EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0388*
SENATE BILL 388
P6 5lr2413
HB 9/24 – APP CF HB 98
By: Senator Folden
Introduced and read first time: January 17, 2025
Assigned to: Budget and Taxation
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
(2024 Replacement Volume and 2024 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
(2024 Replacement Volume and 2024 Supplement) 19
SECTION 1. BE IT ENACTED BY TH E GENERAL ASSEMBLY OF MARYLAND, 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 SENATE BILL 388
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 MEANI NGS 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 PUBLI C EMPLOYEE IN CONNEC TION WITH A DECREE O R 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 C HARGES THAT CONSTITU TE 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 COMMI TTED IN 20
THE COURSE OF THE PE RFORMANCE OF THE PUB LIC 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 VESTED AL LOWANCE. 25
(G) “VESTED ALLOWANCE ” HAS THE MEANING STAT ED IN § 20–101 OF THIS 26
ARTICLE. 27
21–802. 28
SENATE BILL 388 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, 2025. 12
21–803. 13
(A) BENEFITS UNDER THIS DIVISION II OF THIS ARTICLE PAYA BLE TO A 14
PUBLIC EMPLOYEE ARE SUBJECT TO FORFEITUR E IN ACCORDANCE WITH THIS 15
SUBTITLE IF THE PUBL IC 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 REDUCT ION WILL NEGATIVELY AFFECT OR INVALIDATE 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 STATUS OF ANY OF THE SEVERAL SYSTE MS, 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
(A) IF THE FINAL ADJUDICA TION OF CHARGES RESU LTS IN CONVICTION OF 29
A PUBLIC EMPLOYEE , THE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWAN CE SHALL BE 30 4 SENATE BILL 388
FORFEITED IN ACCORDA NCE WITH THIS SECTIO N. 1
(B) (1) EXCEPT AS PROVIDED UN DER SUBSECTIONS (C), (D), AND (E) OF 2
THIS SECTION, BENEFITS MAY NOT BE PAID TO A PUBLIC EMP LOYEE IF THE BOARD 3
OF TRUSTEES FINDS BY CLE AR AND CONVINCING EV IDENCE THAT: 4
(I) THE PUBLIC EMPLOYEE WAS CONVICTED OF A Q UALIFYING 5
CRIME; 6
(II) THE PUBLIC EMPLOYEE WAS A MEMBER OF THE STATE 7
POLICE RETIREMENT SYSTEM, THE LAW ENFORCEMENT OFFICERS’ PENSION 8
SYSTEM, THE EMPLOYEES’ PENSION SYSTEM, THE EMPLOYEES’ RETIREMENT 9
SYSTEM, THE TEACHERS’ PENSION SYSTEM, THE TEACHERS’ RETIREMENT 10
SYSTEM, THE CORRECTIONAL OFFICERS’ RETIREMENT SYSTEM, OR THE JUDGES’ 11
RETIREMENT SYSTEM; AND 12
(III) THE QUALIFYING CRIME FOR WHICH THE PUBLIC 13
