State Personnel and Pensions (GSP) — Title 30. Optional Retirement Program
Statutes in effect as of October 1, 2026.
Subtitle 1. Definitions
Md. Code Ann., State Pers. & Pens. § 30-101 (2026)
Title 30. Optional Retirement Program
Subtitle 1. Definitions
§ 30–101LinkCopy Citation
(a)
In this title the following words have the meanings indicated.
(b)
(1)
“Annuity contract” means a fixed or variable annuity contract or combination of fixed or variable annuity contracts authorized under § 403(a) or (b) of the Internal Revenue Code.
(2)
“Annuity contract” includes a custodial account to be invested in regulated investment company stock as provided in § 401(f) or § 403(b)(7) of the Internal Revenue Code.
(c)
“Designated company” means an entity that is designated by the Board of Trustees.
(d)
“Eligible employee” means an individual eligible to participate in the program.
(e)
“Employing institution” means:
(1)
the University System of Maryland;
(2)
Morgan State University;
(3)
St. Mary’s College;
(4)
the Maryland Higher Education Commission with respect to eligible employees of the Commission; and
(5)
any community college or regional community college established under Title 16 of the Education Article.
(f)
“Participating employee” means an eligible employee who elects to participate in the program.
(g)
“Pension system” means the Employees’ Pension System or the Teachers’ Pension System.
(h)
“Program” means the optional retirement program established under § 30-201 of this title.
(i)
“Retirement system” means the Employees’ Retirement System or the Teachers’ Retirement System.
(j)
“Supplemental retirement plans” means plans established pursuant to § 30–401 of this title.
Subtitle 2. Optional Retirement Program
Md. Code Ann., State Pers. & Pens. § 30-201 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–201LinkCopy Citation
(a)
There is an optional retirement program in which eligible employees may participate.
(b)
Under the program, annuity contracts offered by a designated company that provide retirement and death benefits may be purchased for participating employees.
(c)
(1)
The Board of Trustees shall administer the program to the extent provided in this title.
(2)
The State Retirement Agency shall carry out the administrative duties of the Board of Trustees.
(d)
The program shall be offered by each employing institution.
Md. Code Ann., State Pers. & Pens. § 30-202 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–202LinkCopy Citation
(a)
The Board of Trustees may designate not more than five companies from which annuity contracts are to be purchased under the program.
(b)
The Board of Trustees shall approve the form and contents of annuity contracts to be offered by a company that is designated by the Board of Trustees under subsection (a) of this section.
(c)
In making the designation and giving approval under this section, the Board of Trustees shall consider:
(1)
the nature and extent of the rights and benefits to be provided by the annuity contracts for participating employees and their beneficiaries;
(2)
the relation of those rights and benefits to the amount of contributions to be made;
(3)
the suitability of the rights and benefits to the needs of the participating employees and the interests of the employing institutions in the recruitment and retention of participating employees;
(4)
the ability of the company to provide for suitable rights and benefits under the annuity contracts;
(5)
the selection of annuity contracts offered by the company;
(6)
the financial stability of the company and whether the company meets minimum financial criteria, if any, including a minimum net worth requirement, if any, established by the Board of Trustees; and
(7)
the effect of any fees, commissions, or other charges imposed or collected in connection with an annuity contract.
Md. Code Ann., State Pers. & Pens. § 30-203 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–203LinkCopy Citation
The Board of Trustees shall adopt and maintain a written plan document for the program and may adopt regulations that it deems necessary to carry out this title.
Md. Code Ann., State Pers. & Pens. § 30-204 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–204LinkCopy Citation
The Board of Trustees is not responsible for:
(1)
retirement counseling with respect to the program;
(2)
preparing or disseminating information with respect to an annuity contract offered by a designated company; or
(3)
enrolling, terminating, or retiring a participating employee.
Md. Code Ann., State Pers. & Pens. § 30-205 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–205LinkCopy Citation
(a)
Under the program, the State and the participating employees shall contribute, to the extent required, toward the purchase of annuity contracts.
(b)
A participating employee may elect to make contributions to no more than two designated companies under the program for the same payroll period, if the Board of Trustees determines that the election of more than one designated company is administratively feasible.
(c)
(1)
On behalf of each participating employee, the State shall contribute 7.25% of the participating employee’s annual earnable compensation.
(2)
If a participating employee’s compensation is paid from special or federal funds or both, the State’s contribution to the program shall be paid from those funds.
(d)
The Central Payroll Bureau shall pay contributions to the appropriate designated company for the benefit of each participating employee.
Md. Code Ann., State Pers. & Pens. § 30-206 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–206LinkCopy Citation
In accordance with § 403(b) of the Internal Revenue Code, a participating employee’s rights to benefits under an annuity contract purchased under the program shall be fully vested and nonforfeitable.
