Section 9. Refunds Of Contributions

A. In the event that a member should terminate employment for reasons other than retirement, disability, or death, the member shall be entitled to a refund of the member’s contributions, plus interest calculated at the refund rate, reduced by the sum of any disability benefits which that member might have previously received. Contributions made by an employer on behalf of an employee (also referred to as a “member”) pursuant to Subsection A of Section 22-11-21 NMSA 1978 are “employee contributions” and are subject to refund. A member is not entitled to a refund of any “employer contributions” (also referred to as “local administrative unit contributions”) made pursuant to Subsection B of Section 22-11-21 NMSA 1978. Interest paid by a member to reinstate withdrawn service credit is nonrefundable. B. Any employee who was retired pursuant to the Public Employees Retirement Act (Chapter 10, Article 11 NMSA 1978) and who had made contributions to the fund prior to July 1, 2003, shall be entitled to a refund of such contributions, with interest calculated at the refund rate upon a bona fide termination of employment with the local administrative unit. C. In order to obtain a refund of contributions, the eligible member must file a written request with the director on forms provided by the board. D. A refund of a terminated member’s contributions shall be made as soon as practical after receipt of a fully executed refund request form in the office of the board. If the member’s record has been inactive for a full calendar quarter, the refund may be processed without further certification of termination by the last employer or the final monthly report upon which the member appears. If the member requesting a refund has an active record (i.e., a record reflecting contributions made in the preceding completed calendar quarter), the refund request shall not be processed without the last employer’s certification of termination and the final monthly report upon which the refunding member will appear n by the last employer or the final monthly report upon which the member appears. If the member requesting a refund has an active record (i.e., a record reflecting contributions made in the preceding completed calendar quarter), the refund request shall not be processed without the last employer’s certification of termination and the final monthly report upon which the refunding member will appear. No refund shall be processed until the board has received all required contributions. The board shall not accept contributions subsequent to the submission of the final monthly report, as certified by the employer. If a refunding member returns to employment with any local administrative unit before the refund process is complete, the refund request shall be denied. For purposes of this rule, “termination” means a complete severance of the employment relationship with no contract for, promise of, or expectation of future employment with any local administrative unit. E. Refund of contributions for any period of service performed subsequent to July 1, 1957, will cancel all “prior service” credit which may have been credited to the member at the time of the refund. Restoration of all contributions withdrawn, together with interest calculated at the refund rate, will cause the prior service to be restored; provided, however, that as set forth Subsection C of 2.82.3.11 NMAC, effective July 1, 2011, a member who was a member at any time prior to July 1, 2010 and who, on or before June 30, 2010, had all of his or her member contributions refunded pursuant to Section 22-11-15 NMSA 1978, and who, on or after July 1, 2010, returns to employment or returns the withdrawn contributions to the fund together with interest at the rate set by the board, is eligible to retire as if initially becoming a member on or after July 1, 2010. F time prior to July 1, 2010 and who, on or before June 30, 2010, had all of his or her member contributions refunded pursuant to Section 22-11-15 NMSA 1978, and who, on or after July 1, 2010, returns to employment or returns the withdrawn contributions to the fund together with interest at the rate set by the board, is eligible to retire as if initially becoming a member on or after July 1, 2010. F. Whenever a terminated member leaves a balance of $500.00 or less in the member’s account, the account shall be closed into "unallocated income" after the member has been terminated for a period of not less than two years. The record of the terminated member’s contribution balance at the time that it was closed into “unallocated income” shall be maintained. If the terminated member subsequently returns to employment, the balance shall be restored to that member’s account. Alternatively, if the terminated member should later claim or request a refund of the amount transferred to unallocated income, such amount shall be restored to the terminated member’s account and refunded. G. Whenever a terminated member has received a refund in excess of the amount due the member, such excess may be “closed out" into unallocated income by the director if it does not exceed $1,000.00 after the excess refund has been outstanding for a period of not less than two years, provided that staff has first made two or more separate attempts to contact the terminated member in writing and collect the excess refund. All such attempts must be documented by staff. All such “close out” actions shall be reported to the board in writing at its first regular meeting