Colorado § 31-31.5-411 - Refunds of member contributions.

§ 31-31.5-411. Refunds of member contributions.

(1) (a) Any member covered by the statewide retirement plan who terminates service may elect to have the member's accumulated contributions to one or more lifetime benefit components of the plan refunded together with five percent of the member's total accumulated contributions as interest in a lump sum and thereafter shall have no right to lifetime benefits provided by the plan.

(b) If the member who terminates service and receives a refund of member contributions subsequently returns to service as an active member with an employer that covers its members under the statewide retirement plan, the member's prior service credit shall be restored when the member returns the member's refunded contributions to the lifetime benefit components, with interest accrued from the date of refund to the date of return, according to the terms and conditions established by the board. If the member fails to return the contributions and interest, the member shall be treated as a new member, and the member's prior service shall not be recognized in determining pension eligibility or pension benefits. The restoration of a member's service credit pursuant to this subsection (1)(b) shall not entitle the member to reinstatement of any previously forfeited balance in the member's money purchase component account or the separate retirement account.

(2) (a) If a member dies after termination of service, is not eligible for a vested, normal, or early retirement, and has not yet received a refund or began receiving benefit payments, the association shall refund the member's lifetime benefit component contributions to the member's designated beneficiary, surviving spouse, or dependent children. Where there is no designated beneficiary, surviving spouse, or dependent children, the refund shall be made to the deceased member's estate.

(b) If a member who has not terminated service dies, and there is no spouse or dependents eligible for survivor benefits under part 8 of article 31 of this title 31, the deceased member's lifetime benefit component contributions may be refunded to:

(I) The member's designated beneficiary if the member is not eligible for vested, early, or normal retirement. The designated beneficiary may in the alternative elect a lifetime benefit pursuant to section 31-31.5-406.

(II) If there is no designated beneficiary, the member's estate.

(3) The designated beneficiary of a member eligible for vested, early, or normal retirement shall receive the benefit described in section 31-31.5-406 (2) and no refund of contributions shall be made.

(4) Upon payment of a refund of member contributions, no lifetime benefit components benefits shall be payable.

(5) Refunds of contributions to the lifetime benefit components shall not be made to any members of employers who have failed to remit all contributions required under the provisions of the statewide retirement plan.

(6) A member or the member's designated beneficiary, surviving spouse or partner in a civil union, or dependent children who is entitled to receive a refund of the member's defined benefit contributions may elect to have the refund credited to the member account in the money purchase component. Upon the refund being credited, the member or the member's designated beneficiary, surviving spouse or partner in a civil union, or dependent children are treated as having taken a refund from the defined benefit component for all purposes.

Source: L. 2022: Entire article added, (HB 22-1034), ch. 61, p. 293, § 1, effective August 10.

PART 5

MONEY PURCHASE COMPONENT