As Reported by the House Health and Aging Committee

129th General Assembly Regular Session 2011-2012

Sub. S. B. No. 340

Senators Niehaus, Kearney 

Cosponsors: Senators Bacon, Coley, Hite, Jones, Lehner, Schiavoni, Seitz 

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A BILL

To amend sections 171.04, 742.01, 742.04, 742.10,

1

742.14, 742.16, 742.30, 742.301, 742.31, 742.32,

2

742.33, 742.34, 742.35, 742.37, 742.3711,

3

742.3716, 742.38, 742.39, 742.44, 742.442,

4

742.443, 742.444, 742.45, 742.63, and 742.64; to

5

enact sections 742.012, 742.013, and 742.161; and

6

to repeal section 742.011 of the Revised Code to

7

revise the law governing the Ohio Police and Fire

8

Pension Fund.

9

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That sections 171.04, 742.01, 742.04, 742.10,	10
742.14, 742.16, 742.30, 742.301, 742.31, 742.32, 742.33, 742.34,	11
742.35, 742.37, 742.3711, 742.3716, 742.38, 742.39, 742.44,	12
742.442, 742.443, 742.444, 742.45, 742.63, and 742.64 be amended	13
and sections 742.012, 742.013, and 742.161 of the Revised Code be	14
enacted to read as follows:	15

Sec. 171.04.  The Ohio retirement study council shall:

16

(A) Make an impartial review from time to time of all laws	17
governing the administration and financing of the pension and	18
retirement funds under Chapters 145., 146., 742., 3307., 3309.,	19
and 5505. of the Revised Code and recommend to the general	20
assembly any changes it may find desirable with respect to the	21
allowances and benefits, sound financing of the cost of benefits,	22
the prudent investment of funds, and the improvement of the	23
language, structure, and organization of the laws;	24

(B) Make an annual report to the governor and to the general	25
assembly covering its evaluation and recommendations with respect	26
to the operations of the state retirement systems and their funds;	27

(C) Study all changes in the retirement laws proposed to the	28
general assembly and report to the general assembly on their	29
probable costs, actuarial implications, and desirability as a	30
matter of public policy;	31

(D) Review semiannually the policies, objectives, and	32
criteria adopted under sections 145.11, 742.11, 3307.15, 3309.15,	33
and 5505.06 of the Revised Code for the operation of the	34
investment programs of the state retirement systems, including a	35
review of asset allocation targets and ranges, risk factors, asset	36
class benchmarks, time horizons, total return objectives, relative	37
volatility, and performance evaluation guidelines. The council	38
shall, not later than thirty days after completing a review,	39
submit to the governor and the general assembly a report	40
summarizing its findings.	41

(E) Have prepared by an independent actuary, at least once	42
every ten years, an actuarial review of the annual actuarial	43
valuations and quinquennial actuarial investigations prepared	44
under sections 145.22, 742.14, 3307.20, 3309.21, and 5505.12 of	45
the Revised Code, including a review of the actuarial assumptions	46
and methods, the data underlying the valuations and	47
investigations, and the adequacy of each system's employee and	48
employer contribution rates to amortize its unfunded actuarial	49
pension liability, if any, and to support the payment of benefits	50
authorized by Chapter 145., 742., 3307., 3309., or 5505. of the	51
Revised Code. The council shall submit to the governor and the	52
general assembly a report summarizing the review.	53

(F) Have conducted by an independent auditor at least once	54
every ten years a fiduciary performance audit of each of the state	55
retirement systems.	56

All costs associated with an audit conducted pursuant to	57
division (F) of this section shall be paid by the retirement	58
system audited.	59

(G) Provide each member of the council with copies of all	60
proposed rules submitted to the council pursuant to sections	61
145.09, 742.10, 3307.04, 3309.04, and 5505.04 of the Revised Code	62
and submit any recommendations to the joint committee on agency	63
rule review.	64

Sec. 742.01.  As used in this chapter:

65

(A)(1) "Police department" means the police department of a	66
municipal corporation.	67

(2) "Member of a police department" means any of the	68
following:	69

(a) Any person who receives an original appointment as a	70
full-time regular police officer in a police department from a	71
duly established civil service eligible list or pursuant to	72
section 124.411 of the Revised Code, or who is described in	73
section 742.511 of the Revised Code, or who transfers from the	74
public employees retirement system to the Ohio police and fire	75
pension fund pursuant to section 742.513 of the Revised Code, or	76
who is appointed pursuant to section 737.15 or 737.16 of the	77
Revised Code as a full-time regular police officer and is paid	78
solely out of public funds of the employing municipal corporation;	79

(b) Any person who, on October 1, 1965, was contributing four	80
per cent of the person's annual salary to a police relief and	81
pension fund established under former section 741.32 of the	82
Revised Code;	83

(c) Any person who commences employment on or after September	84
16, 1998, as a full-time police officer with a police department	85
in a position in which the person is required to satisfactorily	86
complete a peace officer training course in compliance with	87
section 109.77 of the Revised Code.	88

(B)(1) "Fire department" means a fire department of the state	89
or an instrumentality of the state or of a municipal corporation,	90
township, joint fire district, or other political subdivision.	91

(2) "Member of a fire department" means all of the following:

92

(a) Any person who commences employment after November 8,	93
1990, as a full-time firefighter with a fire department, in a	94
position in which the person is required to satisfactorily	95
complete or have satisfactorily completed a firefighter training	96
course approved under former section 3303.07 or section 4765.55 or	97
conducted under section 3737.33 of the Revised Code;	98

(b) Any person who has elected under section 742.515 of the	99
Revised Code to be transferred from the public employees	100
retirement system to the Ohio police and fire pension fund;	101

(c) Any full-time firefighter who, on November 8, 1990, is a	102
member of the Ohio police and fire pension fund.	103

(C) "Employee" means any person who is a member of a police	104
department or a member of a fire department.	105

(D) "Employer" means the government entity by which an	106
employee is employed and paid.	107

(E) "Member of the fund" means any person, except an other	108
system retirant as defined in section 742.26 of the Revised Code,	109
who is contributing a percentage of the person's annual salary to	110
the Ohio police and fire pension fund or who is receiving a	111
disability benefit or pension from the fund as a result of service	112
in a police or fire department. A person, other than an other	113
system retirant, who is contributing a percentage of the person's	114
annual salary to the fund and is dismissed, resigns, or is granted	115
a leave of absence from a police or fire department shall be	116
considered a "member of the fund" for a period of twelve months	117
after the first day of the dismissal, resignation, or leave of	118
absence, provided the sum deducted from the person's salary and	119
credited to the person's account in the fund remains on deposit in	120
the fund.	121

A member of the Ohio national guard, the Ohio military	122
reserve, the Ohio naval militia, or a reserve component of the	123
armed forces of the United States who is absent from employment	124
due to active military duty because of an executive order issued	125
by the president of the United States or an act of congress shall	126
be considered a member of the fund for the duration of the active	127
military duty.	128

(F) "Year," for the purpose of determining benefits, means	129
any twelve consecutive calendar months of active service as a	130
member of the fund, or, in the case of a member whose salary is	131
paid weekly or biweekly, fifty-two consecutive weeks of active	132
service as a member.	133

(G) "Average annual salary" means the highest average annual	134
salary of a member of the fund during any threeof the number of	135
years of contributions specified in section 742.37 or 742.39 of	136
the Revised Code, as appropriate, and determined by dividing the	137
member's total salary as an employee during thethose years by	138
threethat number.	139

For the purpose of determining average annual salary for	140
members who, as of July 1, 2013, have fifteen or more years of	141
service credit, "salary" has the same meaning as in division	142
(L)(2) of this section, except that it does not include any	143
amounts that exceed the salary benchmark, determined as follows:	144

(1) Divide by three the total of the member's salaries for	145
the contiguous three-year period immediately preceding the	146
contiguous three-year period immediately prior to the member's	147
effective date of retirement under section 742.37 or effective	148
date of participation in a deferred option retirement plan under	149
section 742.44 of the Revised Code;	150

(2) Multiply the amount determined under division (G)(1) of	151
this section by one hundred ten per cent;	152

(3) Multiply the amount determined under division (G)(2) of	153
this section by one hundred ten per cent;	154

(4) Multiply the amount determined under division (G)(3) of	155
this section by one hundred ten per cent;	156

(5) The amount determined under division (G)(4) of this	157
section is the salary benchmark.	158

(H) "Normal service pension benefit" means the pension	159
benefit payable to a member of the fund under division (C)(1) of	160
section 742.37 of the Revised Code upon attaining age forty-eight	161
attainment of the applicable age listed in that section.	162

(I) "Retirement allowance" means the total pension benefit or	163
disability benefit to which a member of the fund may be entitled	164
under division (C) of section 742.37 or section 742.39 of the	165
Revised Code.	166

(J) "Fiduciary" means a person who does any of the following:

167

(1) Exercises any discretionary authority or control with	168
respect to the management of the system, or with respect to the	169
management or disposition of its assets;	170

(2) Renders investment advice for a fee, direct or indirect,	171
with respect to money or property of the system;	172

(3) Has any discretionary authority or responsibility in the	173
administration of the system.	174

(K) "TerminalExcept as provided in rules authorized by	175
section 742.013 of the Revised Code, "terminal pay" means the	176
following payments made by an employer to an employee on	177
termination of employmentregardless of whether the payments are	178
made before or after termination:	179

(1) Payments for accrued but unused leave, including sick	180
leave, vacation, personal leave, and compensatory time;	181

(2) Payments deferred more than one year compensating the	182
employee for holidays worked or for longevity;	183

(3) Payments for overtime worked that are not included either	184
in the payroll for the period in which the overtime is worked or	185
for the next subsequent payroll for any period ending not later	186
than sixty days after the overtime is worked;	187

(4) Other payments that are not compensation for services	188
rendered in the last pay period in which services were rendered	189
and are designated as terminal pay by rule of the board of	190
trustees of the Ohio police and fire pension fund. The board shall	191
not designate as terminal pay payments deferred one year or less	192
compensating an employee for holidays worked or for longevity.	193

(L)(1) Except as otherwise provided in this division or in	194
rules authorized by section 742.013 of the Revised Code, "salary"	195
means all compensation, wages, and other earnings paid to an	196
employee by reason of employment, but without regard to whether	197
compensation, wages, or other earnings are treated as deferred	198
income for federal income tax purposes. "Salary" includes payments	199
for overtime that are made not later than the payroll following	200
included in the payroll for the period in which the overtime is	201
worked or the payroll for any period not later than sixty days	202
after the overtime is worked.	203

(2) "Salary" does not include any of the following:

204

(a) Compensation for services outside the scope of an	205
employee's regular employment;	206

(b) Reimbursement of expenses;

207

(c) Terminal pay;

208

(d) Payments for accrued but unused sick leave or personal	209
leave, or vacation pay covering periods for which salary,	210
compensation, or benefits are paid;	211

(e) Payments made under division (B), (C), or (E) of section	212
5923.05 of the Revised Code, Section 4 of Substitute Senate Bill	213
No. 3 of the 119th general assembly, Section 3 of Amended	214
Substitute Senate Bill No. 164 of the 124th general assembly, or	215
Amended Substitute House Bill No. 405 of the 124th general	216
assembly;	217

(f) Payments made to or on behalf of an employee that are in	218
excess of the annual compensation that may be taken into account	219
by the fund under division (a)(17) of section 401 of the "Internal	220
Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 401(a)(17), as	221
amended.	222

(3) The board shall determine by rule whether any	223
compensation, wages, or earnings not enumerated in this division	224
is salary, and its decision shall be final.	225

(M) "Actuary" means an individual who satisfies all of the	226
following requirements:	227

(1) Is a member of the American academy of actuaries;

228

(2) Is an associate or fellow of the society of actuaries;

229

(3) Has a minimum of five years' experience in providing	230
actuarial services to public retirement plans.	231

Sec. 742.012. Contributions made to the Ohio police and fire	232
pension fund for salary that exceeds the salary benchmark	233
calculated under division (G) of section 742.01 of the Revised	234
Code shall be refunded in accordance with rules adopted by the	235
trustees of the board under section 742.10 of the Revised Code.	236

Sec. 742.013. The board may, by rule adopted under section	237
742.10 of the Revised Code, establish definitions of "terminal	238
pay" and "salary" that differ from those in divisions (K) and (L)	239
of section 742.01 of the Revised Code. In establishing the	240
definitions, the board may use elements of the compensation	241
provisions of the United States Internal Revenue Code and the	242
Internal Revenue Code form W-2, as those provisions are	243
interpreted by the internal revenue service of the United States	244
department of treasury.	245

Sec. 742.04.  As used in this section, "county" means the	246
county of residence of an individual who signs a nominating	247
petition.	248

Election of the employee members, firefighter retirant	249
member, and police retirant member of the board of trustees of the	250
Ohio police and fire pension fund shall be under the supervision	251
and direction of the board in accordance with rules adopted under	252
section 742.045 of the Revised Code.	253

Nominating petitions for candidates for an employee member of	254
the board elected by police officers shall be signed by at least	255
one hundred police officers, with at least twenty signers from	256
each of at least five counties of the state, and certified in	257
accordance with rules adopted under section 742.045 of the Revised	258
Code.	259

Nominating petitions for candidates for an employee member of	260
the board elected by firefighters shall be signed by at least one	261
hundred firefighters, with at least twenty signers from each of at	262
least five counties of the state, and certified in accordance with	263
rules adopted under section 742.045 of the Revised Code.	264

Nominating petitions for candidates for an employee member of	265
the board shall be filed in the office of the board not later than	266
four p.m. on the first Monday in April preceding the date of the	267
expiration of the term of the employee member of the board whose	268
successor is to be elected.	269

The board shall cause ballots to be prepared for the election	270
of employee members of the board which shall contain the names of	271
all candidates for whom certified nominating petitions have been	272
filed with the board.	273

A police officer or firefighter is eligible to vote in an	274
election if the police officer or firefighter is a member of the	275
fund on the thirty-first Monday in Marchday of January preceding	276
the date of the expiration of the term of the employee member of	277
the board whose successor is to be elected. The board shall	278
determine whether a member of the fund is eligible to vote at an	279
election and its decision shall be final.	280

On or before the first Monday in May preceding the date of	281
the expiration of the term of the employee member of the board	282
whose successor is to be elected, the board shall cause ballots to	283
be sent to each member of the fund who is eligible to vote at such	284
election to the address of such member as shown on the records of	285
the board.	286

Ballots shall be returned to the board not later than the	287
third Tuesday in May following the date that the ballots were	288
mailed to the members of the fund eligible to vote at such	289
election.	290

On certification of the election results in accordance with	291
rules adopted under section 742.045 of the Revised Code, the	292
person receiving the highest number of votes shall be elected as	293
an employee member of the board for a term of four years beginning	294
on the first Monday in June following such election.	295

Nominating petitions for candidates for the police retirant	296
member of the board shall be signed by at least fifty police	297
retirants, with at least ten signers from at least five counties	298
of the state, and certified in accordance with rules adopted under	299
section 742.045 of the Revised Code.	300

Nominating petitions for candidates for the firefighter	301
retirant member of the board shall be signed by at least fifty	302
firefighter retirants, with at least ten signers from at least	303
five counties of the state, and certified in accordance with rules	304
adopted under section 742.045 of the Revised Code.	305

