SB321 Summary

• Creates "Option 5" allowing certain retirees from the Teachers' Retirement System and Employees' Retirement System to elect a lump-sum cash payment equal to up to 50 percent of their retirement allowance in lieu of ongoing monthly payments.

• Requires the Director of Finance to certify annually whether available funds are sufficient and economic conditions support the lump-sum option; suspends the option for 12 months if conditions are unsatisfactory.

• Establishes the Alabama Pension Authority as a public corporation authorized to issue bonds to fund lump-sum retirement payments, with debt service repaid from savings generated by reduced state contribution obligations to the retirement systems.

• Provides financial counseling requirements for members electing the lump-sum option and prohibits purchase of prior service credit for periods covered by the lump-sum distribution.

• Makes Option 5 available to all members with retirement dates on or after October 1, 2017, allowing time for implementation by the Retirement Systems and Department of Finance.