(a) If, upon receipt of a domestic relations order,
the domestic relations liaison is of the opinion that the order does
not comply in all ways with the requirements for a qualified domestic
relations order under the provisions of this chapter, the domestic
relations liaison shall notify the parties that the order does not
qualify as a qualified domestic relations order in the notice sent
under §129.3 of this title (relating to Notice Regarding Receipt
of Order, such notice being hereinafter referred to as "§129.3
Notice"). Unless the participant or the alternate payee pursues action
in a court of competent jurisdiction within 90 days of the date of
the §129.3 Notice to bring the order into compliance with the
requirements of this chapter relating to qualified domestic relations
orders, the system will proceed as if it never had received the non-compliant
order. The system may require a certified copy of the filed pleading
to pursue action on the order.
(1) BEFORE RETIREMENT. If the order relates to a participant
who has not yet begun to receive service retirement or disability
retirement benefit payments subject to the order when the system receives
the order, the system may delay action on an application by the participant
for benefits that would be subject to the order (if the order were
to be qualified under this chapter), and the domestic relations liaison
may proceed in accordance with the remaining subsections of this section.
If the domestic relations liaison has made an initial determination
under this section that the order does not appear to qualify, the
system nonetheless may (but shall not be required to) pay to the participant
all or any portion of any benefits to which the participant appears
entitled under the order while interpreting the division of benefits
in the light most beneficial to the alternate payee under the domestic
relations order and state law. In determining under this paragraph
whether or not to process a benefits application and begin payments
to a participant pending pursuit of a qualified domestic relations
order, the system may take into consideration the difficulty in dividing
the benefits between the parties prior to receipt of, or in re-dividing
the benefits after receipt of, a qualified domestic relations order.
Any benefits not paid under this paragraph shall be retained by the
system until they are paid under one of the remaining subsections
of this section.
(2) AFTER RETIREMENT. If the domestic relations order
relates to a participant who is receiving service retirement or disability
retirement benefit payments subject to the order when the system receives
the order, the domestic relations liaison may proceed in accordance
with this paragraph and the remaining subsections of this section.
(A) If the order proposes to award the alternate payee
a percentage of the then-current monthly benefit payable to participant
(commonly referred to as a "carve-out"), the system shall reduce the
amount to be paid to the participant to the portion of benefits to
which the participant appears entitled under the order while interpreting
the division of benefits in the light most beneficial to the alternate
payee under the domestic relations order and state law. Any benefits
not paid to the participant under this subparagraph shall be retained
by the system until they are paid under one of the remaining subsections
of this section.
(B) If the domestic relations order proposes to award
the alternate payee an interest in the participant's benefits from
the system other than a carve-out (as described in subparagraph (A)
of this paragraph), the system is not required to reduce the amount
to be paid to the participant and retain the amount withheld for the
alternate payee until the system receives an order that complies with
the requirements of this chapter for qualified domestic relations
orders because of the difficulty in dividing the benefits between
the parties prior to receipt of, or in re-dividing the benefits after
receipt of, a qualified domestic relations order. If a domestic relations
order that falls under this subparagraph is subsequently brought into
compliance with the requirements of this chapter for qualified domestic
relations orders, payments to the alternate payee under the qualified
domestic relations order shall be made prospectively only.
(b) If 60 days have elapsed since the date of the §129.3
Notice, and neither party has submitted documentation to the system
reflecting that action has been pursued to bring the order into compliance,
the domestic relations liaison will send another notice letter to
each party by first class mail that reminds the parties that unless
documentation has been submitted to the system showing that action
has been pursued before the expiration of the 90-day period, the order
will be determined not to be a qualified domestic relations order
and the system will pay to the participant any sums that have been
withheld up to that date, and shall thereafter make payment of benefits
as if no order had been received by the system.
(c) If neither party has timely pursued before the
expiration of the 90-day period described in subsection (a) of this
section, or any applicable extension for good cause granted under
this subsection, in accordance with this section or in accordance
with §129.11 of this title (relating to Procedure for Obtaining
Formal Hearing), the order is not a qualified domestic relations order
and the system will pay to the participant any benefits that have
been withheld hereunder after 90 days from the date of the §129.3
Notice unless the system has granted an extension for good cause prior
to the expiration of the 90 days. Either party may request extensions
for good cause, while pursuing court action to bring an order into
compliance with the requirements of this chapter for a qualified domestic
relations order, for up to 18 months from the date the domestic relations
order was received. Any initial request for any extension for good
cause must be received by the system prior to the expiration of 90
days after the date of the §129.3 Notice, and determination of
good cause for extensions and the length of any extension shall be
made by the system in its sole discretion. Any request for an additional
extension must be received by the system prior to the expiration of
the then applicable extension period. "Good Cause" may include, but
shall not be limited to, notice of a hearing before the court with
jurisdiction over the domestic relations order.
(d) Upon the expiration of 18 months from the date
the domestic relations order was received, if the domestic relations
order has not been qualified, the system will pay to the participant
all benefits that have been withheld hereunder up to that date and
shall thereafter make payment of benefits as if no order had been
received by the system.
(e) In the event that, in the determination of the
domestic relations liaison, the domestic relations order is subsequently
brought into compliance with the requirements of this chapter for
qualified domestic relations orders, the domestic relations liaison
shall so notify the parties in writing, and the system will thereafter
pay the sums payable under the order (including any benefits previously
retained by the system) in the manner set forth in the order, unless
such order is subsequently set aside or modified by a court of competent
jurisdiction and such modified order is determined by the system to
be qualified in accordance with the requirements of this chapter.
(f) Neither the system nor any officials or employees
of the system shall be liable for making any payment under this section.
|