Attorney General's Opinion
Attorney General, Richard Blumenthal
May 1, 2002
Director, Retirement and Benefit Services Division
Office of the Comptroller
55 Elm Street
Hartford, CT 06106-1775
Dear Mr. Weinberger:
You have requested our opinion as to whether certain provisions of the retirement plan for state employees are preempted by federal law. In particular, you inquire as to the enforceability of state statutory and contractual provisions prohibiting those who qualify for military pensions from purchasing retirement credit for military service during war or national emergency. Our response is that federal law, in particular section 10 U.S.C. 12736, preempts any state retirement plan provision that prohibits an employee who is eligible to receive a military pension from purchasing credit for years of active military service.
It is important to clarify at the outset that your request concerns only those individuals who are seeking to purchase credit for active duty served before state employment, who are also entitled to military pensions for a combination of active and reserve military service. With regard to these individuals, section 10 U.S.C. 12736 governs the relationship between federal and state pension plans.
Section 10 U.S. 12736 reads as follows:
Several sections of the State Employees’ Retirement Act, Conn. Gen. Stat. §§ 5-152 to 5-192x, and of SEBAC agreements, which also govern retirement benefits under that act, are in apparent conflict with section 10 U.S.C. 12736. See Conn. Gen. Stat. §§ 5-180(b), 5-192i(j), 5-192j(d); Appendix B of SEBAC V.
Section 5-192i(j), as well as Conn. Gen. Stat. §§ 5-180(b), 5-192j(d) and Appendix B of SEBAC V, permit the purchase of state retirement credit for military service performed in time of war or national emergency. However, this option may not be exercised if the military service is creditable under any other pension plan. For example, Conn. Gen. Stat. §§ 5-192i(j) provides, in relevant part, as follows:
Conn. Gen. Stat. § 5-192i(j). (emphasis added).
Your inquiry concerns those State Employees’ Retirement System (SERS) members who are eligible for federal military pensions. The above-cited statutory and contractual provisions will prevent them from receiving state retirement credit for their active duty military service unless these provisions are preempted by section 10 U.S.C. 12736.
The United States Supreme Court has held "[a] fundamental principle of the [U.S.] Constitution is that Congress has the power to preempt state law [under the Supremacy Clause] Art. VI cl. 2." Crosby v. National Foreign Trade Council, 530 U.S. 363, 372 (2000); accord, English v. General Electric Co., 496 U.S. 72, 78 (1990). The Court has defined three situations in which federal preemption occurs.
First, Congress may explicitly state in the relevant federal statute that the states are not to legislate in the area covered by that statute. Geier v. American Honda Motor Co., Inc., 529 U.S. 861, 867-68 (2000); English, 496 U.S. at 78. Second, the courts will find preemption when Congress has manifested an intent to occupy exclusively the field of law in issue, preempting even state laws that do not actually conflict with federal law. Crosby, 530 U.S. at - , 120 S.Ct. at 2293; California v. ARC American Corp., 490 U.S. 93, 100 (1989). Third, "even if Congress has not occupied the field, state law is naturally preempted to the extent of any conflict with a federal statute." Crosby, 530 U.S. at 372; English, 496 U.S. at 79. Actual conflict with federal law can arise in two instances: (1) "where it is impossible for a private party to comply with both state and federal law and [(2)] where, ‘under the circumstances of a particular case, the challenged state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’" Crosby, 530 U.S. at 372-73 (alteration in original) (citations omitted) (quoting Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142-43 (1963) and Hines v. Davidowitz, 312 U.S. 52, 67 (1941)).
Several federal courts have found that section 10 U.S.C. 12736 preempts state statutes preventing those eligible for military pensions from purchasing retirement credit for active military service. Cantwell v. County of San Mateo, 631 F.2d 631 (9th Cir. 1980) cert. denied, 450 U.S. 998 (1981)); Almeida v. Retirement Board of the Rhode Island Employees Retirement System, 116 F.Supp. 2d 269 (D.R.I. 2000); Arrington v. Florida, 1985 U.S. Dist. LEXIS 14131 (N.D. Fla. Nov. 5, 1985). We did not find any contrary precedent on this issue. No federal court in the Second Circuit, which covers Connecticut, has yet examined this question in any reported decision.