EMPLOYEE WAS CONVICT ED WAS COMMITTED WHI LE THE PUBLIC EMPLOY EE WAS 14
AN ACTIVE MEMBER OF THE STATE POLICE RETIREMENT SYSTEM, THE LAW 15
ENFORCEMENT OFFICERS’ PENSION SYSTEM, THE EMPLOYEES’ PENSION SYSTEM, 16
THE EMPLOYEES’ RETIREMENT SYSTEM, THE TEACHERS’ PENSION SYSTEM, THE 17
TEACHERS’ RETIREMENT SYSTEM, THE CORRECTIONAL OFFICERS’ RETIREMENT 18
SYSTEM, OR THE JUDGES’ RETIREMENT SYSTEM. 19
(2) ONLY SERVICE CREDIT I N THE STATE SYSTEM IN WHIC H THE 20
PUBLIC EMPLOYEE IS A MEMBER WHEN THE QUAL IFYING CRIME IS COMM ITTED IS 21
ELIGIBLE FOR FORFEIT URE UNDER THIS SECTI ON. 22
(C) (1) A PUBLIC EMPLOYEE CONV ICTED OF A QUALIFYIN G CRIME MAY, 23
WITHIN 1 YEAR AFTER THE CONVI CTION, FILE A CLAIM IN CIRC UIT COURT FOR A 24
PARTIAL PAYMENT OF T HE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWAN CE. 25
(2) NOTICE OF THE CLAIM F ILED UNDER PARAGRAPH (1) OF THIS 26
SUBSECTION SHALL BE SERVED ON THE STATE RETIREMENT AGENCY. 27
(3) WHEN CONSIDERING A CL AIM OF A PUBLIC EMPL OYEE UNDER 28
PARAGRAPH (1) OF THIS SUBSECTION , THE COURT SHALL CONS IDER: 29
(I) THE SEVERITY OF THE CRIME; 30
(II) THE AMOUNT OF MONETA RY LOSS SUFFERED BY THE 31
STATE, A COUNTY, A POLITICAL SUBDIVIS ION, OR A PERSON AS A RES ULT OF THE 32
CRIME; 33
SENATE BILL 388 5
(III) THE DEGREE OF PUBLIC TRUST PLAC ED IN THE PUBLIC 1
EMPLOYEE; 2
(IV) THE FINANCIAL NEEDS AND RESOURCES OF THE PUBLIC 3
EMPLOYEE; 4
(V) THE FINANCIAL NEEDS AND RESOURCES OF THE PUBLIC 5
EMPLOYEE’S SPOUSE, CHILDREN, OR OTHER DEPENDENTS ; 6
(VI) ANY INTEREST IN BENE FITS OF A FORMER SPO USE 7
ESTABLISHED UNDER AN EX ISTING DOMESTIC RELA TIONS ORDER; AND 8
(VII) ANY OTHER FACTORS TH E COURT DETERMINES R ELEVANT. 9
(D) (1) A SPOUSE, A FORMER SPOUSE , A CHILD, OR ANY OTHER 10
DEPENDENT OF A PUBLI C EMPLOYEE CONVICTED OF A QUALIFYING CRIM E MAY, 11
WITHIN 1 YEAR AFTER THE CONVICTION , FILE A CLAIM IN CIRC UIT COURT FOR A 12
PARTIAL PAYMENT OF T HE PUBLIC EMPLOYEE ’S RETIREMENT ALLOWAN CE FOR 13
PURPOSES OF CHILD SU PPORT, ALIMONY, OR MARITAL PROPERTY RIGHTS. 14
(2) NOTICE OF THE CLAIM F ILED UNDER PARAGRAPH (1) OF THIS 15
SUBSECTION SHALL BE SERVED ON THE STATE RETIREMENT AGENCY. 16
(3) THE COURT MAY ENTER A DOMESTIC RELATIONS O RDER THAT 17
PROVIDES THAT SOME O R ALL OF THE FORFEIT ED BENEFITS BE PAID TO A SPOUSE, 18
A FORMER SPOUSE , A CHILD, OR ANY OTHER DEPENDE NT FOR PURPOSES OF CHILD 19
SUPPORT, ALIMONY, OR MARITAL PROPERTY RIGHTS. 20
(4) WHEN DETERMINING WHET HER TO ENTER A DOMES TIC 21
