Disabato v. Board of Trustees of the State Employees' Retirement System

THIRD DIVISION

December 6, 1996

1-94-3649

COLUMBUS DISABATO, DONALD JOHNSON, ) Appeal from

GERALD W. JACKSON, JOHN KUCERA, ) the Circuit Court

STANLEY SHANTER, GEORGE MARCHOUS, ) Cook County

VERNON LOWE, WILLIAM KOUNTIS, )

RAYMOND WOOD, C. PANAGAKIS, )

LAWRENCE JOHNSON, RICHARD HANSEN, )

EDWARD FOLEY, JERRY HARDEN, )

WAYNE MISFELDT, JAMES THOMPSON, )

JAMES ESNER, CARMEN SARACCO, )

ROBERT CADWELL, ROBERT LEDEN, )

T. PLADIS and FRANKLIN WALKER )

)

Plaintiffs-Appellants, )

)

v. )

)

THE BOARD OF TRUSTEES OF THE )

STATE EMPLOYEES' RETIREMENT SYSTEM )

OF ILLINOIS and MICHAEL L. MORY, )

EXECUTIVE SECRETARY, ) The Honorable

) Edwin M. Berman,

Defendants-Appellees. ) Judge Presiding.

Justice Leavitt delivered the opinion of the Court:

The plaintiffs were Secretary of State investigators,

appointed pursuant to section 2-115 of the Illinois Vehicle Code.

625 ILCS 5/2-115 (West 1994). As state employees, they were

"members" of the State Employees' Retirement System (SERS) (see

40 ILCS 5/14-103.06 (West 1994), which provides retirement

benefits to a wide variety of state employees under the larger

aegis of the Illinois Pension Code. See 40 ILCS 5/1-101 to 5/18-

101. The plaintiffs believe that the statutory scheme by which

their retirement benefits are calculated is discriminatory, and

they sought to have their benefits recalculated. They now seek

administrative review of a decision by the defendant, the Board

of Trustees of SERS (the Board), denying their claims.

In 1992, after all of the plaintiffs had retired, they sent

letters to the Assistant Executive Secretary of SERS protesting

the method by which their retirement benefits were calculated.

As with all members of SERS, the plaintiffs' retirement benefits

are calculated as a percentage of their "final average

compensation." See 40 ILCS 5/14-109, 5/14-110. Section 14-

103.12(a) of the Code defines final average compensation for most

state employees, including the plaintiffs, as:

"the monthly compensation obtained by dividing the

total compensation of an employee during the period of:

(1) the 48 consecutive months of service within the

last 120 months of service in which the total

compensation was the highest, or (2) the total period

of service, if less than 48 months, by the number of

months of service in such period." 40 ILCS 5/14-

103.12(a).

The plaintiffs asked SERS to recalculate their retirement

benefits pursuant to a 1989 amendment to section 14-103.12 which

altered the basis for calculating the final average compensation

of certain State police officers:

"Notwithstanding the provisions of subsection (a),

for the purpose of calculating retirement and survivor

annuities of persons with at least 20 years of eligible

creditable service as a State policeman, 'final average

compensation' means the monthly rate of compensation

received by the person on the last day of service as a

State policeman, or the average monthly compensation

received by the person for the last 48 months of

service prior to retirement, whichever is greater." 40

ILCS 5/14-103.12(c).

The plaintiffs believed that they served the same functions as

State policemen and should, therefore, receive similar benefits.

They contended that to deny them the benefit of section 14-

103.12(c) was arbitrary and discriminatory.

In November 1992, the Executive Committee of SERS (SERS

Committee) denied the request for a recalculation. The SERS

Committee's ruling denying the plaintiffs' claims notes, as to

each plaintiff, that his claim is premised upon the ground that

section 14-103.12 is "arbitrary and discriminatory." The ruling

then states, as to each plaintiff, "This appeal is similar to the

Russell Watier case, which is currently waiting to be heard in

the circuit court." Russell Watier is not a plaintiff in this

case. The record before us contains nothing indicating what

occurred in that matter. In any event, the SERS Committee denied

each plaintiff's claim "based upon the statutory provisions

(section 14-103.12) governing the calculation of the final

average compensation." In January 1993, the Board ratified the

decision of the SERS Committee.