Nominating petitions for candidates for the retirant members	306
of the board shall be filed in the office of the board not later	307
than four p.m. on the first Monday in April preceding the date of	308
the expiration of the term of the retirant member of the board	309
whose successor is to be elected.	310

The board shall cause ballots to be prepared for the election	311
of these board members which shall contain the names of all	312
candidates for whom certified nominating petitions have been filed	313
with the board.	314

A retirant is eligible to vote in an election if the retirant	315
is a police retirant or firefighter retirant on the thirty-first	316
Monday in Aprilday of January preceding the date of the	317
expiration of the term of the retirant member of the board whose	318
successor is to be elected. The board shall determine whether a	319
police retirant or firefighter retirant is eligible to vote at an	320
election and its decision shall be final.	321

On or before the first Monday in May preceding the date of	322
the expiration of the term of a retirant member of the board whose	323
successor is to be elected, the board shall cause ballots to be	324
sent to each person who is eligible to vote in the election to the	325
address of the person as shown on the records of the board.	326

Ballots shall be returned to the board not later than the	327
third Tuesday in May following the date that the ballots were	328
mailed to the persons eligible to vote in the election.	329

On certification of the election results in accordance with	330
rules adopted under section 742.045 of the Revised Code, the	331
person receiving the highest number of votes shall be elected as	332
the police retirant member or the firefighter retirant member of	333
the board for a term of four years beginning on the first Monday	334
in June following the election.	335

Sec. 742.10.  The board of trustees of the Ohio police and	336
fire pension fund may sue and be sued, plead and be impleaded,	337
contract and be contracted with, employ and fix the compensation	338
of employees, and adopt rules for the proper administration and	339
management of the fund.	340

Effective ninety days after the effective date of this	341
amendmentSeptember 15, 2004, the board of trustees may not employ	342
a state retirement system investment officer, as defined in	343
section 1707.01 of the Revised Code, who does not hold a valid	344
state retirement system investment officer license issued by the	345
division of securities in the department of commerce.	346

If the Ohio retirement study council establishes a uniform	347
format for any report the board is required to submit to the	348
council, the board shall submit the report in that format.	349

The attorney general shall prescribe procedures for the	350
adoption of rules authorized under this chapter, consistent with	351
the provisions of section 111.15 of the Revised Code under which	352
all rules shall be filed in order to be effective. Such procedures	353
shall establish methods by which notice of proposed rules is given	354
to interested parties and rules adopted by the board published and	355
otherwise made available. When it files a rule with the joint	356
committee on agency rule review pursuant to section 111.15 of the	357
Revised Code, the board shall submit to the Ohio retirement study	358
council a copy of the full text of the rule, and if applicable, a	359
copy of the rule summary and fiscal analysis required by division	360
(B) of section 127.18 of the Revised Code.	361

All rules adopted pursuant to this chapter, prior to August	362
20, 1976, shall be published and made available to interested	363
parties by January 1, 1977.	364

Sec. 742.14.  (A) The board of trustees of the Ohio police	365
and fire pension fund shall have prepared annuallytriennially by	366
or under the supervision of an actuary an actuarial valuation of	367
the pension assets, liabilities, and funding requirements of the	368
Ohio police and fire pension fund as established pursuant to	369
sections 742.01 to 742.61 of the Revised Code. The actuary shall	370
complete the valuation in accordance with actuarial standards of	371
practice promulgated by the actuarial standards board of the	372
American academy of actuaries and prepare a report of the	373
valuation. The report shall include all of the following:	374

(1) A summary of the benefit provisions evaluated;

375

(2) A summary of the census data and financial information	376
used in the valuation;	377

(3) A description of the actuarial assumptions, actuarial	378
cost method, and asset valuation method used in the valuation,	379
including a statement of the assumed rate of payroll growth and	380
assumed rate of growth or decline in the number of members of the	381
fund contributing to the pension fund;	382

(4) A summary of findings that includes a statement of the	383
actuarial accrued pension liabilities and unfunded actuarial	384
accrued pension liabilities;	385

(5) A schedule showing the effect of any changes in the	386
benefit provisions, actuarial assumptions, or cost methods since	387
the last annualtriennial actuarial valuation;	388

(6) A statement of whether employee and employer	389
contributions to the pension fund are expected to be sufficient to	390
satisfy the funding objectives established by the board.	391

The board shall submit thefirst triennial report shall be	392
made not later than November 1, 2013, to the Ohio retirement study	393
council and the standing committees of the house of	394
representatives and the senate with primary responsibility for	395
retirement legislation not later than the first day of November	396
following the year for which the valuation was madeand thereafter	397
triennially, not later than the first day of November.	398

(B) The board shall annually thereafter have prepared by an	399
actuary a report showing the adequacy of the rate of the police	400
officer employers' contribution provided for by section 742.33 of	401
the Revised Code, and the adequacy of the rate of the firefighter	402
employers' contribution provided for by section 742.34 of the	403
Revised Code.	404

(C) At such times as the board determines, and at least once	405
in each quinquennial period, the board shall have prepared by or	406
under the supervision of an actuary an actuarial investigation of	407
the mortality, service, and other experience of the members of the	408
fund and of other system retirants, as defined in section 742.26	409
of the Revised Code, who are members of a police department or a	410
fire department to update the actuarial assumptions used in the	411
actuarial valuation required by division (A) of this section. The	412
actuary shall prepare a report of the actuarial investigation. The	413
report shall be prepared and any recommended changes in actuarial	414
assumptions shall be made in accordance with the actuarial	415
standards of practice promulgated by the actuarial standards board	416
of the American academy of actuaries. The report shall include all	417
of the following:	418

(1) A summary of relevant decrement and economic assumption	419
experience observed over the period of the investigation;	420

(2) Recommended changes in actuarial assumptions to be used	421
in subsequent actuarial valuations required by division (A) of	422
this section;	423

(3) A measurement of the financial effect of the recommended	424
changes in actuarial assumptions;	425

(4) If the investigation required by this division includes	426
the investigation required by division (F)(E) of this section, a	427
report of the result of that investigation.	428

The board shall submit the report to the Ohio retirement	429
study council and the standing committees of the house of	430
representatives and the senate with primary responsibility for	431
retirement legislation not later than the first day of November	432
following the last fiscal year of the period the report covers.	433

(D)(C) The board shall have prepared by or under the	434
supervision of an actuary an actuarial analysis of any introduced	435
legislation expected to have a measurable financial impact on the	436
pension fund. The actuarial analysis shall be completed in	437
accordance with the actuarial standards of practice promulgated by	438
the actuarial standards board of the American academy of	439
actuaries. The actuary shall prepare a report of the actuarial	440
analysis, which shall include all of the following:	441

(1) A summary of the statutory changes that are being	442
evaluated;	443

(2) A description of or reference to the actuarial	444
assumptions and actuarial cost method used in the report;	445

(3) A description of the participant group or groups included	446
in the report;	447

(4) A statement of the financial impact of the legislation,	448
including the resulting increase, if any, in the employer normal	449
cost percentage; the increase, if any, in actuarial accrued	450
liabilities; and the per cent of payroll that would be required to	451
amortize the increase in actuarial accrued liabilities as a level	452
per cent of covered payroll for all active members of the fund	453
over a period not to exceed thirty years;	454

(5) A statement of whether the scheduled contributions to the	455
system after the proposed change is enacted are expected to be	456
sufficient to satisfy the funding objectives established by the	457
board.	458

Not later than sixty days from the date of introduction of	459
the legislation, the board shall submit a copy of the actuarial	460
analysis to the legislative service commission, the standing	461
committees of the house of representatives and the senate with	462
primary responsibility for retirement legislation, and the Ohio	463
retirement study council.	464

(E)(D) The board shall have prepared annuallytriennially a	465
report giving a full accounting of the revenues and costs relating	466
to the provision of benefits under section 742.45 of the Revised	467
Code. The first triennial report shall be made as of December 31,	468
19972013, and the thirty-first day of December of each year	469
triennially thereafter. The report shall include the following:	470

(1) A description of the statutory authority for the benefits	471
provided;	472

(2) A summary of the benefits;

473

(3) A summary of the eligibility requirements for the	474
benefits;	475

(4) A statement of the number of participants eligible for	476
the benefits;	477

(5) A description of the accounting, asset valuation, and	478
funding method used to provide the benefits;	479

(6) A statement of the net assets available for the provision	480
of the benefits as of the last day of the fiscal year;	481

(7) A statement of any changes in the net assets available	482
for the provision of benefits, including participant and employer	483
contributions, net investment income, administrative expenses, and	484
benefits provided to participants, as of the last day of the	485
fiscal year;	486

(8) For the last six consecutive fiscal years, a schedule of	487
the net assets available for the benefits, the annual cost of	488
benefits, administrative expenses incurred, and annual employer	489
contributions allocated for the provision of benefits;	490

(9) A description of any significant changes that affect the	491
comparability of the report required under this division;	492

(10) A statement of the amount paid under division (B) of	493
section 742.45 of the Revised Code.	494

The board shall submit the report to the Ohio retirement	495
study council and the standing committees of the house of	496
representatives and the senate with primary responsibility for	497
retirement legislation not later than the thirtieth day of June	498
following the year for which the report was made.	499

(F)(E) At least once in each quinquennial period, the board	500
shall have prepared by or under the supervision of an actuary an	501
actuarial investigation of the deferred retirement option plan	502
established under section 742.43 of the Revised Code. The	503
investigation shall include an examination of the financial	504
impact, if any, on the fund of offering the plan to members.	505

The actuary shall prepare a report of the actuarial	506
investigation. The report shall include a determination of whether	507
the plan, as established or modified, has a negative financial	508
impact on the fund and, if so, recommendations on how to modify	509
the plan to eliminate the negative financial impact. If the	510
actuarial report indicates that the plan has a negative financial	511
impact on the fund, the board may modify the plan or cease to	512
allow members who have not already done so to elect to participate	513
in the plan. The firefighter and police officers employers'	514
contributions shall not be increased to offset any negative	515
financial impact of the plan.	516

If the board ceases to allow members to elect to participate	517
in the plan, the rights and obligations of members who have	518
already elected to participate shall not be altered.	519

The board may include the actuarial investigation required	520
under this division as part of the actuarial investigation	521
required under division (C)(B) of this section. If the report of	522
the actuarial investigation required by this division is not	523
included in the report required by division (C)(B) of this	524
section, the board shall submit the report required by this	525
division to the Ohio retirement study council and the standing	526
committees of the house of representatives and the senate with	527
primary responsibility for retirement legislation not later than	528
the first day of November following the last fiscal year of the	529
period the report covers.	530

Sec. 742.16.  The board of trustees of the Ohio police and	531
fire pension fund shall establish a period of not more than thirty	532
years to amortize the Ohio police and fire pension fund's unfunded	533
actuarial accrued pension liabilities. The board shall adopt a	534
plan that specifies how it proposes to meet the thirty-year	535
amortization period not later than December 31, 2006. If in any	536
year the period necessary to amortize the unfunded actuarial	537
accrued pension liability exceeds thirty years, as determined by	538
the annual actuarial valuation required by section 742.14 of the	539
Revised Code, the board, not later than ninety days after receipt	540
of the valuation, shall prepare and submit to the Ohio retirement	541
study council and the standing committees of the house of	542
representatives and the senate with primary responsibility for	543
retirement legislation a report that includes the following	544
information:	545

(A) The number of years needed to amortize the unfunded	546
actuarial accrued pension liability as determined by the annual	547
actuarial valuation;	548

(B) A plan approved by the board that indicates how the board	549
will reduce the amortization period of unfunded actuarial accrued	550
pension liability to not more than thirty years;	551

(C) Whether the board has made any progress in meeting the	552
thirty-year amortization period.	553

Sec. 742.161.  Following the actuarial investigation required	554
by division (B) of section 742.14 of the Revised Code due on	555
November 1, 2017, and following each quinquennial actuarial	556
investigation thereafter, if, in consultation with its actuary,	557
the Ohio police and fire pension fund board of trustees determines	558
that an adjustment to the age and years of service credit required	559
to receive a pension or benefit under division (C) of section	560
742.37 of the Revised Code is appropriate, the board may, in	561
accordance with rules adopted under section 742.10 of the Revised	562
Code, do either of the following:	563

(A) If the board's determination is that increasing the age	564
and years of service requirements is necessary to preserve the	565
fiscal integrity of the fund, increase the age and years of	566
service credit required to receive a pension or benefit;	567

(B) If the board's determination is that reducing the age and	568
years of service requirements would not materially impair the	569
fiscal integrity of the fund, reduce the age and years of service	570
credit required to receive a pension or benefit.	571

Sec. 742.30.  (A) The employer's accrued liability, as	572
determined pursuant to former section 742.29 of the Revised Code,	573
shall be paid to the Ohio police and fire pension fund. Payments	574
shall be credited to the police officers' pension reserve fund, or	575
to the firefighters' pension reserve fund, in accordance with the	576
relief and pension fund from which the liability for such payment	577
arises, until such time as the employer's accrued liability on	578
account of pensioners and other benefit recipients on the rolls of	579
the particular police relief and pension fund or firemen's relief	580
and pension fund is satisfied. Thereafter, payments shall be	581
credited to the police officers' contribution fund or the	582
firefighters' contribution fund, in accordance with the relief and	583
pension fund from which the liability for such payments arises,	584
until such time as the employer's accrued liability on account of	585
deductions made from the compensation of police officers or	586
firefighters under the particular police relief and pension fund	587
or firemen's relief and pension fund is satisfied. Thereafter,	588
payments shall be credited to the police officer employers'	589
contribution fund, or firefighter employers' contribution fund, in	590
accordance with the relief and pension fund from which the	591
liability for such payments arises, until such time as the	592
employer's total accrued liability under the particular police	593
relief and pension fund or firemen's relief and pension fund is	594
satisfied.	595

(B) That part of the employer's accrued liability remaining	596
unpaid on January 1, 1969, shall be paid by the employer at not	597
less than the following rates per year: two per cent in 1969, two	598
per cent in 1970, three per cent in 1971, four per cent in 1972,	599
and five per cent per annum beginning in 1973 and each year	600
thereafter for sixty-two years. Except as provided in division (C)	601
of this section, payments shall be fixed annually and paid on	602
dates fixed by the board of trustees of the Ohio police and fire	603
pension fund.	604

(C) The board may enter into an agreement with a municipal	605
corporation or township for a single payment by the municipal	606
corporation or township of the employer's accrued liability. The	607
agreement may provide for a reduction in the amount of the accrued	608
liability based on the value to the fund of receiving a single	609
payment. A municipal corporation or township that has made payment	610
in accordance with such an agreement shall have no further	611
obligation to make payments under this section.	612

(D) The board shall report every twothree years to the	613
general assembly during its first regular session on the condition	614
of the retirement system, with particular emphasis upon the	615
payment of the employer's accrued liability, and make such	616
recommendations, upon the advice of its actuary, as it considers	617
necessary for the proper funding of the liabilities.	618

Sec. 742.301. (A) Each employer shall promptly pay the amount	619
due on the accrued liability on the dates fixed by the board of	620
trustees of the Ohio police and fire pension fund. Upon	621
certification by the board that payment of an employer's accrued	622
liability has not been paid within thirty days following the date	623
a payment is due, a penalty of five per cent of the amount due	624
shall be assessed against such employer. If the payment and	625
penalty have not been paid within ninety days following the date a	626
payment is due, annual interest at six per cent shall be assessed	627
against the payment and penalty from the date that the payment is	628
due.	629

