STATE TROOPERS FRATERNAL ASSOCIATION OF NEW JERSEY VS. STATE POLICE RETIREMENT BOARD (STATE POLICE RETIREMENT SYSTEM)

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the

internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2090-17T1

STATE TROOPERS FRATERNAL

ASSOCIATION OF NEW JERSEY,

STATE TROOPERS NON-

COMMISSIONED OFFICERS

ASSOCIATION OF NEW JERSEY,

STATE TROOPERS SUPERIOR

OFFICERS ASSOCIATION,

RICHARD POKORNY, THOMAS

DECKER, BRIAN ZAMROCK,

JOHN SCALABRINI, FABIAN

GERKE, and all other persons

similarly situated,

Petitioners-Appellants,

v.

STATE POLICE RETIREMENT

BOARD,

Respondent-Respondent.

___________________________

Argued May 21, 2019 – Decided July 5, 2019

Before Judges Suter and Geiger.

On appeal from the Board of Trustees of the State

Police Retirement System, SPRS No. 8-10-004653.

Lauren P. Sandy argued the cause for appellants.

Robert E. Kelly, Deputy Attorney General, argued the

cause for respondent (Gurbir S. Grewal, Attorney

General, attorney; Melissa H. Raksa, Assistant

Attorney General, of counsel; Robert E. Kelly, on the

brief).

PER CURIAM

Appellants are three labor unions, five named members of those unions,

and all other persons similarly situated. They appeal from a final agency

decision of respondent Board of Trustees (the Board) of the State Police

Retirement System (SPRS) denying the transferability of certain prior non-SPRS

service credit. For the following reasons, we affirm.

New Jersey State Troopers Richard Pokorny, Thomas Decker, Brian

Zamrock, John Scalabrini, and Fabian Gerke (collectively the five named

members) were all members of the Police and Fireman's Retirement System

(PFRS) before enrolling in the SPRS. Prior to becoming a State Trooper in

1993, Pokorny was employed as a detective by the Ocean County Prosecutor's

Office for three years and eight months. Decker was employed by the New

Jersey Department of Corrections for two years and ten months prior to

becoming a State Trooper in 1987. Zamrock was employed by the New Jersey

Division of Criminal Justice (DCJ) as a State Investigator for four years and six

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months prior to becoming a State Trooper in 2003. Scalabrini was employed by

the DCJ as a State Investigator for five years and three months before becoming

a State Trooper in 2004. Gerke was employed by the DCJ as a State Investigator

for three years prior to becoming a State Trooper in 2003. None of these five

named members had a break in service when they became State Troopers.

We begin with an overview of the relevant statutory framework. The

SPRS was created in 1965 to "provide retirement allowances and other benefits

for its members and their beneficiaries." N.J.S.A. 53:5A-4. Prior to 1997, SPRS

membership was limited to: (1) members of the State Police Retirement and

Benevolent Fund; (2) fulltime commissioned officers, noncommissioned

officers, and troopers of the Division of State Police; and (3) persons employed

in certain positions in the Division of Motor Vehicles who were appointed to the

State Police in 1983. L. 1983, c. 403, §§ 37-38.

In 1997, the Legislature amended the statute to appoint persons in the

following enumerated positions to the State Police: (1) Alcoholic Beverage

Control Enforcement Bureau (ABC) inspectors; (2) State Capitol Police Force

members; and (3) Bureau of Marine Law Enforcement officers who satisfied

certain age, health, and performance criteria (collectively the 1997 appointees).

L. 1997, c. 19, §§ 1, 7. The service credit earned by the 1997 appointees in the

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PFRS or the Public Employees' Retirement System (PERS) was transferred to

the SPRS. L. 1997, c. 19, § 4. To ensure the 1997 appointees and the SPRS

would not be harmed by transfer, the 1997 amendments required the PFRS and

PERS to remit the "accumulated deductions standing to the credit" of the 1997

appointees and "the pro-rata part of the reserve fund constituting the employer's

obligations under the former system applicable" to the 1997 appointees'

accounts. L. 1997, c. 19, § 5. The 1997 amendments also required the

employers to contribute the amount of any deficiency to the SPRS, if the amount

remitted pursuant to L. 1997, c. 19, § 5 was "less than the total" needed by the

SPRS to provide the 1997 appointees "with credit for [their] public service." L.

1997, c. 19, § 6.

