Senate amendment to the 2nd edition makes the following changes. 

Part VIII. 

Amends the second listed condition in GS 128-31(c1) (Local Government Retirement System [LGERS] exemptions from execution and offset of amounts owed by beneficiary) and GS 135-9 (c1) (Teachers and State Employees' Retirement System [TSERS] exemptions from garnishment, attachment and offset of amounts owed by member of beneficiary) to now require that in cases of an overpayment of benefits entirely due to administrative error on the part of LGERS/TSERS, it will be deemed to satisfy its duty to pursue repayment of the overpayment if it offsets any recurring monthly benefit for periods coincident with or following the determination of the overpayment by no more than 25% but not less than 8.5% (was, not less than 25%) of the monthly benefit as computed after payment deductions or by offsetting the amount of the overpayment in two fewer monthly benefit payments when the overpayment amount is less than $500.

Part I

Amends GS 135-5(1) (pertaining to the death benefit plan for the Teachers’ and State Employees’ Retirement System [TSERS]), GS 128-27(l6) (death benefit plan for Local Government Employees’ Retirement System [LGERS]), GS 120-4.27 (death benefit for Legislative Retirement System [LRS]), and GS 135-64(k) (death benefit under Consolidated Judicial Retirement Act [JRA]) as follows.  Upon proof of a death of a retired member received on or after January 1, 2015, removes requirement that payment be made to the member’s surviving spouse (if any) if no beneficiary was designated by the decedent.  Instead, payment will be made to the decedent’s personal representative if no designated beneficiary has survived the decedent.  Makes conforming changes. 

Part II

Amends GS 135-105(d) (TSERS short-term disability benefits) to add new language specifying that the Plan shall not reimburse any employer for amounts related to notifications made on or after January 1, 2024.

Part III

Replaces the Medical Board with the Retirement Systems Division of the Department of State Treasurer (Division) as deciding agency for certain types of disability decisions, described in detail below. Makes conforming change to GS 135-6(k) and GS 135-102(d) (pertaining to the Medical Board) to allow for new designation. 

Makes clarifying and conforming changes to GS 135-5(a)(5) (pertaining to conversion of disability application to early retirement), GS 135-105(f) (pertaining to eligibility of short-term disability or a preliminary determination on eligibility for long term disability), and GS 135-105(g) (pertaining to extension of short term disability benefits) to indicate that the Division is the deciding agency for applications for extended short-term, rather than the Medical Board. 

Further amends GS 135-105 to authorize the Department of State Treasurer (DST) to adopt implementing rules.

Part IV

Amends GS 135-5(g) (TSERS/JRA election of optional allowance), GS 128-27 (LGERS election of optional allowance), and GS 120-4.26 (provisions of the LRS pertaining to benefit payment options) as follows. Changes relevant time period from “until the first payment on account of any benefit becomes normally due, or the member's first retirement check has been cashed” to until the first payment on account of any benefit becomes normally due and the first payment date has occurred” for (1) election of different benefit payment options; (2) revocations of certain options relating to beneficiaries who die before the members (only TSERS/JRA/LGERS); (3) revocations of certain options relating to beneficiary spouses who die before the members (only TSERS/JRA/LRS); (4) benefits options or designated survivor beneficiary.  Makes conforming changes throughout.  Makes language gender neutral.

Part V

Amends GS 135-105(g) (pertaining to short-term disability benefits) to clarify the starting date for a 365-day extension of short-term disability benefits. Provides that the extension commences the first day succeeding the conclusion of the short-term disability period if the beneficiary or participant applies within 180 days after the later of when the short-term disability period ceases, after salary continuation payments cease, or after monthly payments for Workers' Compensation cease.

Part VI

Amends 135-7(g) (pertaining to master trust and management of funds) as follows. Specifies that the assets of the trust fund will be used only for the exclusive benefit of persons who are or may be entitled to benefits under the Plans. Bars trustees from ever distributing the assets of the trust fund to any entity that is not a state, a political subdivision of a state, or another entity the income of which is excludable from its gross income by application of section 115(1) of the Internal Revenue Code.

Part VII

Amends GS 135-5(g1) (pertaining to the survivors’ alternate beneficiary default-TSERS), GS 128-27(g1) (pertaining to the survivors’ alternate beneficiary default-LGERS), GS 120-4.28 (pertaining to the survivors’ alternate beneficiary default-LRS) as follows. Adds new language allowing for payment of excess funds to contingent beneficiary’s personal representative in a lump sum if the contingent beneficiary dies before the total of the retirement allowances paid equals the amount of the accumulated contributions of the member at the date of the member’s death. (Currently, this language only exists for primary beneficiaries.) Makes clarifying and conforming changes.  

Part VIII

Enacts new subsection GS 135-106(b1) pertaining to reducing the amount of the long-term disability benefit to which a participant or beneficiary is entitled while receiving workers' compensation benefits. Sets forth the following formulas that apply. (1) If the participant or beneficiary is entitled to a weekly workers' compensation payment, the monthly payment for workers' compensation must be determined by multiplying the weekly payment by 52 and dividing by 12 and the long-term disability benefit must be reduced by the monthly payment for workers' compensation effective on the first day of the month following the month of initial entitlement for workers' compensation. (2) If the participant or beneficiary is entitled to a lump sum workers' compensation payment equal to a stated weekly or monthly amount for a given number of weeks or months, the monthly payment for workers' compensation must be determined using the stated weekly or monthly amount and the long-term disability benefit must be reduced by the monthly payment for workers' compensation effective on the first day of the month following the month of the lump sum payment. (3) If the participant or beneficiary is entitled to a lump sum workers' compensation payment that is not in reference to a stated weekly or monthly amount, the monthly payment for workers' compensation shall be determined  by dividing the lump sum by 500 weeks to arrive at a weekly payment, then multiplying by 52 and dividing by 12, and the long-term disability benefit  shall be reduced by the monthly payment for workers' compensation effective on the first day of the month following the month of the lump sum payment.  (4) In the case of monthly reduction in the long-term disability benefit arising from a lump sum workers' compensation payment, once the total reductions, without interest, are at least equal to the entirety of the lump sum payment, the member may contact the Retirement Systems Division to request cessation of the monthly payment reduction. The Retirement Systems Division must cease the reduction after verifying that the total reductions are at least equal to the entirety of the lump sum payment. If the Retirement Systems Division determines that the total reductions are greater than the lump sum payment, the Retirement Systems Division shall distribute the excess amount to the member in a lump sum payment. Applies to participants or beneficiaries who become entitled to receive workers' compensation benefits on or after July 1, 2023.

Part IX

Enacts new subsection(e) to GS 135-9 (pertaining to recovery of funds overpaid to beneficiaries by the North Carolina Retirement Systems Division as fulfillment of its duties to recover overpayment of State funds within a reasonable amount of time). Requires that when there is an overpayment of benefits or erroneous payments to a member in a State-administered retirement system or the former Disability Salary Continuation Plan or the Disability Income Plan of North Carolina, including benefits paid to, or State Health Plan premiums or claims paid on behalf of, any member or beneficiary who was determined to have been ineligible for those benefits or unentitled to those amounts due to an administrative error of the Retirement Systems Division, the Retirement System must notify the member or beneficiary. Specifies that any member or beneficiary in receipt of the written notice will have not less than 25% of the net retirement allowance withheld toward the amount owed to the Retirement System until that amount has been paid in full.

Designates general effective date as January 1, 2024, except as otherwise provided.