(a) An active or inactive member who has never been vested in this plan or in the teachers' retirement plan under AS 14.25.009 - 14.25.220, who has at least two years of credited service in this plan, and who has membership service in the teachers' retirement system may claim credited service in this plan in an amount equal to the membership service the member has in the teachers' retirement system. The claimed credited service may be added to service earned under AS 39.35.095 - 39.35.680 to enable the member to qualify for a public service benefit under this section. The member may not claim credited service for membership service for which the member has received a refund under AS 14.25.150. The member may not claim credited service in this plan based on unused sick leave under AS 14.25.115.

(b) To claim credited service under this section, the member shall file a written request with the administrator when the member applies to retire. The administrator shall determine the full actuarial cost of benefits based on the member's total credited service and shall transfer from the teachers' retirement system to this plan an amount equal to the sum of the member contributions and any indebtedness payments to the teachers' retirement system and the employer contributions to the teachers' retirement system made on behalf of the employee together with interest earned on those contributions and indebtedness payments. If the amount to be transferred, when combined with the amount of employee contributions and indebtedness payments to this plan and the amount of employer contributions on behalf of the employee in this plan, and interest earned on contributions and indebtedness payments for the employee, is less than the full actuarial cost computed under this subsection, an indebtedness to the plan equal to the amount of the difference is established. Interest as prescribed by regulation accrues on the indebtedness. The member must pay any outstanding indebtedness existing at the time the member applies for retirement in full before the member is appointed to retirement under this section.

(c) A member is entitled to receive a public service benefit under this section if the member has at least a total of five years credited service under AS 39.35.095 - 39.35.680 and credited service from the teachers' retirement plan under AS 14.25.009 - 14.25.220 claimed under this section. A public service benefit shall be calculated using the higher of the average monthly compensation for service in this plan or the average base salary for service in the teachers' retirement plan under AS 14.25.009 - 14.25.220. The amount of the benefit shall be calculated in accordance with AS 39.35.370(c).

(d) Credited service earned under either this plan or the teachers' retirement system that has been claimed for a public service benefit under this section may not be used for any other purpose. A member who claims credited service under this section loses all rights to benefits under AS 14.25 based on the claimed credited service. A member may not claim credited service under this section unless the member claims all of the membership service the member has in the teachers' retirement system. A public service benefit does not constitute a normal or early retirement benefit for purposes of qualifying for a conditional service retirement benefit under AS 14.25.125 or AS 39.35.385.

(e) A member whose rights to benefits under AS 14.25 are subject to a qualified domestic relations order may claim credited service under this section. However, the credited service claimed remains subject to the terms of the order.

(f) [Repealed, § 116(b) ch 20 SLA 2007.]

(g) If a member retires under this section and subsequently returns to work for an employer under this plan or the teachers' retirement system, benefits under this section shall cease during the period of reemployment and shall recommence when the reemployment is ended. The credited service earned during the period of reemployment may not be added to the credited service claimed for a public service benefit under this section. If a member vests and meets the other eligibility requirements under this system or the teachers' retirement system during the reemployment, the member is entitled to a benefit under AS 14.25.009 - 14.25.220 or AS 39.35.095 - 39.35.680, as appropriate.

(h) In this section,

(1) “membership service earned under AS 14.25” means membership service earned under AS 14.25.009 - 14.25.220;

(2) “teachers' retirement system” and “teachers' retirement system under AS 14.25” mean the teachers' retirement plan established in AS 14.25.009 - 14.25.220.