D.B. Townsend v. Northampton Twp.

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

D. Bruce Townsend, :

Appellant :

:

v. : No. 1361 C.D. 2022

:

Northampton Township : Submitted: November 9, 2023

BEFORE: HONORABLE CHRISTINE FIZZANO CANNON, Judge

HONORABLE ELLEN CEISLER, Judge

HONORABLE LORI A. DUMAS, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION

BY JUDGE CEISLER FILED: January 11, 2024

D. Bruce Townsend appeals from the August 4, 2022 Order of the Court of

Common Pleas of Bucks County (Trial Court) denying his Motion for Partial

Summary Judgment (Motion) and granting the Cross-Motion for Summary

Judgment (Cross-Motion) filed by Northampton Township (Township). This appeal

arises from the forfeiture of funds in Mr. Townsend’s deferred compensation plan

(457 plan)1 pursuant to the Public Employee Pension Forfeiture Act, Act of July 8,

1978, P.L. 752, as amended, 43 P.S. §§ 1311-1315 (Forfeiture Act), due to his

misappropriation of public funds while employed as Township Manager. For the

reasons that follow, we affirm the Trial Court’s Order.

Background

In December 1975, the Township passed a resolution establishing a deferred

compensation plan for the position of Township Manager. On February 28, 1980,

Mr. Townsend entered into an employment contract with the Township to serve as

1

A “457 plan” is a deferred compensation plan that, for purposes of federal income tax, is

governed by Section 457 of the Internal Revenue Code, 26 U.S.C. § 457.

Township Manager until his termination or separation from employment. The

contract also authorized his participation in the Township’s 457 plan.

Mr. Townsend began his employment with the Township on March 3, 1980.

Throughout Mr. Townsend’s employment, all funds in his 457 plan were contributed

by the Township under the terms of the employment contract. Specifically, the

contract stated:

[The] Township will pay 5% of Mr. Townsend’s annual compensation

(as presently fixed and as thereafter increased), as deferred

compensation to . . . ICMA Corporation’s [(ICMA)] deferred

compensation plan. Mr. Townsend shall have the rights granted by such

plan, including the right to designate beneficiaries and to make

supplemental contributions thereto.

Reproduced Record (R.R.) at 57a. The Township did not make any deductions from

Mr. Townsend’s salary to fund those contributions, nor did Mr. Townsend make any

supplemental contributions to the 457 plan from his paycheck. Trial Ct. Op.,

10/14/22, at 2.

In November 2006, the Township discovered that Mr. Townsend had

misappropriated Township funds by using a Township credit card for personal

purchases. As a result, Mr. Townsend resigned from his position, and the Township’s

Board of Supervisors accepted his resignation and voted to terminate his

employment contract with the Township.

In 2007, Mr. Townsend pled guilty to multiple criminal offenses, including

theft by failure to make required disposition of funds received (a third-degree

felony)2 and misapplication of entrusted property and property of government or

2

Section 3927 of the Crimes Code, 18 Pa. C.S. § 3927.

2

financial institutions (a second-degree misdemeanor).3 Both of these crimes are

enumerated in the Forfeiture Act’s definition of “[c]rimes related to public office or

public employment.” See Section 2 of the Forfeiture Act, 43 P.S. § 1312.

Following the entry of Mr. Townsend’s guilty plea, all of his retirement

benefits, including the funds in his 457 plan, were forfeited pursuant to Section 3(a)

of the Forfeiture Act, which states:

[N]o public official or public employee nor any beneficiary designated

by such public official or public employee shall be entitled to receive

any retirement or other benefit or payment of any kind except a return

of the contribution paid into any pension fund without interest, if such

public official or public employee is found guilty of a crime related to

public office or public employment or pleads guilty or nolo contendere

to any crime related to public office or public employment.

