EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0790*
HOUSE BILL 790
P6 3lr1236
By: Delegate Crosby
Introduced and read first time: February 8, 2023
Assigned to: Appropriations
A BILL ENTITLED
AN ACT concerning 1
State Retirement and Pension System – Forfeiture of Benefits 2
FOR the purpose of establishing that a public employee is subject to forfeiture of benefits 3
from the State Retirement and Pension System when the public employee is found 4
guilty of, pleads guilty to, or enters a plea of nolo contendere to a qualifying crime; 5
providing for the processes and procedures to implement a forfeiture of benefits; 6
providing for the processes and procedures to reverse a forfeiture of benefits; and 7
generally relating to the forfeiture of pension benefits. 8
BY repealing and reenacting, with amendments, 9
Article – State Personnel and Pensions 10
Section 21–502(a)(3) 11
Annotated Code of Maryland 12
(2015 Replacement Volume and 2022 Supplement) 13
BY adding to 14
Article – State Personnel and Pensions 15
Section 21–801 through 21–809 to be under the new subtitle “Subtitle 8. Forfeiture 16
of Benefits” 17
Annotated Code of Maryland 18
(2015 Replacement Volume and 2022 Supplement) 19
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF M ARYLAND, 20
That the Laws of Maryland read as follows: 21
Article – State Personnel and Pensions 22
21–502. 23
(a) (3) A court of competent jurisdiction may expressly order that a benefit 24
under this Division II be assigned to a spouse, former spouse, child, or other dependent 25 2 HOUSE BILL 790
when [an order of benefit forfeiture is issued] A FORFEITURE OF BENE FITS OCCURS in 1
accordance with § 21–704 OR § 21–804 of this title. 2
SUBTITLE 8. FORFEITURE OF BENEFITS. 3
21–801. 4
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 5
INDICATED. 6
(B) “DOMESTIC RELATIONS OR DER” MEANS AN ORDER ISSUE D IN 7
ACCORDANCE WITH § 21–502(A)(2) OF THIS TITLE, § 414(P) OF THE INTERNAL 8
REVENUE CODE, AND REGULATIONS ADOP TED BY THE BOARD OF TRUSTEES THAT 9
ASSIGNS A BENEFIT TO A SPOUSE, A FORMER SPOUSE , A CHILD, OR ANY OTHER 10
DEPENDENT OF A PUBLIC EMPLOYEE IN CONNECTION WITH A DECREE OR ORDER OF 11
ALIMONY, CHILD SUPPORT , OR DIVORCE. 12
(C) “FINAL ADJUDICATION ” MEANS ADJUDICATION B Y A TRIAL COURT 13
RESULTING IN FINAL D ISPOSITION OF ALL CH ARGES THAT CONSTITUT E A 14
QUALIFYING CRIME . 15
(D) “PUBLIC EMPLOYEE ” MEANS AN INDIVIDUAL WHO: 16
(1) IS LISTED IN § 21–802 OF THIS SUBTITLE; AND 17
(2) HAS BEEN CHARGED WIT H A QUALIFYING CRIME . 18
(E) “QUALIFYING CRIME ” MEANS A CRIMINAL OFF ENSE UNDER § 3–303, § 19