(B) Upon certification by the board to the superintendent of	630
liquor control or the county auditor of an amount due from any	631
employer who is subject to this chapter by reason of such	632
employer's delinquency in making payments on the accrued	633
liability, the amount due shall be withheld from the employer from	634
liquor control permit fees to be distributed to that employer	635
according to Chapter 4301. of the Revised Code or from the local	636
government fund allocated for distribution to that employer by the	637
county budget commission in accordance with Chapter 5739. of the	638
Revised Code. Upon receipt of the certification from the board,	639
the superintendent or county auditor shall provide for payment	640
against such funds in favor of the Ohio police and fire pension	641
fund for the certified amount due and any penalty and interest	642
thereon.	643

(C) If the payments under divisions (A) and (B) of this	644
section are insufficient to pay the Ohio police and fire pension	645
fund any amounts due the fund from an employer, the fund may seek	646
payment through the office of budget and management. On	647
certification by the board to the director of budget and	648
management of any such amount due, the director shall withhold	649
from the employer any amount available, not to exceed the amount	650
certified as due the fund, from any amounts under the director's	651
control that are payable or due the employer. The director shall	652
pay the amount withheld to the fund.	653

Sec. 742.31. Each(A) Except as provided in division (B) of	654
this section, each employee shall contribute an amount equal to	655
ten per centa percentage of the employee's salary to the Ohio	656
police and fire pension fund. Theaccording to the following	657
schedule:	658

(1) For salary earned in pay periods beginning not later than	659
July 1, 2013, ten per cent;	660

(2) For salary earned in pay periods beginning not earlier	661
than July 2, 2013, but not later than July 1, 2014, ten and	662
three-quarters per cent;	663

(3) For salary earned in pay periods beginning not earlier	664
than July 2, 2014, but not later than July 1, 2015, eleven and	665
one-half per cent;	666

(4) For salary earned in pay periods beginning not earlier	667
than July 2, 2015, twelve and one-quarter per cent.	668

(B) Following the actuarial investigation required by	669
division (B) of section 742.14 of the Revised Code due on November	670
1, 2017, and following each quinquennial actuarial investigation	671
thereafter, if, in consultation with the board's actuary, the	672
board determines that an adjustment to the contribution rate is	673
appropriate, the board may, in accordance with rules adopted under	674
section 742.10 of the Revised Code, do either of the following:	675

(1) If the board's determination is that an increase in the	676
contribution rate is necessary to preserve the fiscal integrity of	677
the fund, increase the contribution rate;	678

(2) If the board's determination is that a decrease in the	679
contribution rate would not materially impair the fiscal integrity	680
of the fund, decrease the contribution rate.	681

(C) The amount shall be deducted by the employer from the	682
employee's salary as defined in division (L) of section 742.01 of	683
the Revised Code for each payroll period, irrespective of whether	684
the minimum compensation provided by law for the employee is	685
reduced thereby. Every employee shall be deemed to consent to the	686
deductions, and payment to the employee less the deductions is a	687
complete discharge and acquittance of all claims and demands for	688
the services rendered by the employee during the period covered by	689
such payment.	690

Sec. 742.32. (A) The fiscal officer of each employer shall	691
transmit monthly to the secretary of the board of trustees of the	692
Ohio police and fire pension fund a report of employee deductions	693
in such form as the board requires. The report shall show all	694
deductions for the fund made pursuant to section 742.31 of the	695
Revised Code and shall be accompanied by payments covering the	696
total of such deductions. The report shall also include the name	697
of each member for whom deductions were made and the portion of	698
the payment attributed to that member. Separate payments shall be	699
so transmitted for that portion of such deductions made from the	700
salaries of members of the police department and for that portion	701
of such deductions made from the salaries of members of the fire	702
department. The report and payment are due the last day of the	703
month following the last business day of the reporting period. A	704

(B) A penalty determined under section 742.352 of the Revised	705
Code shall be assessed if any of the following occur:	706

(A)(1) The report is received by the board after the due date	707
or is not in the form required by the board.	708

(B)(2) Payments to cover the total amount due from the	709
salaries of all employees of the employer are received by the	710
board after the due date.	711

The penalty shall be added to and collected on the next	712
succeeding regular employer billing. If the penalty is not paid	713
within sixty days after it is added to the regular employer	714
billing, interest at a rate determined by the board may be charged	715
on the total amount due and the amount of the penalty from the	716
date the amount is due to the date of payment.	717

(C) The secretary of the board, after making a record of all	718
such receipts and crediting each employee's individual account	719
with the amount deducted from the employee's salary, shall deposit	720
the receipts with the treasurer of state for use as provided by	721
this chapter. Where an employer fails to deduct contributions for	722
any employee and transmit such amounts to the fund, the board may	723
make a determination of the employee's liability for contributions	724
and certify to the employer the amounts due for collection in the	725
same manner and subject to the same penalties as payments due the	726
employer's contributions funds.	727

Sec. 742.33.  (A) Each employer shall pay quarterlymonthly,	728
on such dates as the board of trustees of the Ohio police and fire	729
pension fund requires, from its general fund, or from a levy	730
imposed pursuant to division (J) or (W) of section 5705.19 of the	731
Revised Code, to the fund an amount known as the "police officer	732
employers' contribution," which shall be nineteen and one-half per	733
cent of the salaries as defined in division (L) of section 742.01	734
of the Revised Code of the members of the police department of the	735
employer.	736

(B) The taxing authority of each municipal corporation in	737
which there was a police relief and pension fund on October 1,	738
1965, shall annually, in the manner provided for making other	739
municipal levies and in addition to all other levies authorized by	740
law, levy a tax of three-tenths of one mill upon all the real and	741
personal property as listed for taxation in the municipal	742
corporation for the purpose of paying the police officer	743
employers' contribution and the municipal corporation's accrued	744
liability for its former police relief and pension fund and	745
interest thereon, and of defraying the current operating expenses	746
of the municipal corporation. The annual revenues derived from the	747
tax shall be used in the following order:	748

(1) First, to pay the current police officer employers'	749
contribution and any interest related thereto;	750

(2) Second, to pay any accrued liability chargeable to the	751
municipal corporation during the current calendar year for its	752
former police relief and pension fund and any interest related	753
thereto;	754

(3) Third, to defray the current operating expenses of the	755
municipal corporation.	756

Sec. 742.34.  (A) Each employer shall pay quarterlymonthly,	757
on such dates as the board of trustees of the Ohio police and fire	758
pension fund requires, from its general fund, or from a levy	759
imposed pursuant to division (I) or (W) of section 5705.19 of the	760
Revised Code, to the fund an amount known as the "firefighter	761
employers' contribution," which shall be twenty-four per cent of	762
the salaries as defined in division (L) of section 742.01 of the	763
Revised Code of the members of the fire department of the	764
employer.	765

(B) The taxing authority of each municipal corporation in	766
which there was a firemen's relief and pension fund on October 1,	767
1965, shall annually, in the manner provided for making other	768
municipal levies and in addition to all other levies authorized by	769
law, levy a tax of three-tenths of one mill upon all the real and	770
personal property as listed for taxation in the municipal	771
corporation for the purpose of paying the firefighter employers'	772
contribution and the municipal corporation's accrued liability for	773
its former firemen's relief and pension fund and interest thereon,	774
and of defraying the current operating expenses of the municipal	775
corporation. The annual revenues derived from the tax shall be	776
used in the following order:	777

(1) First, to pay the current firefighter employers'	778
contribution and any interest related thereto;	779

(2) Second, to pay any accrued liability chargeable to the	780
municipal corporation during the current calendar year for its	781
former firemen's relief and pension fund and any interest related	782
thereto;	783

(3) Third, to defray the current operating expenses of the	784
municipal corporation.	785

Sec. 742.35. As used in this section, "calendar quarter"	786
means the three-month period ending on the last day of March,	787
June, September, or December.	788

Each employer shall pay its annual police officer employers'	789
contribution and firefighter employers' contribution in four equal	790
installments promptlymonthly payments as provided in sections	791
742.33 and 742.34 of the Revised Code. If anThe employer fails to	792
shall make aeach payment on or before the date that is sixty days	793
after the last day of the calendar quarternot later than the last	794
day of the month after the month for which the police officer or	795
firefighter employee contributions were withheld. If an employer	796
fails to make the payment installment by the date it is due, a	797
penalty determined under section 742.352 of the Revised Code shall	798
be assessed against the employer. In addition, interest on past	799
due accounts and penalties may be charged at a rate determined by	800
the board from the date the installmentpayment is due to the	801
date of payment.	802

Upon certification by the board to the county auditor of an	803
amount due from any employer within the county who is subject to	804
this chapter, by reason of such employer's delinquency in making	805
employer contribution payments to the fund for past months, such	806
amount shall be withheld from such employer from any funds in the	807
hands of the county treasurer for distribution to such employer.	808
Upon receipt of such certification, the county auditor shall draw	809
a warrant against such funds in favor of the fund for the amount.	810

Sec. 742.37.  The board of trustees of the Ohio police and	811
fire pension fund shall adopt rules for the management of the fund	812
and for the disbursement of benefits and pensions as set forth in	813
this section and section 742.39 of the Revised Code. Any payment	814
of a benefit or pension under this section is subject to the	815
provisions of section 742.461 of the Revised Code. Notwithstanding	816
any other provision of this section, no pension or benefit paid or	817
determined under division (B) or (C) of this section or section	818
742.39 of the Revised Code shall exceed the limit established by	819
section 415 of the "Internal Revenue Code of 1986," 100 Stat.	820
2085, 26 U.S.C.A. 415, as amended.	821

(A) Persons who were receiving benefit or pension payments	822
from a police relief and pension fund established under former	823
section 741.32 of the Revised Code, or from a firemen's relief and	824
pension fund established under former section 521.02 or 741.02 of	825
the Revised Code, at the time the assets of the fund were	826
transferred to the Ohio police and fire pension fund, known at	827
that time as the police and firemen's disability and pension fund,	828
shall receive benefit and pension payments from the Ohio police	829
and fire pension fund in the same amount and subject to the same	830
conditions as such payments were being made from the former fund	831
on the date of the transfer.	832

(B) A member of the fund who, pursuant to law, elected to	833
receive benefits and pensions from a police relief and pension	834
fund established under former section 741.32 of the Revised Code,	835
or from a firemen's relief and pension fund established under	836
former section 741.02 of the Revised Code, in accordance with the	837
rules of the fund governing the granting of benefits or pensions	838
therefrom in force on April 1, 1947, shall receive benefits and	839
pensions from the Ohio police and fire pension fund in accordance	840
with such rules; provided, that any member of the fund who is not	841
receiving a benefit or pension from the fund on August 12, 1975,	842
may, upon application for a benefit or pension to be received on	843
or after August 12, 1975, elect to receive a benefit or pension in	844
accordance with division (C) of this section.	845

(C) MembersUnless the board acts under section 742.161 of	846
the Revised Code, members of the fund who have not elected to	847
receive benefits and pensions from a police relief and pension	848
fund or a firemen's relief and pension fund in accordance with the	849
rules of the fund in force on April 1, 1947, shall receive	850
pensions and benefits in accordance with the following provisions:	851

(1) A member of the fund who has completed twenty-five years	852
of active service in a police or fire departmentcredit and has	853
attained forty-eight years ofthe requisite age may, at the	854
member's election,elect to retire from the police or fire	855
department. UponThe requisite age is forty-eight for a member	856
whose membership began before July 2, 2013, and fifty-two for a	857
member whose membership began on or after that date.	858

Upon notifying the board in writing of the election, the	859
member shall receive an annual pension, payable in twelve monthly	860
installments, in an amount equal to a percentage of the member's	861
average annual salary. TheIf, as of July 2, 2013, the member had	862
fifteen or more years of service credit, the average annual salary	863
shall be determined using three years of contributions. If, as of	864
that date, the member had less than fifteen years of service	865
credit, the average annual salary shall be determined using five	866
years of contributions.	867

The percentage shall be the sum of two and one-half per cent	868
for each of the first twenty years the member was in the active	869
of service of the departmentcredit, plus two per cent for each of	870
the twenty-first to twenty-fifth years the member was in the	871
activeof service of the departmentcredit, plus one and one-half	872
per cent for each year in excess of twenty-five years the member	873
was in the activeof service of the departmentcredit. The annual	874
pension shall not exceed seventy-two per cent of the member's	875
average annual salary.	876

A member who completedhas twenty-five years of active	877
service credit, has resigned or been discharged, and has left the	878
sum deducted from the member's salary on deposit in the pension	879
fund shall, upon attaining forty-eight years ofthe requisite age,	880
be entitled to receive a normal service pension benefit computed	881
and paid under division (C)(1) of this section.	882

While participating in the deferred retirement option plan	883
established under section 742.43 of the Revised Code, a member	884
shall not be considered to have elected retirement under division	885
(C)(1) of this section. On notifying the board under division	886
(B)(1) of section 742.444 of the Revised Code of the member's	887
election to terminate active service, a member described in	888
division (B) of that section shall receive an annual pension under	889
division (C)(1) of this section calculated in accordance with	890
section 742.442 of the Revised Code and rules that shall be	891
adopted by the board of trustees of the Ohio police and fire	892
pension fund.	893

(2) A member of the fund who has served fifteen or more years	894
as an active member of a police or fire departmentservice credit	895
and who voluntarily resigns or is discharged from the department	896
for any reason other than dishonesty, cowardice, intemperate	897
habits, or conviction of a felony, shall receive an annual	898
pension, payable in twelve monthly installments, in an amount	899
equal to one and one-half per cent of the member's average annual	900
salary multiplied by the number of full years of the member was in	901
the activemember's service of the departmentcredit. TheIf, as	902
of July 2, 2013, the member had fifteen or more years of service	903
credit, the average annual salary shall be determined using three	904
years of contributions. If, as of that date, the member had less	905
than fifteen years of service credit, the average annual salary	906
shall be determined using five years of contributions.	907

If a member's membership began before July 2, 2013, the	908
pension payments shall not commence until the member has attained	909
the age of forty-eight years and until twenty-five years have	910
elapsed from the date on which the member became a full-time	911
regular police officer or firefighter in the department. Pension	912
payments shall not commence for a member whose membership began on	913
or after July 2, 2013, until the member has attained the age of	914
fifty-two years and until twenty-five years have elapsed from the	915
date on which the member became a full-time regular police officer	916
or firefighter.	917

(3) A member of the fund who has completed fifteen or more	918
years of active service in a police or fire departmentcredit and	919
who has attained sixty-two years of age, may retire from the	920
department and, upon notifying the board in writing of the	921
election to retire, shall receive an annual pension, payable in	922
twelve monthly installments, in an amount equal to a percentage of	923
the member's average annual salary. If, as of July 2, 2013, the	924
member had fifteen or more years of service credit, the average	925
annual salary shall be determined using three years of	926
contributions. If, as of that date, the member had less than	927
fifteen years of service credit, the average annual salary shall	928
be determined using five years of contributions. The percentage	929
shall be the sum of two and one-half per cent for each of the	930
first twenty years the member was in the activeof service of the	931
departmentcredit, plus two per cent for each of the twenty-first	932
to twenty-fifth years the member was in the activeof service of	933
the departmentcredit, plus one and one-half per cent for each	934
year in excess of twenty-five years the member was in the active	935
of service of the departmentcredit. The annual pension shall not	936
exceed seventy-two per cent of the member's average annual salary.	937

