(A) A recipient of a disability allowance under section 3307.631 of the Revised Code whose allowance will terminate under that section may make application for service retirement under this section. The retirement shall be effective on the first day of the first month following the last day for which the disability allowance is paid.

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(B) The annual allowance payable under this section shall consist of the sum of the amounts determined under divisions (B)(1) and (2) of this section:

(1) The greater of the following:

(a) An allowance calculated as provided in section 3307.58 of the Revised Code, excluding any period during which the applicant received a disability benefit under section 3307.631 of the Revised Code;

(b) An allowance calculated by multiplying the applicant’s total service credit, including service credit for the last continuous period during which the applicant received a disability benefit under section 3307.631 of the Revised Code, by two and two-tenths per cent of the applicant’s final average salary, except that the allowance shall be determined without application of division (B) of section 3307.501 of the Revised Code and shall not exceed forty-five per cent of the applicant’s final average salary.

(2) Using the allowance calculated under division (B)(1) of this section adjusted for the plan of payment selected by the member under section 3307.60 of the Revised Code, an amount equal to the additional allowance the recipient would receive under section 3307.67 of the Revised Code, plus any other additional amount the recipient would receive under this chapter, for the recipient’s most recent continuous period of receipt of a disability benefit under section 3307.631 of the Revised Code.

(C) The allowance calculated under division (B) of this section adjusted for the plan of payment selected by the member under section 3307.60 of the Revised Code, exclusive of any amount added under division (B)(2) of this section based on section 3307.67 of the Revised Code, shall be the base for all future additional allowances under section 3307.67 of the Revised Code.

The anniversary date for future additional allowances under section 3307.67 of the Revised Code shall be the effective date of the recipient’s most recent continuous period of receipt of a disability benefit under section 3307.631 of the Revised Code.

(D) The retirement allowance determined under this section shall be paid as provided in section 3307.58 of the Revised Code.