DISTRICTS ‑- PORT ‑- EMPLOYEES ‑- CONTRACT FOR ADDITIONAL PENSION PROGRAM

DISTRICTS ‑- PORT ‑- EMPLOYEES ‑- CONTRACT FOR ADDITIONAL PENSION PROGRAM.

Under the provisions of RCW 53.08.170 a port district may contribute to an additional pension program established by contract between a trade association acting as collective bargaining agent for various employers including a port district and a labor union representing, among others, certain employees of the port district even though the eligible employees of said port district are members of the Washington State Employees' Retirement System.

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                                                                February 20, 1961

Honorable John A. Petrich
State Senator, 26th District
1915 North Cedar
Tacoma, Washington

                                                                                                                Cite as:  AGO 61-62 No. 12

Dear Sir:

            By letter previously acknowledged you have requested an opinion of this office on the question which we paraphrase as follows:

            May a Port District, the eligible employees of which have become members of the Washington State Employees' Retirement System pursuant to RCW 41.40.410, contribute to an additional pension program established by contract between a trade association acting as collective bargaining agent for various employers including the subject Port District, and a labor union representing, among others, certain employees of the Port District?

            It is our opinion that, with reference to the structure of the particular additional pension program which you have submitted for our consideration, this question may be answered in the affirmative for the reason set forth in our analysis.

             [[Orig. Op. Page 2]]

                                                                     ANALYSIS

            This office has previously had occasion to consider a number of aspects of the problem of participation by various classes of municipal corporations in the State Employees' Retirement System, as well as the related problem of participation by such municipal corporations in pension programs other than the aforesaid state employees' program.  Of particular significance in relation to the problem here presented are the following previous rulings:

            (1) A Port District is a political subdivision of the state and thus is eligible to participate in the state employees' program pursuant to RCW 41.40.410 (relating to optional entry into the State Employees' Retirement System by political subdivisions).  Attorney General's Opinion dated August 20, 1947, to the Chairman of the Washington State Employees' Retirement System [[1947-48 OAG 59a]].

            (2) In establishing the state employees' program, however, the legislature did not intend to preempt the pension field so as to limit such authority as a particular type or class of political subdivision might have to participate in some other pension program.  AGO 57-58 No. 223, dated October 28, 1958, to the Prosecuting Attorney of Spokane County.

            (3) The question of whether a particular class or type of political subdivision may participate in a pension program other than the state employees' program is to be determined by reference to the statutory provisions authorizing the formation and operation of the type or class of political subdivision in question.  AGO 57-58 No. 223,supra.

            Copies of the noted opinions are enclosed herein.

            In other words, a Port District may participate in the State Employees' Retirement System, but its eligibility to do so does not constitute a limitation on such authority as it may otherwise have been granted to participate in some other pension program.  We do not believe that the picture is in any way altered by actual entry into the State Employees' Retirement System of a Port District; that is to say, an examination of the statutes governing the State Employees' Retirement System (RCW 41.40.010 through 41.40.440) reveals nothing which, in our opinion, would prevent a political subdivision such as a Port District, which has actually elected to participate in the state employees' pension program from additionally exercising, or continuing to exercise such independent statutory authority as it may have to participate in some other pension program.

             [[Orig. Op. Page 3]]

            We do not presently pass upon the question of what effect certain forms of Port District participation in an additional pension program might have upon the eligibility of certain of its employees for membership in the State Employees' Retirement System, in view of RCW 41.40.120 (4) excluding from membership in the State Employees' Retirement System those employees holding membership in, or receiving pension benefits under, "any retirement plan operated wholly or in part by an agency of the state or political subdivision thereof, . . ."  It does not appear from the documentary materials which you have submitted that the particular additional pension program here in question is one which would be deemed to be operated wholly or in part by the political subdivision, i.e., the Port District, desiring to participate therein.  Rather, it appears to be a pension program presently in existence pursuant to a contract between a trade association representing various employers of machinists and a labor union to which said machinists belong; namely, the International Association of Machinists, Local No. 297.  The program is being administered by a board of six trustees, three of whom are selected by the trade association and three of whom are selected by the union.  As we understand it, the Port District is being called upon to participate in a program only by way of making the employer contributions as called for pursuant to the agreement under which the program was established.

            Consequently, the only remaining question is whether there in fact exists independent statutory authority for such participation.

            An examination of the statutory provisions relating to the formation and operation of Port Districts reveals that the legislature has granted to such districts broad powers relative to employment, and has expressly granted to such districts the power to provide various fringe benefits, including pension benefits, to its employees by several alternative methods.  The pertinent statutory provisions are contained in RCW 53.08.170, as follows:

            "The port commission shall have authority to create and fill positions, to fix wages, salaries and bonds thereof, to pay costs and assessments involved in securing or arranging to secure employees, and to establish such benefits for employees, including holiday pay, vacations or vacation pay, retirement and pension benefits, medical, surgical or hospital care, life, accident, or health disability insurance, and similar benefits, already established by other employers of similar employees, as the port commissioner shall by resolution provide.  The port commission shall have authority [1] to provide or pay  [[Orig. Op. Page 4]] such benefits directly, or [2] to provide for such benefits by the purchase of insurance policies or entering into contracts with and compensating any person, firm, agency or organization furnishing such benefits, or [3] by making contributions to vacation plans or funds, or health and welfare plans and funds, or pension plans or funds, or similar plans or funds,already established by other employers of similar employees and in which the port district is permitted to participate for particular classifications of its employees by the trustees or other persons responsible for the administration of such established plans or funds. . . ." (Emphasis supplied.)

            The additional pension program in question, as above outlined, appears to be one which would involve the making of contributions by a Port District to a pension plan already established by other employers of similar employees, in accordance with the third alternative method for providing pension benefits set forth in the above statute.  Consequently, it is our conclusion that a Port District is authorized to participate in this particular program.  For the reasons previously stated, we believe that such participation would be proper even though the Port District desiring to so participate had previously entered into the State Employees' Retirement System, pursuant to RCW 41.40.410.

            We trust that the foregoing will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

PHILIP H. AUSTIN
Assistant Attorney General