Subsequently, the plaintiffs filed complaints in the circuit

court, later consolidated, seeking review of the Board's decision

pursuant to the Administrative Review Law. 735 ILCS 5/3-101 et

seq. (West 1992). They also sought a declaratory judgment that

section 14-103.12(c) is unconstitutional because they believed

the distinction between them and State police officers denied

them their rights to equal protection of the laws under both

Federal and State constitutional provisions; that section 14-

103.12(c) constituted an unlawful grant of a special privilege to

State police officers in violation of Article I, section 16 of

the Illinois constitution; that section 14-103.12(c) constituted

special legislation in violation of Article IV, section 13 of the

Illinois Constitution; and that section 14-103.12(c) diminished

or impaired their pension rights in violation of Article XIII,

section 5 of the Illinois Constitution. The plaintiffs premised

these constitutional claims upon the assertion that they perform

the same job as the State police.

In support of their argument that there was no significant

difference between Secretary of State investigators and State

police officers, the plaintiffs relied upon the statutory

provisions delineating the authorities and duties of each group.

They also submitted several exhibits to illustrate the job duties

of the investigators. After hearing argument, the judge issued

an order concluding that the plaintiffs were "substantially

different as a class from State police officers" and upheld both

the Board's decision and the constitutionality of the statute.

In reviewing an administrative decision, "the findings and

conclusions of the administrative agency on questions of fact

shall be held to be prima facie true and correct." 735 ILCS 5/3-

110. In this regard, "[n]o new or additional evidence in support

of or in opposition to any finding, order, determination, or

decision of the administrative agency shall be heard by the

court." 735 ILCS 5/3-110 (West 1994). We review questions of

law de novo. Villegas v. Downers Grove Board of Fire and Police

Commissioners, 266 Ill. App. 3d 202, 209, 639 N.E.2d 966 (1994),

rev'd on other grounds, 167 Ill. 2d 108, 656 N.E.2d 1074 (1995).

Regarding factual findings, our function is limited to

ascertaining whether the findings and decision of the agency are

supported by the manifest weight of the evidence. Davern v.

Civil Service Comm'n, 47 Ill. 2d 469, 269 N.E.2d 713 (1970);

Podmajersky v. Zoning Board of Appeals, 131 Ill. App. 3d 1072,

1075, 476 N.E.2d 1176 (1985); Taylor v. Police Board of the City

of Chicago, 62 Ill. App. 3d 486, 491, 378 N.E.2d 1160 (1978). A

decision is against the manifest weight of the evidence only if

"no rational trier of fact could have agreed with the agency. ***

If there is any competent evidence supporting the agency's

determination," it will be affirmed. Scadron v. Zoning Board of

Appeals, 264 Ill. App. 3d 946, 949, 637 N.E.2d 710 (1994).

Initially, we must address an issue of standing raised by

the defendants. Each of the plaintiffs retired from their

positions as investigators in 1991 or 1992 with one possible

exception. The defendants contend that the plaintiff, Edward

James Foley, retired in 1984, long before section 14-103.12(c)

was enacted, and, therefore, he lacks standing to maintain this

suit because he was not affected by the amendment. The

plaintiffs claim Foley retired on December 31, 1991. We note

that in the trial court, the defendants challenged the standing

of the plaintiffs as a group, but on an entirely different basis.

The plaintiffs cannot point to any evidence in the record to

support the assertion that Foley retired in 1991. On the other

hand, the defendants cite only the minutes of the SERS Committee

meeting, which conclude that Foley retired in 1984. However, the

record contains no evidence, documentary or otherwise, which

supports the finding of the SERS Committee. Therefore, we reject

that finding because it is not supported by the manifest weight

of the evidence.

Under Illinois law, a person who is excluded from a class

that receives favorable treatment has standing to challenge the

classification. See, e.g., Tobin v. McClure, 144 Ill. App. 3d

33, 37, 493 N.E.2d 1215 (1986). Generally, lack of standing in a

civil case is an affirmative defense which if not raised in the

trial court is waived on appeal. Jensen Disposal Co. v. Town of

Warren, 218 Ill. App. 3d 483, 486, 578 N.E.2d 605 (1991);

Olivieri v. Coronet Insurance Co., 173 Ill.App. 3d 867, 871, 528

N.E.2d 986 (1987). However, the appellee may defend the judgment

on appeal, or urge any point in support of the judgment, even

though not directly ruled on by the trial court, so long as the

factual basis for determination was before the trial court.

Jensen, 218 Ill. App. 3d at 487; Jackson v. Chicago Board of

Education, 192 Ill. App. 3d 1093, 1099, 549 N.E.2d 829 (1989).

