Nat. Educ. Ass'n — Rhode Island v. Retirement Bd.
| Decision Date | 07 August 1997 |
| Docket Number | Civ. A. No. 94-0389L. |
| Citation | 972 F.Supp. 100 |
| Parties | NATIONAL EDUCATION ASSOCIATION — RHODE ISLAND, by its Secretary, Tia SCIGULINSKY, Rhode Island Federation of Teachers, by its Secretary, Coleen Bielecki, John Callaci, Diana Casey, Edward Casey, Jr., Robert Casey, Bernard Connerton, Richard Deorsey, Ronald Diorio, Denise Felice, Joseph Grande, Gloria Heisler, Karen Comiskey Jenkins, Robert Joy, Janice Lanik, Charlene Lee, Cornelius McAuliffe, Edward Mcelroy Harvey Press, Vincent Santaniello, Joan Silva, Bernard Singleton, Diane Thurber, and Jeanette Wooley, Plaintiffs, v. RETIREMENT BOARD OF THE RHODE ISLAND EMPLOYEES' RETIREMENT SYSTEM, Nancy Mayer, Chairperson and Treasurer of the Retirement Board of the Rhode Island Employees' Retirement System in her official capacity, and Joann Flaminio, Executive Director of the Retirement Board of the Rhode Island Employees' Retirement System in her official capacity, Defendants. |
| Court | U.S. District Court — District of Rhode Island |
Robert H. Chanin, Caroline Frederickson, Bredhoff & Kaiser, Washington, DC, William J. Lynch, Richard A. Skolnik, Skolnik, McIntyre & Tate, Providence, RI, Thomas J. Liguori, Jr., Urso, Liguori & Urso, Westerly, RI, for Plaintiffs.
Marc Gursky, Providence, RI, for Plaintiff-Intervenor Richard DeOrsey.
Alan M. Shoer, Neil F.X. Kelly, Attorney General's Office, Providence, RI, John C. Bartenstein, Theodore M. Hess-Mahan, Ropes & Gray, Boston, MA, Joanne McPhee, William S. Eggeling, Ropes & Gray, Providence, RI, for Defendants.
DECISION AND ORDER
In the present case, plaintiffs challenge the constitutionality of R.I. Gen. Laws §§ 36-9.1-1 to -2 (hereinafter the "Eviction Act"). Plaintiffs, employees and organizations that represent employees of the state "for the purposes of collective bargaining," were permitted to elect coverage by the Rhode Island Employees' Retirement System (the "Retirement System") pursuant to R.I. Gen. Laws § 36-9-33 in 1987. Despite the subsequent repeal of that provision, a judge of the Rhode Island Superior Court upheld plaintiffs' admission into the Retirement System. In 1994, however, the Rhode Island General Assembly (the "General Assembly") passed the Eviction Act, under which plaintiffs' participation in the Retirement System was terminated. Plaintiffs now assert that the Eviction Act, as applied, violates the Contract Clause, the Takings Clause, and the Due Process Clause of the United States Constitution.
The matter is presently before the Court on the parties' cross-motions for summary judgment pursuant to Rule 56(c) of the Federal Rules of Civil Procedure.1 For the reasons that follow, plaintiffs' motion for summary judgment is granted in part and denied in part. Defendants' motion for summary judgment is granted in part and denied in part.
In Nat'l Educ. Ass'n-Rhode Island v. Retirement Bd. of the Rhode Island Employees' Retirement Sys. ("NEA-RI"), 890 F.Supp. 1143 (D.R.I.1995), an opinion denying defendants' motions to dismiss, this Court set forth the background of the present controversy. The following statement recounts those facts, with the addition of all further factual development. The facts are undisputed, except as noted.
In 1936, the General Assembly established the Retirement System. 1936 R.I. Pub. Laws ch. 2334; R.I. Gen. Laws § 36-8-2. State employees, public school teachers, and employees of participating municipalities who otherwise meet the eligibility requirements are able to participate in the Retirement System. See R.I. Gen. Laws § 36-9-2 (state employees); § 16-16-2 (public school teachers); § 45-21-8 (municipal employees). Provisions governing the Retirement System are currently codified in title 36, chapters 8-10 of the General Laws of Rhode Island.
Defendant Retirement Board of the Rhode Island Employees' Retirement System (the "Retirement Board") bears responsibility for the general administration and operation of the Retirement System. See R.I. Gen. Laws § 36-8-3. Defendant Nancy J. Mayer, in her capacity as the General Treasurer of Rhode Island, serves as the ex-officio chair of the Retirement Board and as custodian of the funds and treasurer of the Retirement System. See R.I. Gen. Laws § 36-8-9.
The Retirement System is a "defined benefit" plan.2 Therefore, benefits paid to a participating employee are calculated as a percentage, determined by the number of years of credited service, of the average of his or her three highest consecutive years of compensation, multiplied by his or her years of service. See R.I. Gen. Laws § 36-10-10. Employees participating in the Retirement System must contribute a fixed percentage to the Retirement System. R.I. Gen. Laws. § 36-10-1.