3–304, § 3–309, OR § 3–310 OF THE CRIMINAL LAW ARTICLE THAT IS COMMITTED IN 20
THE COURSE OF THE PE RFORMANCE OF THE PUBLIC EMPLOYEE ’S DUTIES AND 21
RESPONSIBILITIES . 22
(F) “RETIREMENT ALLOWANCE ”: 23
(1) HAS THE MEANING STAT ED IN § 20–101 OF THIS ARTICLE; AND 24
(2) INCLUDES A VEST ED ALLOWANCE . 25
(G) “VESTED ALLOWANCE ” HAS THE MEANING STAT ED IN § 20–101 OF THIS 26
ARTICLE. 27
21–802. 28
HOUSE BILL 790 3
(A) THIS SUBTITLE APPLIES TO AN INDIVIDUAL WHO IS A MEMBER, FORMER 1
MEMBER, OR RETIREE OF: 2
(1) THE STATE POLICE RETIREMENT SYSTEM; 3
(2) THE LAW ENFORCEMENT OFFICERS’ PENSION SYSTEM; 4
(3) THE EMPLOYEES’ PENSION SYSTEM OR THE EMPLOYEES’ 5
RETIREMENT SYSTEM; 6
(4) THE TEACHERS’ PENSION SYSTEM OR THE TEACHERS’ 7
RETIREMENT SYSTEM; 8
(5) THE CORRECTIONAL OFFICERS’ RETIREMENT SYSTEM; OR 9
(6) THE JUDGES’ RETIREMENT SYSTEM. 10
(B) THIS SUBTITLE DOES NO T APPLY TO ANY SERVI CE EARNED BEFORE 11
JULY 1, 2023. 12
21–803. 13
(A) BENEFITS UNDER THIS DIVISION II OF THIS ARTICLE PAYA BLE TO A 14
PUBLIC EMPLOYEE ARE SUBJECT TO FORFE ITURE IN ACCORDANCE WITH THIS 15
SUBTITLE IF THE PUBLIC EMPLOYEE IS FOUND GUILTY OF , PLEADS GUILTY TO , OR 16
ENTERS A PLEA OF NOL O CONTENDERE TO A QU ALIFYING CRIME . 17
(B) (1) BENEFITS UNDER THIS DIVISION II MAY NOT BE FORFEITED OR 18
REDUCED IF THE INTERNAL REVENUE SERVICE DETERMINES TH AT THE 19
FORFEITURE OR REDUCTION WILL NE GATIVELY AFFECT OR I NVALIDATE THE TAX 20
QUALIFIED STATUS OF ANY OF THE SEVERAL S YSTEMS. 21
(2) IF THE INTERNAL REVENUE SERVICE DETERMINES TH AT THE 22
APPLICATION OF THIS SUBTITLE WOULD NEGAT IVELY AFFECT OR INVA LIDATE THE 23
TAX QUALIFIED STATU S OF ANY OF THE SEVE RAL SYSTEMS, ANY FORFEITURE OF 24
BENEFITS THAT TOOK P LACE BEFORE THE INTERNAL REVENUE SERVICE’S 25
DETERMINATION SHALL BE REVERSED IN ACCOR DANCE WITH § 21–807 OF THIS 26
SUBTITLE TO THE EXTE NT NECESSARY TO COMP LY WITH THE DETERMIN ATION. 27
21–804. 28
4 HOUSE BILL 790
(A) IF THE FINAL ADJUDICA TION OF CHARGES RESU LTS IN CONVICTION OF 1
A PUBLIC EMPLOYEE , THE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWANCE SHALL BE 2
FORFEITED IN ACCORDA NCE WITH THIS SECTIO N. 3
(B) (1) EXCEPT AS PROVIDED UN DER SUBSECTIONS (C), (D), AND (E) OF 4
THIS SECTION, BENEFITS MAY NOT BE PAID TO A PUBLIC EMPLOYEE IF THE BOARD 5
OF TRUSTEES FINDS BY CLE AR AND CONVINCING EV IDENCE THAT: 6
(I) THE PUBLIC EMPLOYEE WAS CONVICTED OF A Q UALIFYING 7
CRIME; 8
(II) THE PUBLIC EMPLOYEE WAS A MEMBER OF THE STATE 9
POLICE RETIREMENT SYSTEM, THE LAW ENFORCEMENT OFFICERS’ PENSION 10
