In no event may a member's annual benefit exceed: one hundred eighty-five thousand
dollars ($185,000.00) (adjusted for cost of living in accordance with Internal Revenue
Code (IRC) Section 415(d), but only for the year in which such adjustment is effective),
or if the member has less than ten (10) years of service with the employer (as defined
in IRC Section 415(b)(5) and as modified by IRC Section 415(b)(6)(D)), the applicable
limitation in paragraph (a) or paragraph (b) of this subsection shall be reduced by
multiplying such limitation by a fraction, not to exceed one (1). The numerator of
such fraction shall be the number of years, or part thereof, of service with the employer;
the denominator shall be ten (10) years.
For purposes of this subsection, the "annual benefit" means a benefit payable annually
in the form of a straight life annuity with no ancillary or incidental benefits and
with no member or rollover contributions. To the extent that ancillary benefits are
provided, the limits set forth in paragraphs (a) and (b) above will be reduced actuarially,
using an interest rate assumption equal to the greater of five (5) percent or the
interest rate used in the most recent annual actuarial valuation, to reflect such
ancillary benefits.
If distribution of retirement benefits begins before age sixty-two (62), the dollar
limitation as described in paragraph (a) shall be reduced actuarially using an interest
rate assumption equal to the greater of five (5) percent or the interest rate used
in the most recent annual actuarial valuation; however, retirement benefits shall
not be reduced below one hundred eighty-five thousand dollars ($185,000.00) if payment
of benefits at or after age fifty-five (55) and not below the actuarial equivalent
of one hundred eighty-five thousand dollars ($185,000.00) if payment of benefits begins
before age fifty-five (55). If retirement benefits begin after age sixty-five (65),
the dollar limitation of paragraph (a) shall be increased actuarially using an interest
assumption equal to the lesser of five (5) percent of the interest rate used in the
most recent annual actuarial valuation.
