Montgomery County Councilmember Duchy Trachtenberg on Tuesday, July 27, will introduce Bill 45-10 that would further reform disability retirement provisions for certain County employees by creating a two-tier service-connected disability retirement system with benefits for partial incapacity and total incapacity. This system would be identical to the system currently in place for members of the Montgomery County Career Fire Fighters Association. Bill 45-10, which is co-sponsored by Councilmembers Phil Andrews and Roger Berliner, would create the system for all other County employees.
Under provisions of the bill, a County employee who retires due to service-connected disability would receive either a partial incapacity benefit of at least 52.5 percent of final earnings or a total incapacity benefit of at least 70 percent of final earnings. The current system for all employees, except fire and rescue employees, provides for a service-connected disability retirement benefit of at 66.7 percent of final earnings for both partial and total incapacity.
Under the bill, an employee would be eligible for a total incapacity benefit if the employee was unable to perform any substantial gainful activity because of an impairment that is unlikely to resolve in the next 12 months and may be permanent. An employee would be eligible for a partial incapacity benefit if the impairment prevents the employee from performing one or more of the essential functions of the employee’s position, but does not prevent the employee from performing any other substantial gainful activity.
A public hearing on the bill is tentatively scheduled for Sept. 28.
“As we continue our efforts to reinforce a strong fiscal foundation for the County’s future, we must implement a multi-tiered structure for our disability retirement system that makes good fiscal sense and that is transparent and accountable,” said Councilmember Trachtenberg, who is the lead sponsor of Bill 45-10 and is chair of the Council’s Management and Fiscal Policy Committee. “And, of course, it must effectively support the medical needs of those of our employees who need it. I have come to the same conclusion as County Executive Ike Leggett that the only way to reform the system is with decisive legislative action.”
In 2009, the Council unanimously approved amended Bill 37-08 that reformed the County’s Disability Retirement Law, but that legislation, which was proposed by Councilmembers Andrews and Trachtenberg, was approved with amendments that eliminated provisions for a two-tier system.
According to the County’s Office of Human Resources, as of May 2009, only 10 of the 67 fire and rescue employees who received service-connected disability retirement since their two-tiered system began in 2000 were awarded the higher 70 percent benefit. Eighty-five percent of the awards were at the lower 52.5 percent level. Mercer, the County’s actuary, estimated that the County would save more than $2.6 million each year in the County’s retirement contribution if it extended the two-tier system to all employees.
"Last May, the Council took important first steps in reforming the County's disability retirement system by requiring independent medical exams, a more qualified and independent medical review panel, and mandatory reviews to determine continued eligibility for a disability pension,” said Councilmember Phil Andrews, who chairs the Council’s Public Safety Committee. “The Council opted to see if labor negotiations that began last fall would produce agreement on a two-tier retirement system, but nothing came of them. Now, the Council needs to act to reform the disability retirement system so that disability retirement benefits reflect the difference between injuries that are partial disabling and those that are fully disabling."
Councilmember Berliner, who also is a member of the Public Safety Committee, said: “It has been my hope that this issue would have been resolved by the parties in the collective bargaining process. A resolution to this problem is long past due and this legislation is a major step in the right direction.”
Councilmembers Trachtenberg and Andrews have advocated reform of the County’s disability retirement program since a September 2008 report was issued by the County’s Inspector General showing that a much greater percentage of Montgomery County police officers are awarded disability retirement than are workers in similar positions in neighboring jurisdictions.
Bill 45-10 also would prohibit the award of a service-connected disability to an employee who “has committed an offense that would justify removal for cause.” That provision also was in the original version of Bill 37-08, but was not enacted in the final version of the bill.
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