43 P.S. § 1313(a) (emphasis added); see also 43 P.S. § 1312 (defining “public

employee” as “all persons who are members of any retirement system funded in

whole or in part by . . . any political subdivision”). The balance of Mr. Townsend’s

457 account at the time of forfeiture was $201,682.60. It is undisputed that this

amount was comprised of “payments made entirely from Township funds, not any

payments made by [Mr.] Townsend.” Trial Ct. Op., 10/14/22, at 3 (emphasis added).

On August 17, 2011, Mr. Townsend filed a Complaint against the Township

and ICMA, seeking a declaration that they improperly exercised forfeiture against

his 457 plan. On December 20, 2011, the parties filed a stipulation with the Trial

Court, wherein they agreed to the dismissal of Mr. Townsend’s claims against ICMA.

After the disposition of the Township’s Preliminary Objections, the Township filed

an Answer, New Matter, and Counterclaim on April 11, 2012.

3

Section 4113 of the Crimes Code, 18 Pa. C.S. § 4113.

3

On August 31, 2021, Mr. Townsend filed the instant Motion with the Trial

Court,4 and the Township filed its Cross-Motion on February 2, 2022. On August 4,

2022, following briefing and oral argument by the parties, the Trial Court entered an

Order granting the Township’s Cross-Motion and denying Mr. Townsend’s Motion.

In its subsequent Pa.R.A.P. 1925(a) Opinion, the Trial Court concluded that

Mr. “Townsend’s deferred compensation benefit with [the] Township was properly

forfeited upon his termination due to criminal activity involving public funds which

amounted to a clear breach of his public employment contract.” Trial Ct. Op.,

10/14/22, at 8 (citing Com. v. Abraham, 62 A.3d 343 (Pa. 2012)). In reaching its

decision, the Trial Court underscored that the parties had confirmed on the record

that “the funds at issue represented all deferred compensation payments made by

[the] Township and did not include any personal fund contributions from [Mr.]

Townsend from his salary.” Id. at 3 (emphasis added); see R.R. at 428a.

In determining whether Mr. Townsend’s 457 plan qualified as a “retirement or

other benefit” subject to forfeiture under the Forfeiture Act, the Trial Court looked

to Section 8.1 of The Fiscal Code, Act of March 30, 1811, P.L. 145, as amended, 72

P.S. § 4521.1 (emphasis added),5 which states that “[s]uch deferred compensation

program shall be in addition to, and not a part of, any other retirement benefit

program provided by law for employes of the county, city, town, or other political

subdivision.” In other words, Section 8.1 of The Fiscal Code categorizes a deferred

compensation plan as an “other retirement benefit program.” The Trial Court found

that because Section 8.1, which was enacted in 1974, pre-dated Mr. Townsend’s

4

Mr. Townsend initially filed a Motion for Summary Judgment on October 27, 2020,

which the Trial Court denied as premature because discovery had not yet been completed.

5

Section 8.1 of The Fiscal Code was added by the Act of July 18, 1974, P.L. 472.

4

employment contract, it applied to his 457 plan. Trial Ct. Op., 10/14/22, at 5.

Therefore, the Trial Court concluded that Mr. Townsend’s 457 plan fell within the

scope of Section 3(a) of the Forfeiture Act, “which requires the forfeiture of any

‘retirement or other benefit or payment of any kind.’” Id. (quoting 43 P.S. § 1313(a))

(emphasis added).

The Trial Court also found that Mr. Townsend’s “eligibility for the deferred

compensation benefit was contingent upon his faithful performance of public service

under his [employment] contract.” Id. at 6. As such, his 457 funds were “only to be

distributed to [him] upon retirement or agreed-upon amicable separation from the

Township after satisfactorily fulfilling his contractual duties as a public official.”

Id. at 7 (emphasis in original). Because Mr. Townsend’s separation was due to his

criminal activity involving public funds, the Trial Court concluded that he forfeited

his 457 benefits, along with his other future retirement benefits, under the Forfeiture

Act. Id. at 7-8.

