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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN FRANK J. KELLEY, ATTORNEY GENERAL Opinion No. 6010 November 24, 1981 LEGISLATURE: Legislative retirement system RETIREMENT SYSTEMS: Legislative--determination of benefits for member leaving service before having attained the age of 55 years The retirement allowance to be awarded a legislator upon attainment of age 55 years who left office on December 31, 1974, and effective January 1, 1975, received insurance benefits conferred upon retirants under the act but because of age was not qualified to receive retirement benefits at that time, must be based on the statute in effect on January 1, 1975. Honorable Jack Faxon State Senator The Capitol Lansing, Michigan You have requested my opinion with respect to the applicable retirement benefit formula for a former legislator. The legislator served until December 31, 1974. When he left the Legislature, the legislator was, but for age, eligible to receive a retirement allowance from the legislative retirement system. The former legislator reached age 55 years on March 28, 1981, thus satisfying the age retirement for the payment of a monthly retirement allowance. The Michigan Legislative Retirement System Act, 1957 PA 261; MCLA 38.1001 et seq; MSA 2.169(1) et seq, established and controls the legislative retirement system. At the time the former legislator left office, 1957 PA 261, supra, Sec. 23(3), provided: 'A member retiring on or after December 31, 1974, shall be entitled to an annual retirement allowance of 30% of the salary stated in his application for the first 8 years of service plus 3.75% for each of the next 8 years of service. . . .' (1) After leaving office, but before the time the legislator reached age 55, 1957 PA 261, Sec. 23(3), supra, was amended by 1978 PA 560 so as to provide: 'A participant retiring on or after December 31, 1974 and before January 1, 1979, shall be entitled to an annual retirement allowance of 30% of the salary stated in the application for the first 8 years of service plus 3.75% for each of the next 8 years of service. . . .' 1978 PA 560 also added a new subsection (4) onto 1957 PA 261, Sec. 23, supra, which provided: 'A member retiring after December 31, 1978, shall be entitled to an annual retirement allowance of 32% of the salary stated in his or her application for the first 8 years of service plus 4% for each of the next 8 years of service. . . .' On behalf of the Legislative Retirement Board, you ask whether the former legislator is to be paid a retirement allowance based on the formula contained in 1957 PA 261, Sec. 23, supra, at the time the legislator left office or under the formula adopted four years later, but before the legislator commenced receiving a monthly retirement allowance. To be precise, at the time the former legislator reached age 55 on March 28, 1981, 1957 PA 261, Sec. 23(4), supra, provided: 'A participant retiring after December 31, 1978, shall be entitled to an annual retirement allowance of 32% of the salary stated in his or her application for the first 8 years of service plus 4% for each of the next 8 years of service. . . .' 1979 PA 52 amended 1957 PA 261, Sec. 23(4), supra, to substitute 'participant' for the word 'member.' The determination of specific pension rights in an individual case and when those rights accrue are dependent upon the terms and conditions of the legislative retirement system, which are established by statute. OAG, 1967-1968, No 4365, p 55, 60 (June 26, 1967). Legislative enactments must be read as a whole to harmonize the meaning of their separate provisions and give effect to the Legislature's intent. Washtenaw County v Saline River Intercounty Drainage Board, 80 Mich App 550; 264 NW2d 53; lv den 402 Mich 944 (1978). For the time in question here, 1957 PA 261, supra, Sec. 6(a), defined the word 'member' as a 'member of the legislature of this state.' The word 'participant' was defined by 1957 PA 261, supra, Sec. 8, as 'any eligible member who is participating in the system.' (2) The phrase 'eligible member' was defined as 'any member other than one who has elected not to participate in the system as provided in section 18 of this act.' 1957 PA 261, supra, Sec. 7. The Legislative Retirement System Act, supra, had a quite distinct definition for retirant. 