1. Any member eligible for a retirement allowance pursuant to section 169.670 and who has not previously received a retirement allowance, including an allowance under disability retirement, pursuant to section 169.670, and whose sum of age and creditable service equals eighty-six years or more or whose creditable service is thirty-three years or more or whose age is sixty-three years or more and has eight years or more creditable service may elect a distribution under the partial lump sum option plan provided in this section if the member notifies the retirement system on the application for retirement of the member’s effective date of retirement; provided that the partial lump sum option plan may not be elected if the member elects a retirement allowance under option 7 of subdivision (1) of subsection 4 of section 169.670.

2. A member entitled to make an election pursuant to this section may elect to receive a lump sum distribution in addition to the member’s monthly retirement allowance payment pursuant to section 169.670 as reduced pursuant to this section. Such member may elect the amount of the member’s lump sum distribution from one, but not more than one, of the following options:

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(1) A lump sum amount equal to twelve times the retirement allowance, less any temporary retirement allowance payable pursuant to subdivision (5) of subsection 1 of section 169.670, the member would receive if no election were made under this section and the member had chosen option 1 under section 169.670;

(2) A lump sum amount equal to twenty-four times the retirement allowance, less any temporary retirement allowance payable pursuant to subdivision (5) of subsection 1 of section 169.670, the member would receive if no election were made pursuant to this section and the member had chosen option 1 under section 169.670; or

(3) A lump sum amount equal to thirty-six times the retirement allowance, less any temporary retirement allowance payable pursuant to subdivision (5) of subsection 1 of section 169.670, the member would receive if no election were made pursuant to this section and the member had chosen option 1 under section 169.670.

3. When a member makes an election to receive a lump sum distribution pursuant to this section, the retirement allowance that the member would have received in the absence of the election shall be reduced on an actuarially equivalent basis to reflect the payment of the lump sum distribution and the reduced retirement allowance shall be the member’s retirement allowance thereafter for all purposes in relation to retirement allowance amounts pursuant to section 169.670. If eligible, the member may also receive a temporary benefit, pursuant to subdivision (5) of subsection 1 of section 169.670, for the period of time described therein. A retirement allowance increased due to the death of a person nominated by the member to receive benefits pursuant to the provisions of option 2, 3, or 4 of subsection 4 of section 169.670 shall be increased pursuant to such provisions to the amount the retired member would be receiving had the retired member elected option 1 as actuarially reduced due to the lump sum distribution made pursuant to this section. Any payment of accumulated contributions pursuant to the provisions of sections 169.600 to 169.715 shall be reduced by the amount of any lump sum distribution made pursuant to this section in addition to any other reductions required by sections 169.600 to 169.715.

4. If the member dies before receiving a lump-sum distribution under this section the lump-sum distribution shall be paid in accordance with rules adopted by the board of trustees.

5. Benefits paid pursuant to this section in addition to all other provisions of the public education employee retirement system of Missouri shall not exceed the limitations of Section 415 of Title 26 of the United States Code except as provided in subsection 13 of section 169.670.