(4) A member of the fund whose membership began on or after	938
July 2, 2013, and who has twenty-five years of service credit and	939
has attained forty-eight years of age may elect to retire. Upon	940
notifying the board in writing of the election, the member shall	941
receive an annual pension, payable in twelve monthly installments,	942
in an amount determined under division (C)(1) of this section	943
except that the amount shall be reduced to be the actuarial	944
equivalent, as determined by the fund's actuary, of the amount	945
payable had the member retired at fifty-two years of age.	946

(5) With the exception of those persons who may make	947
application for benefits as provided in section 742.26 of the	948
Revised Code, no person receiving a pension or other benefit under	949
division (C) of this section on or after July 24, 1986, shall be	950
entitled to apply for any new, changed, or different benefit.	951

If a member covered by division (C) of this section or	952
section 742.38 of the Revised Code dies prior to the time the	953
member has received a payment and leaves a surviving spouse or	954
dependent child, the surviving spouse or dependent child shall	955
receive a pension under division (D) or (E) of this section.	956

(D)(1) Except as provided in division (D)(2) of this section,	957
a surviving spouse of a deceased member of the fund or a surviving	958
spouse described in division (D)(4) of this section shall receive	959
a monthly pension as follows:	960

(a) For the period beginning July 1, 1999, and ending June	961
30, 2000, five hundred fifty dollars;	962

(b) For the period beginning July 1, 2000, and ending June	963
30, 2002, five hundred fifty dollars plus an amount determined by	964
multiplying five hundred fifty dollars by the average percentage	965
change in the consumer price index, not exceeding three per cent,	966
as was annually determined by the board under former section	967
742.3716 of the Revised Code as that section existed on January	968
31, 2002;	969

(c) For the period beginning July 1, 2002, and the period	970
beginning the first day of July of each year thereafter and	971
continuing for the following twelve months, an amount equal to the	972
monthly amount paid during the prior twelve-month period plus	973
sixteen dollars and fifty cents.	974

(2) A surviving spouse of a deceased member of the fund shall	975
receive a monthly pension of four hundred ten dollars if the	976
surviving spouse is eligible for a benefit under division (B) or	977
(D) of section 742.63 of the Revised Code. If the surviving spouse	978
ceases to be eligible for a benefit under division (B) or (D) of	979
section 742.63 of the Revised Code, the pension shall be	980
increased, effective the first day of the first month following	981
the day on which the surviving spouse ceases to be eligible for	982
the benefit, to the amount it would be under division (D)(1) of	983
this section had the spouse never been eligible for a benefit	984
under division (B) or (D) of section 742.63 of the Revised Code.	985

(3) A pension paid under this division shall continue during	986
the natural life of the surviving spouse. Benefits to a deceased	987
member's surviving spouse that were terminated under a former	988
version of this section that required termination due to	989
remarriage and were not resumed prior to September 16, 1998, shall	990
resume on the first day of the month immediately following receipt	991
by the board of an application on a form provided by the board.	992

(4) A surviving spouse of a deceased member of or contributor	993
to a fund established under former Chapter 521. or 741. of the	994
Revised Code whose benefit or pension was terminated or not paid	995
due to remarriage shall receive a monthly pension under division	996
(D)(1) of this section.	997

The pension shall commence on the first day of the month	998
immediately following receipt by the board of a completed	999
application on a form provided by the board and evidence	1000
acceptable to the board that at the time of death the deceased	1001
spouse was a member of or contributor to a police or firemen's	1002
relief and pension fund established under former Chapter 521. or	1003
741. of the Revised Code and that the surviving spouse's benefits	1004
were terminated or not granted due to remarriage.	1005

(E)(1) Each surviving child of a deceased member of the fund	1006
shall receive a monthly pension until the child attains the age of	1007
eighteen years, or marries, whichever event occurs first. A	1008
pension under this division, however, shall continue to be payable	1009
to a child under age twenty-two who is a student in and attending	1010
an institution of learning or training pursuant to a program	1011
designed to complete in each school year the equivalent of at	1012
least two-thirds of the full-time curriculum requirements of the	1013
institution, as determined by the board. If any surviving child,	1014
regardless of age at the time of the member's death, because of	1015
physical or mental disability, is totally dependent upon the	1016
deceased member for support at the time of death, the child shall	1017
receive a monthly pension under this division during the child's	1018
natural life or until the child has recovered from the disability.	1019

(2) An eligible surviving child shall receive a monthly	1020
pension as follows:	1021

(a) For the period beginning July 1, 2001, and ending June	1022
30, 2002, a monthly pension of one hundred fifty dollars plus the	1023
cost of living increase provided for inthat was determined under	1024
former section 742.3720 of the Revised Code;	1025

(b) For the period beginning July 1, 2002, and ending June	1026
30, 2003, one hundred sixty-three dollars and fifty cents;	1027

(c) For the period beginning July 1, 2003, and the period	1028
beginning the first day of each July thereafter and continuing for	1029
the following twelve months, an amount equal to the monthly amount	1030
paid during the prior twelve-month period plus four dollars and	1031
fifty cents.	1032

(F)(1) If a deceased member of the fund leaves no surviving	1033
spouse or surviving children, but leaves one or two parents	1034
dependent upon the deceased member for support, each parent shall	1035
be paid a monthly pension. The pensions provided for in this	1036
division shall be paid during the natural life of the surviving	1037
parents, or until dependency ceases, or until remarriage,	1038
whichever event occurs first.	1039

(2) Each eligible surviving parent shall be paid a monthly	1040
pension as follows:	1041

(a) For the period ending June 30, 2002, one hundred six	1042
dollars for each parent or two hundred twelve dollars for a sole	1043
dependent parent;	1044

(b) For the period beginning July 1, 2002, and ending June	1045
30, 2003, one hundred nine dollars for each parent or two hundred	1046
eighteen dollars for a sole dependent parent;	1047

(c) For the period beginning July 1, 2003, and the first day	1048
of each July thereafter and continuing for the following twelve	1049
months, an amount equal to the monthly amount paid during the	1050
prior twelve-month period plus three dollars for each parent or	1051
six dollars for a sole dependent parent.	1052

(G)(1) Subject to the provisions of section 742.461 of the	1053
Revised Code, a member of the fund who voluntarily resigns or is	1054
removed from active service in a police or fire department is	1055
entitled to receive an amount equal to the sums deducted from the	1056
member's salary and credited to the member's account in the fund,	1057
except that a member receiving a disability benefit or service	1058
pension is not entitled to receive any return of contributions to	1059
the fund.	1060

(2) A member described in division (G)(1) of this section who	1061
is married at the time of application for payment and would be	1062
eligible for age and service retirement under this section or	1063
section 742.39 of the Revised Code but for a forfeiture ordered	1064
under division (A) or (B) of section 2929.192 of the Revised Code	1065
shall submit with the application a written statement by the	1066
member's spouse attesting that the spouse consents to the payment	1067
of the member's accumulated contributions. Consent shall be valid	1068
only if it is signed and witnessed by a notary public. The board	1069
may waive the requirement of consent if the spouse is	1070
incapacitated or cannot be located, or for any other reason	1071
specified by the board. Consent or waiver is effective only with	1072
regard to the spouse who is the subject of the consent or waiver.	1073

(H) On and after January 1, 1970, all pensions shall be	1074
increased in accordance with the following provisions:	1075

(1) A member of the fund who retired prior to January 1,	1076
1967, has attained age sixty-five on January 1, 1970, and was	1077
receiving a pension on December 31, 1969, pursuant to division (B)	1078
or (C)(1) of this section or former division (C)(2), (3), (4), or	1079
(5) of this section, shall have the pension increased by ten per	1080
cent.	1081

(2) The monthly pension payable to eligible surviving spouses	1082
under division (D) of this section shall be increased by forty	1083
dollars for each surviving spouse receiving a pension on December	1084
31, 1969.	1085

(3) The monthly pension payable to each eligible child under	1086
division (E) of this section shall be increased by ten dollars for	1087
each child receiving a pension on December 31, 1969.	1088

(4) The monthly pension payable to each eligible dependent	1089
parent under division (F) of this section shall be increased by	1090
thirty dollars for each parent receiving a pension on December 31,	1091
1969.	1092

(5) A member of the fund, including a survivor of a member,	1093
who is receiving a pension in accordance with the rules governing	1094
the granting of pensions and benefits in force on April 1, 1947,	1095
that provide an increase in the original pension from time to time	1096
pursuant to changes in the salaries of active members, shall not	1097
be eligible for the benefits provided in this division.	1098

(I) On and after January 1, 1977, a member of the fund who	1099
was receiving a pension or benefit on December 31, 1973, under	1100
division (A), (B), (C)(1), or former division (C)(2) or (7) of	1101
this section shall have the pension or benefit increased as	1102
follows:	1103

(1) If the member's annual pension or benefit is less than	1104
two thousand seven hundred dollars, it shall be increased to three	1105
thousand dollars.	1106

(2) If the member's annual pension or benefit is two thousand	1107
seven hundred dollars or more, it shall be increased by three	1108
hundred dollars.	1109

The following shall not be eligible to receive increased	1110
pensions or benefits as provided in this division:	1111

(a) A member of the fund who is receiving a pension or	1112
benefit in accordance with the rules in force on April 1, 1947,	1113
governing the granting of pensions and benefits, which provide an	1114
increase in the original pension or benefit from time to time	1115
pursuant to changes in the salaries of active members;	1116

(b) A member of the fund who is receiving a pension or	1117
benefit under division (A) or (B) of this section, based on funded	1118
volunteer or funded part-time service, or off-duty disability, or	1119
partial on-duty disability, or early vested service;	1120

(c) A member of the fund who is receiving a pension under	1121
division (C)(1) of this section, based on funded volunteer or	1122
funded part-time service.	1123

(J) On and after July 1, 1977, a member of the fund who was	1124
receiving an annual pension or benefit on December 31, 1973,	1125
pursuant to division (B) of this section, based upon partial	1126
disability, off-duty disability, or early vested service, or	1127
pursuant to former division (C)(3), (5), or (6) of this section,	1128
shall have such annual pension or benefit increased by three	1129
hundred dollars.	1130

The following are not eligible to receive the increase	1131
provided by this division:	1132

(1) A member of the fund who is receiving a pension or	1133
benefit in accordance with the rules in force on April 1, 1947,	1134
governing the granting of pensions and benefits, which provide an	1135
increase in the original pension or benefit from time to time	1136
pursuant to changes in the salaries of active members;	1137

(2) A member of the fund who is receiving a pension or	1138
benefit under division (B) or (C)(2) of this section or former	1139
division (C)(3), (5), or (6) of this section based on volunteer or	1140
part-time service.	1141

(K)(1) Except as otherwise provided in this division, every	1142
person who on July 24, 1986, is receiving an age and service or	1143
disability pension, allowance, or benefit pursuant to this chapter	1144
in an amount less than thirteen thousand dollars a year that is	1145
based upon an award made effective prior to February 28, 1984,	1146
shall receive an increase of six hundred dollars a year or the	1147
amount necessary to increase the pension or benefit to four	1148
thousand two hundred dollars after all adjustments required by	1149
this section, whichever is greater.	1150

(2) Division (K)(1) of this section does not apply to the	1151
following:	1152

(a) A member of the fund who is receiving a pension or	1153
benefit in accordance with rules in force on April 1, 1947, that	1154
govern the granting of pensions and benefits and that provide an	1155
increase in the original pension or benefit from time to time	1156
pursuant to changes in the salaries of active members;	1157

(b) A member of the fund who is receiving a pension or	1158
benefit based on funded volunteer or funded part-time service.	1159

(L) On and after July 24, 1986:

1160

(1) The pension of each person receiving a pension under	1161
division (D) of this section on July 24, 1986, shall be increased	1162
to three hundred ten dollars per month.	1163

(2) The pension of each person receiving a pension under	1164
division (E) of this section on July 24, 1986, shall be increased	1165
to ninety-three dollars per month.	1166

Sec. 742.3711.  (A) On application for retirement as provided	1167
in section 742.37 of the Revised Code, a member of the fund may	1168
elect to receive a retirement allowance payable throughout the	1169
member's life, or may elect, on the application for retirement, to	1170
receive the actuarial equivalent of the member's retirement	1171
allowance in a lesser amount payable for life and continuing after	1172
death to a surviving designated beneficiary under one of the	1173
following optional plans, provided the amount payable to the	1174
beneficiary shall not exceed the amount payable to the retiring	1175
member of the fund, and is certified by the actuary engaged by the	1176
board of trustees of the Ohio police and fire pension fund to be	1177
the actuarial equivalent of the member's retirement allowance and	1178
is approved by the board.	1179

(1) Option 1. The member's lesser retirement allowance shall	1180
be paid for life to the sole beneficiary designated at the time of	1181
the member's retirement.	1182

(2) Option 2. One-half or some other portion of the member's	1183
lesser retirement allowance shall be paid for life to the sole	1184
beneficiary designated at the time of the member's retirement.	1185

(3) Option 3. Upon the member's death before the expiration	1186
of a certain period from the retirement date and elected by the	1187
member and approved by the retirement board, the member's lesser	1188
retirement allowance shall be continued for the remainder of that	1189
period to the beneficiary the member has nominated by written	1190
designation anddesignated in writing filed with the retirement	1191
board.	1192

Should the nominated beneficiarymember's designated in	1193
writing become deceasedbeneficiary die prior to the expiration of	1194
the guarantee period, then for the purpose of completing payment	1195
for the remainder of the guarantee period, the present value of	1196
such payments shall be paid to the estate of the beneficiary last	1197
receiving.	1198

(4) Option 4. The member's lesser retirement allowance or a	1199
portion of the lesser retirement allowance shall be paid for life	1200
to two, three, or four surviving beneficiaries designated at the	1201
time of the member's retirement, in such portions as specified at	1202
retirement. If the member elects this plan as required by a court	1203
order issued under section 3105.171 or 3105.65 of the Revised Code	1204
or the laws of another state regarding the division of marital	1205
property and compliance with the court order requires the	1206
allocation of a portion less than ten per cent to any beneficiary,	1207
the member shall allocate a portion less than ten per cent to that	1208
beneficiary in accordance with that order. In all other	1209
circumstances, no portion allocated under this plan of payment	1210
shall be less than ten per cent. The total of the portions	1211
allocated shall not exceed one hundred per cent of the member's	1212
lesser allowance.	1213

(B)(1) The death of a spouse nominateddesignated as	1214
beneficiary or the death of any other nominateddesignated	1215
beneficiary following a member's retirement or election under	1216
section 742.44 of the Revised Code to participate in the deferred	1217
retirement option plan shall cancel the portion of the optional	1218
plan of payment providing continuing lifetime benefits to the	1219
deceased nominateddesignated beneficiary. The member of the fund	1220
shall receive the actuarial equivalent of the member's single	1221
lifetime benefit, as determined by the board, based on the number	1222
of remaining beneficiaries, with no change in the amount payable	1223
to any remaining beneficiary. The change shall be effective the	1224
month following receipt by the board of notice of the death.	1225

