February 16, 1979

Dr. Fred W. Zuercher, Secretary 
Department of Public Safety 
Division of Highway Patrol 
118 West Capitol 

Pierre, South Dakota 57501

Official Opinion No. 79-4

Relation of Old Law Enforcement Officers' Retirement System to Present Retirement System

Dear Dr. Zuercher:

Mr. Dennis Eisnach, Acting Secretary of the Department of Public Safety, requested an opinion from this office based upon the following factual situation:

FACTS: 

Two members of the South Dakota Highway Patrol took normal retirement from the South Dakota Retirement System, and presently are receiving retirement benefits as prescribed by law for Class B members of the system. 

These two retirants have since been hired by the State of South Dakota as port of entry inspectors for the Department of Public Safety, Division of Highway Patrol.  Their present employment makes them members of the retirement system as Class A members.  The employment of retirants by a participating unit of the retirement system is allowing them to draw benefits from the system and at the same time establish additional benefits for a “second” retirement.

Based on the above facts you ask the following questions:

QUESTIONS: 

1.  SDCL Chapter 3-13, Law Enforcement Officers Retirement, which was repealed by SL 1974, Chapter 35, §  80, did not address the situation of a member retiring, drawing benefits, and being employed by another agency of state government.  Your predecessor did, however, issue an Official Opinion on February 10, 1961, in which he stated a retirant under Chapter 44:06A, SDC 1960 Supp. (later recodified as Chapter 3-13 SDCL) could “. . . work for some other department of state government,” but that, “Of course, such person receiving retirement payments could not work for . . . the motor patrol.  . . .” Are the two retirants from the highway patrol prohibited from employment as port of entry inspectors with the highway patrol? 

2.  If the answer to Question No. 1 is no, and even though SDCL 3-12-127 consolidated Chapter 3-13 into Chapter 3-12 South Dakota Retirement System and provides that '. . . members of systems established thereunder shall be entitled to retire at the age, length of service and the benefits available to them under those provisions and the provisions of this chapter,' would not the two retirants described in the factual situation be prevented from being “. . . employed by a participating unit prior to normal retirement age, . . .” unless their annuity is suspended while so employed? 

3.  “Normal retirement age” was not addressed in Chapter 3-13 SDCL LAW ENFORCEMENT OFFICER'S RETIREMENT SYSTEM, but is addressed in SDCL 3-12-47(35) and is established as age fifty-five for law enforcement officers.  If your answer to Question No. 2 is yes, would the 'normal retirement age' provided for in SDCL 3-12-47(35) be binding on these retirants? 

4.  If your answers to Questions No. 2 and 3 are yes, would these retirants merely be required to have the payment of their annuities suspended while they are employed as port of entry inspectors for the Division of Highway Patrol, or should they be required to refund all annuities they have received thus far to the South Dakota Retirement System as well as having all further annuities suspended while they are so employed?

IN RE QUESTION NO. 1:

The Law Enforcement Officers Retirement System was established in 1957 and was originally codified at SDCL 3-13.  Pursuant to SDCL 3-12-43 the Legislature provided that other existing state retirement plans, such as the Law Enforcement Officers Retirement Plan, could be incorporated into the State Public Employees Retirement System.  This provision was enacted in 1967.  In 1974, the South Dakota Legislature provided that the South Dakota Law Enforcement Law Officers Retirement System was incorporated into the South Dakota Retirement System and further provided that the South Dakota Retirement System should provide an orderly means of continuing benefits of those already retired and to those eligible to retire from the respective systems consolidated.   SDCL 3-12-46. SDCL 3-13, further, was repealed by the 1974 Legislature.  1974 Session Laws Chapter 35, §  80.  The 1974 Legislature also provided at SDCL 3-12-111 that: 

In the event a retirant becomes employed by a participating unit prior to normal retirement age, the payment of his annuity shall be suspended during such employment.

This amendment in 1974 changed SDCL 3-12-29.3, passed in 1970, which had provided: 

In the event the retirant becomes employed by a participating employer in the State and earns during such employment, the gross amount of two thousand dollars ($2000) in a calendar year, the payment of his annuity shall be suspended for the balance of such calendar year.

The 1974 Legislature also provided in what is now SDCL 3-12-127 that all former members of the Law Enforcement Officers Retirement System under Chapter 3-13 would be entitled to retire under that system at the age, length of service and benefits available to them under those provisions and the provisions of Chapter 3-12.  This statute was further amended in 1975 to clarify the intent of the Legislature that the members of the former Law Enforcement Officers Retirement System had the option of retiring either under the old system or under the provisions of the consolidated system.  See Official Opinion No. 75-85.

Since the Legislature has guaranteed to the former members of the Law Enforcement Officers Retirement System the option of retiring under that system, and since that system did not contain a limitation as presently found at SDCL 3-12-111 (formerly SDCL 3-12-29.3), I do not believe the law prohibits such retirees under the old system from coming back to work for the State, and earning an additional benefit under the present retirement system codified at Chapter 3-12.

In this matter I can not agree with your contention that this situation will  (1) defeat the basic purpose of the State in providing an additional retirement income to supplement the social security retirement benefits or (2) adversely affect the fiscal soundness of the retirement system so that special appropriations by future sessions of the Legislature would be needed to make the system actuarially sound.  It is my view in this matter that the retirees under the old system who come back to earn a benefit under the new system are merely earning an additional benefit under the new system for which they are paying the same as anyone else under the new system.  These individuals are not earning additional benefits which threaten the fiscal soundness of the system or earning an increase on a former benefit rate which gives them some unique preferential treatment.

The answer to your first question is “no.”

IN RE QUESTION NO. 2:

The answer to your second question is also “no.”  Retirants under the old Law Enforcement Officers Retirement System who have met the qualifications of that system for retirement are not prevented from being 'employed by a participating unit prior to normal retirement age, unless their annuity is suspended while so employed.'  In my view, the limitations of SDCL 3-12-111 in this regard do not prevent the two retirants described in your factual situation from being employed by a participating unit under the present system (SDCL 3-12) unless their annuity under the old system is suspended while so employed.

IN RE QUESTIONS NO. 3 AND 4:

Since the answers to Questions No. 1 and 2 answer the questions involved in Questions No. 3 and 4, it is not necessary to deal further with them.

Respectfully submitted,

Mark V. Meierhenry
Attorney General

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