Although the trial judge requested briefing on the issue of

standing in regard to the entire group of plaintiffs, he did not

do so with regard to the issue as it is presented by the

defendants on appeal. We conclude that the issue of Foley's

standing based on the date of his retirement was not properly

raised below. Therefore, it is waived.

As to the plaintiffs' substantive claims, the SERS Committee

and the Board denied the plaintiffs' claim for recalculation of

benefits based upon the clear language of section 14-130.12(c),

under which the plaintiffs are not entitled to the calculation

they requested. It is unclear from the SERS Committee's ruling,

however, whether it made any factual findings in this regard.

Rather, it apparently adopted its findings in a similar case

involving a plaintiff named Russell Watier, findings not included

in the record before us. Nonetheless, the administrative agency

clearly considered and rejected the plaintiffs' contentions by

applying the terms of the appropriate statutory provisions. As

such, its decision is not against the manifest weight of the

evidence.

The plaintiffs' primary contention concerning their request

for a declaratory judgment is that the more favorable benefit

calculation accorded State police under section 14-103.12(c)

denies them equal protection of the laws under the United States

and Illinois constitutions. U.S. Const. Amend 14; Ill. Const

1970, Art. I, sec. 2. They argue that because there is

essentially no difference in the job duties of State police

officers and Secretary of State investigators, section 14-

103.12(c) creates an unreasonable and arbitrary classification.

If a legislative classification does not affect a

fundamental right or impact a suspect class, we will uphold the

classification unless it bears no rational relationship to a

legitimate state goal. People v. Esposito, 121 Ill. 2d 491, 500,

521 N.E.2d 873 (1988). The legislature may classify different

people differently, so long as the classification is not

arbitrary and capricious. People v. Kimbrough, 163 Ill. 2d 231,

237, 644 N.E.2d 1137 (1994).

Although the plaintiffs assert that the legislative

classification "imping[es] upon their fundamental constitutional

rights," they cite no authority to support this proposition.

Indeed, our courts have recognized that "[f]undamental interests

generally are those that lie at the heart of the relationship

between the individual and a republican form of nationally

integrated government." People ex rel. Tucker v. Kotsos, 68 Ill.

2d 88, 97, 368 N.E.2d 903 (1977). These include such interests

as the right to vote, first amendment guarantees, the right to

travel, and the right to privacy. Massachusetts Board of

Retirement v. Murgia, 427 U.S. 307, 312 n.3, 49 L. Ed. 2d 520, 96

S. Ct. 2562 (1976); Tucker, 68 Ill. 2d at 97. They do not

include the plaintiffs' claim to a particular pension benefit

calculation method. Muzquiz v. City of San Antonio, 520 F.2d

993, 1001 (5th Cir. 1975), aff'd en banc, 528 F.2d 499 (1976) and

vacated on other grounds, 438 U.S. 901, 57 L. Ed. 2d 1144, 98 S.

Ct. 3117 (1978).

Even if we agreed that the plaintiffs' duties were the same

as those of the State police, "the legislature may ***

differentiate between persons similarly situated if there is a

rational basis for doing so." Esposito, 121 Ill. 2d at 501.

Thus, the classification created by section 14-103.12(c) "'must

be upheld against challenge if there is any reasonable

conceivable state of facts that could provide a rational basis

for'" it. (Emphasis added.) Heller v. Doe, 509 U.S. 312, 320, 125

L. Ed. 2d 257, 113 S. Ct 2637 (1993); Opyt's Amoco, Inc. v.

Village of South Holland, 149 Ill. 2d 265, 595 N.E.2d 1060

(1992). That basis need not be apparent from the legislation

itself, nor must the State produce evidence to support the

classification. Heller, 509 U.S. at 321. Rather, the

classification "may be [legitimately] based upon rational

speculation unsupported by evidence or empirical data." Heller,

509 U.S. at 321.

We believe the legislature has implicitly expressed the

basis for the classification at issue within the provisions of

section 14-103.12(c). That section applies only to State police

officers who have served 20 or more years on the force. The

legislature clearly made a decision to reward the service of

those officers who remain on the force. The legislature could

also have sought to entice experienced officers to remain on the

force by rewarding them with a more favorable pension. Indeed,

the legislature might have believed that it could attract better

candidates to the force by offering an attractive benefits

package unavailable to other state employees. We note that the

Pension Code classifies numerous types of state employees,

granting varying pension benefits rights to them, despite the

fact that many of their employment responsibilities may overlap.