The Legislature also added the following language to N.J.S.A. 53:5A-

6(a):

In addition, service as a member of the State Capitol

Police Force, or as a Supervising Inspector, Principal

Inspector, Senior Inspector, or Inspector Recruit in the

[ABC] or as a Principal Marine Law Enforcement

Officer, Senior Marine Law Enforcement Officer, or

Marine Law Enforcement Officer in the Bureau of

Marine Law Enforcement and service credit transferred

from [the PFRS] or [PERS] shall, if the required

contributions are made by the State and the member, be

considered as creditable service.

[L. 1997, c. 19, § 8.]

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The Assembly's Committee's Statement makes clear that the transfer of

service credit from the PFRS and PERS to the SPRS was limited to the 1997

appointees:

For persons becoming members of the State Police

under the bill, their service credit in [PERS] or [PFRS]

as an alcoholic beverage control inspector, State

Capitol Police Force member, or marine law

enforcement office[r] shall be transferred to the SPRS.

Any other service credit established in PERS or PFRS

shall be included in the computation of an SPRS

retirement allowance on the basis of 1% of final

compensation for each year of such service credit . . . .

[Assemb. Comm. Statement to A. 1451 2 (June 10,

1996).]

The Legislature expressly contemplated "that 162 persons ([twenty-four]

ABC inspectors, 134 Marine Police officers and [four] State Capitol police

officers) would be eligible to transfer to the . . . State Police" under the 1997

Amendments and "that 115, or approximately [seventy] percent, of these persons

would qualify to transfer to the State Police" under the 1997 Amendments. S.

Comm. Statement to A. 1451 2 (Nov. 25, 1996). Of those 162, the Office of

Legislative Services (OLS) estimated "115, or approximately seventy percent,

of these persons would qualify to transfer." Ibid. The OLS estimated "the total

additional pension cost to the State in the first year following enactment would

be $835,181" for those 115 employees. Ibid.

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In January 2015, the Unions petitioned the Board on behalf of five named

members and "all other similarly situated troopers." These individuals did not

claim to be among the 1997 appointees. Relying on our unpublished opinion in

LaRosa v. State Police Ret. Sys., No. A-0927-12 (Sept. 27, 2013),1 appellants

claimed the Union members' creditable service in the PFRS should be treated as

transferred credit in the SPRS. The Unions subsequently submitted "a formal

request for compliance with N.J.S.A. 53:5A-6(a)" and LaRosa.

The Board denied the petition, "determin[ing] that only service credit

transferred in from specific titles was eligible to be included as creditable

service." In reaching that conclusion, the Board distinguished the facts

presented in the unpublished opinion relied upon by appellants, which involved

employees who previously held titles "specifically enumerated" in the 1997

amendments. The Board further determined that "a plain reading of [N.J.S.A.

53:5A-6(b)] does not lead to the conclusion that all transferred service credit is

to be treated similarly for all employees."

1

"No unpublished opinion shall constitute precedent or be binding upon any

court." R. 1:36-3. Unreported decisions "serve no precedential value, and

cannot reliably be considered part of our common law." Trinity Cemetery v.

Wall Twp., 170 N.J. 39, 48 (2001) (Verniero, J., concurring).

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The Unions appealed from the Board's decision. The appeal was

transmitted to the Office of Administrative Law for hearing as a contested case

and assigned to an Administrative Law Judge (ALJ). The parties cross-moved

for summary decision pursuant to N.J.A.C. 1:1-12.5.2 Following oral argument,

the ALJ issued an Initial Decision on October 6, 2017.

The ALJ concluded summary decision was appropriate because there were

no material facts in dispute. The ALJ stated "[t]he sole issue is interpretation of

N.J.S.A. 53:5A-6 as it applies to the undisputed facts."

The ALJ focused on "whether subsection (a) or subsection (b) of N.J.S.A.

53:5A-6 should apply to petitioners' service previously rendered in the PFRS."

The ALJ noted subsection (a) "enumerates positions within specific agencies

and provides that time served within those positions qualifies as full creditable

service within the SPRS." In turn, the ALJ noted subsection (b) provided for

prior service credit in the PFRS or PERS "is to be included in calculating a SPRS

member's retirement allowance at a rate of one percent of final compensation

for each year of service in those systems, unless otherwise stated in the statute."

2

Pursuant to N.J.A.C. 1:1-12.5(b), summary decision "may be rendered if the

papers and discovery which have been filed, together with affidavits, if any,

show that there is no genuine issue as to any material fact challenged and that

the moving party is entitled to prevail as a matter of law."

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The ALJ rejected the argument that any time served in the PFRS or PERS

should be given full value and concluded that "if all service rendered in the

PFRS or PERS was meant to translate into full creditable service within the

SPRS, there would be no need to enumerate specific agencies or titles within the

statute. Accepting [appellants'] interpretation would render the lists of agencies

and titles superfluous."

