Out-of-State Service

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  1. For the purpose of determining eligibility for service retirement benefits, any teacher or state employee may establish retirement credit for previous service rendered as a public school teacher or full-time state employee in a state other than Tennessee or as a teacher in an overseas facility owned or operated by the United States department of defense under the following conditions:
    1. The previous service shall not be used in determining any rights under this chapter prior to the member being vested;
    2. The member is not receiving, and is not and will not be entitled to receive, retirement credit in any other retirement system for such previous service;
    3. The previous service does not exceed the number of years of creditable service in Tennessee;
    4. The previous service must be certified on proper documents as required by the board of trustees;
    5. The service shall only be credited for the purpose of establishing eligibility for retirement. No benefit shall be paid on such service; and
    6. The member shall make a lump sum payment equal to:
      1. If the previous service was rendered on or before June 30, 2000,
        1. The sum the member would have contributed had the member been a member during such period of out-of-state service;
        2. Plus the employer contributions which would have been made in accordance with the contribution rates in effect during the period in which the service was rendered;
        3. Plus interest on both at the rate provided by § 8-37-214.
      2. If the previous service was rendered after June 30, 2000,
        1. A sum equal to ten percent (10%) of the member's earnable compensation during such period of out-of-state service;
        2. Plus interest at the rate provided by § 8-37-214.
  2. Notwithstanding subdivision (a)(2), if a member was in a defined contribution plan maintained on behalf of the member by an out-of-state public employer, the member shall be permitted to use other funds not in that plan to establish credit pursuant to this section.


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