Md. Code Ann., State Pers. & Pens. § 30-207 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–207LinkCopy Citation
Benefits under the program:
(1)
shall be payable to participating employees or their beneficiaries in accordance with the terms of the annuity contracts; and
(2)
are not payable by the State or governing board of an employing institution.
Md. Code Ann., State Pers. & Pens. § 30-208 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–208LinkCopy Citation
(a)
Every 3 years the Board of Trustees shall review the performance, form, and contents of the annuity contracts offered under the program.
(b)
After a review under subsection (a) of this section, the Board of Trustees may:
(1)
eliminate a designated company from participation in the program; or
(2)
withdraw approval for a type of annuity contract offered by a designated company under the program.
(c)
(1)
If a designated company is eliminated from the program or approval for a type of annuity contract is withdrawn, the Board of Trustees:
(i)
to the extent permitted under an annuity contract, may direct the transfer of existing balances of participating employees to a new annuity contract; and
(ii)
shall give participating employees an opportunity to select an annuity contract with a designated company for future contributions and existing balances subject to transfer under the program, in accordance with item (i) of this paragraph.
(2)
If a participating employee does not make a selection under paragraph (1)(ii) of this subsection within a period specified by the Board of Trustees, the participating employee shall be deemed to have elected for future contributions and existing balances subject to transfer an annuity contract and a designated company specified by the Board of Trustees.
(d)
All eligible employees shall have access to the information compiled for the purpose of conducting the review required under this section and shall be notified of the availability of the information by the Board of Trustees.
Md. Code Ann., State Pers. & Pens. § 30-209 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–209LinkCopy Citation
(a)
There is an expense fund for the program to which shall be credited and from which shall be paid all money provided in the State budget to pay the administrative and operational expenses of the program.
(b)
(1)
Each year, the Board of Trustees shall estimate the amount of money required to provide for the administrative and operational expenses of the program for the subsequent fiscal year.
(2)
The amount determined in accordance with paragraph (1) of this subsection shall be collected from the designated companies on an equal basis and credited to the expense fund, as determined by the Board of Trustees.
(c)
The costs incurred by the Board of Trustees in selecting companies and types of annuity contracts to be offered under the program shall be recovered by assessing on an equal basis the companies designated by the Board of Trustees under § 30-202(a) of this subtitle and crediting those amounts to the expense fund.
(d)
Any unexpended funds remaining in the expense fund at the end of the fiscal year shall be held by the Board of Trustees for the exclusive purpose of defraying administrative costs of the program in subsequent years and may not revert to the General Fund of the State.
(e)
The Board of Trustees may invest and reinvest the expense fund as the Board of Trustees determines.
Md. Code Ann., State Pers. & Pens. § 30-210 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–210LinkCopy Citation
With respect to a participating employee who is employed by an employing institution or an institution over which the employing institution has administrative authority, the employing institution shall administer the participating employee’s enrollment, termination, or retirement under the program.
Md. Code Ann., State Pers. & Pens. § 30-210.1 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–210.1LinkCopy Citation
(a)
In this section, “covered individual” means an employee of an employing institution with discretionary authority over the management or administration of any of the supplemental retirement plans or the management or disposition of the assets of any of the supplemental retirement plans.
(b)
Subject to the provisions of this section, the State shall indemnify a covered individual who is, or is threatened to be made, a party to an action or proceeding, including an administrative or investigative proceeding, by reason of the covered individual’s service as an employee of an employing institution with discretionary authority over the management or administration of any of the supplemental retirement plans or the management or disposition of the assets of any of the supplemental retirement plans.
(c)
(1)
In this subsection, “expenses” include:
(i)
reasonable attorney’s fees;
(ii)
judgments;
(iii)
fines; and
(iv)
other expenses that were actually and reasonably incurred by the individual in connection with the action or proceeding.
(2)
With respect to a civil, administrative, or investigative action or proceeding, the State shall indemnify a covered individual for the expenses of the action or proceeding if the covered individual acted:
(i)
in good faith; and
(ii)
in a manner the covered individual reasonably believed to be in or not opposed to the best interest of the supplemental retirement plans.
(3)
With respect to a criminal action or proceeding, the State shall indemnify a covered individual for the expenses of the action or proceeding if the covered individual:
(i)
acted in good faith;
(ii)
acted in a manner the covered individual reasonably believed to be in or not opposed to the best interest of the supplemental retirement plans; and
(iii)
did not have reasonable cause to believe that the covered individual’s conduct was unlawful.
(d)
Any termination of an action or proceeding does not, of itself, create a presumption that the covered individual did not meet the standards for indemnification described in subsection (b)(2) and (3) of this section.