(2) On divorce, annulment, or marriage dissolution, a member	1226
receiving a retirement allowance under a plan that provides for	1227
continuation of all or part of the allowance after death for the	1228
lifetime of the member's surviving spouse may, with the written	1229
consent of the spouse or pursuant to an order of the court with	1230
jurisdiction over the termination of the marriage, elect to cancel	1231
the portion of the plan providing continuing lifetime benefits to	1232
that spouse. The member shall receive the actuarial equivalent of	1233
the member's single lifetime benefit as determined by the board	1234
based on the number of remaining beneficiaries, with no change in	1235
amount payable to any remaining beneficiary. The election shall be	1236
made on a form provided by the board and shall be effective the	1237
month following its receipt by the board.	1238

(C)(1) Following marriage or remarriage, both of the	1239
following apply:	1240

(a) A member of the fund receiving a retirement allowance	1241
under section 742.37 or 742.39 of the Revised Code may elect not	1242
later than one year after the date of marriage or remarriage a new	1243
optional plan of payment based on the actuarial equivalent of the	1244
member's single lifetime benefit as determined by the board.	1245

(b) If a member is receiving a retirement allowance pursuant	1246
to a plan of payment providing for payment to a former spouse	1247
pursuant to a court order described in division (D)(1)(c) of this	1248
section and the board has received a copy of the order described	1249
in that division, the member may elect a new plan of payment under	1250
"option 4" based on the actuarial equivalent of the retirant's	1251
single lifetime retirement allowance as determined by the board if	1252
the new plan of payment elected does not reduce the payment to the	1253
former spouse.	1254

(2) A plan elected under this division and the member's	1255
lesser retirement allowance shall become effective on the date of	1256
receipt by the board of an application on a form approved by the	1257
board.	1258

(D)(1) Unless one of the following occurs, an application for	1259
retirement by a married person shall be considered an election of	1260
a benefit under option 2 as provided for in division (A)(2) of	1261
this section under which one-half of the lesser retirement	1262
allowance payable during the life of the retirant will be paid	1263
after death to the retirant's spouse for life as sole beneficiary:	1264

(a) The retirant selects an optional plan under division (A)	1265
of this section providing for payment after death to the	1266
retirant's spouse for life as sole beneficiary of more than	1267
one-half of the lesser retirement allowance payable during the	1268
life of the retirant;	1269

(b) The retirant submits to the retirement board a written	1270
statement signed by the spouse attesting that the spouse consents	1271
to the retirant's election to receive a single lifetime retirement	1272
allowance or a payment under an optional benefit plan under which	1273
after the death of the retirant the surviving spouse will receive	1274
less than one-half of the lesser retirement allowance payable	1275
during the life of the retirant;	1276

(c) A plan of payment providing for payment in a specified	1277
amount continuing after the retirant's death to a former spouse is	1278
required by a court order issued prior to the effective date of	1279
the retirant's retirement under section 3105.171 or 3105.65 of the	1280
Revised Code or the laws of another state regarding division of	1281
marital property.	1282

(d) If a retirant is subject to division (D)(1)(c) of this	1283
section and the board has received a copy of the order described	1284
in that division, the board shall accept the retirant's election	1285
of a plan of payment under this section only if the retirant	1286
complies with both of the following:	1287

(i) The retirant elects a plan of payment that is in	1288
accordance with the order described in division (D)(1)(c) of this	1289
section.	1290

(ii) If the retirant is married, the retirant elects "option	1291
4" and designates the retirant's current spouse as a beneficiary	1292
under that plan unless that spouse consents in writing to not	1293
being designated a beneficiary under any plan of payment or the	1294
board waives the requirement that the current spouse consent.	1295

(2) An application for retirement shall include an	1296
explanation of all of the following:	1297

(a) That, if the member is married, unless the spouse	1298
consents to another plan of payment or there is a court order	1299
dividing marital property issued under section 3105.171 or 3105.65	1300
of the Revised Code or the laws of another state regarding the	1301
division of marital property that provides for payment in a	1302
specified amount, the member's retirement allowance will be paid	1303
under "option 2" and consist of the actuarial equivalent of the	1304
member's retirement allowance in a lesser amount payable for life	1305
and one-half of the lesser allowance continuing after death to the	1306
surviving spouse for the life of the spouse;	1307

(b) A description of the alternative plans of payment	1308
available with the consent of the spouse;	1309

(c) That the spouse may consent to another plan of payment	1310
and the procedure for giving consent;	1311

(d) That consent is irrevocable once notice of consent is	1312
filed with the board.	1313

Consent shall be valid only if it is signed, in writing, and	1314
witnessed by an employee of the board or a notary public.	1315

(3) If the retirant does not select an optional plan as	1316
described in division (D)(1)(a) of this section and the board does	1317
not receive the written statement provided for in division	1318
(D)(1)(b) of this section, it shall determine and pay the	1319
retirement allowance in accordance with division (A)(2) of this	1320
section, except that the board may provide by rule for waiver by	1321
the board of the statement and payment of the allowance other than	1322
in accordance with division (A)(2) of this section if the retirant	1323
is unable to obtain the statement due to absence or incapacity of	1324
the spouse or other cause specified by the board.	1325

(E) A member of the fund who has elected an optional plan	1326
under this section or section 742.3715 of the Revised Code may,	1327
with the consent of the designated beneficiary, cancel the	1328
optional plan and receive the retirement allowance payable	1329
throughout life the member would have received had the member not	1330
elected the optional plan, if the member makes a request to cancel	1331
the optional plan not later than one year after the later of	1332
September 9, 1988, or the date on which the member first receives	1333
a payment under this section or section 742.3715 of the Revised	1334
Code. Cancellation of the optional plan shall be effective the	1335
month after acceptance of the request by the trustees of the fund.	1336
No payment or adjustment shall be made in the retirement allowance	1337
payable throughout the member's life to compensate for the lesser	1338
allowance the member received under the optional plan.	1339

The request to cancel the optional plan shall be made on a	1340
form provided by the fund and shall be valid only if the completed	1341
form includes a signed statement of the designated beneficiary's	1342
understanding of and consent to the cancellation. The signature	1343
shall be verified by the trustees of the fund prior to their	1344
acceptance of the cancellation.	1345

(F) Any option elected and payments made under this section	1346
shall be in addition to any benefit payable under divisions (D),	1347
(E), and (F) of section 742.37 of the Revised Code.	1348

(G) A person is eligible to receive a benefit increase under	1349
this division if the person is receiving a retirement allowance or	1350
benefit under an optional plan elected under this section or	1351
section 742.3715 of the Revised Code based on an award made prior	1352
to July 24, 1986. A person is not eligible to receive an increase	1353
under this division if the person is receiving a pension or	1354
benefit in accordance with rules in force on April 1, 1947, that	1355
govern the granting of pensions and benefits and that provide an	1356
increase in the original pension or benefit from time to time	1357
pursuant to changes in the salaries of active members.	1358

The board shall annually increase all benefits payable under	1359
this section or section 742.3715 of the Revised Code to eligible	1360
persons by the actuarial equivalent of three hundred sixty	1361
dollars, except that no benefit shall exceed the limit established	1362
by section 415 of the "Internal Revenue Code of 1986," 100 Stat.	1363
2085, 26 U.S.C.A. 415, as amended.	1364

The first increase is payable to all eligible persons on July	1365
1, 1988. The increase is payable for the ensuing twelve-month	1366
period or until the next increase is granted under this section,	1367
whichever is later.	1368

The date of the first increase payable under this section	1369
shall be the anniversary date for future increases.	1370

If payment of a portion of a benefit is made to an alternate	1371
payee under section 742.462 of the Revised Code, increases under	1372
this division granted while the order is in effect shall be	1373
apportioned between the alternate payee and the benefit recipient	1374
in the same proportion that the amount being paid to the alternate	1375
payee bears to the amount paid to the benefit recipient.	1376

If payment of a portion of a retirement allowance is made to	1377
one or more beneficiaries under "option 4" under division (A)(4)	1378
of section 742.3711 of the Revised Code, each increase under this	1379
division granted while the plan of payment is in effect shall be	1380
divided among the designated beneficiaries in accordance with the	1381
portion each beneficiary has been allocated.	1382

Sec. 742.3716.  (A)(1) As used in this section:

1383

(a) "Eligible person" means a person who meets all of the	1384
following conditions:	1385

(i) Has been receiving a pension or benefit under this	1386
chapter for one year or more based on an award made on or after	1387
July 24, 1986;	1388

(ii) Has not made the election provided for in division (B)	1389
of this section;	1390

(iii) Is not the spouse or survivor of a person who has made	1391
the election provided for in division (B) of this section;	1392

(iv) Is receiving a benefit in accordance with division (A),	1393
(B), or (C) of section 742.37, division (C)(2), (3), (4), or (5)	1394
of former section 742.37, section 742.3711, or section 742.39 of	1395
the Revised Code.	1396

(b)(1) "Recalculated average annual salary" means the highest	1397
average annual compensation of a member of the Ohio police and	1398
fire pension fund during any three years of contributions,	1399
including amounts included in terminal pay attributable to such	1400
three years, determined by dividing the member's total earnings as	1401
an employee during such years by three.	1402

(2) In the case of a member participating in the deferred	1403
retirement option plan established under section 742.43 of the	1404
Revised Code or a member described in division (B) of section	1405
742.444 of the Revised Code, the period of one year or more	1406
described in division (A)(1)(a)(i) of this section begins on the	1407
effective date of the member's election under section 742.44 of	1408
the Revised Code.	1409

(B)(1) Notwithstanding section 742.37 or 742.39 of the	1410
Revised Code, a member of the fund who is not receiving a pension	1411
or benefit under this chapter and who on January 1, 1989, has	1412
completed fifteen or more years of active service in a police or	1413
fire department may elect to have any future benefit or pension	1414
paid to the member or the member's spouse or survivors under this	1415
chapter calculated on the basis of the member's recalculated	1416
average annual salary rather than the member's average annual	1417
salary. The election shall be made by the member prior to or at	1418
the time of making an election under section 742.3711 of the	1419
Revised Code. This division does not apply to a member of the fund	1420
who elected to participate in the deferred retirement option plan	1421
established under section 742.43 of the Revised Code unless the	1422
member's participation has terminated pursuant to division (C) of	1423
section 742.444 or to section 742.445 of the Revised Code.	1424

(2) If the member eligible to make the election under	1425
division (B)(1) of this section dies prior to making the election	1426
and at the time of death is eligible to retire and receive a	1427
pension or benefit under division (C)(1) or (3) of section 742.37	1428
of the Revised Code, the person entitled to receive a benefit	1429
under section 742.3714 of the Revised Code may make the election	1430
provided for in division (B)(1) of this section.	1431

(3) The election under division (B)(1) or (2) of this section	1432
shall be made on forms provided by the trustees of the fund. Once	1433
received by the fund, the election shall be irrevocable and shall	1434
bind the member and any other person who receives a pension or	1435
benefit based on the member's service. No person who receives a	1436
pension or benefit calculated in accordance with division (B) of	1437
this section is eligible to receive a cost-of-living allowance	1438
under this section. If the person making the election receives a	1439
benefit under section 742.3714 of the Revised Code, that person is	1440
not eligible to receive a cost-of-living allowance under section	1441
742.3711 of the Revised Code.	1442

(C)(1) The(2) "Consumer price index" means the index, as	1443
prepared by the United States bureau of labor statistics (U.S.	1444
city average for urban wage earners and clerical workers: all	1445
items 1982-84=100), or, if that index is no longer published, a	1446
generally available comparable index.	1447

(B) For persons who become members of the fund on or after	1448
July 1, 2013, and members of the fund who as of July 1, 2013, have	1449
less than fifteen years of service credit and are not receiving a	1450
pension or disability benefit under this chapter, the board of	1451
trustees of the Ohio police and fire pension fund shall annually	1452
increase allthe pension or benefits that become payable to	1453
eligible persons by three per cent, except that no benefit shall	1454
each member pursuant to section 742.37 of the Revised Code or	1455
division (D)(2) or (4) of section 742.38 of the Revised Code once	1456
the member has received the pension or benefit for at least one	1457
year and has attained the age of fifty-five. Benefits that become	1458
payable pursuant to division (D)(1) of section 742.38 of the	1459
Revised Code shall be increased annually once the member has	1460
received the benefits for at least one year.	1461

The pension or benefit shall be increased by the lesser of	1462
the following:	1463

(1) Three per cent;

1464

(2) The percentage increase, if any, in the consumer price	1465
index over the twelve-month period that ends on the thirtieth day	1466
of September of the immediately preceding year, rounded to the	1467
nearest one-tenth of one per cent.	1468

In no event shall the pension or benefit exceed the limit	1469
established by section 415 of the "Internal Revenue Code of 1986,"	1470
100 Stat. 2085, 26 U.S.C.A. 415, as amended.	1471

The first increase is payable to all eligible persons who on	1472
July 1, 1988, have been receiving a pension or benefit for twelve	1473
months or longer. The increase is payable for the ensuing	1474
twelve-month period or until the next increase is granted under	1475
this section, whichever is later.	1476

The date of the first increase paid under this section	1477
division shall be the anniversary date for future increases. The	1478
pension or benefit used in the first calculation of an increase	1479
under this sectiondivision shall remain as the base for all	1480
future increases paid under this sectiondivision, unless a new	1481
base is established by law. In the case of a member who has	1482
elected	1483

(C) For members of the fund who as of July 1, 2013, have	1484
fifteen or more years of service credit and are not receiving a	1485
pension or disability benefit under this chapter and members who	1486
are receiving a pension or disability benefit that became	1487
effective before that date and did not make the election under	1488
division (D) of this section, the board shall annually increase	1489
the pension or benefits that become payable to each member	1490
pursuant to section 742.37 of the Revised Code or division (D)(2)	1491
or (4) of section 742.38 of the Revised Code once the member has	1492
received the pension or benefits for at least one year and has	1493
attained the age of fifty-five. Benefits that become payable	1494
pursuant to division (D)(1) of section 742.38 of the Revised Code	1495
shall be increased once the member has received the benefits for	1496
at least one year.	1497

The pension or disability benefit shall be increased by three	1498
per cent. In no event shall the pension or benefit exceed the	1499
limit established by section 415 of the "Internal Revenue Code of	1500
1986," 100 Stat. 2085, 26 U.S.C. 415, as amended.	1501

The date of the first increase paid under this division shall	1502
be the anniversary date for future increases. The pension or	1503
benefit used in the first calculation of an increase under this	1504
division shall remain as the base for all future increases paid	1505
under this division unless a new base is established by law.	1506

(D)(1) Notwithstanding any other provision of this section,	1507
section 742.37, or section 742.39 of the Revised Code, a member of	1508
the fund who is not receiving a pension or benefit under this	1509
chapter and on January 1, 1989, had fifteen or more years of	1510
service credit under this chapter may elect to have any future	1511
pension or benefit paid to the member or the member's spouse or	1512
survivors under this chapter calculated on the basis of the	1513
member's recalculated average annual salary rather than the	1514
member's average annual salary as determined under section 742.37	1515
or 742.39 of the Revised Code. The election shall be made by the	1516
member prior to or at the time of making an election under section	1517
742.3711 of the Revised Code.	1518

(2) If a member eligible to make the election under division	1519
(D)(1) of this section dies prior to making the election and at	1520
the time of death is eligible to retire and receive a pension or	1521
benefit under division (C)(1) or (3) of section 742.37 of the	1522
Revised Code, the person entitled to receive a benefit under	1523
section 742.3714 of the Revised Code may make the election	1524
provided for in this division.	1525

