7. (a) When a member of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System elects to transfer to an alternate benefit program by filing the proper application form declaring his election to participate in such alternate benefit program, the respective retirement system shall transfer the amount of his accumulated deductions as of the date of transfer to his individual account in the program.

(b) There shall also be transferred from the contingent reserve fund or the pension fund of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System or from the Group Annuity Plan to the individual’s account in the alternate benefit program, the pension reserve required as of the date of his transfer to provide a pension for each year of service credited to the account of the member as set forth in N.J.S. 18A:66-36 or N.J.S. 18A:66-44 or as set forth in section 38 or section 48 of P.L.1954, c.84 as such sections have been amended and supplemented as of July 1, 1969 (C.43:15A-38, C. 43:15A-48) or as set forth in section 17 of P.L.1964, c.241 (C. 43:16A-11.2) or section 5 of P.L.1944, c.255 (C. 43:16A-5) or for each year of service credited under the Group Annuity Plan. Such transfer from the contingent reserve fund or the pension fund of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System or the Group Annuity Plan shall be made at the time of the member’s transfer to the alternate benefit program in the case of any such member who has then met the eligibility requirements for a pension under the aforementioned N.J.S.18A:66-36, or N.J.S.18A:66-44, or section 38 or section 48 of P.L.1954, c.84 (C.43:15A-38, C. 43:15A-48) or section 17 of P.L.1964, c.241 (C. 43:16A-11.2) or section 5 of P.L.1944, c.255 (C. 43:16A-5) or the Group Annuity Plan. In the case of any member who elects to participate in the alternate benefit program who has not then met the eligibility requirements for a pension under N.J.S. 18A:66-36 or N.J.S.18A:66-44, or under section 38 or section 48 of P.L.1954, c.84 (C.43:15A-38, C. 43:15A-48) or section 17 of P.L.1964, c.241 (C. 43:16A-11.2) or section 5 of P.L.1944, c.255 (C. 43:16A-5) or under the Group Annuity Plan, the transfer from the contingent reserve fund or the pension fund of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System or the Group Annuity Plan shall be effected at the time such requirements have been met, taking into account for the purpose of such eligibility requirement his years of membership service at the time of his election and his subsequent years of service as a full-time member of the faculty of Rutgers, The State University, the New Jersey Institute of Technology, Rowan University, Montclair State University, Kean University, or the State or county colleges or as an eligible employee of the Department of Higher Education, or at the time he shall have 10 years of credit for New Jersey service and becomes physically incapacitated for the performance of duty if he had been a member of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System as of the date of transfer.

The annuity to be used in determining the amount of pension is the actuarial equivalent of the member’s accumulated deductions transferred from the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System to the date the member attains 60 years of age, if subsequent to the date of election. The amount of pension is that established by formula within N.J.S. 18A:66-44 or section 48 of P.L.1954, c.84 as such sections have been amended and supplemented as of July 1, 1969 (C. 43:15A-48) or section 5 of P.L.1944, c.255 (C. 43:16A-5) or under the Group Annuity Plan, and changes to N.J.S. 18A:66-44 or section 48 of P.L.1954, c.84 (C. 43:15A-48) or section 5 of P.L.1944, c.255 (C. 43:16A-5) enacted subsequent to this act or the Group Annuity Plan shall have no application to the provisions of this act.

In the event that the eligibility requirement under N.J.S. 18A:66-36 or under section 38 of P.L.1954, c.84 (C. 43:15A-38) or section 17 of P.L.1964, c.241 (C. 43:16A-11.2) or under the Group Annuity Plan is changed at some future date to permit members to become eligible for such benefit prior to the completion of 15 years of service, the transfer of the reserve from the contingent reserve fund or the pension fund of the Teachers’ Pension and Annuity Fund or the Public Employees’ Retirement System or the Police and Firemen’s Retirement System or from the Group Annuity Plan shall be effective as of the date the member who had elected the alternate benefit program meets the amended eligibility requirement or the effective date of the amendment, whichever is later.

In the event an option is available with respect to the distribution of employee and employer contributions between fixed and variable annuities under the alternate benefit program, the employee shall have the right to determine the percentage distribution of these funds subject to any limitations imposed by the designated insurer or insurers.

(c) No transfer of pension reserves shall be made pursuant to this section where more than two consecutive years elapse in which no employer contributions to an alternate benefit program are required.

L.1969, c.242, s.7; amended 1981, c.342, s.2; 1993, c.385, s.5; 2012, c.45, s.92; 2017, c.178, s.53; 2021, c.282, s.53.