 415(m) benefit plan” shall mean the separate, unfunded qualified governmental excess benefit arrangement within the meaning of section 415(m) of Title 26 of the United States Code and established pursuant to section 169.070.16, RSMo and this rule that is a separate portion of the retirement system. (E) “Unrestricted benefit” shall mean the monthly benefit a retiree or beneficiary would have been entitled to receive from the retirement system under Chapter 169, RSMo without giving effect to the restrictions of section 169.070.16, RSMo designed to conform to section 415 of Title 26 of the United States Code. (2) A section 415(m) benefit participant receiving benefits from the retirement system pursuant to Chapter 169, RSMo is entitled to a monthly benefit under the section 415(m) benefit plan in an amount equal to the section 415(m) benefit participant’s unrestricted benefit less the maximum benefit. In no event shall a retiree or beneficiary receive a total monthly benefit from the retirement system and the section 415(m) benefit plan in excess of the monthly benefit he or she would have been entitled to receive from the retirement system under Chapter 169, RSMo without giving effect to the restrictions of section 169.070.16, RSMo designed to conform to section 415 of Title 26 of the United States Code. (3) Any benefit to which a retiree or beneficiary is entitled pursuant to this rule shall be paid at the same time and in the same manner as the benefit would have been paid from the retirement system if the payment of the benefit from the retirement system had not been precluded by section 169.070.16, RSMo designed to conform to section 415 of Title 26 of the United States Code. (4) Contributions may not be accumulated under the section 415(m) benefit plan to pay future monthly benefits to retirees or beneficiaries. Instead, a portion of each payment of employer contributions that is made to the retirement system under section 169.030, RSMo shall be paid to the section 415(m) benefit plan in an amount necessary to satisfy the monthly obligation to pay section 415(m) benefit participants the amount calculated pursuant to (2) above, as those amounts become due, and may include amounts needed to pay reasonable expenses necessary to administer the section 415(m) benefit plan. Employer contributions made to provide section 415(m) benefits pursuant to this rule shall not be commingled with any other assets of the retirement system. (5) The section 415(m) benefit plan is a separate portion of the retirement system plan qualified pursuant to section 401(a) of Title 26 of the United States Code and is maintained solely for the purpose of providing benefits to retirees and beneficiaries that would otherwise exceed the limits imposed by section 415 of Title 26 of the United States Code. (6) A member, retiree, or beneficiary of the retirement system may not directly or indirectly elect to defer compensation or to otherwise purchase benefits pursuant to section 169.070.16, RSMo or this rule. (7) The section 415(m) benefit plan shall be administered in the same manner as the retirement system pursuant to section 169.020, RSMo. AUTHORITY: section 169.020, RSMo 2000.* Original rule filed Aug. 15, 2001, effective Feb. 28, 2002. *Original authority: 169.020, RSMo 1945, amended 1951, 1953, 1967, 1973, 1983, 1990, 1995, 1996, 1998.