(3) The election under division (D)(1) or (2) of this section	1526
shall be made on forms provided by the fund. Once received by the	1527
fund, the election is irrevocable and binds the member and any	1528
other person who receives a pension or benefit based on the	1529
member's service. No person who receives a pension or benefit	1530
calculated in accordance with division (D) of this section is	1531
eligible to receive an increase under this section. If the person	1532
making the election receives a benefit under section 742.3714 of	1533
the Revised Code, that person is not eligible to receive an	1534
increase under division (G) of section 742.3711 of the Revised	1535
Code.	1536

(E) A member whose election to participate in the deferred	1537
retirement option plan established under section 742.43 of the	1538
Revised Code or a member described in division (B) of section	1539
742.444 of the Revised Code, the pension amount used in the first	1540
calculation of an increase under this section shall be the amount	1541
calculated under section 742.442 of the Revised Code unless the	1542
member's participation has terminated pursuant to division (C) of	1543
section 742.444 or to section 742.445 of the Revised Code.	1544

(2) Increases paid in years subsequent to the year of the	1545
first increase paid under this section shall be paid to all	1546
eligible persons who, on the date that the increase is authorized	1547
by the board, have been receiving a pension or benefit for twelve	1548
monthsis effective prior to July 2, 2013, is eligible to receive	1549
an increase under this section while participating in the deferred	1550
retirement option plan on attaining the age of fifty-five and	1551
having participated in the plan twelve months. The pension amount	1552
used in the first calculation of an increase under this section	1553
shall be the amount calculated under section 742.442 of the	1554
Revised Code unless the member's participation has terminated	1555
pursuant to division (C) of section 742.444 or to section 742.445	1556
of the Revised Code. A member whose election to participate in the	1557
deferred retirement option plan is effective on or after July 2,	1558
2013, shall not receive an increase under this section while	1559
participating in the deferred retirement option plan.	1560

(E)(F) If payment of a portion of a benefit is made to an	1561
alternate payee under section 742.462 of the Revised Code,	1562
increases under this section granted while the order is in effect	1563
shall be apportioned between the alternate payee and the benefit	1564
recipient in the same proportion that the amount being paid to the	1565
alternate payee bears to the amount paid to the benefit recipient.	1566

If payment of a portion of a retirement allowance is made to	1567
one or more beneficiaries under "option 4" under division (A)(4)	1568
of section 742.3711 of the Revised Code, each increase under this	1569
section granted while the plan of payment is in effect shall be	1570
divided among the designated beneficiaries in accordance with the	1571
portion each beneficiary has been allocated.	1572

Sec. 742.38.  (A)(1) The board of trustees of the Ohio police	1573
and fire pension fund shall adopt rules establishing minimum	1574
medical testing and diagnostic standards or procedures to be	1575
incorporated into physical examinations administered by physicians	1576
to prospective members of the fund. The standards or procedures	1577
shall include diagnosis and evaluation of the existence of any	1578
heart disease, cardiovascular disease, or respiratory disease. The	1579
rules shall specify the form of the physician's report and the	1580
information to be included in it.	1581

The board shall notify all employers of the establishment of	1582
the minimum standards or procedures and shall include with the	1583
notice a copy of the standards or procedures. The board shall	1584
notify all employers of any changes made to the standards or	1585
procedures. Once the standards or procedures take effect,	1586
employers shall cause each prospective member of the fund to	1587
submit to a physical examination that incorporates the standards	1588
or procedures.	1589

(2) Division (A)(2) of this section applies to an employee	1590
who becomes a member of the fund on or after the date the minimum	1591
standards or procedures described in division (A)(1) of this	1592
section take effect. For each employee described in division	1593
(A)(2) of this section, the employer shall forward to the board a	1594
copy of the physician's report of a physical examination that	1595
incorporates the standards or procedures described in division	1596
(A)(1) of this section. If an employer fails to forward the report	1597
in the form required by the board on or before the date that is	1598
sixty days after the employee becomes a member of the fund, the	1599
board shall assess against the employer a penalty determined under	1600
section 742.353 of the Revised Code.	1601

(B) Application for a disability benefit may be made by a	1602
member of the fund or, if the member is incapacitated as defined	1603
in rules adopted by the board, by a person acting on the member's	1604
behalf. Not later than fourteen days after receiving an	1605
application for a disability benefit from a member or a person	1606
acting on behalf of a member, the board shall notify the member's	1607
employer that an application has been filed. The notice shall	1608
state the member's position or rank. Not later than twenty-eight	1609
days after receiving the notice or filing an application on behalf	1610
of a member, the employer shall forward to the board a statement	1611
certifying the member's job description and any other information	1612
required by the board to process the application.	1613

If the member applying for a disability benefit becomes a	1614
member of the fund prior to the date the minimum standards or	1615
procedures described in division (A)(1) of this section take	1616
effect, the board may request from the member's employer a copy of	1617
the physician's report of the member's physical examination taken	1618
on entry into the police or fire department or, if the employer	1619
does not have a copy of the report, a written statement certifying	1620
that the employer does not have a copy of the report. If an	1621
employer fails to forward the report or statement in the form	1622
required by the board on or before the date that is twenty-eight	1623
days after the date of the request, the board shall assess against	1624
the employer a penalty determined under section 742.353 of the	1625
Revised Code. The board shall maintain the information submitted	1626
under this division and division (A)(2) of this section in the	1627
member's file.	1628

(C) For purposes of determining under division (D) of this	1629
section whether a member of the fund is disabled, the board shall	1630
adopt rules establishing objective criteria under which the board	1631
shall make the determination. The rules shall include standards	1632
that provide for all of the following:	1633

(1) Evaluating a member's illness or injury on which an	1634
application for disability benefits is based;	1635

(2) Defining the occupational duties of a police officer or	1636
firefighter;	1637

(3) Providing for the board to assign competent and	1638
disinterested physicians and vocational evaluators to conduct	1639
examinations of a member;	1640

(4) Requiring a written report for each disability	1641
application that includes a summary of findings, medical opinions,	1642
including an opinion on whether the illness or injury upon which	1643
the member's application for disability benefits is based was	1644
caused or induced by the actual performance of the member's	1645
official duties, and any recommendations or comments based on the	1646
medical opinions;	1647

(5) Providing for the board to consider the member's	1648
potential for retraining or reemployment.	1649

(D) This division does not apply to members of the fund who	1650
have elected to receive benefits and pensions in accordance with	1651
division (A) or (B) of section 742.37 of the Revised Code or from	1652
a police relief and pension fund or a firemen's relief and pension	1653
fund in accordance with the rules of that fund in force on April	1654
1, 1947.	1655

(1) As used in this division (D)(1) of this section:

1656

(a) "Totally disabled" means a member of the fund is unable	1657
to perform the duties of any gainful occupation for which the	1658
member is reasonably fitted by training, experience, and	1659
accomplishments. Absolute helplessness is not a prerequisite of	1660
being totally disabled.	1661

(b) "Permanently disabled" means a condition of disability	1662
from which there is no present indication of recovery.	1663

(1) A member of the fund who is permanently and totally	1664
disabled as the result of the performance of the member's official	1665
duties as a member of a police or fire department shall be paid	1666
annual disability benefits in accordance with division (A) of	1667
section 742.39 of the Revised Code. In determining whether a	1668
member of the fund is permanently and totally disabled, the board	1669
shall consider standards adopted under division (C) of this	1670
section applicable to the determination.	1671

(2) A member of the fund who is permanently and partially	1672
disabled as the result of the performance of the member's official	1673
duties as a member of a police or fire department shall, if the	1674
disability prevents the member from performing those duties and	1675
impairs the member's earning capacity, receive annual disability	1676
benefits in accordance with division (B) of section 742.39 of the	1677
Revised Code. In determining whether a member of the fund is	1678
permanently and partially disabled, the board shall consider	1679
standards adopted under division (C) of this section applicable to	1680
the determination.	1681

(3) A member of the fund who is permanently disabled as a	1682
result of heart disease or any cardiovascular or respiratory	1683
disease of a chronic nature, which disease or any evidence of	1684
which disease was not revealed by the physical examination passed	1685
by the member on entry into the department or another examination	1686
specified in rules the board adopts under section 742.10 of the	1687
Revised Code, is presumed to have incurred the disease while	1688
performing the member's official duties, unless the contrary is	1689
shown by competent evidence. The board may waive the requirement	1690
that the absence of disease be evidenced by a physical examination	1691
if competent medical evidence of a type specified in rules adopted	1692
under section 742.10 of the Revised Code is submitted documenting	1693
that the disease was not evident prior to or at the time of entry	1694
into the department.	1695

(4) A member of the fund who has completed five or more years	1696
of active service in a police or fire departmentcredit and has	1697
incurred a permanent disability not caused or induced by the	1698
actual performance of the member's official duties as a member of	1699
the department, or by the member's own negligence, shall if the	1700
disability prevents the member from performing those duties and	1701
impairs the member's earning capacity, receive annual disability	1702
benefits in accordance with division (C) of section 742.39 of the	1703
Revised Code. In determining whether a member of the fund is	1704
permanently disabled, the board shall consider standards adopted	1705
under division (C) of this section applicable to the	1706
determination.	1707

(5) The board shall notify a member of its final action	1708
awarding a disability benefit to the member within thirty days of	1709
the final action. The notice shall be sent by certified mail,	1710
return receipt requested. Not later than ninety days after receipt	1711
of notice from the board, the member shall elect, on a form	1712
provided by the board, either to accept or waive the disability	1713
benefit award. If the member elects to waive the disability	1714
benefit award or fails to make an election within the time period,	1715
the award is rescinded. A member who later seeks a disability	1716
benefit award shall be required to make a new application, which	1717
shall be dealt with in accordance with the procedures used for	1718
original disability benefit applications.	1719

A person is not eligible to apply for or receive disability	1720
benefits under this division, section 742.39 of the Revised Code,	1721
or division (C)(2), (3), (4), or (5) of former section 742.37 of	1722
the Revised Code unless the person is a member of the fund on the	1723
date on which the application for disability benefits is submitted	1724
to the fund.	1725

With the exception of persons who may make application for	1726
increased benefits as provided in division (D)(2) or (4) of this	1727
section or division (C)(3) or (5) of former section 742.37 of the	1728
Revised Code on or after July 24, 1986, or persons who may make	1729
application for benefits as provided in section 742.26 of the	1730
Revised Code, no person receiving a pension or benefit under this	1731
section or division (C) of former section 742.37 of the Revised	1732
Code may apply for any new, changed, or different benefit.	1733

Sec. 742.39.  (A) A member of the Ohio police and fire	1734
pension fund determined to be eligible for a disability benefit	1735
under division (D)(1) of section 742.38 of the Revised Code shall	1736
be paid annual disability benefits, payable in twelve monthly	1737
installments, in an amount equal to seventy-two per cent of the	1738
member's average annual salary. If, as of July 2, 2013, the member	1739
had fifteen or more years of service credit, the average annual	1740
salary shall be determined using three years of contributions. If,	1741
as of that date, the member had less than fifteen years of service	1742
credit, the average annual salary shall be determined using five	1743
years of contributions.	1744

(B) A member of the fund determined to be eligible for a	1745
disability benefit under division (D)(2) of section 742.38 of the	1746
Revised Code shall be paid annual disability benefits, payable in	1747
twelve monthly installments. If the member has fewer than	1748
twenty-five years of active service in a police or fire department	1749
credit, the benefit shall be in an amount fixed by the board of	1750
trustees of the Ohio police and fire pension fund. The board may	1751
increase or decrease the benefit whenever the board determines	1752
that the impairment of the member's earning capacity warrants an	1753
increase or decrease based on the standards adopted under division	1754
(C) of section 742.38 of the Revised Code applicable to the	1755
determination, but in no event shall the benefit exceed sixty per	1756
cent of the member's average annual salary.	1757

A member who has completed twenty-five or more years of	1758
active service in the departmentcredit shall receive annual	1759
disability benefits, payable in twelve monthly installments, in an	1760
amount equal to a percentage of the member's average annual	1761
salary. The percentage shall be the sum of two and one-half per	1762
cent for each of the first twenty years the member was in the	1763
activeof service of the departmentcredit, plus two per cent for	1764
each of the twenty-first to twenty-fifth years the member was in	1765
the activeof service of the departmentcredit, plus one and	1766
one-half per cent for each year in excess of twenty-five years the	1767
member was in the activeof service of the departmentcredit. The	1768
annual disability benefit shall not exceed seventy-two per cent of	1769
the member's average annual salary.	1770

In calculating a benefit under this division, a member's	1771
average annual salary shall be determined using three years of	1772
contributions if, as of July 2, 2013, the member had fifteen or	1773
more years of service credit. If, as of that date, the member had	1774
less than fifteen years of service credit, the average annual	1775
salary shall be determined using five years of contributions.	1776

(C) A member of the fund determined to be eligible for a	1777
disability benefit under division (D)(4) of section 742.38 of the	1778
Revised Code shall be paid annual disability benefits, payable in	1779
twelve monthly installments, in an amount to be fixed by the	1780
board. The board may increase or decrease the benefits whenever	1781
the board determines that the impairment of the member's earning	1782
capacity warrants an increase or decrease based on the standards	1783
adopted under division (C) of section 742.38 of the Revised Code	1784
applicable to the determination, but in no event shall a benefit	1785
paid to the member exceed sixty per cent of the member's average	1786
annual salary.	1787

(D) Each of the following persons who on July 1, 1999, is	1788
receiving annual benefits of less than six thousand six hundred	1789
dollars shall have the benefits increased to that amount effective	1790
July 1, 1999:	1791

(1) A person receiving annual benefits described in division	1792
(A) of this section;	1793

(2) A person receiving annual benefits described in division	1794
(C) of this section based on an award made prior to September 16,	1795
1998.	1796

(E) Benefits payable under this section continue until death	1797
unless adjusted under division (D)(5) of section 742.38 of the	1798
Revised Code or adjusted or terminated under division (C)(3) of	1799
section 742.40 of the Revised Code.	1800

Sec. 742.44. Except as provided in section 742.14 of the	1801
Revised Code, at any time prior to filing an application for	1802
retirement under division (C)(1) of section 742.37 of the Revised	1803
Code, a member who has attained the requisite age and is eligible	1804
to retire under that division may elect to participate in the	1805
deferred retirement option plan established under section 742.43	1806
of the Revised Code.	1807

To make an election, an eligible member shall complete and	1808
submit to the Ohio police and fire pension fund a form prescribed	1809
by the fund. At this time the member may, but is not required to,	1810
elect under section 742.3711 of the Revised Code to have the	1811
member's monthly pension calculated as a retirement allowance	1812
payable throughout the member's life or a retirement allowance	1813
under option 2 in division (A) of section 742.3711 of the Revised	1814
Code. Unless rescinded during a period specified in rules adopted	1815
under section 742.43 of the Revised Code, the election is	1816
irrevocable from the date it is received by the fund until the	1817
employee ceases to participate in the plan as provided in section	1818
742.444 of the Revised Code.	1819

A member is not required to specify the number of years or	1820
portion of a year the member will participate in the plan but must	1821
agree to terminate active service in a police or fire department	1822
and begin receiving the member's pension not later than the date	1823
that is eight years after the effective date of the election to	1824
participate in the plan or be subject to the forfeiture provisions	1825
of division (C) of section 742.444 of the Revised Code.	1826

The effective date of an election made under this section is	1827
the first day of the employer's first payroll period immediately	1828
following the board's receipt of the notice of election.	1829