The Cantwell, Almeida, and Arrington courts found a direct conflict between section 10 U.S.C. 12736 and those portions of state retirement plans which prevented members entitled to military pensions from obtaining credit for active military service. This finding was based on their conclusion that the Congressional intent behind section 12736 would be frustrated if such plan provisions were allowed to stand.
The Almeida court held:
Almeida, 116 F.Supp at 276; accord, Cantwell, 631 F.2d at 635; Arrington, 1985 U.S. Dist. LEXIS at *7. The conclusion that 10 U.S.C. § 12736 directly conflicted with the state retirement plan provisions at issue led the Almeida, Cantwell, and Arrington courts to find these provisions preempted under the Supremacy Clause.
The situation you present regarding SERS is indistinguishable from that in Almeida, Cantwell, and Arrington. We therefore find the analysis and conclusions of these cases to be persuasive authority supporting preemption. A finding of preemption is also consistent with a prior opinion of this office issued on August 12, 1981, to John Shears, Secretary of the Teachers’ Retirement Board. 1981 W.L. 157490. In that opinion, the Attorney General concluded that 10 U.S.C. § 1336 (now 10 U.S.C. § 12736) preempted section 10-183e(b) of the State Teachers’ Retirement Act. That section, like the provisions at issue, prohibited purchase of credit for military service if the member was entitled to receive credit for this service in the military pension system. We see no reason to stray from this well-trodden and well-reasoned path. We therefore conclude that all provisions in the state employees’ pension plan that prohibit the purchase of retirement credit for active military service, based on entitlement to federal pension benefits, are preempted.
You have also inquired as to the effective date of preemption by section 10 U.S.C. 12736. This statute was passed in 1956, well before the inception of any state plan provision at issue. The conflict between these state provisions and federal law therefore existed from the former’s creation. We must, thus, conclude that these portions of the state retirement plan were preempted ab initio.1
In conclusion, section 10 U.S.C. § 12736 preempts the application of any state retirement plan provision that prohibits purchase of years of active military service, served prior to state employment, based on entitlement to credit for these years under the military pension plan. This preemption was in effect from the effective date of the state plan provisions. Therefore, the State Employee’s Retirement Commission may not deny the right to purchase credit for this service, if this denial is based solely on a member’s qualification to receive credit for the same years of service under the military pension plan.
Very truly yours,
Assistant Attorney General
1It should be noted, however, that federal courts have upheld state procedural limits on the award of retirement credit for prior military service. Sawyer v. County of Sonoma, 719 F.2d 1001 (9th Cir. 1983); Cantwell, 631 F.2d at 637-38. These courts have permitted the denial of retirement credit to applicants failing to follow procedural requirements uniformly imposed on the purchase of retirement credit.
The Sawyer and Cantwell courts ruled that section 12736 only prohibits denial of retirement benefits for years of active military service if that denial is based solely on the applicant’s qualification for a military pension. The courts therefore upheld denial of retirement credit based on the failure to request these credits within the time frame prescribed for such requests.
The courts based their bar of untimely requests on the language of section 12736, which requires granting retirement credit for military service only "if that service is otherwise properly credited under it [the state retirement plan]," 10 U.S.C. § 12736. Sawyer, 719 F.2d at 1004-06; Cantwell, 631 F.2d at 637-38. According to these courts, to be “otherwise properly credited” under the retirement systems at issue, the service had to be requested in the form and time frame specified by the retirement plan. Therefore, requests that were made only after a court established section 12736 preemption were properly denied for failure to meet the general retirement plan deadlines for such requests.
As your inquiry does not reach this issue, we decline to opine on the applicability of these legal conclusions to the Connecticut retirement system. We note, however, that the Cantwell and Sawyer opinions cannot be interpreted as a broad grant of authority to deny untimely requests to purchase the retirement credits covered by this opinion. Even if the rule articulated in these opinions is followed, procedural limitations could be imposed on SERS members seeking the purchase of such credits only to the extent they would be imposed on members seeking to purchase other retirement credits. If time limits would be waived for others under the circumstances pertinent to this opinion, they would have to be waived as well for those who declined to assert formally their claims to military service credit in the face of contrary state practice and plan provisions.