The ALJ found appellants' reliance on LaRosa misplaced because the

employees in LaRosa held titles "specifically enumerated" in subsection (a),

whereas here, appellants did not "transfer[] into the SPRS from a position

enumerated in subsection (a)."

The ALJ rejected the argument subsection (b) was "inapplicable because

it only applie[d] to service credit that ha[d] been purchased, meaning unworked

time on a leave of absence without pay, not service credit that has been

transferred." The ALJ concluded appellants' interpretation of subsection (b) was

"undermined by the language" of subsection (f). The ALJ explained:

Subsection (f) states that individuals who become

SPRS members pursuant to the 1997 amendments and

are required to retire at age fifty-five with less than

twenty years of SPRS credit, may use "service credit

transferred or purchased pursuant to subsection b" to

attain the requisite twenty years. Subsection (f) also

indicates that, for the 1997 appointees, "[t]ransferred or

purchased service credit in excess of the amount

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necessary to provide 20 years of creditable service in

the retirement system shall be included in the

computation of a retirement allowance on the basis

provided in subsection b." Again, this language

suggests that subsection (b) can apply to both

transferred or purchased service credit from another

retirement system.

The ALJ also found the legislative history of N.J.S.A. 53:5A-6 supported

the Board's position, noting the 1997 amendment provided that service credit

transferred from the PFRS or the PERS in the enumerated titles "would

constitute creditable service in the SPRS." The ALJ also noted the Assembly

State Government Committee's Statement to Assembly Bill 1451 "indicates that

service credit established in specific, enumerated PERS and PFRS positions

would transfer to the SPRS. However any other service credit established in

other retirement systems was meant to be treated differently for purposes of

calculating retirement allowances."

Based on this analysis, the ALJ granted the Board's motion for summary

decision and found that PERS or PFRS credit transferred into the SPRS is not

credited at full value unless the service was attributable to one of the enumerated

titles. The ALJ concluded subsection (b) "is the appropriate subsection for

calculating [the] retirement allowance for previous creditable service in the

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PERS and PFRS under non-enumerated titles." Appellants and the Board each

filed exceptions to the Initial Decision.

The Board adopted the ALJ's Initial Decision, determining that "N.J.S.A.

53:5A-6(a) and (b) [do] not provide for the transfer of previously earned PFRS

service to a member's SPRS account on a full SPRS value for any individual[s]

becoming members of the SPRS other than those who transferred into SPRS in

1997 and occupied one of the positions enumerated in the statute." This appeal

followed.

Appellants argue:

POINT I

THE DECISION OF THE STATE POLICE

RETIREMENT BOARD DID NOT FOLLOW THE

LAW AND THEREFORE SHOULD BE REVERSED.

POINT II

THE BOARD'S DECISION DID NOT FOLLOW THIS

COURT'S DECISION IN LAROSA AND

THEREFORE SHOULD BE REVERSED BECAUSE

IT IS ARBITRARY AND CAPRICIOUS.

POINT III

THE DECISION OF THE BOARD VIOLATES THE

PUBLIC POLICY TO CONSTRUE PENSION

STATUTES LIBERALLY, AND THEREFORE,

SHOULD BE REVERSED. (Not Raised Below).

Appellate courts serve a "limited role" in reviewing administrative agency

decisions. In re Stallworth, 208 N.J. 182, 194 (2011) (quoting Henry v. Rahway

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State Prison, 81 N.J. 571, 579 (1980)). We will not overturn an agency decision

"unless there is a clear showing that it is arbitrary, capricious, or unreasonable,

or that it lacks fair support in the record." Stein v. Dep't of Law & Pub. Safety,

458 N.J. Super. 91, 99 (App. Div. 2019) (quoting J.B. v. N.J. State Parole Bd.,

229 N.J. 21, 43 (2017)). When undertaking that analysis, a reviewing court must

scrutinize:

(1) whether the agency's action violates express or

implied legislative policies, that is, did the agency

follow the law; (2) whether the record contains

substantial evidence to support the findings on which

the agency based its action; and (3) whether in applying

the legislative policies to the facts, the agency clearly

erred in reaching a conclusion that could not reasonably

have been made on a showing of the relevant factors.

[Stallworth, 208 N.J. at 194 (quoting In re Carter, 191

N.J. 474, 482-83 (2007)).]

We do not substitute our own judgment for an agency's, even if we might

have reached a different result. Ibid. In addition, courts generally "afford

substantial deference to an agency's interpretation of a statute that the agency is

charged with enforcing. An appellate court, however, is 'in no way bound by

the agency's interpretation of a statute or its determination of a strictly legal

issue.'" Richardson v. Bd. of Trs., Police & Firemen's Ret. Sys., 192 N.J. 189,

196 (2007) (quoting In re Taylor, 158 N.J. 644, 658 (1999)).