Mr. Townsend now appeals to this Court.6

Analysis

1. Forfeiture Act’s Applicability

Mr. Townsend first asserts that Section 3(a) of the Forfeiture Act does not

apply to his 457 plan. He contends that Abraham, on which the Trial Court relied,

is inapplicable here because, although the Supreme Court used the phrase “deferred

compensation” in that case, it was referring only to public pensions, not to statutory

deferred compensation plans. According to Mr. Townsend, the Trial Court

erroneously concluded that Abraham’s reference in dictum to “deferred

6

“Our standard of review on appeal from the grant or denial of summary judgment is de

novo, and our scope of review is plenary.” Clean Air Council v. Sunoco Pipeline L.P., 185 A.3d

478, 485 (Pa. Cmwlth. 2018).

5

compensation” means that all forms of deferred compensation fall within the

Forfeiture Act’s purview.

We begin our analysis by reviewing the pertinent language of the Forfeiture

Act. Subsection (a) of Section 3 provides that “no public official or public employee

. . . shall be entitled to receive any retirement or other benefit or payment of any kind

. . . if such public official or public employee is found guilty of a crime related to

public office or public employment or pleads guilty . . . to any crime related to public

office or public employment.” 43 P.S. § 1313(a) (emphasis added).7 Subsection (b)

of Section 3 further provides that “[s]uch plea, verdict or order shall be deemed to

be a breach of a public officer’s or public employee’s contract with his employer.”

Id. § 1313(b) (emphasis added). The plain language of Section 3 does not appear to

limit the types of retirement benefits subject to forfeiture, broadly encompassing

“any retirement or other benefit or payment of any kind.” Id. § 1313(a).

We now turn to the Abraham case on which the Trial Court relied in

interpreting the above statutory language. Abraham arose from a criminal matter

under the Post Conviction Relief Act, 42 Pa. C.S. §§ 9541-9546. The specific issue

before the Supreme Court in Abraham was whether the defendant’s plea counsel was

ineffective for failing to inform him that he would forfeit his state pension upon

pleading guilty to indecent assault of a person less than 16 years of age. While the

issue before the Abraham Court did not arise under the Forfeiture Act, the Supreme

Court analyzed in detail the Forfeiture Act’s legislative intent and purpose to

determine whether pension forfeiture was a direct or collateral consequence of a

7

Our Court has stated that under the Forfeiture Act, “[t]he crime must be committed by

such a public official or employee when that employee’s public employment places him in a

position to commit the crime.” Gierschick v. State Emps.’ Ret. Bd., 733 A.2d 29, 32 (Pa. Cmwlth.

1999).

6

guilty plea. See, e.g., Abraham, 62 A.3d at 348-49 (because the Forfeiture Act itself

“contains no statement of purpose,” the Supreme Court considered, inter alia, the

state legislators’ public discussions of the Act while it was a pending bill in order to

discern its aim). In the end, the Supreme Court held that because pension forfeiture

is a non-punitive, civil consequence of the underlying conviction, counsel was not

ineffective for failing to advise the defendant of the collateral consequence of his

plea. Id. at 352-53.

In conducting its analysis, the Supreme Court, applying prior precedent,

recognized that the purpose of the Forfeiture Act is to “‘promote integrity in public

employment by imposing a forfeiture provision that would deter acts of criminal

misconduct, thereby[] encouraging public employees to maintain standards of

conduct deserving of the public’s trust.’” Id. at 349 (quoting Mazzo v. Bd. of

Pensions & Ret., 611 A.2d 193, 196 (Pa. 1992)). The Supreme Court also explained:

[The Forfeiture Act] is triggered by a specific class of crimes which are

particularly abhorrent when committed by those serving the public; that

a plea to such crimes is deemed a breach of the employment contract

suggests strongly that the statute is designed to ensure employees

maintain their integrity while in public employment. That is, its goal is

to restrict future benefits for public employees who commit certain

crimes, a deterrent.

