Stiens v. Fire and Police Pension Ass'n
| Decision Date | 04 June 1984 |
| Docket Number | No. 82SA368,82SA368 |
| Citation | 684 P.2d 180 |
| Parties | Rudolph K. STIENS, John P. Hager, Ed Veglia, and William Baker, Plaintiffs- Appellants, v. FIRE AND POLICE PENSION ASSOCIATION; Castlewood Fire Protection District and Its Board of Directors; Castlewood Firemen's Pension Fund and Its Board of Trustees; City and County of Denver; Firemen's Pension Fund of the City and County of Denver; Police Pension and Relief Board of the City and County of Denver; Special District Association, Defendants-Appellees. |
| Court | Colorado Supreme Court |
Brauer & Buescher, P.C., Thomas B. Buescher, Dennis E. Valentine, Denver, for plaintiffs-appellants.
Tallmadge, Tallmadge, Wallace & Hahn, P.C., C. Thomas Bastien, Cynthia A. Calkins, Denver, for defendant-appellee Fire and Police Pension Assn.
Stephen H. Kaplan, City Atty., Darlene M. Ebert, Brian H. Goral, Asst. City Attys., Denver, for defendants-appellees Firemen's Pension Fund, and Police Pension and Relief Bd. of the City and County of Denver, and the City and County of Denver.
Calkins, Kramer, Grimshaw & Harring, Charles E. Norton, Matthew R. Dalton, Denver, for defendant-appellee Special Dist. Assn LOHR, Justice.
The plaintiffs, Colorado fire fighters and police officers first hired between April 8, 1978, and July 1, 1981, sought a declaratory judgment to establish that the Policemen's and Firemen's Pension Reform Law, as embodied in three acts, 1 was retroactive legislation as applied to them, and therefore unconstitutional. The defendants are various public bodies associated with the administration of public employees' pensions. Certain of the defendants filed motions to dismiss, and a motion for judgment on the pleadings. The trial court granted these motions, and directed entry of final judgment for the moving defendants pursuant to C.R.C.P. 54(b). 2 We affirm.
The plaintiffs' claim is based on a chronology involving three acts of the legislature and one decision by this court. The 1978 Act is the first of these. It resulted from a Colorado Legislative Council Committee study reporting that fire fighters' and police officers' pension funds statewide had estimated unfunded accrued liabilities of approximately $500,000,000, and was intended as an interim measure pending design of a more complete remedy. City of Colorado Springs v. State, 626 P.2d 1122, 1124 (Colo.1981). Its primary purpose is apparent from the legislative declaration, which stated that "the establishment of statewide actuarial standards regarding funded and unfunded liabilities of policemen's and firemen's pension funds established pursuant to [§§ 31-30-301 to -620, 12 C.R.S. (1977)] is a matter of statewide concern affected with a public interest ...." Ch. 98, sec. 1, § 31-30-802, 1978 Colo.Sess.Laws 446. The previous statutory scheme for Colorado fire fighters and police officers contained no requirement that the pension plans be actuarially sound. § 31-30-301 to -620, 12 C.R.S. (1977); Huff v. Mayor and City Council of Colorado Springs, 182 Colo. 108, 512 P.2d 632 (1973). To address this concern, the General Assembly in the 1978 Act created minimum funding standards increasing local contributions so that accrued unfunded pension liability would be reduced and eventually eliminated. 3 It increased the portion of state revenues earmarked for pension benefits. 4 It provided for an actuarial study of all police officers' and fire fighters' pension funds. 5 It created a Policemen's and Firemen's Pension Reform Commission comprised of legislators to develop proposed legislation to effect a more complete remedy. 6 Finally, in the provision central to this litigation, the General Assembly provided that none of the benefits of the previous statutory scheme would vest in employees hired after the effective date of the act:
Every employee employed as a fireman or policeman for the first time after the effective date of this [act] shall be covered by the benefit provisions set forth in or authorized by [the previous statutory scheme] until the creation of a new statewide retirement system in which he shall be a member but shall not be vested in any benefits provided or authorized by [the previous scheme]. Each employer shall notify any such employee of his limited rights under a pension plan created or authorized pursuant to [the previous scheme].
Ch. 98, sec. 1, § 31-30-804(9), 1978 Colo.Sess.Laws 446, 451. The 1978 Act was approved on April 7, 1978.