SYSTEM, THE EMPLOYEES’ PENSION SYSTEM, THE EMPLOYEES’ RETIREMENT 11
SYSTEM, THE TEACHERS’ PENSION SYSTEM, THE TEACHERS’ RETIREMENT 12
SYSTEM, THE CORRECTIONAL OFFICERS’ RETIREMENT SYSTEM, OR THE JUDGES’ 13
RETIREMENT SYSTEM; AND 14
(III) THE QUALIFYING CRIME FOR WHICH THE PUBLIC 15
EMPLOYEE WAS CONVICTED WAS CO MMITTED WHILE THE PUBLIC EMPLOYEE WAS 16
AN ACTIVE MEMBER OF THE STATE POLICE RETIREMENT SYSTEM, THE LAW 17
ENFORCEMENT OFFICERS’ PENSION SYSTEM, THE EMPLOYEES’ PENSION SYSTEM, 18
THE EMPLOYEES’ RETIREMENT SYSTEM, THE TEACHERS’ PENSION SYSTEM, THE 19
TEACHERS’ RETIREMENT SYSTEM, THE CORRECTIONAL OFFICERS’ RETIREMENT 20
SYSTEM, OR THE JUDGES’ RETIREMENT SYSTEM. 21
(2) ONLY SERVICE CR EDIT IN THE STATE SYSTEM IN WHICH THE 22
PUBLIC EMPLOYEE IS A MEMBER WHEN THE QUALIFYING CRIME IS COMMITTED IS 23
ELIGIBLE FOR FORFEIT URE UNDER THIS SECTI ON. 24
(C) (1) A PUBLIC EMPLOYEE CONVICTED OF A QUALI FYING CRIME MAY , 25
WITHIN 1 YEAR AFTER THE CONVI CTION, FILE A CLAIM IN CIRCUIT COURT FOR A 26
PARTIAL PAYMENT OF T HE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWANCE . 27
(2) NOTICE OF THE CLAIM F ILED UNDER PARAGRAPH (1) OF THIS 28
SUBSECTION SHALL BE SERVED ON THE STATE RETIREMENT AGENCY. 29
(3) WHEN CONSIDERING A CL AIM OF A PUBLIC EMPLOYEE UNDER 30
PARAGRAPH (1) OF THIS SUBSECTION , THE COURT SHALL CONS IDER: 31
(I) THE SEVERITY OF THE CRIME; 32
HOUSE BILL 790 5
(II) THE AMOUNT OF MONETA RY LOSS SUFFERED BY THE 1
STATE, A COUNTY, A POLITICAL SUBDIVIS ION, OR A PERSON AS A RES ULT OF THE 2
CRIME; 3
(III) THE DEGREE OF PUBLIC TRUST PLACED IN THE PUBLIC 4
EMPLOYEE; 5
(IV) THE FINANCIAL NEEDS AND RESOURCES OF THE PUBLIC 6
EMPLOYEE; 7
(V) THE FINANCIAL NEEDS AND RESOURCES OF THE PUBLIC 8
EMPLOYEE’S SPOUSE, CHILDREN, OR OTHER DEPENDENTS ; 9
(VI) ANY INTEREST IN BENE FITS OF A FORMER SPO USE 10
ESTABLISHED UNDER AN EXISTING DOMESTIC RE LATIONS ORDER ; AND 11
(VII) ANY OTHER FACTORS TH E COURT DETERMINES R ELEVANT. 12
(D) (1) A SPOUSE, A FORMER SPOUSE, A CHILD, OR ANY OTHER 13
DEPENDENT OF A PUBLIC EMPLOYEE CONVICTED OF A QUALI FYING CRIME MAY , 14
WITHIN 1 YEAR AFTER THE CONVI CTION, FILE A CLAIM IN CIRCUIT COURT FOR A 15
PARTIAL PAYMENT OF T HE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWANCE FOR 16
PURPOSES OF CHILD SU PPORT, ALIMONY, OR MARITAL PROPERTY RIGHTS. 17
(2) NOTICE OF THE CLAIM F ILED UNDER PARAGRAPH (1) OF THIS 18
SUBSECTION SHALL BE SERVED ON THE STATE RETIREMENT AGENCY. 19
(3) THE COURT MAY ENTER A DO MESTIC RELATIONS ORD ER THAT 20
PROVIDES THAT SOME O R ALL OF THE FORFEIT ED BENEFITS BE PAID TO A SPOUSE, 21
