H. B. 4034
(By Delegates Stalnaker, Browning,
Williams, Hall and Duke)
[Introduced January 17, 2006; referred to the
Committee on Pensions and Retirement then Finance.]
A BILL to repeal §5-10-43 of the Code of West Virginia, 1931, as
amended; and to amend and reenact §5-10-26, §5-10-44 and
§5-10-54 of said code, all relating to the Public Employees
Retirement System; removing the requirement that a no longer
disabled employee must return to his or her former job;
permitting administrative hearings before disability
retirement termination; clarifying procedures for
reapplication by disability retirants whose benefits were
terminated for economic causes; correcting errors; and
terminating benefits for knowingly making false statements or
permitting false records to be filed with the Consolidated
Public Retirement Board in an attempt to defraud the system.
Be it enacted by the Legislature of West Virginia:
That §5-10-43 of the Code of West Virginia, 1931, as amended,
be repealed; and that §5-10-26, §5-10-44 and §5-10-54 of said code
be amended and reenacted, all to read as follows:
ARTICLE 10. WEST VIRGINIA PUBLIC EMPLOYEES RETIREMENT ACT.
§5-10-26. Reexamination of disability retirants; reemployment;
adjustment of annuity for earnings.
(a) At least once each year during the first five years
following the retirement of a member on account of disability, as
provided in section twenty-five of this article, and at least once
in each three-year period thereafter, the board may require a
disability retirant, who has not attained age sixty years, to
undergo a medical examination to be made by or under the direction
of a physician designated by the board, or to submit a statement
signed by the disability retirant's physician certifying continued
disability, or both, and a copy of the disability
retirants's
retirant's annual statement of earnings. If the retirant refuses
to submit to the medical examination or provide the certification
or statement in any period, his or her disability annuity may be
discontinued by the board until the retirant complies. If the
refusal continues for one year, all the retirant's rights in and to
the annuity may be revoked by the board. If, upon medical
examination of a disability retirant, the physician reports to the
board that the retirant is physically able and capable of resuming
employment with a participating public employer,
the retirant shall
be returned to the employ of the participating public employer from
whose employment he or she retired and his or her disability
annuity shall terminate:
Provided, That the board concurs in the
physician's report
and first offers to the disability retirant the opportunity for an administrative appeal hearing.
(b) A disability retirant who is returned to the employ of a
participating public employer shall again become a member of the
retirement system and the retirant's credited service in force at
the time of his or her retirement shall be restored.
(c) If a review of the disability retirant's annual statement
of earnings or other financial information as required by the board
determines that the disability retirant's earned income for the
preceding year exceeds the substantial gainful activity amount as
defined by the United States Social Security Administration, the
disability retirant's annuity shall be terminated by the board,
upon recommendation of the board's disability review committee, on
the first day of the month following the board's action. Any
person who wishes to reapply for disability retirement and whose
disability retirement annuity has been terminated by the board
for
exceeding the substantial gainful activity amount may do so within
ninety days of the effective date of termination:
by requesting
Provided, That any person reapplying for disability benefits must
also undergo an examination at the applicant's expense by an
appropriate medical professional chosen by the board.
§5-10-44. Correction of errors.
If any change or employer error in the records of any
participating public employer or the retirement system results in
any person receiving from the system more or less than he or she would have been entitled to receive had the records been correct,
the board shall correct the error, and as far as is practicable
shall adjust the payment of the benefit in a manner that the
actuarial equivalent of the benefit to which the person was
correctly entitled shall be paid. Any employer error resulting in
an underpayment to the retirement system may be corrected by the
employee remitting the required employee contribution and the
participating public employer remitting the required employer
contribution. Interest shall accumulate in accordance with the
Legislative Rule 162 CSR 7 concerning retirement board
refund
reinstatement
and loan interest factors, and any accumulating
interest owed on the employee and employer contributions resulting
from employer error shall be the responsibility of the participating
public employer. The participating public employer
may remit total
payment and the employee reimburse the participating public employer
through payroll deduction over a period equivalent to the time
period during which the employer error occurred.
§5-10-54. Termination of early retirement benefits; termination
of retirement benefits; procedures.
(a) Whenever the board determines that: (1) Any person has
knowingly made any false statement or falsified or permitted to be
falsified any record or records of the retirement system in an
attempt to defraud the system; or (2) any person who resumes
employment with a governmental entity or accepts, directly or indirectly, work on a contract basis from a governmental entity,
except as provided for under this article, the board shall terminate
any benefit that person has received, is receiving and is entitled
to receive under the early retirement provisions of this article.
Further, if any person taking early retirement under this article
desires to revoke his or her early retirement incentive, he or she
shall be allowed to do so if he or she is entitled to regular
retirement pursuant to this article:
Provided, however, That such
revocation shall be retroactive to the date of last employment and
any incentive annuity, under any incentive option, already received
by the retiree be repaid to the retirement system. Any person who
revokes his or her early retirement incentive shall be thereafter
carried upon the records of the retirement system as a regular
retiree and shall not be entitled to any enhanced benefit by reason
of the early retirement options contained in this article:
Provided, however, That any person who chose to retire under the
early retirement provisions of this article who would not have been
and is not eligible for regular retirement but for the early
retirement incentive options must reapply for admission to a
retirement system and repay all pension benefits plus regular
interest which would have been earned by the fund in the period
during which the annuity payments were paid to him or her since the
date his or her employment ceased.
(b) Whenever the board determines that any person has knowingly made any false statement or falsified or permitted to be falsified
any record or records of the retirement system in an attempt to
defraud the system, the board shall terminate any retirement or
disability benefits the person is receiving, in addition to
notifying the appropriate county prosecutor of the misdemeanor as
provided by statute.
(c) Any termination of benefits may be appealed pursuant to
the state administrative procedures act in chapter twenty-nine-a of
this code. The board shall promulgate rules and regulations
regarding the procedure for termination of benefits and the
repayment of any benefit in accordance with the provisions of
article three, chapter twenty-nine-a of this code.
NOTE: The purpose of this bill is to repeal the obsolete
provisions of §5-10-43 on pro rata reduction of annuities; to remove
the requirement that a no longer disabled employee must return to
his or her former job; to permit administrative hearings before
disability retirement termination; to clarify procedures for
reapplication by disability retirants whose benefits were terminated
for economic causes; to clarify in that the reinstatement interest
factors would be used in error correction matters; and to specify
that the board may terminate not only early retirement benefits but
also regular or disability retirement benefits of someone who has
fraudulently obtained them. Current code establishes that such
fraud is a misdemeanor with jail and monetary penalties.
Strike-throughs indicate language that would be stricken from
the present law and underscoring indicates new language that would
be added.
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