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A.  If a member has not participated in the Deferred Retirement Option Plan upon attaining eligibility, as provided by the provisions of this Chapter, and if the maximum benefit or an optional benefit is chosen pursuant to La. Rev. Stat. 11:1150(B)(2), (3), or (4), then a reduced retirement allowance plus an initial benefit shall be paid to the member, provided the initial benefit, together with the reduced retirement allowance, shall be certified by the actuary to be actuarially equivalent to the member’s maximum or optional retirement allowance and shall be approved by the board of trustees.

B.  The amount of the initial benefit, as determined by the member, shall not exceed an amount equal to the member’s maximum monthly retirement allowance times thirty-six and shall, at the option of the member, be paid in accordance with plan provisions under La. Rev. Stat. 11:1152 or as a lump-sum payment.  The amount of the initial benefit shall be placed in an account in accordance with La. Rev. Stat. 11:1152, and interest will be paid on any balance in the account in accordance with La. Rev. Stat. 11:1152.

C.  Cost-of-living adjustments granted by the board of trustees to retirees who select the option under this Section shall be computed on the basis of each retiree’s regular monthly retirement benefit or on the basis of each beneficiary/survivor’s benefit based on the option selected as reduced and shall not be computed on the initial benefit received either as a lump-sum or paid pursuant to La. Rev. Stat. 11:1152(G)(1).

Acts 2001, No. 266, §1, eff. July 1, 2001.