It is not for this court to "second-guess" the legislature's

wisdom in this regard, and the plaintiffs must negate all of the

bases supporting the legislation in order to successfully attack

it. Heller, 509 U.S. at 321.

The only basis upon which the plaintiffs rely to negate the

legitimacy of the classification, however, is that their duties

are no different from those of State police officers and thus all

of the reasons the legislature could have for according state

police better pension benefits apply to them, as well. Even

assuming the truth of this allegation, the State may address a

problem one step at a time. Friedman & Rochester, Ltd. v. Walsh,

67 Ill. 2d 413, 421-22, 367 N.E.2d 1325 (1977); Illinois Coal

Operators Ass'n v. Pollution Control Board, 59 Ill. 2d 305, 312-

13, 319 N.E.2d 782 (1974). It may address itself first to what

it decides is the most acute need (Chicago National League Ball

Club, Inc. v. Thompson, 108 Ill. 2d 357, 371, 483 N.E.2d 1245

(1985)), in this instance the recruitment and retention of

qualified and experienced State police officers.

In any event, we agree with the circuit court that the

plaintiffs are substantially different from State police

officers. The plaintiffs were employed by the Secretary of State

primarily "for the purpose of more effectively carrying out the

provisions of the laws in relation to motor vehicles." 625 ILCS

5/2-115. However, they contend that like the state police,

Secretary of State investigators have "all of the powers of

police officers." We disagree with the plaintiffs'

characterization of the statutory scheme.

Under the State Police Act (20 ILCS 2610/0.01 et seq.(West

1994)), the State police are authorized as follows regarding the

enforcement of motor vehicle laws:

"State policemen shall enforce the provisions of

The Illinois Vehicle Code *** and Article 9 of the

'Illinois Highway Code' *** and shall patrol the public

highways and rural districts to make arrests for

violations of the provisions of such Acts. They are

conservators of the peace and as such have all powers

possessed by policemen in cities, and sheriffs, except

that they may exercise such powers anywhere in this

State. The State policemen shall cooperate with the

police of cities, villages and incorporated towns, and

with the police officers of any county, in enforcing

the laws of the State and in making arrests and

recovering property." 20 ILCS 2610/16.

The State police are further authorized by section 55a of

the Civil Administrative Code (20 ILCS 2605/55a (West 1994)), to

act as general police officers. Section 55a includes 34 specific

grants of power to the State police, such as that of

investigating the criminal laws of the State of Illinois,

generally, as well as "the origins, activities, personnel and

incidents of crime and the ways to redress the victims of crimes

*** enforce all laws regulating the production, sale,

prescribing, *** delivering, distributing, or use of controlled

substances and cannabis." 20 ILCS 2605/55a(A)(4)(a) & (b). The

State police may also employ experts or additional investigators

to aid in preventing or detecting crime. 20 ILCS

2605/55a(A)(4)(c). The State police are the "central repository

and custodian" of criminal records in the State. 20 ILCS

2605/55a(A)(5)(a). They are charged with, among other things,

the responsibility of investigating racetracks, arson, child

abuse and neglect, and identifying and responding to reports of

hate crimes. 20 ILCS 2605/55a(A)(14), (17), (29) & (31).

By contrast, under the Illinois Vehicle Code, the authority

of Secretary of State investigators is much narrower:

"It shall be the duty of [the] investigators to

investigate and enforce violations of the provisions of

this Act administered by the Secretary of State and

provisions of Chapters 11, 12, 13, 14 and 15 [of this

Act]***. Such investigators shall have and may

exercise throughout the State all of the powers of

peace officers." 625 ILCS 5/2-115.

Also, Secretary of State investigators "shall cooperate with the

State Police and the sheriffs and police in enforcing the laws

regulating the operating of vehicles and the use of the

highways." 625 ILCS 5/2-116(a). Finally, they "shall

investigate and report violations of the provisions of this Act

in relation to the equipment and operation of vehicles as

provided for in section 2-115 and for such purposes these

investigators have and may exercise throughout the State all of

the powers of police officers." (Emphasis added.) 625 ILCS 5/16-

102.

Although the responsibilities of State police and Secretary

of State investigators overlap in regard to the enforcement of

provisions of the Illinois Vehicle Code, the similarity ends

there. Section 55a of the Civil Administrative Code grants the

State police broad police power not possessed by Secretary of

State investigators. Indeed, there are few limitations on the

powers of State police officers, while the powers of

investigators are, with some exceptions cited by the plaintiffs,

circumscribed to those incident to investigating and enforcing

motor vehicle laws.

