(A) This section applies only to members of the public employees retirement system participating in the PERS combined plan, as defined in section 145.196 of the Revised Code, that was consolidated by the system with the PERS defined benefit plan under that section.

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(B)(1) When a member described in section 145.196 of the Revised Code retires on age and service retirement, the total annual single lifetime allowance for that member shall be an amount adjusted in accordance with division (B)(2) or (C) of this section and determined by multiplying the member’s total service credit by the following:

(a) If the member is eligible for age and service retirement under division (A) or (B) of section 145.32 of the Revised Code, one per cent of the member’s final average salary for each of the first thirty years of service plus one and one-quarter per cent of the member’s final average salary for each subsequent year of service;

(b) If the member is eligible for age and service retirement under division (C) of section 145.32 of the Revised Code, one per cent of the member’s final average salary for each of the first thirty-five years of service plus one and one-quarter per cent of the member’s final average salary for each subsequent year of service.

(2)(a) For a member eligible to retire under division (A) of section 145.32 of the Revised Code, the member’s allowance under division (B)(1) of this section shall be adjusted by the factors of attained age or years of service to provide the greater amount as determined by the following schedule:

(b) For a member eligible to retire under division (B) or (C) of section 145.32 of the Revised Code, the member’s allowance under division (B)(1) of this section shall be reduced by a percentage determined by the public employees retirement board’s actuary based on the number of years the commencement of the allowance precedes the member’s eligibility for an unreduced allowance.

(c) The actuary may use an actuarially based average percentage reduction for purposes of division (B)(2)(b) of this section.

(C) The total annual single lifetime allowance that a member shall receive under this section shall not exceed the lesser of the following:

(1) Any limit established under section 145.333 of the Revised Code;

(2) One hundred per cent of the member’s final average salary;

(3) The limit established by section 415 of the “Internal Revenue Code of 1986,” 26 U.S.C. § 415.

(D) Retirement allowances determined under this section shall be paid as provided in section 145.46 of the Revised Code.

If the monthly amount of a member’s annual single lifetime allowance that is first payable on or after the effective date of this section under division (B) of this section would be less than fifty dollars, instead of a monthly payment the retirement system shall pay an amount determined under section 145.40 of the Revised Code as a refund of accumulated contributions.