A FORMER SPOUSE , A CHILD, OR ANY OTHER DEPENDE NT FOR PURPOSES OF C HILD 22
SUPPORT, ALIMONY, OR MARITAL PROPERTY RIGHTS. 23
(4) WHEN DETER MINING WHETHER TO EN TER A DOMESTIC 24
RELATIONS ORDER UNDE R THIS SUBSECTION , THE COURT SHALL CONS IDER 25
WHETHER THE PUBLIC EMPLOYEE ’S SPOUSE, FORMER SPOUSE , CHILDREN, OR 26
OTHER DEPENDENTS WERE CULP ABLE OR COMPLICIT IN THE COMMISSION OF TH E 27
QUALIFYING CRIME . 28
(5) THE COURT MAY NOT ORD ER BENEFITS TO BE PA ID TO A PUBLIC 29
EMPLOYEE’S SPOUSE, FORMER SPOUSE , CHILD, OR OTHER DEPENDENT I N A 30
MANNER THAT IS INCON SISTENT WITH THE PAY MENT OF BENEFITS IN THE STATE 31
SYSTEM IN WHICH THE PUBLIC EMPLOYEE WAS A MEMBER . 32
6 HOUSE BILL 790
(E) (1) A FORFEITURE OF BENEFI TS UNDER THIS SECTIO N MAY NOT 1
IMPAIR OR ALTER AN E XISTING DOMESTIC REL ATIONS ORDER PROVIDI NG BENEFITS 2
TO A FORMER SPOUSE O F A PUBLIC EMPLOYEE . 3
(2) A PUBLIC EMPLOYEE ’S INTEREST IN A BENEFI T OF A FORMER 4
SPOUSE ESTABLISHED B Y A DOMESTIC RELATIONS ORDER MA Y NOT BE SUBJECT TO 5
A FORFEITURE OR REDU CTION UNDER THIS SUB TITLE. 6
(F) BENEFITS AVAILABLE TO A PUBLIC EMPLOYEE AS A BENEFICIARY MAY 7
NOT BE SUBJECT TO A FORFEITURE UNDER THI S SUBTITLE. 8
21–805. 9
(A) IF A PUBLIC EMPLOYEE HAS RETIRED BE FORE BEING CONVICTED OF A 10
QUALIFYING CRIME , THE BOARD OF TRUSTEES MAY RECOVER FROM THE PUBLIC 11
EMPLOYEE THE AMOUNT OF BENEFI TS PAID TO THE PUBLIC EMPLOYEE BEFORE THE 12
CONVICTION. 13
(B) THE RECOVERY UNDER SU BSECTION (A) OF THIS SECTION IS L IMITED 14
TO AN AMOUNT EQUAL TO THE BENEFIT S THAT WOULD HAVE BE EN FORFEITED HAD 15
THE CONVICTION OCCUR RED BEFORE THE PUBLIC EMPLOYEE BEGAN RECEIVING 16
ANY BENEFITS AS A RE TIREE. 17
21–806. 18
(A) THIS SECTION APPLIES TO A PUBLIC EMPLOYEE WHO IS NOT A RETIREE . 19
(B) SUBJECT TO SUBSECTION (C) OF THIS SECTION , A PUBLIC EMPLOYEE 20
MAY SUBMIT AN APPLIC ATION FOR RETIREMENT . 21
(C) IF A PUBLIC EMPLOYEE IS ELIGIBLE TO APPLY FOR A RETIREMENT 22
ALLOWANCE , A PUBLIC EMPLOYEE ’S APPLICATION FOR RETI REMENT BENEFITS : 23
(1) SHALL BE CONSIDERED SUBMITTED ON THE FIRST DAY OF THE 24
MONTH AFTER IT IS PR OPERLY COMPLETED AND SUBMITTED TO THE STATE 25
RETIREMENT AGENCY; AND 26
(2) MAY NOT BE PROCESSED BY THE STATE RETIREMENT AGENCY 27
UNLESS AND UNTIL THE FINAL ADJUDICATION O F THE CHARGE DOES NO T RESULT 28
IN CONVICTION. 29
21–807. 30
HOUSE BILL 790 7
(A) (1) ON RECEIPT OF AN ORDE R THAT REVERSES OR O VERTURNS A 1
CONVICTION OF A PUBLIC EMPLOYEE , THE BOARD OF TRUSTEES SHALL RESCIND 2
THE FORFEITURE OF BENEFITS AND PAY ANY BENEFITS THAT ARE PAYABLE UND ER 3