Id. at 348 (emphasis added). For this reason, the Court determined that under the

Forfeiture Act,

[a]n employee who breaches his contract forfeits his right to deferred

compensation for services rendered in the past. Entitlement to the

compensation that is deferred, however, is not without conditions, the

relevant one being that the employee not commit any of the enumerated

crimes.

Id. at 349 (emphasis added).

7

Before this Court, Mr. Townsend contends that, as interpreted by Abraham,

“[t]he Forfeiture Act explicitly authorizes the forfeiture of pensions, but does not

mention, much less authorize, the forfeiture of a [s]tatutory [d]eferred

[c]ompensation [p]lan.” Townsend Br. at 32. Contrary to this contention, however,

our courts have not distinguished between statutory deferred compensation plans

and pensions with regard to the forfeiture of retirement benefits under the Forfeiture

Act. Both pensions and 457 plans are forms of “deferred compensation,” as

recognized by the Supreme Court in Abraham. See Abraham, 62 A.3d at 349 (“An

employee who breaches his contract forfeits his right to deferred compensation for

services rendered in the past.”) (emphasis added). Although Abraham involved a

pension, the Supreme Court used the terms “pension” and “deferred compensation”

interchangeably in discussing the Act’s legislative purpose and did not limit its

analysis only to pensions. See, e.g., Abraham, 62 A.3d at 349-52. Furthermore, like

a pension, Mr. Townsend’s 457 plan with the Township was funded entirely by

public funds. See Trial Ct. Op., 10/14/22, at 2-3. There is no distinction between

pensions and other forms of deferred compensation earned by public employees for

purposes of Section 3(a) of the Forfeiture Act. See Mazzo, 611 A.2d at 198 (“It has

long been recognized in this Commonwealth that pensions for public employees are

not mere gratuities provided by the employer, but rather are deferred compensation

for services rendered in the past.”) (emphasis added); Newport Twp. v. Margalis,

532 A.2d 1263,1265 (Pa. Cmwlth. 1987) (“[I]t has been held that retirement benefits

are deferred compensation, not gratuities, even where the employee makes no

contribution towards the benefits.”) (emphasis in original). We conclude that, by its

plain language, Section 3(a) of the Forfeiture Act is applicable not only to pensions,

8

but to any “retirement” or “other benefits” or “payments of any kind” that inure to a

public employee as a consequence of his public employment.

We further conclude that both the plain language of Section 3 of the Forfeiture

Act and the Supreme Court’s interpretation thereof establish that, since the statute’s

enactment in 1978, all public employment contracts contain an implied, material

term that the employee refrain from committing “crimes related to public office or

employment.” 43 P.S. § 1312. The Forfeiture Act’s directives are clear: a public

employee who is convicted of or pleads guilty to an enumerated crime related to

public employment forfeits “any retirement or other benefit or payment of any kind,”

and “[s]uch plea, verdict or order shall be deemed to be a breach of [the] public

employee’s contract with his employer.” Id. § 1313(a) and (b) (emphasis added); see

also Scarantino v. Pub. Sch. Emps.’ Ret. Bd., 68 A.3d 375, 385 (Pa. Cmwlth. 2013)

(concluding that, to receive retirement benefits, a public employee must satisfy all

conditions precedent, like age and years of service, as well as another condition: the

“employee cannot have been convicted of one of the enumerated crimes” in the

Forfeiture Act); Pub. Sch. Emps.’ Ret. Bd. v. Matthews, 806 A.2d 971, 973 (Pa.

