(1) Option P2 is a modified joint survivorship annuity, which is defined as a somewhat smaller sum of money than the amount that would be payable under option A but that is the actuarial equivalent thereof, as calculated under this retirement plan, payable monthly to an annuitant from the time of retirement until the death of said annuitant, and, thereafter an amount equal to one-half of the monthly amount paid to the annuitant is payable monthly to the annuitant's designated co-annuitant until the death of that person. The designation of the co-annuitant shall be effective upon the effective date of the member's retirement and may not subsequently be changed except as provided in subsection (2) of this section. Upon the death of the co-annuitant prior to the death of the annuitant, the benefit payable to the annuitant thereafter shall be the original option A amount increased by any increases in the basic retirement allowance granted in accordance with the provisions of the DPS plan document and section 24-51-1732 subsequent to the annuitant's effective date of retirement. In addition to designating a co-annuitant, the member shall designate a beneficiary and shall have the exclusive right to change such designation of beneficiary at any time prior to the annuitant's death. If, upon the death of both the annuitant and the co-annuitant, the total amount of retirement allowance that has been paid to them does not exceed the member's accumulated contributions, then the difference between said accumulated contributions and the total amount of retirement allowance paid to such annuitant and co-annuitant shall be paid to the named beneficiary of the annuitant, or, if no named beneficiary exists, to the estate of the co-annuitant.

(2) In case of the death of the designated co-annuitant under option P2 after the date of application for retirement and before the effective date of retirement, the member may make a change of option or designate a new co-annuitant within thirty days after the death of the previously designated co-annuitant and subject to the appropriate recalculation of the retirement allowance.

(3) Notwithstanding any provision to the contrary, an annuitant may change the co-annuitant that was named by such annuitant and designate a supplemental needs trust as a co-annuitant in place of the previously named co-annuitant if:

(a) The beneficiary of the supplemental needs trust is the same person as the previously named co-annuitant; and

(b) The retiree files an application and any required documents in a form as designated by the association.

(4) If a supplemental needs trust is not established before or within ninety days after the death of the annuitant, is determined to be invalid, or is terminated on or after the death of the annuitant, the beneficiary that was named in the trust is the co-annuitant.