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We affirm substantially for the reasons expressed by the ALJ in her cogent

and comprehensive Initial Decision, which was adopted by the Board without

modification. We add the following comments.

Both the plain language of N.J.S.A. 53:5A-6 and its legislative history

fully support the Board's decision. Appellants did not transfer from any of the

titles enumerated in subsection (a). They are not eligible for the retirement

benefits they seek.

As the ALJ found, adopting appellants' position would render the

inclusion of the enumerated titles set forth in subsection (a) superfluous. "A

construction that would render any part of a statute inoperative, superfluous or

meaningless, is to be avoided." Hoffman v. Hock, 8 N.J. 397, 406-07 (1952)

(citing 2 Sutherland, Statutory Construction § 4705 at 339 (3d ed. 1943)). It

would also be contrary to the maxim of ejusdem generis. See Lewis v. Bd. of

Trs., PERS, 366 N.J. Super. 411, 416 (App. Div. 2004) (stating "the inclusion

of specific words and phrases controls or limits more general words and phrases

in interpreting" statutory language). Had the Legislature intended to include all

titles pensionable under the PERS or PFRS, it would not have listed the

enumerated titles in the 1997 amendment.

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Appellants' reliance on LaRosa is misplaced.3 The controlling facts in

LaRosa are readily distinguishable from this matter. In LaRosa, each appellant

was previously employed by the ABC and the Division of Gaming and

Enforcement (DGE) as inspectors. They became members of the State Police

on April 12, 1997, after voluntarily transferring from those inspector positions.

LaRosa, slip op. at 4. We noted subsection (a) unambiguously states that

creditable service for purposes of the SPRS includes service as an inspector in

the ABC. Id. at 12. Therefore, "all of appellants' service to the State – including

their stints in PERS – qualify as creditable service under this subsection." Id. at

13. We rejected the Board's position that such PERS creditable service is eroded

by subsection (b). Ibid. Central to that determination was the fact that the

creditable service at issue was accrued in one of the titles enumerated in

subsection (a); whereas appellants in this matter were not employed in any of

the enumerated titles. LaRosa provides no support for appellants' position.

On appeal, appellants argue for the first time that the Board's decision

violates the public policy to construe pension statutes liberally. We disagree.

3

The court will engage in the following analysis of this unreported decision for

the limited purpose of demonstrating that it is factually distinguishable from this

matter. See Ryan v. Gina Marie, L.L.C., 420 N.J. Super. 215, 224 n.2 (App.

Div. 2011).

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We recognize that a person deemed eligible for benefits is entitled to a

liberal interpretation of the pension statute, Krayniak v. Bd. of Trs., 412 N.J.

Super. 232, 242 (App. Div. 2010), because "pension statutes are 'remedial in

character' and 'should be liberally construed and administered in favor of the

persons intended to be benefitted thereby,'" Klumb v. Bd. of Educ. of

Manalapan-Englishtown Reg. High Sch. Dist., 199 N.J. 14, 34 (2009) (quoting

Geller v. N.J. Dep't of Treasury, Div. of Pensions & Annuity Fund, 53 N.J. 591,

597-98 (1969)).

These well-established interpretative principles do not apply to eligibility

determinations. Krayniak, 412 N.J. Super. at 242; Smith v. State of New Jersey,

Div. of Pensions and Benefits, 390 N.J. Super. 209, 213 (App. Div. 2007). In

light of the fiduciary duties imposed on fund administrators, pension fund

eligibility guidelines "must be carefully interpreted so as not to obscure or

override considerations of . . . a potential adverse impact on the financial

integrity of the [f]und." Krayniak, 412 N.J. Super. at 242 (alterations in original)

(quoting Smith, 390 N.J. Super. at 213).

The issue here is eligibility for a specific benefit – a full service credit

transfer – not the amount owed under that disputed benefit. Because appellants

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are ineligible for the pension benefits they seek, the rule of liberal construction

does not apply.

Appellants' remaining arguments lack sufficient merit to warrant

discussion in a written opinion. R. 2:11-3(e)(1)(E).

In conclusion, the Board's final decision was not arbitrary, capricious, or

unreasonable. The Board correctly determined that the five named State

Troopers and others similarly situated were not eligible for full SPRS value for

prior service credits in the PFRS. Rather, they were only eligible for one percent

of final compensation for each year of such service credit.

Affirmed.

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