Pursuant to R.I. Gen. Laws § 36-10-9, participating employees may retire and begin receiving benefits after (a) reaching the age of sixty and completing ten years of service, or (b) completing twenty-eight years of service. Section 36-10-7 of Rhode Island General Laws provides that "it is the intention of the state" to make the required payments in accordance with these provisions.
On July 3, 1987, after repeated attempts to pass similar bills, the General Assembly enacted R.I. Gen. Laws § 36-9-33, which authorized certain private-sector employees to participate in the Retirement System. In accordance with § 36-9-33(a), "full-time employees or organizations representing employees of the state and/or any political subdivision thereof for the purposes of collective bargaining" were admitted to the Retirement System, provided that coverage was properly elected. In addition, pursuant to R.I. Gen. Laws § 36-9-33(b), such employees were permitted to purchase credit for past years of service as full-time union employees.3
Pursuant to § 36-9-33(a), plaintiffs National Education Association — Rhode Island ("NEA-RI") and Rhode Island Federation of Teachers ("RIFT") elected coverage by the Retirement System. In addition, certain union employees, currently the individual plaintiffs in the present action, filed applications with the Retirement Board.
On June 6, 1988, however, the General Assembly repealed § 36-9-33. See 1988 Pub. Laws ch. 486 ("Repeal Statute"). At that time, the applications of the individual plaintiffs were pending before the Retirement Board. Based on the repeal of § 36-9-33, the Retirement Board deemed plaintiffs ineligible to participate in the Retirement System, and, therefore, the individual plaintiffs were not allowed to accrue future service credits in the Retirement System or to purchase additional service credits.
On October 20, 1988, NEA-RI, RIFT, and other organizational and individual plaintiffs filed a suit against the Retirement System and the Executive Director of the Retirement Board in Rhode Island Superior Court, claiming that they were entitled to join the Retirement System since they had filed their applications for admission while § 36-9-33 was still in effect. On December 11, 1986, a judge of the Rhode Island Superior Court agreed that the repeal of § 36-9-33 was merely prospective in nature. In addition, on April 23, 1990, the same Superior Court judge, responding to a Petition for Clarification and/or Instructions, held that the individual plaintiffs "shall be treated as becoming members of the Retirement System as of ... January 1, 1990." Neither decision was appealed, and, therefore, the Superior Court judgments became final.
Pursuant to those judgments, the individual plaintiffs were admitted as members of the Retirement System on January 1, 1990. On that date, NEA-RI and RIFT and its affiliates became employers in the Retirement System and were required to contribute to the Retirement System in accordance with § 36-9-33(a). In addition, the individual plaintiffs either began or continued to contribute to the Retirement System and/or purchased past service credits in the Retirement System pursuant to § 36-9-33.4
On June 16, 1991, the General Assembly passed an amendment to the Retirement System providing that "no member shall be eligible for pension benefits ... unless the member shall have been a contributing member of the employee's retirement system for at least ten (10) years." However, the 1991 amendment had a "grandfather" clause, providing that a person who had ten years of service credit as of that date "shall be vested." See § 36-10-9(c) (1991).
On July 15, 1994, the General Assembly enacted two identical bills, each entitled "An Act Relating to Public Officers and Employees — Evicting Non-Employee and Non-Teacher Members from the Retirement System," codified as R.I. Gen. Laws §§ 36-9.1-1 to -2 (the "Eviction Act").5 The Eviction Act provides, in pertinent part:
[a]ny individual who became a member of the Retirement Systems based solely on § 36-9-33 (repealed), or who purchased credit in the Retirement Systems based upon § 36-9-33 (repealed), shall no longer be entitled to such membership and/or such credit(s) and shall no longer receive any benefits of any type from said Retirement Systems which was based upon § 36-9-33 (repealed).
When the Eviction Act was enacted, the status of each individual plaintiff was different with respect to the Retirement System. The participation of the individual plaintiffs in the Retirement System is as follows:6
A. Retirees before July 1994:
Edward Casey, Jr.:
Edward Casey, Jr. was employed as a field representative and executive secretary for RIFT from March of 1970 to December of 1992. Pursuant to § 36-9-33(b), Casey purchased thirty years and twenty-three days worth of service credit for $28,351.69. He retired in December 1992 at fifty-six years of age.
After his retirement, Casey continued to work for RIFT as a consultant at a rate of one hundred dollars per hour.
Bernard Connerton:
Bernard Connerton worked at NEA-RI from November of 1973 until July 28, 1990. Connerton purchased twenty years, eight months, and twenty-seven days of service credit in the...
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National Educ. Association-Rhode Island ex rel. Scigulinsky v. Retirement Bd. of Rhode Island Employees' Retirement System
...decided the heart of the case in a detailed and lucid opinion on August 7, 1997. See National Educ. Ass'n-R.I. v. Retirement Bd. of R.I. Employees' Retirement Sys., 972 F.Supp. 100 (D.R.I.1997) ("NEA II "). The decision resolved all legal issues but reserved for later disposition a few fact......