FROM: Barbara Hannah, Chief Counsel
SUBJECT: Informational: Disability Retirement Process
RECOMMENDATION:
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Review CERL system survey regarding the disability retirement processes.
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BACKGROUND:
At the request of Trustee Mason, staff conducted a survey of other retirement systems governed by the County Employees’ Retirement Law (CERL) to better understand how disability retirement initial hearings are administered and whether a Disability Retirement Committee is utilized.
Staff contacted and/or reviewed publicly available materials from the various retirement systems. The survey sought general information regarding (1) the decision-making body used for the initial determination; (2) the existence and composition of any Committee; and (3) the role of the committee in making recommendations or decisions.
The survey results indicate the 20 CERL retirement systems employ similar approaches when conducting disability retirement initial hearing:
Board of Retirement: 17
Disability Committee: 1
Information Unavailable: 2 (most likely the Board because each of the two systems do not have a standing disability retirement committee.)
Staff believes that a primary reason the majority of CERL systems have not adopted a committee-based approach similar to that of the one CERL system is the clear statutory language in the CERL. Government Code section 31720 provides that a member is retired for disability only when the Board of Retirement finds that the member is permanently incapacitated. Since a committee does not constitute the full Board, a final determination regarding disability retirement cannot be made by a committee alone.
In light of this statutory framework, staff met with representatives from the one CERL system utilizing a Disability Committee to better understand their process. Under this model, cases are first presented to the Committee, which reviews the matter and makes a recommendation to either grant or deny the application. If the Committee recommends denial, the member is provided an opportunity to appeal the recommendation and proceed to an administrative hearing. If the Committee recommends approval or the member fails to appeal the Committee’s denial, the disability retirement case is presented to the full Board and placed on the consent calendar. The Committee meets on the same day of the Board, an hour prior to the start of the Board meeting.
Based on the survey results, the applicable statutory framework, and staff’s discussion with the one system regarding the use of a Disability Retirement Committee, staff concludes that maintaining SBCERA’s current practice is appropriate. The survey reflects that the overwhelming majority of CERL systems vest disability retirement determinations with the full Board, consistent with Government Code section 31720, which requires a finding by the Board that a member is permanently incapacitated for the performance of duties. While the one CERL system utilizes a Disability Retirement Committee in an advisory capacity, that approach remains the exception among CERL systems and does not alter the Board’s ultimate statutory responsibility. Absent further direction from the Committee or the Board, staff recommends continuing SBCERA’s existing practice of having the Board make the determination on disability retirement applications.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Operational Excellence & Efficiency
STAFF CONTACT:
Barbara Hannah
ATTACHMENTS:
None.