(e)
The State may not indemnify:
(1)
a covered individual with respect to an action or proceeding as to which the covered individual was held liable for gross negligence or willful misconduct in the performance of the covered individual’s duty to the supplemental retirement plans; or
(2)
an independent contractor furnishing services to the supplemental retirement plans.
(f)
(1)
The State shall provide insurance for a covered individual eligible for indemnification under this section.
(2)
For the purpose of paragraph (1) of this subsection, the State may provide self-insurance under terms and conditions satisfactory to the State Treasurer.
(3)
A covered individual may not be required to pay amounts attributable to liability described in this section because the State does not provide adequate insurance coverage or otherwise fails to indemnify in accordance with this section.
Md. Code Ann., State Pers. & Pens. § 30-211 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–211LinkCopy Citation
(a)
Before enrolling a participating employee, each designated company shall provide to eligible employees, the Board of Trustees, and the employing institutions any information requested, including a full disclosure of the entire compensation provided to the senior executives of the designated company, and any information requested regarding the designated company or the annuity contracts offered by the designated company.
(b)
Each designated company shall provide and pay for all administrative, informational, and counseling services with respect to the annuity contracts offered by the designated company.
(c)
Each designated company shall cooperate with the employing institution in connection with any concerns that relate to enrollment, termination, or retirement of a participating employee.
(d)
Each designated company shall disclose to the Board of Trustees all fees, commissions, or other charges the designated company imposes or collects with respect to an annuity contract.
Md. Code Ann., State Pers. & Pens. § 30-212 (2026)
Title 30. Optional Retirement Program
Subtitle 2. Optional Retirement Program
§ 30–212LinkCopy Citation
A designated company or a company authorized to provide supplemental retirement accounts under § 30–401 of this title shall hold harmless and indemnify the State, the Board of Trustees, employing institutions, and the officers, agents, and employees of the State, the Board of Trustees, and employing institutions from any claims or demands arising from any act or omission on the part of the designated company or a company authorized to provide supplemental retirement accounts under § 30–401 of this title or its officers, agents, or employees, including any claim or demand for payment of benefits or damages arising from the formation, execution, performance, or termination of an annuity contract.
Subtitle 3. Participation
Md. Code Ann., State Pers. & Pens. § 30-301 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–301LinkCopy Citation
(a)
An individual is eligible to participate in the program only if the individual:
(1)
is eligible for membership in a retirement system or a pension system;
(2)
has not previously participated in a State system as an employee of an employing institution or any other unit of State government; and
(3)
is:
(i)
a member of the faculty of an employing institution;
(ii)
a professional employee at a community college or regional community college established under Title 16 of the Education Article;
(iii)
an employee of the University System of Maryland who is in a position designated as exempt under a policy adopted by the University System of Maryland Board of Regents;
(iv)
an employee of Morgan State University who is in a position designated as executive or professional administrative by the Board of Regents of Morgan State University;
(v)
an employee of St. Mary’s College of Maryland who is in a position determined by the Board of Trustees of the College to be an exempt position; or
(vi)
an employee of the Maryland Higher Education Commission who is in a position determined by the Secretary of Higher Education to be a professional position.
(b)
(1)
This subsection applies to an individual who:
(i)
on August 22, 2004, was eligible to participate in the program; and
(ii)
is in a position that, as of August 23, 2004, was reclassified by the University System of Maryland Board of Regents or the Board of Regents of Morgan State University and would no longer be eligible for participation in the program under subsection (a) of this section.
(2)
An individual described under paragraph (1) of this subsection shall continue to participate in the program if the individual:
(i)
would otherwise be eligible for membership in a system under the State Retirement and Pension System; and
(ii)
is employed by an employing institution.
(c)
(1)
This subsection applies to an individual who:
(i)
is in a position that was eligible to participate in the program but was reclassified by the governing board of the individual’s employing institution or the Secretary of Higher Education to a position that would no longer be eligible for participation in the program under subsection (a) of this section; and
(ii)
was a participant in the program on the date immediately preceding the reclassification.
(2)
An individual described under paragraph (1) of this subsection shall continue to participate in the program if the individual:
(i)
would otherwise be eligible for membership in a system under the State Retirement and Pension System; and
(ii)
is employed by an employing institution.
Md. Code Ann., State Pers. & Pens. § 30-302 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–302LinkCopy Citation
(a)
An election to participate in the program shall be made by an eligible employee at commencement of employment.
(b)
An eligible employee’s election to participate in the program is a one–time irrevocable election.
(c)
An individual who previously participated in a State system as an employee of an employing institution or any other unit of State government may not elect to participate in the program.
Md. Code Ann., State Pers. & Pens. § 30-303 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–303LinkCopy Citation
(a)
An eligible employee shall elect to:
(1)
join a pension or retirement system in accordance with the provisions of this Division II applicable to that system; or
(2)
participate in the program.