1957 PA 261, supra, Sec. 13, provided: "Retirant' means a retired participant receiving a retirement allowance from the system or a person who except of age is otherwise eligible to receive a retirement allowance from the system.' (Emphasis added) (3) The underscored language was added by 1974 PA 215, effective December 31, 1974. The terms 'participant' and 'retirant' are distinct for the purposes of the legislative retirement system and, therefore, a retirant could not avail himself or herself of an option provided a participant of the legislative retirement system. OAG, 1981-1982, No 5989, p 408 (October 7, 1981). The former legislator cited in your opinion request fell within the definition of a retirant for the purposes of the legislative retirement system. Even though the former legislator had to wait until age 55 to receive the legislative retirement system's monthly retirement allowance, he did receive benefits from the retirement system upon leaving the Legislature. For example, as you emphasize in your letter, all retirants are provided life, dental, hospital, and medical coverage insurance by the legislative retirement system in accordance with 1957 PA 261, supra, Secs. 50a and 50b. 1957 PA 261, Sec. 50a, supra, provided in part as follows: '(6) The board may pay from the earnings derived from the investment of funds appropriated or accruing to the retirants life insurance revolving funds, a death benefit of a sum not to exceed $5,000.00 to the surviving spouse or the estate of a participant retiring after December 31, 1974. The board may also pay to the surviving spouse or the estate of a retirant the sum of $2,500.00 in addition to any present plan of retirants life insurance for which the member pays the premiums. ' (8) The board may equalize the amount of life insurance to which a retirant is eligible to carry with the highest permissible to retirants. The premium on the equalized amount of life insurance shall also be equalized and shall be paid to the board by direct payment or by payroll deduction. The proceeds from the premium payments shall be added to appropriations made to the fund for this purpose.' In 1957 PA 261, Sec. 50b, supra, the Legislature has provided: 'The board may purchase and pay the premiums on dental, hospital, and medical coverage insurance for retirants of the system and their survivors from appropriations made for this purpose to the grants and insurance revolving fund.' The records of the legislative retirement system indicate that the former legislator in question, as a retirant of the system, received life insurance benefits pursuant to 1957 PA 261, Sec. 50a, supra, since January 1, 1975, and dental, medical and hospital benefits under 1957 PA 261, Sec. 50b, supra, since October 1, 1978. A statute is to be construed as having prospective operation only, unless its terms show clearly a legislative intention that it should operate retrospectively. Barber v Barber, 327 Mich 5; 41 NW2d 463 (1950). An intent to make a statute retrospective only appears from the context of the statute when: "[a] purpose to give it a retrospective force is expressed by clear and positive command, or to be inferred by necessary, unequivocal and unavoidable implication from the words of the statute taken by themselves and in connection with the subject matter, and the occasion of the enactment, admitting of no reasonable doubt, but precluding all questions as to such intention." In re Davis' Estate, 330 Mich 647, 651; 48 NW2d 151, 153 (1951). (4) The Legislature took great pains in amendatory 1978 PA 560 to restrict the effect to future retirants of the legislative retirement system. The benefit formula added to 1957 PA 261, Sec. 23(3), supra, by 1974 PA 215 was not only retained, but it was also amended to read '[a] participant retiring on or after December 31, 1974 and before January 1, 1979.' Another benefit formula was also added by 1978 PA 560 as the new 1957 PA 261, Sec. 23(4), supra, which provided '[a] participant retiring after December 31, 1978.' Hughes v Judges' Retirement Board, 407 Mich 75, 88-90; 282 NW2d 160, 165-166 (1979), leaves no doubt that the increased retirement benefit formula of 1957 PA 261, Sec. 23(4), supra, was not applicable to persons who ceased being participants and became retirants before January 1, 1979: 'The pertinent part of 1974 PA 337, Sec. 14 under which plaintiffs seek relief is set forth, supra, and provides that the newly created benefits are payable '[u]pon a member's retirement'. 'There are two essential requirements for attaining pensionable status under the amendment. A judge must: (1) be a member of the Judges' Retirement System, and (2) have more than 12 years of service credited to his account. Since both plaintiffs had well over 12 years of service credited to their accounts, it is the element of membership in the retirement system which is critical to their attainment of pensionable status under the amendment. To determine whether plaintiffs are 'members' of the retirement system we look first to the act itself. Section 2(c) states: "Member' means a judge who, subject to this act, agrees to become a member of the retirement system.' 'It is uncontroverted that Judges Hughes and Salmon became members of the retirement system in 1957 and 1952, respectively. However, Sec. 12 of the act provides: 'A judge's membership in the retirement system shall terminate (1) whenever he becomes a beneficiary; ' 'Section 2(i) of the act defines a beneficiary as follows: "Beneficiary' means a person in receipt of the annuity or other benefit provided by this act. 