STATE EMPLOYEES RETIREMENT SYSTEM ‑- COUNTY EMPLOYEE MEMBERS ‑- OASI COVERAGE ‑- REFERENDUM AND GENERAL PROCEDURE

STATE EMPLOYEES RETIREMENT SYSTEM ‑- COUNTY EMPLOYEE MEMBERS ‑- OASI COVERAGE ‑- REFERENDUM AND GENERAL PROCEDURE

County Commissioners may request referendum of county employees under state employees retirement system as to whether they desire OASI coverage.General procedure for obtaining such coverage outlined.

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                                                                    July 15, 1955

Honorable Charles O. Carroll
Prosecuting Attorney
King County
County-City Building
Seattle 4, Washington                                                                                                              Cite as:  AGO 55-57 No. 116

Attention:  Mr. K. G. Smiles, Chief Civil Deputy

Dear Sir:

            You have requested the opinion of this office on the following question:

            "Does the Board of King County Commissioners as the governing body of King County have the authority to request the Governor to Authorize a referendum of King County employees on the question of whether they wish to be covered under the Federal Social Security Act as appears to be provided in Section 3 (3) of ch. 4 of the 1955 Ex. Sess.?"

            You ask also that we outline the procedure to be followed by the County Commissioners in order to make OASI coverage available for county employees.

             [[Orig. Op. Page 2]]

            An additional inquiry as to employer contributions for the benefit of county hospital employees who might be covered by OASI has been treated by separate opinion.

            It is our conclusion that the King County Commissioners may request such a referendum, as a step in the procedure summarized below.

                                                                     ANALYSIS

            1.The Referendum.  We are informed that the employees of King County are members of the State Employees Retirement System.  Until this year § 218 (d) of the Social Security Act [U.S.C.A. Title 42, § 418 (d)] precluded OASI coverage for such employees.  Public Law 761, enacted by the 83rd Congress in 1954, amended that section to permit such coverage under certain conditions.  Chapter 4, Laws of 1955, Ex. Sess., as stated in § 1 thereof, was passed to enable public employees in our state to take advantage of this change.

            Under § 418 (d) (3) of Title 42 RCW a favorable vote in a referendum by members of a particularretirement system is one of the conditions which must be met to obtain OASI coverage.  This is the referendum authorized by subsections 3 (3) and 3 (4) of chapter 4 [RCW 41.48.030].  § 418 (d) (6) provides that

            "If a retirement system covers positions of employees of the State and positions of employees of one or more political subdivisions of the State * * * then, for purposes of the preceding paragraphs of this subsection,there shall, if the State so desires, be deemed to be a separate retirement system with respect to any one or more of the political subdivisions concerned and, where the retirement system covers positions of employees of the State, a separate retirement system with respect to the State or with respect to the State and any one or more of the political subdivisions concerned.  * * * [Emphasis ours]

            King County is of course a political subdivision within the definitions of § 418 (b) (2) and § 2 (5) of chapter 4.  The latter subsection states that

             [[Orig. Op. Page 3]]

            "* * * Such a subdivision may elect to accept federal OASI coverage under this chapter."

            The senate Finance Committee Report on the effect of § 418 (d) (6), in 18 U.S. Code Congressional and Administrative News 6864, said that

            "The bill amends the provision of the House bill so a State may consider any political subdivision or any combination of political subdivisions as having a separate retirement system for the purposes of the referendum.  * * *"

            In the same Report at p. 6901 the Committee said

            "* * * The members of each such group deemed to be a separate retirement system would vote in a separate referendum and would be covered or excluded as a single group.  * * *"

            Thus under § 418 (d) (6) our legislature was free to require a single referendum for an entire system or to permit members of the system employed by a subdivision to accept or reject OASI coverage on a local basis.

            The legislature chose the second course, as shown by subsection 3 (3) of chapter 4, which provides in relevant part that:

            "* * *If a retirement system covers positions of employees of the state of Washington, the university of Washington, the state college of Washington and the several colleges of education, and positions of employees of one or more of the political subdivisions of the state, then for the purpose of the referendum as provided herein, there may be deemed to be a separate retirement system with respect to any one or more of the political subdivisions, or institutions of higher learning (excluding members of the state employees retirement system), named herein and the governor shall authorize a referendum upon request of the subdivisions' or institutions' of higher learning governing body:  * * *" [Emphasis supplied]

             [[Orig. Op. Page 4]]

            The State Employees Retirement System clearly falls within the descriptive portion of the subsection.  The parenthetical exclusion, because of its punctuation and because under the rule ofDavis v. Gibbs, 39 Wn. (2d) 481, it must apply to the last possible antecedent, means only that a separate referendum could not be held among members of the State Employees Retirement System employed by an institution of higher learning.

            It follows that the King County Commissioners may request a separate referendum for county employees on the question of OASI coverage.

            2.The Procedure. The first step in the extension of OASI coverage to county employees now under the State Employees Retirement System is the formulation and submission by the System to the Governor of a plan under § 5 (1) for handling the procedural details.  As explained in AGO 55-57 No. 115, addressed to the State Auditor on July 15, 1955, a copy of which is attached, the county itself could not submit such a plan.  The legislature evidently intended that a single plan should apply to all members of a system, whether employed by the state or by a subdivision.  The situation in this respect is the same as that produced for municipal employees by the first proviso of subsection 3 (3):

            "* * * That any city or town affiliated with the statewide city employees retirement system organized under RCW 41.44 may at its option agree to a plan submitted by the board of trustees of said statewide city employees retirement system for inclusion under an agreement under this chapter * * *"

            The second step is approval of the plan by the Governor pursuant to § 5.  Legislative approval of the plan in so far as county employees are concerned would not be required under subsection 5 (1) (d).  See AGO 55-57 No. 81, addressed to Senator Ryder on May 25, 1955, a copy of which is also attached.

            The third step is approval of the plan by the county commissioners.  Subsection 3 (4) provides that

             [[Orig. Op. Page 5]]

            "The governor,before authorizing a referendum, shall require the following conditions to be met:

            "* * *

            "(f) The state legislature, in the case of a referendum affecting the rights and liabilities ofstate employees covered under the state employees' retirement system and employees under the teachers' retirement system, andin all other cases the local legislative authority or governing body, shall have specifically approved the proposed plan and approved any necessary structural adjustment to the existing system to conform with the proposed plan."  [Emphasis supplied]

            The other conditions are such that they can be met only in the actual conduct of the referendum.  Local approval of the plan is possible before the referendum, and "shall have" been given.  Thus employees will be able to vote on the basis of an approved plan.

            The fourth step is logically the request for a referendum, although the request might be made at an earlier stage subject to completion of the intervening requirements.

            The fifth step is of course the holding of a referendum among the King County employees under the conditions of subsection 3 (4).  Upon a favorable vote the Governor and the Secretary of Health, Education, and Welfare could execute or extend an agreement to effect the indicated OASI coverage.

            The statutory procedure as outlined above will undoubtedly require a considerable amount of consultation and cooperation between the subdivisions involved and the Retirement System.  We hope that the foregoing analysis will prove helpful in this connection; and we will of course be happy to assist you in any other way to insure that the employees  [[Orig. Op. Page 6]] of King County are given an opportunity to pass upon OASI coverage as soon as possible.

Very truly yours,

DON EASTVOLD
Attorney General

A. J. HUTTON, JR.
Assistant Attorney General