(a) In this section the term "ineligible benefit payment" means that portion of a payment or distribution, other than a Group Term Life benefit payment, made by the retirement system to, or on behalf of, a living or deceased person who was not legally entitled to the payment at the time it was made. An ineligible benefit payment is a receivable of the system.
(b) In this section the term "recipient" means the person or persons who, directly or indirectly, received an ineligible benefit payment.
(c) If a repayment of an ineligible benefit payment is not received by the retirement system, the system may offset the amount of the ineligible benefit payment against future benefit payments otherwise due the recipient.
(d) If the board determines that an ineligible benefit payment is not recoverable, the receivable shall be charged against the general reserves account of the endowment fund provided the ineligible benefit payment was not the result of an error or omission of a participating subdivision.
(e) If the board determines that the ineligible benefit payment was the result of an error or omission of a participating subdivision and determines that the payment is not recoverable, the receivable shall be charged against the subdivision's account in the subdivision accumulation fund.
(f) In making its determination, the board may consider the amount of the ineligible benefit payment, the likelihood of repayment, the costs of recovery, and any other fact or circumstance which the board considers to be relevant in finding that further efforts for the recovery of the payment are not in the best interests of the retirement system, its members and annuitants.

Source Note: The provisions of this §107.10 adopted to be effective December 25, 2000, 25 TexReg 12812; amended to be effective January 1, 2006, 30 TexReg 7887; amended to be effective December 30, 2012, 37 TexReg 10250