Contribution Reserves and Accounts

All assets of the Fund shall be credited according to the purposes for which they are held in the following designated reserve accounts:

(a)Members’ Contribution Reserve. The amounts contributed by the members shall be credited to this reserve, together with regular interest thereon as herein provided.

(1)An individual account shall be maintained for each member, to which shall be credited the amounts of his contributions and interest thereon. Regular interest on such contributions shall be credited annually, as of the close of each year and shall be allowed only on the amount of the accumulated contributions standing to the credit of each member at the close of each year. A statement of account shall be issued to each member, annually, as of the end of each fiscal year, showing the amount of his accumulated contributions plus interest.

(2)Upon the granting of a service retirement annuity, disability annuity or survivors annuity or benefit, the accumulated contributions, including interest, to the credit of the member concerned shall be transferred from this reserve to the retirement reserve. Refunds and death benefit payments representing members’ contributions shall be charged to this reserve.

(3)Upon effective election by a member to participate in the Defined Contribution Retirement System in accordance with the provisions of § 8207 of this Chapter, the accumulated contributions, including interest, to the credit of the member concerned shall be transferred from CH. 8 RETIREMENT OF PUBLIC EMPLOYEES this reserve to the member’s account in the Defined Contribution Retirement System and treated as the member’s contribution, subject to distribution limitations applicable to funds in the member’s account.

(b)Employer’s Contribution Reserve. The amounts contributed by the government under the provisions hereof, or service retirement annuity, disability retirement annuity and benefits to survivors covering membership service and prior service, shall be credited to this reserve. Regular interest shall be credited annually upon the mean amount in the reserve.

(1)Upon the granting of a service retirement annuity, disability retirement annuity or survivor’s benefit, an amount representing the excess of the actuarial value of the annuity or benefit over the accumulated contributions of the member, including interest, shall be transferred from this reserve to the retirement reserve.

(2)Upon effective election by a member to participate in the Defined Contribution Retirement System in accordance with the provisions of § 8207 of this Chapter, an amount equal to five percent (5%) of the member’s annual base pay for each year of creditable service immediately prior to the member’s transfer, up to a maximum of five

(5)years, not including interest, shall be transferred from this reserve to the Transfer Incentive Reserve in accordance with § 8209.1(b) of this Chapter, and shall be subject to the timing of distribution limitations set forth in the Defined Contribution Retirement System Plan and Trust Agreement.

(3)Transfers made pursuant to this Subsection shall be fully vested and shall constitute a window benefit to the transferring member, and shall not be available after December 31, 2000.

(c)Retirement Reserve. Upon the granting of a service retirement annuity, disability retirement annuity or survivors benefits the accumulated contributions of the member, including interest and an amount representing the excess of the actuarial value of the annuity or benefit over such accumulated contributions, shall be transferred to this reserve from the member’s contribution reserve and employer’s contribution reserve, respectively.

(1)All payments on account of any such annuity or benefit shall be charged to this reserve. Regular interest shall be credited annually upon the mean amount of this reserve.

(2)Any excess balance in this reserve, as determined by actuarial valuation as of the close of any fiscal year, shall be applied to reduce the employer’s contributions for membership service for the fiscal next following the date of such valuation.

(3)Any deficiency in this reserve shall be removed by an increase in the amount of the employer’s contributions for membership service.

(d)Death Benefit Account. The amount representing the contributions by the Government for death benefits shall be credited to this account. All death benefit payments on account of death of the member while in service shall be charged to this account.

(e)Interest and Investment Income Reserve. All income from investments, including gains on investment transactions, shall be credited to this reserve. All losses on investment shall be charged to this reserve. All amounts required for interest on the other reserve accounts of the Fund shall be transferred from this reserve.

(f)Supplementary Annuity Payment Reserve. To defray the cost of increases in the annuity, investment income accruing to the Fund from investments held by the Fund, inclusive of gains or losses on sales or exchanges of investments during the year, over and above four percent (4%) per annum, shall be used to the extent necessary and the amount thereof shall be transferred as of the end CH. 8 RETIREMENT OF PUBLIC EMPLOYEES of each year, beginning with the year 1971, to an account to be designated as the “Supplementary Annuity Payment Reserve.” The increases in annuities effective January 1, 1970, shall be charged to this reserve.