following that action. If a terminated member who received an excess refund that was closed into "unallocated income" should return to employment, such excess refund shall be charged to the member's contribution account. H and collect the excess refund. All such attempts must be documented by staff. All such “close out” actions shall be reported to the board in writing at its first regular meeting following that action. If a terminated member who received an excess refund that was closed into "unallocated income" should return to employment, such excess refund shall be charged to the member's contribution account. H. If a terminated member shall have received a refund in excess of $1,000.00 over the amount due that member, and two or more separate attempts have been made to contact the terminated member and collect the 2.82.3 NMAC 4 excess refund, the director may, after taking into account the costs of doing so, direct staff to pursue legal action to recover the excess. If the amount is deemed uncollectible by the director, the matter shall be brought before the board to determine any further action. I. Member contributions which have been withheld and paid to the educational retirement fund in error for a member who is not eligible to receive service credit for the time covered by the withholding, shall be returned to the employer, without interest, upon the member’s written request or upon the board learning that the member was not eligible to receive service credit for the time covered. The employer shall be responsible for returning such contributions to the member. [2.82.3.9 NMAC - Rp, 2.82.3.9 NMAC, 7/1/2012; A, 6/30/2016; A, 9/26/2017] 2.82.3.10 REFUNDS OF CONTRIBUTIONS IN THE EVENT OF DEATH OF MEMBER OR BENEFICIARY: A. In the event of the death of an active member who is not vested, member contributions together with interest calculated at the refund rate shall be refunded to the member’s beneficiary or to the member’s estate upon completion of the proper refund forms as provided for herein. B /2012; A, 6/30/2016; A, 9/26/2017] 2.82.3.10 REFUNDS OF CONTRIBUTIONS IN THE EVENT OF DEATH OF MEMBER OR BENEFICIARY: A. In the event of the death of an active member who is not vested, member contributions together with interest calculated at the refund rate shall be refunded to the member’s beneficiary or to the member’s estate upon completion of the proper refund forms as provided for herein. B. In the event of the death of a vested member who did not select Option B benefits prior to the effective date of retirement, the deceased member’s beneficiary shall be have the option of electing to receive a refund of the member’s contributions or receiving benefits in the form of Option B as provided in Section 22-11-29 NMSA 1978. Refunds, together with interest calculated at the refund rate and reduced by the sum of any disability benefits which that member previously received, shall be paid to the member’s surviving beneficiary, surviving spouse or domestic partner if no beneficiary had been named, or if there is no named surviving beneficiary, surviving spouse or domestic partner, to the member’s estate. If a beneficiary defers payment after the member dies as described in Section 22-11-29 NMSA 1978 and requests a lump sum payment in lieu of benefit under Option B, interest shall be calculated at the refund rate though the end of the calendar quarter prior to the date on which the completed refund request is received by the ERB. Under the provisions of Options B and C, if both the member and the designated beneficiary die before the total of the retirement benefits received by the member and the beneficiary equal the total contributions made by the member, the difference, less any disability benefits previously paid to the member, shall be paid to the member’s or the beneficiary’s estate. C request is received by the ERB. Under the provisions of Options B and C, if both the member and the designated beneficiary die before the total of the retirement benefits received by the member and the beneficiary equal the total contributions made by the member, the difference, less any disability benefits previously paid to the member, shall be paid to the member’s or the beneficiary’s estate. C. In order to obtain a refund of contributions after the death of a member, the member’s beneficiary must notify the director of the member’s death and furnish a copy of the death certificate or other proof of death acceptable to the director, whereupon the director shall furnish the beneficiary the proper forms to request a refund. D. If the amount of a deceased member’s contribution does not exceed the sum of $1,000.00 and no written claim is made to the board for it within one year from the date of the member’s death, by the member’s surviving beneficiary or estate, payment thereof may be made to the named beneficiary or, if none is named, to the person that the board determines to be entitled to the contribution under the laws of New Mexico. E. A person will be considered a domestic partner if the person submits a completed ERB domestic partner affidavit form and two of the following documents: proof of shared residence via joint mortgage statement, joint rental agreement, or deed; automobile title or registration showing joint ownership of a vehicle; joint checking, bank, or investment account statement; joint credit account statement; a will or life insurance policy that designates the other person as primary beneficiary; or such other supporting document(s) approved by the director.