RELATIONS ORDER UNDE R THIS SUBSECTION , THE COURT SHALL CONS IDER 22
WHETHER THE PUBLIC E MPLOYEE’S SPOUSE, FORMER SPOUSE , CHILDREN, OR 23
OTHER DEPENDENTS WER E CULPABLE OR COMPLICI T IN THE COMMISSION OF THE 24
QUALIFYING CRIME . 25
(5) THE COURT MAY NOT ORD ER BENEFITS TO BE PA ID TO A PUBLIC 26
EMPLOYEE’S SPOUSE, FORMER SPOUSE , CHILD, OR OTHER DEPENDENT I N A 27
MANNER THAT IS INCON SISTENT WITH THE PAY MENT OF BENEFITS IN THE STATE 28
SYSTEM IN WHICH THE PUBLIC EMPLOYEE WAS A MEMBER. 29
(E) (1) A FORFEITURE OF BENEFI TS UNDER THIS SECTIO N MAY NOT 30
IMPAIR OR ALTER AN E XISTING DOMESTIC REL ATIONS ORDER PROVIDI NG BENEFITS 31
TO A FORMER SPOUSE O F A PUBLIC EMPLOYEE . 32
(2) A PUBLIC EMPLOYEE’S INTEREST IN A BENE FIT OF A FORMER 33 6 SENATE BILL 388
SPOUSE ESTABLISHED B Y A DOMESTIC RELATIO NS ORDER MAY NOT BE SUBJECT TO 1
A FORFEITURE OR REDU CTION UNDER THIS SUB TITLE. 2
(F) BENEFITS AVAILABLE TO A PUBLIC EMPLOYEE AS A BENEFICIARY MAY 3
NOT BE SUBJECT TO A FORFEITURE UNDER THIS SUBT ITLE. 4
21–805. 5
(A) IF A PUBLIC EMPLOYEE HAS RETIRED BEFORE B EING CONVICTED OF A 6
QUALIFYING CRIME , THE BOARD OF TRUSTEES MAY RECOVER FROM THE PUBLIC 7
EMPLOYEE THE AMOUNT OF BENEFITS PAID TO THE PUBLIC EMPLOYEE BEFORE THE 8
CONVICTION. 9
(B) THE RECOVERY UNDER SU BSECTION (A) OF THIS SECTION IS L IMITED 10
TO AN AMOUNT EQUAL T O THE BENEFITS THAT WOULD HAVE BEEN FORF EITED HAD 11
THE CONVICTION OCCUR RED BEFORE THE PUBLI C EMPLOYEE BEGAN REC EIVING 12
ANY BENEFITS AS A RE TIREE. 13
21–806. 14
(A) THIS SECTION APPLIES TO A PUBLIC EMPLOYEE WHO IS NOT A RETIREE. 15
(B) SUBJECT TO SUBSECTION (C) OF THIS SECTION , A PUBLIC EMPLOYEE 16
MAY SUBMIT AN APPLIC ATION FOR RETIREMENT . 17
(C) IF A PUBLIC EMPLOYEE IS ELIGIBLE TO APPLY FOR A RETIREMENT 18
ALLOWANCE , A PUBLIC EMPLOYEE ’S APPLICATION FOR RETI REMENT BENEFITS : 19
(1) SHALL BE CONSIDERED SUBMITTED ON THE FIR ST DAY OF THE 20
MONTH AFTER IT IS PR OPERLY COMPLETED AND SUBMITTED TO THE STATE 21
RETIREMENT AGENCY; AND 22
(2) MAY NOT BE PROCESSED BY THE STATE RETIREMENT AGENCY 23
UNLESS AND U NTIL THE FINAL ADJUD ICATION OF THE CHARG E DOES NOT RESULT 24
IN CONVICTION. 25
21–807. 26
(A) (1) ON RECEIPT OF AN ORDE R THAT REVERSES OR O VERTURNS A 27
CONVICTION OF A PUBL IC EMPLOYEE, THE BOARD OF TRUSTEES SHALL RESCIN D 28
THE FORFEITURE OF BE NEFITS AND PAY ANY B ENEFITS THAT ARE PAYABL E UNDER 29
THIS DIVISION II OF THIS ARTICLE TO T HE PUBLIC EMPLOYEE . 30
(2) WHEN A CONVICTION IS OVERTURNED , ANY DOMESTIC 31 SENATE BILL 388 7
