FROM: Barbara Hannah, Chief Counsel
SUBJECT: Review of the Supplemental Disability Retirement Allowance Process
RECOMMENDATION:
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Review of the Supplemental Disability Retirement Allowance Process.
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BACKGROUND:
At the request of Trustee Fiorino, this item is presented to inform the Committee and Board about the process for administering the supplemental disability retirement allowance after the Board grants the benefit, and to ensure that members receiving the benefit are accurately reporting their status.
Background:
On February 24, 1975, the San Bernardino County Board of Supervisors adopted Article 15.6 of the County Employees’ Retirement Law (CERL), establishing survivor and supplemental disability retirement benefits to replace Social Security coverage. As a result, Government Code section 31740 (Supplemental Retirement Allowance) became effective January 3, 1976.
The Board of Supervisors intended that the $300 per month supplemental retirement allowance be awarded only to members with a permanent disability who are unable to engage in any gainful employment. Consistent with this intent, the SBCERA Board incorporated into its By-Laws a definition of “gainful employment” as the performance of any service for compensation. This standard differs from the Social Security standard, which considers “substantial” or “customary” employment. Under the SBCERA standard, a member who performs any type of work for compensation, regardless of whether it is similar to their prior position or provides equal or greater pay, does not qualify for the supplemental retirement allowance.
It is important to note that the award of this benefit is provided only if the Board determines the member is permanently incapacitated from performing their usual job duties and is incapable of performing any type of employment after retirement for compensation. To assist the Board in the determination of granting or denying the supplemental retirement allowance, on June 5, 2025, the Board approved a contract for services with the Access Employment Network (AEN) for vocational assessment services. The engagement ensures a consistent and impartial approach of assessing whether an applicant is eligible for the supplemental retirement allowance.
Process after the Supplemental has been Granted:
Once a member is granted a disability retirement and the supplemental retirement allowance, under the SBCERA By-Laws there is a requirement of each member to sign a declaration stating that the member understands that the supplemental retirement allowance will continue only so long as the member is incapable of gainful employment. Members are required to execute the declaration semi-annually. In addition, the Board approved that no declaration will be required for those retired members who reach full retirement age as defined by the Social Security Administration. As of the December 2025 reporting period, 17 disabled retirees, who reached age 67, were exempted from signing the declaration form.
Use of Service
SBCERA currently makes use of a third party information services provider, which includes background check services. However, the contract explicitly states that the service may not be used as a condition for determining benefit eligibility. Therefore, using such a service solely to determine whether a member is working would violate the contract terms.
Procedural Safeguards
After viewing SBCERA’s current process, staff believes that appropriate safeguards are in place to help ensure members remain compliant with eligibility requirements and that benefits are administered in accordance with established policies and procedures.
1. The use of AEN to assist in determining whether a member is capable of gainful employment. This process supports compliance with eligible requirements by providing objective information that helps verify the member’s inability to engage in gainful employment, ensuring that the supplemental retirement allowance benefit is administered to only those who meet the established criteria.
2. The requirement for members to submit the declaration every six (6) months helps ensure ongoing compliance requirements.
3. The requirement that the declaration be signed under penalty of perjury strengthens compliance with eligibility requirements. By affirming accuracy of the information under penalty of perjury, the members are held legally accountable for their statement, which helps deter misrepresentation and supports the proper administration of the supplement disability retirement allowance benefit.
4. Self-reporting obligates members to promptly disclose any changes in their employment status or capacity to work. We had one case in 2024 where the member self-reported that she was capable of gainful employment and no longer wanted the benefit. As a result, the benefit was terminated.
Overall, the existing safeguards, including the use of AEN, the semi-annual declaration requirement, certification under penalty of perjury, and the self-reporting, collectively provide a comprehensive framework to ensure compliance with eligibility requirements for the supplemental disability retirement benefits. Based on our review, staff does not recommend modifying the process.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Superior Service Experience
STAFF CONTACT:
Barbara Hannah
ATTACHMENTS:
None.