Cmwlth. 2002) (“Section 3(a) of [the Forfeiture Act] clearly prohibits a public

employee from receiving retirement benefits upon conviction of a crime related to

public employment.”).8

8

In his appellate brief, Mr. Townsend cites Bellomini v. State Employees’ Retirement

Board, 445 A.2d 737 (Pa. 1982), in support of his assertion that “[t]he condition of faithful

performance is contrary to common law.” Townsend Br. at 35-36. However, Mr. Townsend’s

reliance on Bellomini is misplaced, as that case is factually distinguishable. Bellomini involved

two state legislators who, unlike Mr. Townsend, “had obviously met all of the requirements

necessary to receive retirement pay” prior to the Forfeiture Act’s enactment in 1978. 445 A.2d at

741. The Supreme Court concluded that since the legislators had completed their terms of office

and satisfied the conditions of their contracts before the statute’s enactment, the Commonwealth

could not condition receipt of their retirement benefits on “faithful service” because there was no

(Footnote continued on next page…)

9

There are also strong policy reasons supporting this interpretation of the

Forfeiture Act. As Township Manager, Mr. Townsend held a position of public trust

with the Township for 26 years. By misappropriating Township funds for his own

private use while employed by the Township, he violated that public trust and

breached his employment contract by committing acts that constituted “[c]rimes

related to public office or employment.” 43 P.S. § 1313; see Abraham, 62 A.3d at

349 (recognizing that the Forfeiture Act’s legislative history demonstrates “its aim

of preventing those who violate the public’s trust from receiving the benefit of a

taxpayer-funded pension”); Shiomos v. State Employes’ Ret. Bd., 626 A.2d 158, 163

(Pa. 1993) (“It is neither unconscionable nor unreasonable to require honesty and

integrity during an employee’s tenure in public service.”); Apgar v. State Employes’

Ret. Sys., 655 A.2d 185, 189 (Pa. Cmwlth. 1994) (“Because criminal conduct

committed in the course of one’s employment is a violation of the trust the people of

the Commonwealth place in their employees, such conduct shall not be

sanctioned.”).

Next, Mr. Townsend asserts that the Forfeiture Act does not apply to the funds

in his 457 account because those funds were “already received” by him.

Specifically, Mr. Townsend asserts:

[T]he Forfeiture Act, by the including the phrase “entitled to receive,”

limits forfeiture to those funds to funds the employee is “entitled to

receive” (in the future) and not to funds already received. The record

is clear that Mr. Townsend had already received the funds in the 457

preexisting “implied contractual duty of faithfulness”; rather, that condition was later imposed by

statute, as set forth in Section 3(b) of the Forfeiture Act, 43 P.S. § 1313(b). Id. at 740-41.

Therefore, the Court held that the Forfeiture Act was “ineffective as it relate[d] to [the legislators],

and all others whose retirement benefits rights had vested prior to July 8, 1978.” Id. at 741

(emphasis added).

10

[a]ccount before the forfeiture occurred. Therefore, the funds in the

457 [a]ccount could not be forfeited.

Townsend Br. at 32 (emphasis added). In other words, Mr. Townsend contends that

since he earned the 457 benefit attendant to his employment beginning in 1980 and

could have voluntarily left his employment anytime thereafter and “cashed out,” the

benefit was already received by him. We disagree.

Our courts have recognized that deferred compensation is compensation for

services rendered in the past that is held by the public employer for the employee’s

future use and enjoyment. See, e.g., Com. ex rel. Zimmerman v. Officers & Emps.

Ret. Bd., 469 A.2d 141, 142 (Pa. 1983) (per curiam) (“It is the well[-]settled law of

this jurisdiction that the nature of retirement provisions for public employees is that

of deferred compensation for services actually tendered in the past.”) (collecting

cases); Fairview Twp. v. Fairview Twp. Police Ass’n, 795 A.2d 463, 470 (Pa.

Cmwlth. 2002) (same),9 aff’d, 839 A.2d 183 (Pa. 2003). Moreover, our Supreme

Court has stated:

[W]hether or not a public employee’s right to receive retirement

benefits has vested, or he or she is in actual receipt of benefits, all

previous accumulated rights to receive such benefits are subject to

forfeiture by and through the “renewed” agreement which is formed

each time a person chooses to become a “public official” as defined by

[Section] 1312 [of the Forfeiture Act].

