Senate Bill No. 201
(By Senator Foster)
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[Introduced January 10, 2008; referred to the Committee on
Pensions; and then to the Committee on Finance.]
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A BILL to amend and reenact §5-10A-2, §5-10A-3, §5-10A-4, §5-10A-5,
§5-10A-6, §5-10A-7 and §5-10A-8 of the Code of West Virginia,
1931, as amended, all relating to disqualification for public
retirement benefits; adding the definition of "former
participant"; terminating retirement benefits in all public
retirement plans of former and present participants who have
rendered less than honorable service; and providing for
retention of vested employer contributions for members of the
Teachers' Defined Contribution Retirement System whose
benefits are terminated for less than honorable service.
Be it enacted by the Legislature of West Virginia:
That §5-10A-2, §5-10A-3, §5-10A-4, §5-10A-5, §5-10A-6,
§5-10A-7 and §5-10A-8 of the Code of West Virginia, 1931, as
amended, be amended and reenacted, all to read as follows:
ARTICLE 10A. DISQUALIFICATION FOR PUBLIC RETIREMENT PLAN BENEFITS.
§5-10A-2. Definitions.
As used in this article:
(a) "Retirement plan" or "plan" means the Public Employees
Retirement Act, pursuant to article ten, chapter five of this code;
each municipal employees retirement plan, pursuant to article
twenty-two, chapter eight of this code; each Policemen's and
Firemen's Pension and Relief Fund, pursuant to article twenty-two,
chapter eight of this code; the West Virginia State Police Death,
Disability and Retirement Fund, pursuant to article two, chapter
fifteen of this code; the West Virginia State Police Retirement
System, pursuant to article two-a, chapter fifteen of this code;
the State Teachers Retirement System, pursuant to article seven-a,
chapter eighteen of this code; the Teachers' Defined Contribution
Retirement System, pursuant to article seven-b, chapter eighteen of
this code; the Deputy
Sheriff Sheriff's Retirement System, pursuant
to article fourteen-d, chapter seven of this code; supplemental and
additional retirement plans, pursuant to section four-a, article
twenty-three, chapter eighteen of this code; the Judges' Retirement
System, pursuant to article nine, chapter fifty-one of this code;
and any other plan established pursuant to this code for the
payment of pension, annuity, disability or other benefits to any
person by reason of his or her service as an officer or employee of
this state or of any political subdivision, agency or
instrumentality thereof, whenever the plan is supported in whole or in part by public funds.
(b) "Beneficiary" means any person eligible for or receiving
benefits on account of the service for a public employer by a
participant
or former participant in a retirement plan.
(c) "Benefits" means pension, annuity, disability or any other
benefits granted pursuant to a retirement plan.
(d) "Conviction" means a conviction on or after the effective
date of this article in any federal or state court of record
whether following a plea of guilty, not guilty or nolo contendere,
and whether or not the person convicted was serving as an officer
or employee of a public employer at the time of the conviction.
(e) "Former Participant" means any person who is no longer
eligible to receive any benefit under a retirement plan because
full distribution has occurred.
(e) (f)"Less than honorable service" means:
(1) Impeachment and conviction of a participant
or former
participant under the provisions of section nine, article four of
the Constitution of West Virginia, except for a misdemeanor;
(2) Conviction of a participant
or former participant of a
felony for conduct related to his or her office or employment which
he or she committed while holding the office or during the
employment; or
(3) Conduct of a participant
or former participant which
constitutes all of the elements of a crime described in either of the foregoing subdivisions (1) or (2) but for which the participant
or former participant was not convicted because:
(I) Having been indicted or having been charged in an
information for the crime, he or she made a plea bargaining
agreement pursuant to which he or she pleaded guilty to or nolo
contendere to a lesser crime:
Provided, That the lesser crime is
a felony containing all the elements described in
subdivisions
subdivision (1) or (2) of this subsection; or
(ii) Having been indicted or having been charged in an
information for the crime, he or she was granted immunity from
prosecution for the crime.
(f) (g) "Participant" means any person eligible for or
receiving any benefit under a retirement plan on account of his or
her service as an officer or employee for a public employer.
(g) (h) "Public employer" means the State of West Virginia and
any political subdivision, agency, or instrumentality thereof for
which there is established a retirement plan.
(h) (I) "Supervisory board" or "board" means the Consolidated
Public Retirement Board; the board of trustees of any municipal
retirement fund; the board of trustees of any policemen's or
firemen's retirement plan; the governing board of any supplemental
retirement plan instituted pursuant to authority granted by section
four-a, article twenty-three, chapter eighteen of this code, and
any other board, commission or public body having the duty to supervise and operate any retirement plan.
§5-10A-3. Notice of intention to terminate benefits; waiver;
failure to reply.
(a) Whenever a supervisory board, upon receipt of a verified
complaint or otherwise, has reasonable cause to believe that a
participant
or former participant rendered less than honorable
service as defined in section two of this article, it shall notify
the affected participant,
former participant or beneficiary that it
believes that the participant
or former participant rendered less
than honorable service and that the participant,
former participant
or beneficiary is thereby ineligible to receive benefits. No
supervisory board may issue a notice:
(1) If more than two years have elapsed since the judgment of
conviction upon which the notice is based became final; or
(2) In cases described in paragraph (3), subsection (e),
section two of this article, if more than two years have elapsed
since, as the case may be: The plea bargaining agreement or the
grant of immunity; or
(3) With respect to conduct which occurred prior to the
effective date of this article.