(b)
An eligible employee shall:
(1)
make an election under this section in writing; and
(2)
file the election with the Board of Trustees and the employing institution at commencement of employment.
(c)
An eligible employee’s election under this section is a one–time, irrevocable election.
(d)
The effective date of the election shall be the day of commencement of employment.
Md. Code Ann., State Pers. & Pens. § 30-304 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–304LinkCopy Citation
Unless an eligible employee transferred to a pension system on or before July 1, 1981, the eligible employee may not elect to participate in the program after transferring to a pension system.
Md. Code Ann., State Pers. & Pens. § 30-305 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–305LinkCopy Citation
(a)
This section applies only to a State employee who is appointed, promoted, transferred, or reclassified to a position in which an employee would be eligible to participate in the program.
(b)
A State employee described in subsection (a) of this section may not elect to participate in the program.
Md. Code Ann., State Pers. & Pens. § 30-306 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–306LinkCopy Citation
An election of the program by an eligible employee is only effective when the election is accompanied by an appropriate application, if required, for the issuance of an annuity contract under the program.
Md. Code Ann., State Pers. & Pens. § 30-307 (2026)
Title 30. Optional Retirement Program
Subtitle 3. Participation
§ 30–307LinkCopy Citation
(a)
(1)
This subsection applies to an election to participate in the program made on or before June 30, 2017.
(2)
Except as otherwise provided in this section, an election to participate in the program is a waiver of all rights and benefits provided by the retirement or pension system in which the participating employee was a member on the effective date of the election.
(3)
For the purpose of determining eligibility for immediate vested rights or benefits in a retirement system or pension system, an eligible employee who is a member of that State system when the employee elects to participate in the program is deemed to have separated from employment on the effective date of the election.
(4)
The Board of Trustees may only compute retirement system or pension system benefits on the basis of years of creditable service as a member of that State system.
(5)
(i)
This paragraph applies only to a participating employee whose last employer prior to joining the program was a participating employer that does not participate in the employer pick–up program as defined in § 414(h)(2) of the Internal Revenue Code.
(ii)
A participating employee may withdraw any accumulated contributions in the annuity savings fund on or after the effective date of the participating employee’s election to join the program.
(iii)
If a participating employee withdraws the accumulated contributions, the participating employee forfeits any right to a benefit in the State system from which the accumulated contributions were withdrawn.
(b)
(1)
A participating employee is ineligible for membership in a retirement system or pension system while the participating employee is employed in any eligible position by any employing institution.
(2)
A participating employee who is subsequently appointed, promoted, or transferred to another position that is eligible for membership in a State system but is not eligible for participation in the program shall participate in a State system with respect to that position as a condition of employment.
Subtitle 4. Supplemental Retirement Plans
Md. Code Ann., State Pers. & Pens. § 30-401 (2026)
Title 30. Optional Retirement Program
Subtitle 4. Supplemental Retirement Plans
§ 30–401LinkCopy Citation
(a)
An employing institution may:
(1)
establish supplemental retirement plans that provide supplemental retirement accounts offered by a designated company in accordance with § 401(a), § 403(b), or § 457 of the Internal Revenue Code, or any other provision of federal law that authorizes supplemental retirement accounts; and
(2)
authorize its employees or the employees of an institution over which it has administrative authority to participate in one or more of the supplemental retirement plans.
(b)
(1)
Except as provided in paragraph (2) of this subsection, if an employing institution authorizes its employees or the employees of an institution over which it has administrative authority to participate in a supplemental retirement plan, the employing institution shall select one or more of the designated companies under § 30–202 of this title that may offer supplemental retirement accounts to those employees and shall administer the participation of those employees in the supplemental retirement plan.
(2)
With respect to a community or regional college established under Title 16 of the Education Article, other than a community college established under Title 16, Subtitle 5 of the Education Article, if an employing institution authorizes its employees or the employees of an institution over which it has administrative authority to participate in a supplemental retirement plan, the employing institution shall select one or more companies that may offer supplemental retirement accounts to those employees and shall administer the participation of those employees in the supplemental retirement plan.
(c)
Contributions authorized under this section to a supplemental retirement account on behalf of an employee may be made by payroll deduction, a reduction in salary, deferral in compensation in accordance with § 403(b), § 457, or § 414(h) of the Internal Revenue Code, or as otherwise permitted by the Internal Revenue Code and authorized by the employing institution.
(d)
Assets of the supplemental retirement plans may be deposited and invested in accordance with the investment elections allowed under the supplemental retirement plans notwithstanding any other law limiting the types of investments that may be made with State funds or imposing conditions on the deposit of State funds.
(e)
An employee of an employing institution with discretionary authority over the management or administration of any of the supplemental retirement plans or the management or disposition of the assets of any of the supplemental retirement plans is entitled to indemnification and insurance as provided under § 30–210.1 of this title.