THIS DIVISION II OF THIS ARTICLE TO T HE PUBLIC EMPLOYEE . 4
(2) WHEN A CONVICTION IS OVER TURNED, ANY DOMESTIC 5
RELATIONS ORDER ENTE RED IN ACCORDANCE WI TH § 21–804(D) OF THIS SUBTITLE 6
IS TERMINATED AND TH E BOARD OF TRUSTEES MAY NOT PAY ANY BENEFITS IN 7
ACCORDANCE WITH THE ORDER. 8
(B) IF A CONVICTION OF A PUBLIC EMPLOYEE WHO WAS A RETIREE BE FORE 9
THE DATE OF CONVICTI ON IS OVERTURNED : 10
(1) THE PUBLIC EMPLOYEE ’S BENEFITS SHALL BE RE STORED BACK 11
TO THE DATE THE BENE FIT PAYMENTS CEASED ; 12
(2) THE ALLOWANCE SHALL : 13
(I) BE PAID BEGINNING TH E MONTH AFTER THE STATE 14
RETIREMENT AGENCY IS NOTIFIED TH AT THE CONVICTION IS OVERTURNED ; AND 15
(II) INCLUDE ANY COST –OF–LIVING ADJUSTMENTS T HAT 16
WOULD HAVE BEEN MADE IN THE TIME BETWEEN THE CONVICTI ON AND THE TIME 17
BENEFIT PAYMENTS ARE RESTORED; AND 18
(3) BENEFIT PAYMENTS THA T WOULD HAVE BEEN MA DE DURING THE 19
TIME FROM THE DATE O F CONVICTION TO THE DATE THE CONVICTION IS 20
OVERTURNED SHALL BE MADE TO THE PUBLIC EMPLOYEE , LESS ANY PAYMENTS: 21
(I) MADE IN ACCORDANCE W ITH A DOMESTIC RELAT IONS 22
ORDER DIRECTING PAYM ENT OF BENEFITS TO A SPOUSE, A FORMER SPOUSE , A 23
CHILD, OR ANY OTHER DEPENDE NT; AND 24
(II) RECEIVED BY THE PUBLIC EMPLOYEE IN ACCORDANCE 25
WITH AN ORDER ISSUED UNDER § 21–804 GRANTING THE PUBLIC EMPLOYEE A 26
PARTIAL PAYMENT OF B ENEFITS. 27
(C) IF A CONVICTION OF A PUBLIC EMPLOYEE WHO WAS NOT A RETIRE E 28
BEFORE THE DATE OF C ONVICTION IS OVERTUR NED, THE PUBLIC EMPLOYEE MAY 29
RECEIVE BENEFITS IN ACCORDANCE WITH THIS DIVISION II OF THIS ARTICLE. 30
21–808. 31
8 HOUSE BILL 790
(A) EXCEPT AS PROVIDED UN DER SUBSECTION (B) OF THIS SECTION , A 1
PUBLIC EMPLOYEE SUBJECT TO A FORFEIT URE UNDER THIS SUBTI TLE IS ENTITLED 2
TO A RETURN OF THE I NDIVIDUAL’S ACCUMULATED CONTRIBUTIO NS ON REQUEST 3
UNDER § 29–501 OF THIS ARTICLE. 4
(B) THE PUBLIC EMPLOYEE ’S ACCUMULATED CONTRIBU TIONS SHALL BE 5
REDUCED BY AN AMOUNT EQUAL TO ANY BENEFIT PAYMENTS RECEIVED BY THE 6
PUBLIC EMPLOYEE THAT WOULD HAVE BEEN SUBJECT TO FORFEITUR E AND HAVE 7
NOT BEEN RECOVERED B Y THE BOARD OF TRUSTEES UNDER § 21–805 OF THIS 8
SUBTITLE. 9
21–809. 10
THE BOARD OF TRUSTEES SHALL ADOPT REGULATIONS TO IMPLE MENT THIS 11
SUBTITLE. 12
SECTION 2. AND BE IT FURTHER ENACTED, T hat this Act shall be construed to 13
apply only prospectively and may not be applied or interpreted to have any effect on or 14
application to any crime committed before the effective date of this Act. 15
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shal l take effect July 16
1, 2023. 17