Sec. 742.442. For each member who elects to participate in	1830
the deferred retirement option plan, the Ohio police and fire	1831
pension fund shall determine under division (C)(1) of section	1832
742.37 of the Revised Code the monthly pension amount that would	1833
be payable to the member had the member elected to receive a	1834
pension under that division. In determining the pension amount,	1835
the fund shall use the member's total service credit and average	1836
annual salary as of the last day of the employer's payroll period	1837
immediately prior to the effective date of the member's election	1838
to participate in the plan. The pension amount shall be calculated	1839
as a retirement allowance payable for the member's life, except	1840
that, if at the time of electing to participate in the plan the	1841
member selected the plan of payment in option 2 of division (A) of	1842
section 742.3711 of the Revised Code, the pension shall be	1843
calculated using that plan of payment.	1844

A member who participates in the plan is not eligible to make	1845
an election under division (B)(D) of section 742.3716 of the	1846
Revised Code.	1847

Sec. 742.443. (A) During the period beginning on the	1848
effective date of an election to participate in the deferred	1849
retirement option plan and ending on the date participation	1850
ceases, a member's monthly pension amount determined under section	1851
742.442 of the Revised Code shall accrue to the member's benefit.	1852
ToIf the member is eligible for increases under section 742.3716	1853
of the Revised Code, to this amount shall be added any benefit	1854
increases the member would be eligible for under division (C) of	1855
that section 742.3716 of the Revised Code had the member, on the	1856
effective date of the member's election, retired under division	1857
(C)(1) of section 742.37 of the Revised Code.	1858

(B)(1) The amounts contributed under section 742.31 of the	1859
Revised Code by a member participatingwho, before July 2, 2013,	1860
elects to participate in the deferred retirement option plan shall	1861
accrue to the member's benefit as follows:	1862

(a) During the period beginning on the first day of the first	1863
payroll period after the election's effective date and ending on	1864
the earlier of the date that is two years thereafter or the date	1865
the member ceases participation in the plan, fifty per cent of the	1866
member's contributions for that period;	1867

(b) During the period beginning on the date that is two years	1868
and one day after accruals begin under this division and ending on	1869
the earlier of the date that is three years thereafter or the date	1870
the member ceases participation in the plan, seventy-five per cent	1871
of the member's contributions for that period;	1872

(c) During the period beginning on the date that is three	1873
years and one day after accruals begin under this section and	1874
ending on the date the member ceases participation in the plan,	1875
one hundred per cent of the member's contributions for that	1876
period.	1877

(2) The amounts contributed under section 742.31 of the	1878
Revised Code by a member who, on or after July 2, 2013, elects to	1879
participate in the deferred retirement option plan shall accrue to	1880
the member's benefit as follows:	1881

(a) During the period beginning on the first day of the first	1882
payroll period after the election's effective date and ending on	1883
the earlier of the date that is three years thereafter or the date	1884
the member ceases participation in the plan, fifty per cent of the	1885
member's contributions for that period;	1886

(b) During the period beginning on the date that is three	1887
years and one day after accruals begin under this division and	1888
ending on the earlier of the date that is five years thereafter or	1889
the date the member ceases participation in the plan, seventy-five	1890
per cent of the member's contributions for that period;	1891

(c) During the period beginning on the date that is five	1892
years and one day after accruals begin under this section and	1893
ending on the date the member ceases participation in the plan,	1894
one hundred per cent of the member's contributions for that	1895
period.	1896

(3) The Ohio police and fire pension fund shall credit the	1897
portion of a member's contributions that are not accrued to the	1898
member's benefit under division (B)(1) or (2) of this section to	1899
the police officers' contribution fund or firefighters'	1900
contribution fund, as appropriate.	1901

(C) During the period beginning on the election's effective	1902
date and ending on the day before the date distributions under	1903
division (B)(3) of section 742.444 of the Revised Code are	1904
completed, the amounts described in divisions (A) and (B)(1) of	1905
this section shall earn interest at an annual rate established by	1906
the board of trustees of the fund and compounded annually using a	1907
method established by rule adopted under section 742.43 of the	1908
Revised Code.	1909

Sec. 742.444. (A) A member's participation in the deferred	1910
retirement option plan ceases on the occurrence of the earliest of	1911
the following:	1912

(1) Termination of the member's active service in a police or	1913
fire department;	1914

(2) The last day of the eight-year period that begins on the	1915
effective date of the member's election to participate in the	1916
plan;	1917

(3) Acceptance by the member of a disability benefit awarded	1918
by the board of trustees of the Ohio police and fire pension fund,	1919
unless the acceptance is revoked by the member in accordance with	1920
rules adopted by the board;	1921

(4) The member's death.

1922

(B) If a member terminates active service in a police or fire	1923
department not later than eight years after the effective date of	1924
the member's election to participate in the plan, all of the	1925
following apply:	1926

(1) The member shall notify the Ohio police and fire pension	1927
fund of the date of termination on a form prescribed by the fund.	1928
The member is not eligible to make another election under section	1929
742.44 of the Revised Code.	1930

(2) If(a) For a member whose election to participate in the	1931
plan is effective before July 2, 2013, the member's termination of	1932
active service occurs on or after the date that is the first day	1933
of the fourth year after the effective date of the election to	1934
participate in the plan, the entire amount that has accrued to the	1935
member's benefit under the deferred retirement option plan shall	1936
be distributed to the member pursuant to the member's selection	1937
under division (B)(3) of this section. If the member's termination	1938
of active service occurs before the date that is four years after	1939
the effective date of the election to participate, the member	1940
shall forfeit the total amount of the interest credited under	1941
division (C) of section 742.443 of the Revised Code.	1942

(b) For a member whose election to participate in the plan is	1943
effective on or after July 2, 2013, if the member's termination of	1944
active service occurs on or after the date that is the sixth year	1945
after the effective date of the election to participate in the	1946
plan, the entire amount that has accrued to the member's benefit	1947
under the deferred retirement option plan shall be distributed to	1948
the member pursuant to the member's selection under division	1949
(B)(3) of this section. If the member's termination of active	1950
service occurs before the date that is six years after the	1951
effective date of the election to participate, the member shall	1952
forfeit the total amount of the interest credited under division	1953
(C) of section 742.443 of the Revised Code.	1954

(3) The member shall select one of the following as the	1955
method of distribution of the amount to be distributed to the	1956
member:	1957

(a) A single payment;

1958

(b) Periodic payments as determined by the board.

1959

The fund shall retain amounts accrued to the benefit of a	1960
member under the plan until a form specifying the method of	1961
distribution selected is filed with the fund by the member or an	1962
authorized representative of the member.	1963

The board shall afford a member who selects periodic payments	1964
the opportunity at least once during each calendar year to change	1965
the member's selection.	1966

(4) Distribution of the amount accrued to a member's benefit	1967
under the deferred retirement option plan shall not commence until	1968
the following:	1969

(a) For members whose election to participate in the plan is	1970
effective before July 2, 2013, the date that is the first day of	1971
the fourth year after the effective date of the election;	1972

(b) For members whose election to participate in the plan is	1973
effective on or after July 2, 2013, the date that is the first day	1974
of the sixth year after the effective date of the election.	1975

(5) The member shall select a plan of payment under section	1976
742.3711 of the Revised Code for the pension payable to the member	1977
under division (C) of section 742.37 of the Revised Code, unless	1978
the member selected a plan of payment at the time of electing to	1979
participate in the plan. The pension shall commence not later than	1980
the first day of the second month following the date the employee	1981
ceases to participate in the plan.	1982

(C) If, at the end of the eight-year period that begins on	1983
the effective date of a member's election to participate in the	1984
plan, the member has failed to terminate active service in a	1985
police or fire department, all of the following apply:	1986

(1) No further amounts shall accrue to the member's benefit,	1987
and the member shall forfeit all amounts that have accrued to the	1988
member's benefit under section 742.443 of the Revised Code. The	1989
amounts forfeited shall be treated as if the member had continued	1990
in the active service of a police or fire department and not	1991
elected to participate in the plan.	1992

(2) The member shall be granted service credit for the period	1993
the member was participating in the plan, and when the member's	1994
pension is calculated under section 742.37 of the Revised Code,	1995
the calculation shall be made as though the member had never	1996
participated in the plan.	1997

(3) Further contributions, and service credit for those	1998
contributions, shall be credited as provided in sections 742.31	1999
through 742.34 of the Revised Code.	2000

Sec. 742.45.  (A) The board of trustees of the Ohio police	2001
and fire pension fund may enter into an agreement with insurance	2002
companies, health insuring corporations, or government agencies	2003
authorized to do business in the state for issuance of a policy or	2004
contract of health, medical, hospital, or surgical benefits, or	2005
any combination thereof, for those individuals receiving service	2006
or disability pensions or survivor benefits subscribing to the	2007
plan. Notwithstanding any other provision of this chapter, the	2008
policy or contract may also include coverage for any eligible	2009
individual's spouse and dependent children and for any of the	2010
eligible individual's sponsored dependents as the board considers	2011
appropriate.	2012

If all or any portion of the policy or contract premium is to	2013
be paid by any individual receiving a service, disability, or	2014
survivor pension or benefit, the individual shall, by written	2015
authorization, instruct the board to deduct from the individual's	2016
benefit the premium agreed to be paid by the individual to the	2017
company, corporation, or agency.	2018

The board may contract for coverage on the basis of part or	2019
all of the cost of the coverage to be paid from appropriate funds	2020
of the Ohio police and fire pension fund. The cost paid from the	2021
funds of the Ohio police and fire pension fund shall be included	2022
in the employer's contribution rates provided by sections 742.33	2023
and 742.34 of the Revised Code.	2024

The board may provide for self-insurance of risk or level of	2025
risk as set forth in the contract with the companies,	2026
corporations, or agencies, and may provide through the	2027
self-insurance method specific benefits as authorized by the rules	2028
of the board.	2029

(B) Except as otherwise provided in this division, the board	2030
shall, beginning the month following receipt of satisfactory	2031
evidence of the payment for coverage, pay monthly to each	2032
recipient of service, disability, or survivor benefits under the	2033
Ohio police and fire pension fund who is eligible for medical	2034
insurance coverage under part B of the medicare program	2035
established under Title XVIII of "The Social Security Amendments	2036
of 1965," 79 Stat. 301 (1965), 42 U.S.C.A. 1395j, as amended, an	2037
amount specified by the board or determined pursuant to a formula	2038
established by the board that is not less than ninety-six dollars	2039
and forty cents, for such coverage, except that the board shall	2040
not pay an amount that exceeds the amount paid by the recipient	2041
for the coverage.	2042

The board shall pay not more than one monthly premium under	2043
this division to an eligible benefit recipient even if the	2044
recipient is receiving more than one monthly benefit from the	2045
fund. The board shall not pay a monthly premium under this	2046
division to an eligible benefit recipient who is receiving	2047
reimbursement for the premium from any other source.	2048

(C) The board shall establish by rule requirements for the	2049
coordination of any coverage, payment, or benefit provided under	2050
this section with any similar coverage, payment, or benefit made	2051
available to the same individual by the public employees	2052
retirement system, state teachers retirement system, school	2053
employees retirement system, or state highway patrol retirement	2054
system.	2055

(D) The board shall make all other necessary rules pursuant	2056
to the purpose and intent of this section.	2057

Sec. 742.63.  The board of trustees of the Ohio police and	2058
fire pension fund shall adopt rules for the management of the Ohio	2059
public safety officers death benefit fund and for disbursements of	2060
benefits as set forth in this section.	2061

(A) As used in this section:

2062

(1) "Member" means all of the following:

2063

(a) A member of the Ohio police and fire pension fund,	2064
including a member of the fund who has elected to participate in	2065
the deferred retirement option plan established under section	2066
742.43 of the Revised Code or a member of or contributor to a	2067
police or firemen's relief and pension fund established under	2068
former Chapter 521. or 741. of the Revised Code;	2069

(b) A member of the state highway patrol retirement system,	2070
including a member who is participating in the deferred retirement	2071
option plan established under section 5505.50 of the Revised Code;	2072

(c) A member of the public employees retirement system who at	2073
the time of the member's death was one of the following:	2074

(i) A county sheriff or deputy sheriff;

2075

(ii) A full-time regular police officer in a municipal	2076
corporation or township;	2077

(iii) A full-time regular firefighter employed by the state,	2078
an instrumentality of the state, a municipal corporation, a	2079
township, a joint fire district, or another political subdivision;	2080

(iv) A full-time park district ranger or patrol trooper;

2081

(v) A full-time law enforcement officer of the department of	2082
natural resources;	2083

(vi) A full-time department of public safety enforcement	2084
agent;	2085

(vii) A full-time law enforcement officer of parks, waterway	2086
lands, or reservoir lands under the control of a municipal	2087
corporation;	2088

(viii) A full-time law enforcement officer of a conservancy	2089
district;	2090

(ix) A correction officer at an institution under the control	2091
of a county, a group of counties, a municipal corporation, or the	2092
department of rehabilitation and correction;	2093

(x) A state university law enforcement officer;

2094

(xi) An investigator, as defined in section 109.541 of the	2095
Revised Code, or an investigator commissioned as a special agent	2096
of the bureau of criminal identification and investigation.	2097

(xii) A drug agent, as defined in section 145.01 of the	2098
Revised Code.	2099

(d) A member of a retirement system operated by a municipal	2100
corporation who at the time of death was a full-time law	2101
enforcement officer of parks, waterway lands, or reservoir lands	2102
under the control of the municipal corporation.	2103

(2) Notwithstanding section 742.01 of the Revised Code, "fire	2104
or police department" includes a fire department of the state or	2105
an instrumentality of the state or of a municipal corporation,	2106
township, joint fire district, or other political subdivision, the	2107
state highway patrol, a county sheriff's office, the security	2108
force of an institution under the control of the department of	2109
rehabilitation and correction, the security force of a jail or	2110
workhouse under the control of a county, group of counties, or	2111
municipal corporation, the security force of a metropolitan,	2112
county, or township park district, the security force of lands	2113
under the control of the department of natural resources,	2114
department of public safety enforcement agents, the security force	2115
of parks, waterway lands, or reservoir lands under the control of	2116
a municipal corporation, the security force of a conservancy	2117
district, the police department of a township or municipal	2118
corporation, and the police force of a state university.	2119

(3) "Firefighter or police officer" includes a state highway	2120
patrol trooper, a county sheriff or deputy sheriff, a correction	2121
officer at an institution under the control of a county, a group	2122
of counties, a municipal corporation, or the department of	2123
rehabilitation and correction, a police officer employed by a	2124
township or municipal corporation, a firefighter employed by the	2125
state, an instrumentality of the state, a municipal corporation, a	2126
township, a joint fire district, or another political subdivision,	2127
a full-time park district ranger or patrol trooper, a full-time	2128
law enforcement officer of the department of natural resources, a	2129
full-time department of public safety enforcement agent, a	2130
full-time law enforcement officer of parks, waterway lands, or	2131
reservoir lands under the control of a municipal corporation, a	2132
full-time law enforcement officer of a conservancy district, and a	2133
state university law enforcement officer.	2134

(4) "Correction officer" includes, in addition to any	2135
correction officer, any correction corporal, sergeant, lieutenant,	2136
or captain, and the equivalents of all such persons.	2137

(5) "A park district ranger or patrol trooper" means a peace	2138
officer commissioned to make arrests, execute warrants, and	2139
preserve the peace upon lands under the control of a board of park	2140
commissioners of a metropolitan, county, or township park	2141
district.	2142