We are also unpersuaded by the exhibits submitted to the

circuit court judge, although they do demonstrate that the

plaintiffs, like all law enforcement personnel, are often called

upon to perform duties beyond the ordinary. Nevertheless, the

statutory duties of the State police are substantially broader

than those of the plaintiffs, and the legislature could

rationally seek to reward those who take on these additional

duties and who continue to perform them over a long period of

time. Given that conclusion, we hold that the classification

established by section 14-103.12(c) of SERS does not deny the

plaintiffs equal protection of the laws.

The plaintiffs next argue that section 14-103.12(c) violates

article IV, section 13, of the Illinois Constitution, which

prohibits the legislature from passing a special or local law

when a general law can be applicable. Ill. Const. 1970, Art. IV,

sec. 13. The plaintiffs contend that section 14-103.12(c)

constitutes a special law because it applies to only a portion of

a class instead of all of the class. That is, section 14-

103.12(c) applies only to State police officers when the

investigators and State police officers are part of the same

class. We have already rejected this contention. Our courts

address alleged violations of the special legislation clause of

the Illinois constitution applying the same rational basis

standard as that applicable to equal protection challenges. Pre-

School Owners Ass'n of Illinois, Inc. v. Department of Children

and Family Services, 119 Ill. 2d 268, 518 N.E.2d 1018 (1988);

Chicago National League Ball Club, 108 Ill. 2d at 368.

Therefore, we reject the plaintiffs argument in this regard, as

we have already held that section 14-103.12(c) is rationally

related to a legitimate state interest.

The plaintiffs also assert that section 14-103.12(c)

violates Article I, section 16, of the Illinois Constitution,

which provides that "No ex post facto law, or law impairing the

obligation of contracts or making an irrevocable grant of special

privileges or immunities shall be passed." Ill. Const. 1970,

Art. I, sec. 16. Like the plaintiffs' special legislation and

equal protection challenges, this contention is rejected because

there is a rational basis for the legislation. Towns v. Kessler,

10 Ill. App. 3d 356, 293 N.E.2d 761 (1973).

Finally, the plaintiffs urge that the more favorable pension

benefit calculation available to State police officers violates

article XIII, section 5, of the Illinois Constitution, which

provides:

"Membership in any pension or retirement system of

this State, any unit of local government or school

district, or any agency or instrumentality thereof,

shall be an enforceable contractual relationship, the

benefits of which shall not be diminished or impaired."

Ill. Const. 1970, Art. XIII, sec. 5.

According to the plaintiffs, the more favorable benefit

calculation available to State police officers "clearly"

diminishes and impairs their pension benefits. We disagree. In

fact, section 14-103.12(c) had no effect on the investigators'

benefits. It affected only the benefits of State police

officers, who, as a result of its enactment, enjoy a more

favorable benefit calculation.

Nevertheless, the plaintiffs contend that any change to the

pension plan in which they participated constitutes an impairment

of their benefits. Neither case law nor common sense supports

their position.

Our courts have held that a change in pension benefits

violated Article XIII, section 5, only when the facts established

an actual reduction in a plaintiff's benefits. See, e.g., Felt

v. Board of Trustees of Judges Retirement System, 107 Ill. 2d

158, 481 N.E.2d 698 (1985); Kraus v. Board of Trustees of the

Police Pension Fund of the Village of Niles, 72 Ill. App. 3d 833,

390 N.E.2d 1281 (1979). As the court stated in Kraus,

"[S]ection 5 of article XIII prohibits legislative

action which directly diminishes the benefits to be

received by those who become members of the pension

system prior to the enactment of the legislation,

though they are not yet eligible to retire.

Legislative action directed toward another aim, but

which has an incidental effect on the pensions which

employees would ultimately receive, is not prohibited."

Kraus, 72 Ill. App. 3d at 849, citing Peters v.

Springfield, 57 Ill. 2d 142, 311 N.E.2d 107 (1974).

The Kraus court explained that the mandatory retirement age may

be reduced, salary and work hours may be reduced and notice

requirements may be imposed without violation of article 13,

section 5, even though these may indirectly reduce benefits.

Kraus, 72 Ill. App. 3d at 849. Here, the plaintiffs cannot

demonstrate that section 14-103.12(c) actually reduced their

benefits, either directly or indirectly.

For all of the foregoing reasons, the judgment of the

circuit court is affirmed.

Affirmed.

Zwick, P.J., and McNamara, J., concur.