Retirement, deferred retirement option plan (DROP), options for Tier I and Tier II Teacher Retirement System members to participate, reopened

HB 136 reopens the Deferred Retirement Option Plan (DROP) for Alabama teachers in the Teacher Retirement System (TRS), allowing Tier I (25+ years service, age 55+) and Tier II (30+ years service, age 62+) members to participate again after a prior ban. It enables eligible teachers to continue working while deferring their retirement payments until the end of their DROP participation period (3-5 years), with the deferred amount accruing interest. The bill specifies that participants must remain classroom teachers (teaching 4+ hours/day in K-12 settings) and provides updated rules for DROP termination and interest calculations. This change directly affects current TRS Tier I and Tier II teachers who meet the service and age requirements.