(6) "Metropolitan, county, or township park district" means a	2143
park district created under the authority of Chapter 511. or 1545.	2144
of the Revised Code.	2145

(7) "Conservancy district" means a conservancy district	2146
created under the authority of Chapter 6101. of the Revised Code.	2147

(8) "Law enforcement officer" means an officer commissioned	2148
to make arrests, execute warrants, and preserve the peace upon	2149
lands under the control of the governmental entity granting the	2150
commission.	2151

(9) "Department of natural resources law enforcement officer"	2152
includes a forest officer designated pursuant to section 1503.29	2153
of the Revised Code, a preserve officer designated pursuant to	2154
section 1517.10 of the Revised Code, a wildlife officer designated	2155
pursuant to section 1531.13 of the Revised Code, a park officer	2156
designated pursuant to section 1541.10 of the Revised Code, and a	2157
state watercraft officer designated pursuant to section 1547.521	2158
of the Revised Code.	2159

(10) "Retirement eligibility date" means the last day of the	2160
month in which a deceased member would have first become eligible,	2161
had the member lived, for the retirement pension provided under	2162
section 145.33, Chapter 145., 521., or 741., division (C)(1) of	2163
section 742.37, or division (A)(1) of section 5505.17 of the	2164
Revised Code or provided by a retirement system operated by a	2165
municipal corporation.	2166

(11) "Death benefit amount" means an amount equal to the full	2167
monthly salary received by a deceased member prior to death, minus	2168
an amount equal to the benefit received under section 145.45,	2169
742.37, 742.3714, or 5505.17 of the Revised Code or the benefit	2170
received from a retirement system operated by a municipal	2171
corporation, plus any increases in salary that would have been	2172
granted the deceased member.	2173

(12) "Killed in the line of duty" means either of the	2174
following:	2175

(a) Death in the line of duty;

2176

(b) Death from injury sustained in the line of duty,	2177
including heart attack or other fatal injury or illness caused	2178
while in the line of duty.	2179

(B) A spouse of a deceased member shall receive a death	2180
benefit each month equal to the full death benefit amount,	2181
provided that the deceased member was a firefighter or police	2182
officer killed in the line of duty and there are no surviving	2183
children eligible for a benefit under this section. The spouse	2184
shall receive this benefit during the spouse's natural life until	2185
the deceased member's retirement eligibility date, on which date	2186
the benefit provided under this division shall terminate.	2187

(C)(1) If a member killed in the line of duty as a	2188
firefighter or police officer is survived only by a child or	2189
children, the child or children shall receive a benefit each month	2190
equal to the full death benefit amount. If there is more than one	2191
surviving child, the benefit shall be divided equally among these	2192
children.	2193

(2) If the death benefit paid under this division is divided	2194
among two or more surviving children and any of the children	2195
become ineligible to continue receiving a portion of the benefit	2196
as provided in division (H) of this section, the full death	2197
benefit amount shall be paid to the remaining eligible child or	2198
divided among the eligible children so that the benefit paid to	2199
the remaining eligible child or children equals the full death	2200
benefit amount.	2201

(3) Notwithstanding divisions (C)(1) and (2) of this section,	2202
all death benefits paid under this division shall terminate on the	2203
deceased member's retirement eligibility date.	2204

(D) If a member killed in the line of duty as a firefighter	2205
or police officer is survived by both a spouse and a child or	2206
children, the monthly benefit provided shall be as follows:	2207

(1)(a) If there is a surviving spouse and one surviving	2208
child, the spouse shall receive an amount each month equal to	2209
one-half of the full death benefit amount and the child shall	2210
receive an amount equal to one-half of the full death benefit	2211
amount.	2212

(b) If the surviving spouse dies or the child becomes	2213
ineligible as provided in division (H) of this section, the	2214
surviving spouse or child remaining eligible shall receive the	2215
full death benefit amount.	2216

(2)(a) If there is a surviving spouse and more than one	2217
child, the spouse shall receive an amount each month equal to	2218
one-third of the full death benefit amount and the children shall	2219
receive an amount, equally divided among them, equal to two-thirds	2220
of the full death benefit amount.	2221

(b) If a spouse and more than one child each are receiving a	2222
death benefit under division (D)(2)(a) of this section and the	2223
spouse dies, the children shall receive an amount each month,	2224
equally divided among them, equal to the full death benefit	2225
amount.	2226

(c) If a spouse and more than one child each are receiving a	2227
benefit under division (D)(2)(a) of this section and any of the	2228
children becomes ineligible to receive a benefit as provided in	2229
division (H) of this section, the spouse and remaining eligible	2230
child or children shall receive a death benefit as follows:	2231

(i) If there are two or more remaining eligible children, the	2232
spouse shall receive an amount each month equal to one-third of	2233
the full death benefit amount and the children shall receive an	2234
amount each month, equally divided among them, equal to two-thirds	2235
of the full death benefit amount;	2236

(ii) If there is one remaining eligible child, the spouse	2237
shall receive an amount each month equal to one-half of the full	2238
death benefit amount, and the child shall receive an amount each	2239
month equal to one-half of the full death benefit amount.	2240

(d) If a spouse and more than one child each are receiving a	2241
benefit under division (D)(2)(a) of this section and all of the	2242
children become ineligible to receive a benefit as provided in	2243
division (H) of this section, the spouse shall receive the full	2244
death benefit amount.	2245

(3) Notwithstanding divisions (D)(1) and (2) of this section,	2246
death benefits paid under this division to a surviving spouse	2247
shall terminate on the member's retirement eligibility date. Death	2248
benefits paid to a surviving child or children shall terminate on	2249
the deceased member's retirement eligibility date unless earlier	2250
terminated pursuant to division (H) of this section.	2251

(E) If a member, on or after January 1, 1980, is killed in	2252
the line of duty as a firefighter or police officer and is	2253
survived by only a parent or parents dependent upon the member for	2254
support, the parent or parents shall receive an amount each month	2255
equal to the full death benefit amount. If there is more than one	2256
surviving parent dependent upon the deceased member for support,	2257
the death benefit amount shall be divided equally among the	2258
surviving parents. On the death of one of the surviving parents,	2259
the full death benefit amount shall be paid to the other parent.	2260

(F)(1) The following shall receive a monthly death benefit	2261
under this division:	2262

(a) A surviving spouse whose benefits are terminated in	2263
accordance with division (B) or (D)(3) of this section on the	2264
deceased member's retirement eligibility date, or who would	2265
qualify for a benefit under division (B) or (D) of this section	2266
except that the deceased member reached the member's retirement	2267
eligibility date prior to the member's death;	2268

(b) A qualified surviving spouse of a deceased member of or	2269
contributor to a police or firemen's relief and pension fund	2270
established under former Chapter 521. or 741. of the Revised Code	2271
who was a firefighter or police officer killed in the line of	2272
duty.	2273

(2) The monthly death benefit shall be one-half of an amount	2274
equal to the monthly salary received by the deceased member prior	2275
to the member's death, plus any salary increases the deceased	2276
member would have received prior to the member's retirement	2277
eligibility date. The benefit shall terminate on the surviving	2278
spouse's death. A death benefit payable under this division shall	2279
be reduced by an amount equal to any allowance or benefit payable	2280
to the surviving spouse under section 742.3714 of the Revised	2281
Code.	2282

(3) A benefit granted to a surviving spouse under division	2283
(F)(1)(b) of this section shall commence on the first day of the	2284
month immediately following receipt by the board of a completed	2285
application on a form provided by the board and any evidence the	2286
board may require to establish that the deceased spouse was killed	2287
in the line of duty.	2288

(G)(1) If there is not a surviving spouse eligible to receive	2289
a death benefit under division (F) of this section or the	2290
surviving spouse receiving a death benefit under that division	2291
dies, a surviving child or children whose benefits under division	2292
(C) or (D) of this section are or have been terminated pursuant to	2293
division (C)(3) or (D)(3) of this section or who would qualify for	2294
a benefit under division (C) or (D) of this section except that	2295
the deceased member reached the member's retirement eligibility	2296
date prior to the member's death shall receive a monthly death	2297
benefit under this division. The monthly death benefit shall be	2298
one-half of an amount equal to the monthly salary received by the	2299
deceased member prior to the member's death, plus any salary	2300
increases the member would have received prior to the member's	2301
retirement eligibility date. If there is more than one surviving	2302
child, the benefit shall be divided equally among the surviving	2303
children.	2304

(2) If two or more surviving children each are receiving a	2305
benefit under this division and any of those children becomes	2306
ineligible to continue receiving a benefit as provided in division	2307
(H) of this section, the remaining eligible child or children	2308
shall receive an amount equal to one-half of the monthly salary	2309
received by the deceased member prior to death, plus any salary	2310
increases the deceased member would have received prior to the	2311
retirement eligibility date. If there is more than one remaining	2312
eligible child, the benefit shall be divided equally among the	2313
eligible children.	2314

(3) A death benefit, or portion of a death benefit, payable	2315
to a surviving child under this division shall be reduced by an	2316
amount equal to any allowance or benefit payable to that child	2317
under section 742.3714 of the Revised Code, but the reduction in	2318
that child's benefit shall not affect the amount payable to any	2319
other surviving child entitled to a portion of the death benefit.	2320

(H) A death benefit paid to a surviving child under division	2321
(C), (D), or (G) of this section shall terminate on the death of	2322
the child or, unless one of the following is the case, when the	2323
child reaches age eighteen:	2324

(1) The child, because of physical or mental disability, is	2325
unable to provide the child's own support, in which case the death	2326
benefit shall terminate when the disability is removed;	2327

(2) The child is unmarried, under age twenty-two, and a	2328
student in and attending an institution of learning or training	2329
pursuant to a program designed to complete in each school year the	2330
equivalent of at least two-thirds of the full-time curriculum	2331
requirements of the institution, as determined by the trustees of	2332
the fund.	2333

(I) Acceptance of any death benefit under this section does	2334
not prohibit a spouse or child from receiving other benefits	2335
provided under the Ohio police and fire pension fund, the state	2336
highway patrol retirement system, the public employees retirement	2337
system, or a retirement system operated by a municipal	2338
corporation.	2339

(J) No person shall receive a benefit under this section if	2340
any of the following occur:	2341

(1) The person fails to exercise the right to a monthly	2342
survivor benefit under division (A) or (B) of section 145.45,	2343
division (D), (E), or (F) of section 742.37, or division (A)(3),	2344
(4), or (7) of section 5505.17 of the Revised Code; to a monthly	2345
survivor benefit from a retirement system operated by a municipal	2346
corporation; or to a retirement allowance under section 742.3714	2347
of the Revised Code.	2348

(2) The member's accumulated contributions under this chapter	2349
or Chapter 145. or 5505. of the Revised Code are refunded unless	2350
the member had been a member of the public employees retirement	2351
system and had fewer than eighteen months of total service credit	2352
at the time of death.	2353

(3) In the case of a full-time park district ranger or patrol	2354
trooper, a full-time law enforcement officer of the department of	2355
natural resources, a full-time law enforcement officer of parks,	2356
waterway lands, or reservoir lands under the control of a	2357
municipal corporation, a full-time law enforcement officer of a	2358
conservancy district, a correction officer at an institution under	2359
the control of a county, group of counties, or municipal	2360
corporation, or a member of a retirement system operated by a	2361
municipal corporation who at the time of the member's death was a	2362
full-time law enforcement officer of parks, waterway lands, or	2363
reservoir lands under the control of the municipal corporation,	2364
the member died prior to April 9, 1981, in the case of a benefit	2365
under division (B), (C), or (D) of this section, or prior to	2366
January 1, 1980, in the case of a benefit under division (E) of	2367
this section.	2368

(4) In the case of a full-time department of public safety	2369
enforcement agent who prior to June 30, 1999, was a liquor control	2370
investigator of the department of public safety, the member died	2371
prior to December 23, 1986;	2372

(5) In the case of a full-time department of public safety	2373
enforcement agent other than an enforcement agent who, prior to	2374
June 30, 1999, was a liquor control investigator, the member died	2375
prior to June 30, 1999.	2376

(K) A surviving spouse whose benefit was terminated prior to	2377
June 30, 1999, due to remarriage shall receive a benefit under	2378
division (B), (D), or (F) of this section beginning on the first	2379
day of the month following receipt by the board of an application	2380
on a form provided by the board. The benefit amount shall be	2381
determined as of that date.	2382

(1) If the benefit will begin prior to the deceased member's	2383
retirement eligibility date, it shall be paid under division (B)	2384
or (D) of this section and shall terminate as provided in those	2385
divisions. A benefit paid to a surviving spouse under division (D)	2386
of this section shall be determined in accordance with that	2387
division, even if benefits paid to surviving children are reduced	2388
as a result.	2389

(2) If the benefit will begin on or after the deceased	2390
member's retirement eligibility date, it shall be paid under	2391
division (F) of this section and shall terminate as provided in	2392
that division. A benefit paid to a surviving spouse under division	2393
(F) of this section shall be determined in accordance with that	2394
division, even if benefits paid to surviving children are	2395
terminated as a result.	2396

Sec. 742.64.  If aany person who is a disability benefit	2397
recipient or an alternate payee, as defined in section 3105.80 of	2398
the Revised Code, is paid any benefit or payment by the Ohio	2399
police and fire pension fund to which the person is not entitled,	2400
the person shall repay the fund. If the person fails to repay, the	2401
fund shall withhold the amount due from any benefit or payment due	2402
the person or the person's beneficiary under this chapter or may	2403
collect the amount in any other manner provided by law.	2404

Section 2.  That existing sections 171.04, 742.01, 742.04,	2405
742.10, 742.14, 742.16, 742.30, 742.301, 742.31, 742.32, 742.33,	2406
742.34, 742.35, 742.37, 742.3711, 742.3716, 742.38, 742.39,	2407
742.44, 742.442, 742.443, 742.444, 742.45, 742.63, and 742.64 and	2408
section 742.011 of the Revised Code are hereby repealed.	2409

Section 3.  (A) The amendments by this act of sections	2410
742.33, 742.34, and 742.35 of the Revised Code regarding the	2411
frequency of employer payments to the Ohio Police and Fire Pension	2412
Fund apply to police officer employers' contributions and	2413
firefighter employers' contributions due the Fund for employee	2414
payrolls paid on or after the ninety-first day after the effective	2415
date of this section.	2416

(B) Police officer employers' contributions and firefighter	2417
employers' contributions to the Ohio Police and Fire Pension Fund	2418
for employee payrolls paid during the period beginning on the	2419
effective date of this section and ending on the ninety-first day	2420
thereafter are due as follows:	2421

(1) One third of the contributions for that period are due	2422
not later than December 31, 2013.	2423

(2) One third of the contributions for that period are due	2424
not later than December 31, 2014.	2425

(3) One third of the contributions for that period are due	2426
not later than December 31, 2015.	2427

(C) Any applicable penalty determined under section 742.352	2428
of the Revised Code shall be assessed against an employer if the	2429
employer fails to make a payment on or before the date the payment	2430
is due.	2431

Section 4. Sections 1, 2, and 3 of this act take effect	2432
January 7, 2013, except that section 742.161, as enacted by this	2433
act, and division (B) of section 742.31 of the Revised Code, as	2434
amended by this act, take effect one hundred eighty days after the	2435
effective date of this section.	2436