CMS asks NC Supreme Court to reverse ruling on campus police retirement benefits

Charlotte-Mecklenburg Schools is asking North Carolina’s highest court to reverse a lower court order that would force the school system to pay additional retirement benefits for campus police.

A unanimous state Court of Appeals panel determined in February 2024 that CMS must pay into a state retirement fund to cover those officers. The state Supreme Court agreed in December to take the case.

“The issue in this case is whether a school board that employs campus police officers is considered an ‘employer’ that is required to make a mandatory 5% contribution to the Supplemental Retirement Income Plan under N.C. Gen. Stat. § 143-166.50(e),” CMS lawyer Terry Wallace wrote in a brief filed Thursday.

“Section 143-166.50 is a benefits statute that only applies to counties, cities, and towns and their employees who participate in the Local Governmental Employees’ Retirement System (‘LGERS’). The mandatory 5% employer-funded contribution under Section 143-166.50(e) is a LGERS feature applicable to cities, counties, and towns, and the mandatory contributions are funded by city and county sales taxes. CMS is not a LGERS employer, and Plaintiffs are not LGERS members,” the court filing continued.

A trial judge agreed with CMS, but the Appeals Court overruled that decision, “concluding that CMS was an ‘employer’ under the statute because it was a ‘political subdivision of the State’  and because N.C. Gen. Stat. § 143-166.50(e) contained no language limiting the supplemental benefits to only LGERS members,” Wallace explained.

“In essence, the Court of Appeals decision ignored the will of the General Assembly and allowed Plaintiffs to leapfrog from one benefits statute to another,” he added. “The decision has now, by judicial fiat, created a new class of beneficiaries under the statute by essentially shoehorning Plaintiffs into a benefits statute that does not apply to them.”

“It now forces CMS, a non-revenue generating entity, to bear the brunt of making monetary contributions that it was never legislatively required to make,” Wallace argued.

“The broader statutory context of section 143-166.50 along with its legislative history shows that the legislature intended to limit the statute to LGERS participants and had no intent to include school boards, including CMS,” he wrote.

The 2024 Appeals Court ruling reversed part of a lower court’s decision against officers who filed suit against CMS in 2019.

The appellate decision would force the school system to pay 5% of the plaintiffs’ monthly compensation to the Supplemental Retirement Income Plan established in state law. But the unanimous appellate panel rejected a separate argument that a retired officer was entitled to a “special separation allowance” set up in another section of state law.

A 2009 state law allowed Charlotte-Mecklenburg to establish its own “campus police agency.”

“Plaintiffs contend the trial court erred in declaring they are not entitled to the Supplemental Retirement Income Plan under N.C. Gen. Stat. § 143-166.50(e),” wrote Judge Toby Hampson. “Defendant contends Plaintiffs are not entitled to this benefit because, consistent with the trial court’s conclusions, it is not an employer as contemplated by the statute as Plaintiffs should not be deemed law-enforcement employees of ‘a county, city, town or other political subdivision of the State.’”

But “our Courts have historically recognized local Boards of Education to be political subdivisions of the State,” Hampson added. “Thus, Defendant — a county board of education — is a political subdivision of the State. Therefore, Defendant falls under the definition of employer provided in N.C. Gen. Stat. § 143-166.50(a)(2). Consequently, the trial court erred in concluding Plaintiffs were not law-enforcement officers employed by a local government employer under N.C. Gen. Stat. § 143-166.50(e).”

Appellate judges also rejected the school board’s argument that its officers were ineligible for the retirement funding because they were not enrolled in the Local Government Employees Retirement System.

“[T]he plain language of subsection (e) contains no language limiting the supplemental benefits to only LGERS members,” Hampson wrote. “To the contrary, its plain language unequivocally provides: ‘As of January 1, 1986, all law-enforcement officers employed by a local government employer, are participating members of the Supplemental Retirement Income Plan as provided by Article 5 of Chapter 135 of the General Statutes.’ As such, Plaintiffs — law-enforcement officers — employed by Defendant — a local government employer — are participating members in the Supplemental Retirement Income Plan provided for by Article 5 of Chapter 135 of the General Statutes.”

“Plaintiffs are eligible for the Supplemental Retirement Income Plan provided for under Section 143-166.50(e), and Defendant is required to pay the 5% contribution under the statute,” Hampson added.

Appellate judges rejected the officers’ arguments in favor of the “special separation allowance.” “Here, unlike the Supplemental Retirement Income Plan, the Special Separation Allowance is expressly premised on membership in — and upon retirement from — LGERS.”

Officers involved in the suit are enrolled instead in a different retirement system, the Teachers and State Employees Retirement System.

Charlotte-based lawyer John Gresham explained the officers’ complaint in a February 2023 brief filed at the Appeals Court.

“After the Plaintiffs, experienced law enforcement officers, were employed on the CMS police force, they learned that CMS was not making the required contributions to the Supplemental Retirement Income Plan,” Gresham wrote. “Since 2015 the officers had sought this benefit to no avail.”

“In February of 2019 the Plaintiffs retained the undersigned counsel,” Gresham added. “Counsel then wrote to the school system’s general counsel and set out the statutory basis for the officers’ entitlement to the Supplemental Retirement Income Plan and for the retired officers the Special Separation Allowance. The general counsel failed to respond and, after a second letter to the general counsel which enclosed a draft complaint also failed to elicit a response, this lawsuit was filed.”

“CMS is the only police force in … North Carolina where the officers do not receive these benefits,” Gresham argued.

Judges Hunter Murphy and April Wood joined Hampson’s decision.

The post CMS asks NC Supreme Court to reverse ruling on campus police retirement benefits first appeared on Carolina Journal.