Montgomery County Council Press Releases & Statements
Montgomery County 2-Tier Disability Retirement for Employees Going Into Effect on July 1
| ROCKVILLE, Md., June 26, 2012—Landmark measures that create a two-tier service-connected disability retirement system for all Montgomery County employees will go into effect July 1, about one year after the County Council approved the measures and almost five years after the County started pursuing reforms. This system is identical to the current system for employees of the Montgomery Fire and Rescue Service.
Bill 45-10, which created a two-tier system for service-connected disability retirement pensions for all County employees, was approved by a 7-1-1 vote of the Council in June 2011. Councilmembers Phil Andrews, Roger Berliner, Valerie Ervin, Nancy Floreen, Nancy Navarro, Craig Rice and Hans Riemer voted to approve the bill. Councilmember George Leventhal voted against the bill and Councilmember Marc Elrich abstained from voting.
Employees eligible for a partial incapacity service-connected disability retirement benefit will receive a pension of at least 52.5 percent of final earnings. Employees eligible for a total incapacity benefit will receive a pension of at least 70 percent of final earnings. The current system for all employees, except fire and rescue employees, provides a benefit of at least 66.7 percent for both partial and total incapacity. The bill will apply to disabilities occurring after July 1, 2012.
Under Bill 45-10, an employee will be eligible for a total incapacity benefit if the employee is unable to perform any substantial gainful activity because of any impairment that is unlikely to resolve in the next 12 months and may be permanent. An employee will 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.
The bill also will prohibit the award of a service-connected disability pension to an employee who “has committed an offense that would justify termination for misconduct.”
Councilmember Andrews was the chief advocate of Bill 45-10, which he proposed in 2010 along with then-Councilmember Duchy Trachtenberg. Councilmembers Berliner and Ervin were co-sponsors of the legislation.
“The County’s broken disability retirement system needed major reform to work as intended and to restore public confidence,” said Councilmember Andrews, who chairs the Council’s Public Safety Committee. “The measures the Council approved apply to all County employees and set up a system that will allow the panel reviewing claims to differentiate between a partial disability such as a bad back and a severe disability such as total paralysis. It also will prevent employees who are dismissed from their jobs for misconduct from applying for disability retirement. Once the law takes effect and is fully implemented, we will have a much-improved disability retirement system that incorporates best practices.”
An actuarial analysis concluded that the legislation will save taxpayers approximately $2.7 million annually once the reforms are fully implemented.
“Our Council has great respect for the men and women who serve in our police force. They put their lives on the line every day,” said Council President Berliner. “The reforms that will now go into effect ensure that those men and women who are severely injured in performing their duties on our behalf are provided an even greater level of compensation, while minor injuries are treated identically to what our fire personnel receive. The other option that was available to the Council was the result of an arbitrator’s decision that created a three-tier system that, among other things, provided a much higher partial disability award than our County provides fire personnel. We have wisely declined to endorse that result as contrary to the public interest, which is our sole responsibility.”
A 2008 report by the County’s inspector general found that between July 2004 and March 2008, 58 of 93 retiring police officers (62 percent) were awarded disability retirement.
In 2009, the Council approved legislation sponsored by Councilmember Andrews and then-Councilmember Trachtenberg that required independent medical exams for applicants for disability, strengthened the professional qualifications of the disability review panel and required mandatory reviews of employees who received disability pensions to assess whether they remain eligible to receive those payments.
The County explored potential changes to the Disability Retirement program in 2007 with a nine-month-long examination by a work group led by the County’s Office of Human Resources. The Montgomery County Fire and Rescue Service, the Montgomery County Police and the County Attorney participated in the work group’s study.
# # # #