'Plaintiffs do not dispute that they are presently beneficiaries of the retirement system receiving annuities 'provided by this act'. By legislative definition then, they are no longer 'members' of the retirement system. The express legislative mandate that '[u]pon a member's retirement [the member] shall be paid a straight life annuity, and that a judge's membership terminates 'whenever he becomes a beneficiary', means that only those judges who were members of the retirement system on the effective date of 1974 PA 337, Sec. 14, may claim its benefits. 'It follows then that as retirant-beneficiaries, plaintiffs are not members of the retirement system and were not on the effective date of the 1974 amendment to Sec. 14. They do not have the requisite pensionable status to entitle them to its benefits.' The former legislator was, on January 1, 1979, no longer a participant of the legislative retirement system. He was a retirant receiving, among other things, life, health and dental insurance coverage from the legislative retirement system. The fact that he could not claim participant status is accented by 1957 PA 261, supra, Sec. 23b(1), which provides: 'If a retirant again becomes a member, he shall not again become a participant unless within 30 days of the date of the beginning of his subsequent service he files with the board a written notice of election to again become a participant and complies with all the provisions of this section. . . .' While OAG, 1979-1980, No 5644, p 584 (February 1, 1980), considered the amendment made to 1957 PA 261, Sec. 13, supra, by means of 1974 PA 215 to broaden the meaning of the term 'retirant' under the act to include persons who, except for age, are otherwise eligible to receive a retirement allowance from the system, the opinion request did not advise that insurance benefits were being paid for the former legislator as a retirant of the system and the opinion failed to consider 1957 PA 261, Secs. 50a and 50b, supra, which made insurance benefits available to such persons who, except for age, are otherwise eligible to receive a retirement allowance from the system. (5) The fact that the legislator in question received the insurance benefits authorized by 1957 PA 261, Secs. 50a and 50b, supra, after he left the Legislature on December 31, 1974, demonstrates beyond any question his status as a retirant under 1957 PA 261, supra. Therefore, OAG, 1979-1980, No 5644 supra, is overruled. It is my opinion, therefore, that the legislator who left office on December 31, 1974, and who, but for age, was qualified to receive a retirement benefit, retired on January 1, 1975, and is to be paid a retirement allowance based on the formula in 1957 PA 261, Sec. 23(3), supra, in effect on January 1, 1975. Since the legislator in question retired before December 31, 1978, he is not eligible for benefits provided to a participant in 1957 PA 261, Sec. 23(4), supra. Frank J. Kelley Attorney General (1)
'A retirant shall be entitled to an annual retirement allowance of 26% of the salary for the year ending the service stated in his application for the first 8 years of service plus 3% of each of the next 8 years of service. . . .'
(2)
The word 'eligible' in 1957 PA 261, Sec. 8, supra, was inserted by 1974 PA 215. That same amendatory act established the increased benefit formula in 1957 PA 261, Sec. 23(3), supra, which became effective the day the former legislator left office on December 31, 1974.(3)
The underscored portion of 1957 PA 261, Sec. 13, supra, was added by 1974 PA 215, which, as noted in footnote 2, established the benefit formula in place when the former legislator left the Legislature.(4)
An example of a retirement act provision which was retrospective is provided by 1956 PA 224, which amended the Judge's Retirement Act, 1951 PA 198; MCLA 38.801 et seq; MSA 27.125(1) et seq. Hughes v Judges' Retirement Board, 407 Mich 75; 282 NW2d 160 (1979). In pertinent part, 1956 PA 224 amended 1951 PA 198, supra, Sec. 14 to read:'The retirement annuity herein required to be paid shall also be paid to those members already on retirement in a sum equal to that which they would receive if they retired after the effective date of this amendatory act.'
That language was deleted by 1961 PA 169.
(5)
It should also be noted that, after the former legislator began drawing a retirement allowance in April, 1981, 1957 PA 261, supra, was amended by 1981 PA 123, effective July 23, 1981. One effect of 1981 PA 123 is to realign participation in the legislative retirement system into three classifications. The classification of 'participant' is deleted, and a new express classification of 'deferred vested member' is added by a new Sec. 17a to 1957 PA 261, supra.
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