Shiomos, 626 A.2d at 162-63 (emphasis added); see also Abraham, 62 A.3d at 352

(in concluding that pension forfeiture is non-punitive, the Supreme Court clarified

that the public employee “is not losing something he already had in hand,” but

9

This Court explained in Fairview Township: “‘When a person undertakes employment,

there is usually a trade-off between present compensation and deferred compensation that is

activated at retirement. The employe[e] agrees to accept less during his active employment in

exchange for benefits during his retirement.’” 795 A.2d at 470 (citation omitted).

11

rather, “he is not getting something he would have received but for his misconduct”)

(emphasis added).

The 457 plan benefit was a bargained-for term of Mr. Townsend’s

employment contract with the Township. It is true that Mr. Townsend could have

voluntarily separated from his employment and chosen to receive his 457 funds at

an earlier time; however, as explained above, he still would have had to refrain from

committing a “crime[] related to public employment” for the duration of his

employment in order to receive that benefit pursuant to his employment contract.

See Abraham, 62 A.3d at 349-50 (“Entitlement to the compensation that is deferred[]

. . . is not without conditions, the relevant one being that the employee not commit

any of the enumerated crimes [in the Forfeiture Act].”). The Trial Court correctly

found:

[Mr. Townsend’s] entitlement to the tax-deferred future compensation

was contingent upon his faithful completion of his public employment

contract with the Township (as was any pension). The deferred

compensation benefit was compensation which [he] was merely

entitled to receive in the future, like a pension. Importantly, the money

paid into the deferred compensation was not taken from his salary, nor

voluntarily contributed by him. Rather, it was an additional 5%

payment solely by the Township from Township funds specifically for

his future use in the [457] plan at issue.

Trial Ct. Op., 10/14/22, at 7. Therefore, we reject Mr. Townsend’s claim that he had

already received the funds in his 457 plan at the time of forfeiture.

2. Fiscal Code

Finally, Mr. Townsend asserts that, in interpreting Section 3(a) of the

Forfeiture Act, the Trial Court erroneously looked to Section 8.1 of The Fiscal Code,

rather than Section 8.2 of The Fiscal Code. Mr. Townsend points specifically to

Section 8.2(h)(1) of The Fiscal Code, which states that “[s]uch deferred

12

compensation plans shall exist and serve in addition to and shall not be a part of [a]

retirement or pension system for officers and employees.” 72 P.S. § 4521.2(h)(1)

(emphasis added).10 Mr. Townsend also asserts that Section 8.2(h)(4), 72 P.S. §

4521.2(h)(4), prohibits the “involuntary transfer” of assets held in trust in 457 plans

created under that section and that “involuntary transfer” necessarily encompasses

forfeiture.11 Thus, Mr. Townsend contends that, under Section 8.2 of The Fiscal

Code, the funds in his 457 plan are not subject to forfeiture under the Forfeiture Act.

We disagree, because we conclude that Mr. Townsend’s 457 plan is governed by

Section 8.1 of The Fiscal Code, not Section 8.2.

Section 8.1(a) of The Fiscal Code provides that a political subdivision, such

as the Township, may “by contract, agree with any employe[e]” to create a deferred

compensation program for the employee. 72 P.S. § 4521.1(a). Importantly, the

General Assembly enacted Section 8.1 in 1974, one year before the Township

resolution establishing the 457 plan at issue here and six years before Mr.

Townsend’s employment contract authorizing his participation in the plan. Relevant

to this appeal, Section 8.1(e) provides that a deferred compensation plan formed

under that section “shall be in addition to, and not a part of, any other retirement

10

Section 8.2 of The Fiscal Code was added by the Act of November 6, 1987, P.L. 394.

11

Section 8.2(h)(4) of The Fiscal Code provides:

Any benefit or interest available under a deferred compensation plan established

under this section, or any right to receive or direct payments under such a plan, or

any distribution of payment made under such a plan shall not, except as expressly

specified by the plan, be subject to assignment, alienation, garnishment,

attachment, transfer, anticipation, sale, mortgage, pledge, hypothecation,

commutation, execution or levy, whether by voluntary or involuntary act of any

interested person.