(b) The notice shall contain a concise statement of the
reasons why the board believes that the participant
or former
participant rendered less than honorable service and shall be made
either by personal service or by certified mail, return receipt requested, to the address which the participant,
former participant
or beneficiary maintains for purposes of corresponding with the
board. If notice is made by certified mail, service shall be
considered complete upon mailing and a completed receipt
constitute
proofs constitute's proof of the receipt of the notice. The notice
shall inform the participant,
former participant or beneficiary
that he or she has the right to demand that the board seek a
determination in circuit court of his or her eligibility for
benefits and membership in the retirement plan by notifying the
board of the demand within forty days. The notice shall also
inform the participant,
former participant or beneficiary that the
board will terminate the benefits in accordance with section four
of this article and refund the participant's
or former
participant's contributions with interest less benefits previously
paid as provided in section six thereof if the participant,
former
participant or beneficiary either waives the right to demand that
the board take the matter before the circuit court or fails to
respond to the board's notice within forty days after service.
§5-10A-4. Determination by circuit court of ineligibility;
jurisdiction; appeal.
(a) If a participant,
former participant or beneficiary
informs the supervisory board within forty days after service of
the notice
as provided
for in section three of this article that he
or she demands that the board seek a determination in circuit court, the board shall forthwith file a petition in the circuit
court in the county in which the board is located or in which the
participant,
former participant or beneficiary resides, seeking
that the court determine that the participant
or former participant
rendered less than honorable service as defined in section two of
this article and that the affected participant,
former participant
or beneficiary is thereby ineligible to receive benefits.
The
circuit courts have jurisdiction to make the determinations.
Jurisdiction is hereby conferred on circuit courts to make such the
determinations.
(b) Upon the filing of
such a petition by a supervisory board,
the circuit court shall give
to the affected parties such notice
and opportunity to be heard
to the affected parties as are
consistent with the demands of due process and necessary for a fair
determination of the matter. Upon completion of its hearings the
court shall make such findings of fact and conclusions of law as
are appropriate. Except in the case of exigent circumstances, the
court shall make its determination within sixty days of the filing
of the petition by the board.
(c) A determination of the circuit court shall be a final
order which may be appealed to the Supreme Court of Appeals in the
same manner as decisions in other civil actions.
§5-10A-5. Termination of benefits.
(a) The board shall terminate a participant's,
former participant's or beneficiary's membership in
the plan any and all
plans in which he or she is or has been a member and shall not
thereafter pay any benefits to the participant,
former participant
or his
or her beneficiaries if an affected participant,
former
participant or beneficiary either waives the right to demand that
the board seek a determination of eligibility in circuit court as
set forth in section three of this article or fails to respond to
the notice within forty days after service thereof as set forth in
said section three, or if a circuit court has determined that the
participant
or former participant rendered less than honorable
service in accordance with section four of this article.
(b) In the event that the participant
or former participant is
deceased and there are two or more beneficiaries at least one of
whom has given the board timely notice that he
or she wishes to
exercise
his the right to demand that the board seek a
determination of eligibility in circuit court, the board shall take
the action
as provided
for by in this section with respect to all
the beneficiaries only upon a determination by the court that the
participant
or former participant has rendered less than honorable
service.
§5-10A-6. Refund of contributions.
The supervisory board shall refund to a participant,
or former
participant or beneficiary terminated from benefits by section five
of this article the contributions of the participant
or former participant in the same manner and with the same interest as
provided to those participants,
former participants or
beneficiaries otherwise eligible to withdraw the participant's
or
former participant's contributions under the retirement plan, less
the amount of any benefits which the participant,
or former
participant or his beneficiaries have previously received.
Provided, That members of the Teachers' Defined Contribution
Retirement System whose benefits have been terminated pursuant to
section five of this article shall be refunded only his or her
employee contributions and the earnings on those contributions.
Any vested employer contributions shall remain in the Teachers'
Defined Contribution Retirement System and be used to offset future
employer contributions for each contributing employer.
§5-10A-7. Eligibility for new participation upon rehabilitation.
Nothing in this article shall prohibit a participant
or former
participant made ineligible for benefits by virtue of conviction of
a crime under this article, and who has paid the full penalty
imposed by law for such crime, from accepting a position as an
officer or employee of the same or different public employer and
joining a retirement plan as a new member; but
he the new member
and his
or her beneficiaries shall remain forever ineligible for
any benefits arising from
his the new member's former participation
in a retirement plan
.
§5-10A-8. Setoff; unpaid benefits subject to execution, freezing of account upon finding of probable cause.
(a) The State of West Virginia or any of its political
subdivisions shall have the right of setoff against any unpaid
benefits which have accrued or may thereafter accrue under the
plan, including any contributions by the participant
or former
participant for any claim caused by less than honorable service by
the participant
or former participant.
(b) Notwithstanding any provision of this article to the
contrary, upon being notified by an agency of the State of West
Virginia or any of its political subdivisions that an employee has
been charged by criminal complaint, indictment or information with
an offense which constitutes less than honorable service and
larceny of funds or property from a state agency or political
subdivision, the retirement board shall withhold payment or
refunding of any participant's
or former participant's
contributions until it receives an order from a court of competent
jurisdiction reflecting that the charge has been dismissed,
reflecting that the participant
or former participant is found not
guilty,
or ordering the release of all or part of the funds, or
directing restitution to the state or political subdivision.
(c) Notwithstanding any provision of the law to the contrary,
any unpaid benefits which have accrued or may thereafter accrue
shall be subject to execution, garnishment, attachment or any other
legal process for collection of a judgment for the recovery of loss or damages incurred by the state or its political subdivision,
caused by the participant's
or former participant's less than
honorable service.
NOTE: The purpose of this bill is to provide for the
termination of retirement benefits in any and all plans of a member
who renders less than honorable service, to add the definition of
"former participant", and to provide for the retention of employer
contributions in the plan of members of the Teachers' Defined
Contribution Retirement System whose benefits have been terminated
for less than honorable service.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.