(a) The annuity savings fund shall be the fund in which shall be accumulated the contributions deducted from the compensation of members to provide for their annuities. Contributions to and payments from the annuity savings fund shall be made as follows:

(1) After the commencement date, each employer shall cause to be deducted from the salary of each member for each and every payroll period a percentage of the member's earnable compensation as determined by the board of trustees which shall be not less than 5 nor more than 6 percent; but no such deduction shall be made from the compensation of a member after the close of the school, fiscal, or contract year in which the member has attained age 65 and has completed 40 or more years of creditable service. In determining the amount earnable by a member in a payroll period, the employer may consider the annual rate of compensation payable to such member on the first day of the payroll period as continuing throughout such payroll period. The employer may omit the deduction from compensation for any period which is less than a full payroll period, if a teacher was not a member on the first day of the payroll period. In order to facilitate the making of deductions, the employer may modify the deductions required of any member by an amount not to exceed one-tenth of 1 percent of the annual compensation, on the basis of which such deductions are to be made. Each employer shall immediately pay the amount deducted to the board of trustees, in such manner as the board of trustees shall prescribe, which amount shall be credited by the board of trustees to the individual accounts in the annuity savings fund of the member from whose compensation the deductions were made. Beginning July 1, 1987, the employee contributions required under this paragraph shall be paid as provided in Code Section 47-3-41.1;

(2) Notwithstanding any other provisions of this subsection, at the close of any school, fiscal, or contract year in which a member has completed 40 or more years of creditable service, such member may elect in writing to cease making contributions to the retirement system. If such election is made, such teacher shall notify his employer and the board of trustees in such manner as the board of trustees shall prescribe. After giving the required notice, the employer shall not thereafter deduct, and the employee shall not thereafter be allowed to make, contributions to the retirement system from the salary or compensation of such member;

(3) Any other provision of this or any other law to the contrary notwithstanding, a member who has attained age 65 and who has completed 40 or more years of creditable service may elect to continue to make contributions to the retirement system during such continuous period of time as the member continues in service. He shall notify his employer and the board of trustees of such election in such manner as the board of trustees shall provide. Any member who has discontinued making contributions to the retirement system because he has attained age 65 and has 40 years of creditable service and who has continued in service may remit contributions to the board of trustees at the rate required by law and under terms and regulations prescribed by the board of trustees on all earnable compensation received by the member since deductions were discontinued. Contributions made under this paragraph shall entitle the member to creditable service for such period, but only for the purpose of determining average compensation over the highest consecutive years, used in the calculations of the retirement benefits of such member;

(4) Employer deductions shall be made, notwithstanding that the minimum compensation provided for by law for any member shall be reduced thereby. Every member shall be deemed to consent and agree to the deductions and payment of salary or compensation, less such deductions, shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by such person during the period covered by such payment, except as to the benefits under this chapter;

(5) In addition to the contributions deducted from the compensation of members under paragraphs (1) and (3) of this subsection, any member, subject to the approval of the board of trustees and such conditions as the board of trustees may prescribe, (A) may redeposit in the annuity savings fund by means of a single payment or by an increased rate of contribution an amount equal to the total amount previously withdrawn from that fund or any part of such amount or (B) may deposit in that fund by means of a single payment or by an increased rate of contribution an amount computed to be sufficient to purchase an additional annuity which, together with his prospective retirement allowance, will provide for him a total retirement allowance of not more than one-half of his average final compensation at retirement, but not exceeding the retirement allowance otherwise payable to him on retirement at age 65. Such additional amounts so deposited shall become a part of his accumulated contributions, provided that upon retirement such amounts shall be treated as excess contributions returnable to the member as an annuity of equivalent actuarial value and shall not be considered in computing the pension.

(b) Notwithstanding subsection (a) of this Code section, no deductions shall be made from a member's salary if the employer's contribution as to such member is in default.

(c) The contributions withdrawn by a member or payable in the event of his death shall be paid from the annuity savings fund and any balance of the accumulated contributions standing to the credit of his individual account shall be transferred from the annuity savings fund to the pension accumulation fund.

(d) Upon the retirement of a member, his accumulated contributions shall be transferred from the annuity savings fund to the pension accumulation fund.