72 P.S. § 4521.2(h)(4) (emphasis added).

13

benefit program provided by law for employes of the county, city, town, or other

political subdivision.” Id. § 4521.1(e). This language suggests that a 457 plan

formed under Section 8.1 is a “retirement benefit” that falls within the Forfeiture

Act’s purview. See 43 P.S. § 1313(a) (stating that “any retirement or other benefit

or payment of any kind” is subject to forfeiture upon a conviction for an enumerated

offense) (emphasis added).

Section 8.2 of The Fiscal Code was enacted 13 years later, in 1987. Section

8.2(h)(1) states that “[s]uch deferred compensation plans shall exist and serve in

addition to and shall not be a part of [a] retirement or pension system for officers

and employees.” 72 P.S. § 4521.2(h)(1) (emphasis added). However, as the Trial

Court correctly determined, Section 8.2 “was enacted several years after [Mr.]

Townsend’s benefit plan was created in 1980 pursuant to his employment agreement

with the Township,” and, as such, his 457 “plan could not have been created pursuant

to Section [8].2 as it did not exist in 1980.” Trial Ct. Op., 10/14/22, at 5 (emphasis

added). The legislature also did not delete Section 8.1 when it added Section 8.2,

demonstrating that Section 8.1 is still applicable to 457 plans established prior to

1987.

Furthermore, Section 8.2(h)(4) of The Fiscal Code, which prohibits the

involuntary transfer of assets held in 457 plans, explicitly applies to “[a]ny benefit

or interest available under a deferred compensation plan established under this

section.” 72 P.S. § 4521.2(h)(4) (emphasis added).12 Again, Mr. Townsend’s 457

plan was not “established under” Section 8.2 of The Fiscal Code, as both the

12

Section 8.1 of The Fiscal Code contains no similar prohibition against “involuntary

transfer.”

14

Township resolution establishing the plan and his 1980 employment contract

authorizing his participation in the plan pre-dated Section 8.2’s enactment.13

The record establishes that Mr. Townsend’s 457 plan was formed under the

authority of Section 8.1 of The Fiscal Code, not the later-added Section 8.2.

Therefore, the Trial Court properly looked to Section 8.1, rather than Section 8.2, in

interpreting the language of Section 3(a) of the Forfeiture Act. Section 8.1 of The

Fiscal Code refers to a deferred compensation plan as another type of “retirement

benefit program” available to public employees. As such, we conclude that Mr.

Townsend’s 457 plan is a “retirement or other benefit or payment of any kind” that

falls within the purview of Section 3(a) of the Forfeiture Act. 43 P.S. § 1313(a).

Conclusion

We conclude the Trial Court correctly interpreted and applied the relevant

provisions of the Forfeiture Act, as interpreted by the Supreme Court in Abraham,

and The Fiscal Code. The funds in Mr. Townsend’s 457 plan were properly forfeited

following his entry of a guilty plea to crimes involving public employment

enumerated in the Forfeiture Act. Accordingly, we affirm the Trial Court’s Order.

__________________________________

ELLEN CEISLER, Judge

13

The primary case on which Mr. Townsend relies to support his argument that Section

8.2 of The Fiscal Code applies to his 457 plan, D’Amour v. Lower Merion Township (Pa. Cmwlth.

No. 957 C.D. 2018, filed August 30, 2019), is an unreported, non-precedential decision of this

Court and did not address the legal question presently before us.

15

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

D. Bruce Townsend, :

Appellant :

:

v. : No. 1361 C.D. 2022

:

Northampton Township :

ORDER

AND NOW, this 11th day of January, 2024, the August 4, 2022 Order of the

Court of Common Pleas of Bucks County is hereby AFFIRMED.

__________________________________

ELLEN CEISLER, Judge