The 1979 Act, the second act among the three at issue, created the new statewide retirement system foreshadowed by the non-vesting provision in § 31-30-804(9), and by the 1978 Act as a whole. In the legislative declaration of the 1979 Act, the General Assembly reiterated its concern that police officers' and fire fighters' pension plans be actuarially sound. It also stated that the establishment of such pension plans was a matter of statewide concern, that the ability to pay earned benefits was a necessary corollary to this, and that state monies were to be contributed to such pension plans in recognition of current local financial burdens, not as a continuing obligation. Ch. 316, sec. 1, § 31-30-1001, 1979 Colo.Sess.Laws 1189. Accordingly, the legislature formed a fire and police pension association to administer the new system; created a fire and police members' benefit fund supported by employer, member and state contributions, existing funds, and other sources; provided for retirement, disability and survivor benefits; established procedures for adjustment and termination of benefits and return and transfer of contributions; and prescribed who was to be covered by the new system. In particular, with exceptions not relevant to this case, the 1979 Act stated that "every [police or fire] employer in this state shall provide the pension benefits of the [new system] for members hired on or after April 8, 1978," i.e., after the 1978 Act went into effect. Ch. 316, sec. 1, § 31-30-1003(1), 1979 Colo.Sess.Laws 1189, 1190. It also stated that "[e]very employee employed as a fireman or policeman for the first time after April 7, 1978, shall be covered by the benefit provisions set forth in or authorized by [the new system]." Ch. 316, sec. 14, § 31-30-804(9), 1979 Colo.Sess.Laws 1189, 1205. Pension plan members hired before April 8, 1978, were required to elect irrevocably between the previous scheme and the new system. Ch. 316, sec. 1, § 31-30-1003(3)(b), 1979 Colo.Sess.Laws 1189, 1191. The 1979 Act was approved on June 22, 1979, to take effect January 1, 1980.
In City of Colorado Springs v. State, 626 P.2d 1122 (Colo.1981), this court struck down the provisions of the 1978 Act mandating local contributions in excess of one mill to cover unfunded accrued pension liabilities. We held that they were retrospective laws contravening Article XV, Section 12 of the Colorado Constitution. We also held that imposing on municipalities sole liability for paying prospective current service costs of pension benefits attributable to current members was constitutional, but that the provisions in the 1978 Act creating such liability were nevertheless invalid because of an unseverability clause in that act. 7 We stated,
[t]he legislative intent could not be more free from doubt. Notwithstanding the intrinsic constitutionality of the requirement that municipalities bear prospective annual service costs of firemen's pension funds, that requirement is invalid because expressly declared not to be severable from the unconstitutional mandate that municipalities pay unfunded accrued liabilities of such funds.
Id. at 1130. Only the minimum funding standards increasing local contributions were challenged in that case. City of Colorado Springs was decided on December 15, 1980, and modified on denial of rehearing on March 23, 1981.
The 1981 Act, the third act at issue here, promulgated modified minimum funding standards in place of those in the 1978 Act declared unconstitutional or otherwise invalid in City of Colorado Springs. 8 It reiterated the legislature's concern that statewide actuarial standards be established. 9 It also provided that "[e]very employee employed as a fireman or policeman for the first time after April 7, 1978, shall be covered by the benefit provisions set forth in or authorized by [the new system]." 10 This is the same language as that employed in the 1979 Act. The 1981 Act was approved on June 10, 1981, to take effect July 1, 1981.
The plaintiffs reason that since part of the minimum funding standards in the 1978 Act were struck down as unconstitutional in City of Colorado Springs, and since other provisions in the 1978 Act setting forth minimum funding standards were declared invalid because of the unseverability clause in the act, it follows that the provision preventing the vesting of benefits under the previous statutory scheme in fire fighters and police officers hired after the effective date of the 1978 Act is also unseverable and invalid. They conclude that as a result the provisions in the 1979 Act and the 1981 Act incorporating these employees into the new system constitute retrospective legislation forbidden by Article II, Section 11 of the Colorado Constitution and ex post facto laws violating Article I, Section 10 of the United States Constitution. 11 Evaluation of this argument requires some discussion of the principles of severability.
Our analysis begins with this court's decision in City of Lakewood v. Colfax Unlimited Ass'n, 634 P.2d 52 (Colo.1981), where we held that
[a]s a general rule, if a statute or ordinance is constitutional in one part and unconstitutional in another, the constitutional provision may be sustained and the unconstitutional stricken.... Whether unconstitutional provisions are excised from an otherwise sound law depends on two factors: (1) the autonomy of the portions remaining after the defective provisions have been deleted and (2) the intent of the enacting legislative body.
It is clear...
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