RELATIONS ORDER ENTE RED IN ACCORDANCE WI TH § 21–804(D) OF THIS SUBTITLE 1
IS TERMINATED AND TH E BOARD OF TRUSTEES MAY NO T PAY ANY BENEFITS I N 2
ACCORDANCE WITH THE ORDER. 3
(B) IF A CONVICTION OF A PUBLIC EMPLOYEE WHO WAS A RETIREE BEFORE 4
THE DATE OF CONVICTI ON IS OVERTURNED : 5
(1) THE PUBLIC EMPLOYEE ’S BENEFITS SHALL BE RESTORED BACK 6
TO THE DATE THE BENE FIT PAYMENTS CEASED ; 7
(2) THE ALLOWANCE SHALL : 8
(I) BE PAID BEGINNING TH E MONTH AFTER THE STATE 9
RETIREMENT AGENCY IS NOTIFIED TH AT THE CONVICTION IS OVERTURNED ; AND 10
(II) INCLUDE ANY COST –OF–LIVING ADJUSTMENTS T HAT 11
WOULD HAVE BEEN MADE IN THE TIME BETWEEN THE CONVICTION AND THE T IME 12
BENEFIT PAYMENTS ARE RESTORED; AND 13
(3) BENEFIT PAYMENTS THA T WOULD HAVE BEEN MA DE DURING THE 14
TIME FROM THE DATE O F CONVICTION TO THE DATE THE CONVICTION IS 15
OVERTURNED SHALL BE MADE TO THE PUBLIC E MPLOYEE, LESS ANY PAYMENTS : 16
(I) MADE IN ACCORDANCE W ITH A DOMESTIC RELAT IONS 17
ORDER DIRECTING PAYM ENT OF BENEFITS TO A SPOUSE, A FORMER SPOUSE , A 18
CHILD, OR ANY OTHER DEPENDE NT; AND 19
(II) RECEIVED BY THE PUBL IC EMPLOYEE IN ACCOR DANCE 20
WITH AN ORDER ISSUED UNDER § 21–804 OF THIS SUBTITLE GRANTING THE PUBL IC 21
EMPLOYEE A PARTIAL P AYMENT OF BENEFITS . 22
(C) IF A CONVICTION OF A PUBLIC EMPLOYEE WHO WAS NOT A RETIREE 23
BEFORE THE DATE OF C ONVICTION IS OVERTUR NED, THE PUBLIC EMPLOYEE MAY 24
RECEIVE BENEFITS IN ACCORDANCE WITH THIS DIVISION II OF THIS ARTICLE. 25
21–808. 26
(A) EXCEPT AS PROVIDED UN DER SUBSECTION (B) OF THIS SECTION , A 27
PUBLIC EMPLOYEE SUBJ ECT TO A FORFEITURE UNDER THIS SUBTITLE IS ENTITLED 28
TO A RETURN OF THE I NDIVIDUAL’S ACCUMULATED CONTRI BUTIONS ON REQUEST 29
UNDER § 29–501 OF THIS ARTICLE. 30
(B) THE PUBLIC EMPLOYEE ’S ACCUMULATED CONTRI BUTIONS SHALL BE 31
REDUCED BY AN AMOUNT EQUAL TO ANY BENEFIT PAYMENTS RECEIVED BY THE 32 8 SENATE BILL 388
PUBLIC EMPLOYEE THAT WOULD HAVE BEEN SUBJ ECT TO FORFEITURE AN D HAVE 1
NOT BEEN RECOVERED B Y THE BOARD OF TRUSTEES UNDER § 21–805 OF THIS 2
SUBTITLE. 3
21–809. 4
THE BOARD OF TRUSTEES SHALL ADOPT REGULATIONS TO IMPLE MENT THIS 5
SUBTITLE. 6
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall be construed to 7
apply only prospectively and may not be applied or interpreted to have any effect on or 8
application to any crime committed before the effective date of this Act. 9
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect July 10
1, 2025. 11