(a) A vested employee is entitled to credited service for periods in which the employee regularly rendered full-time personal service to an employer but was not qualified to participate in the plan because of the exclusion of temporary workers as described in AS 39.35.680(22)(C)(iii). Benefits are not payable on this credited service unless the employee makes retroactive contributions to the plan for the period of time that credited service is claimed. The retroactive contribution is the full actuarial cost of providing benefits for the credited service claimed.

(b) To obtain credited service under this section, an employee shall elect to do so and shall verify the period of temporary service. When eligibility for temporary service credit has been established, an indebtedness shall be determined as provided in (a) of this section. Any outstanding indebtedness existing at the time an employee retires requires an actuarial adjustment to the benefits payable based on the temporary service. Interest as prescribed by regulation accrues on the indebtedness beginning

(1) July 1, 1981, or one year following the date the employee first becomes vested, whichever is later, for an employee who claims temporary service credit no more than one year after the employee becomes vested;

(2) the date of vesting, for an employee who becomes vested after June 30, 1980, who is claiming temporary service credit more than one year after vesting for service performed before the employee vested;

(3) July 1, 1980, for an employee who became vested before July 1, 1980, who is claiming temporary service credit after June 30, 1981, for service performed before July 1, 1980;

(4) one year after completing the temporary service, for an employee who was vested on the last day of employment as a temporary employee and who claims the temporary service no more than one year after completing the service;

(5) on the date of completing the temporary service, for an employee who was vested on the last day of employment as a temporary employee and who claims temporary service more than one year after completing the service.

(c) A deferred vested employee on July 1, 1980, is eligible to claim credited service under (a) of this section. To obtain credited service under this section, a deferred vested employee shall elect to do so and shall verify the period of temporary service. When eligibility for temporary service credit has been established, an indebtedness shall be determined as provided in (a) of this section. Interest as prescribed by regulation accrues on that indebtedness beginning July 1, 1981. Any outstanding indebtedness existing at the time a deferred vested employee retires requires an actuarial adjustment to the benefits payable based on the temporary service.

(d) An employee may choose whether the credited service granted under this section is used to satisfy the credited service requirements for normal retirement under AS 39.35.370(a)(2) or (3) or 39.35.385(f) or is only used for the calculation of benefits. An election under this subsection is irrevocable and applies to all temporary credited service that the employee has accrued when the employee retires. An election under this subsection does not change the date that an employee is considered to have commenced participation in the plan under AS 39.35.120.

(e) Notwithstanding the requirement in (a) of this section that an employee be vested to claim credited service under this section, for purposes of a conditional service retirement benefit under AS 39.35.385(f), an employee may claim credited service under this section for temporary legislative employment before July 1, 1979, for which the employee has not received credited service under AS 39.35.360(g).