19-20-716. Termination pay. If a member receives termination pay at the time of termination and elects to retire at that time, the member shall select one of the following options:
     (1) The member may use termination pay in the calculation of the member's average final compensation. The member and the employer shall pay contributions to the retirement system as determined by the board to adequately compensate the system for the additional retirement benefit. The contributions must be made at the time of termination.
     (2) The member may use a yearly amount of termination pay added to each of the 3 consecutive years' salary used in the calculation of the member's average final compensation. To determine the amount of termination pay used in the calculation of average final compensation, termination pay must be divided by the total number of years of creditable service to determine a yearly amount. The member and the employer shall pay contributions on the termination pay according to the rates provided for in 19-20-602 and 19-20-605(1).
     (3) The member may exclude the termination pay from the average final compensation. A contribution is not required of either the member or the employer, and any contributions made under 19-20-602 and 19-20-605 must be refunded.

     History: En. Sec. 2, Ch. 442, L. 1997.