Do county elected officials and county employees receive retirement credit for a bonus or lump sum payment?
Yes, anyone on a county payroll that is otherwise eligible for retirement credit in the Arkansas Public Employees Retirement System should receive credit for a bonus or lump sum payment. The county should pay into the retirement system the contribution percentage that has been set by the APERS Board of Trustees and the employee, if they are a member of the contributory system, will pay into the retirement system – through payroll deduction – the percentage that has been set by state law.
It has only been since July 1, 2009 that a bonus or lump sum payment has been used in the calculation of compensation for retirement purposes for elected officials and employees of counties. Prior to that time, compensation for retirement purposes was defined in A.C.A. 24-4-101(11)(A) as “recurring remuneration paid a member by public employers for personal services rendered by a member in a position covered by an employer participating in the Arkansas Public Employees’ Retirement System.” The only exceptions to that rule were for state employees where, by law, “recurring remuneration” included career service recognition payments to state employees authorized in A.C.A. 21-5-106; merit increases for state employees authorized in A.C.A. 21-5-1101; and lump sum salary adjustments for state employees authorized in A.C.A. 21-5-211 and 21-5-219.
During tough economic times it became more and more popular in county government to give an end-of-the-year bonus or a lump sum payment rather than giving salary or hourly wage pay increases. By doing this counties were able to help their employees somewhat with carry-over balances or one-time sources of revenue without building increased on-going costs into their budgets. However, county employees were not getting any retirement benefit from these one-time payments because of the definition of “compensation” in the retirement code for APERS. In 2009, Act 616 was enacted by the 87th General Assembly to amend the definition of compensation under the Arkansas Public Employees’ Retirement System to include a bonus or lump sum paid to a county or municipal employee.
Act 616 of 2009 amended two codes to accomplish the inclusion of a bonus or lump sum payment in the calculation of retirement benefits for county employees. A.C.A. 14-14-1206(a), dealing with county compensation was amended to say, “The quorum court of each county shall, by ordinance, fix the number and compensation of all county employees, including a bonus or lump sum payment.” A.C.A. 24-4-101, the code delineating definitions as used for retirement purposes from the Arkansas Public Employees’ Retirement System was also amended – specifically, A.C.A. 24-4-101(11) defining compensation. As mentioned earlier, compensation is defined in this law as “recurring remuneration”. Act 616 of 2009 amended A.C.A. 24-4-101(11) to consider recurring remuneration for personal services for the purposes of determining retirement benefits to include, “payments made to a member under A.C.A. 14-14-1206(a) [a county employee], including without limitation a bonus or lump-sum payment.”
The law does set a limit on the amount of the bonus of lump-sum payment that can be counted as compensation during the last year of an employee’s employment. A.C.A. 24-4-101(11)(B)(iii)(b) says, “The maximum amount of the bonus or lump-sum payment that will be considered to be compensation during the last year of a member’s employment is the lesser of five percent (5%) of the current year’s salary or the amount of the bonus or lump-sum payment that was received by the member during the previous year of employment.”
Who in county government is responsible for maintaining custody of the titles to county owned vehicles and equipment?
Arkansas law does not directly answer that question. I cannot point you to an Arkansas code that says that a certain county official or office shall have custody of titles to county owned vehicles and equipment. However, I would like to call your attention to several laws that help us draw a reasonable conclusion. They are:
- Arkansas Code Annotated 14-25-106. Fixed asset records.
- Amendment 55, Article 3 of the Arkansas Constitution
- Arkansas Code Annotated 14-14-1101. Powers of county judge generally.
- Arkansas Code Annotated 14-14-1102. Exercise of powers by county judge.
A.C.A. 14-25-106 requires each county official to maintain an inventory of all fixed assets under the control of their office. The exception to this rule is if the quorum court designates one county official or county employee to be responsible for maintaining the inventory or fixed asset list. Although, as a general rule, a county official is responsible for maintaining an inventory record under this code – it does NOT give or constitute “custody” of the property to the individual county officials.
Arkansas Constitution, Amendment 55, Article 3 specifically grants “custody of county property” to the County Judge.
•Amendment 55, Article 3 – The County Judge, in addition to other powers and duties provided for by the Constitution and by law, shall preside over the Quorum Court without a vote but with the power of veto; authorize and approve disbursement of appropriated funds;
operate the system of county roads; administer ordinances enacted by the Quorum Court; have custody of county property; hire county employees, except those persons employed by other elected officials of the county.
A.C.A. 14-14-1101 deals with “powers of the county judge generally” and reiterates the executive powers of the county judge as established in Arkansas Constitution, Amendment 55, Article 3. A.C.A. 14-14-1101(a)(5) specifically says that the county judge has “custody of county property”.
A.C.A. 14-14-1102 deals with the exercise of powers by the county judge including, but not limited to, “custody of county property”. A.C.A. 14-14-1102(3)(A) says, “The county judge, as the chief executive officer of the county, shall have custody of county property and is responsible for the administration, care, and keeping of such county property, including the right to dispose of county property in the manner and procedure provided by law for the disposal of county property by the county court.* The county judge shall have the right to lease, assign, or not assign use of such property whether or not the county property was purchased with county funds or was acquired through donations, gifts, grants, confiscation, or condemnation.”
*Note: The responsibility of “the disposal of county property” also lies with the county judge – as noted above. The prevailing laws dealing with the disposal or sale of county property are:
- ACA 14-16-105. Sale of county property generally.
- ACA 14-16-106. Sale or disposal of surplus property.
- ACA 14-16-107. Sale of realty to certain organizations.
- ACA 14-16-116. Property exchange by counties.
Accordingly, it is my conclusion that the law is definitive that the County Judge exercises the executive power of “custody of county property” and is also the only county official with the authority to “sell or dispose of county property”. Therefore it is reasonable to conclude that the County Judge should maintain custody of all titles to county vehicles and equipment since these are lawful instruments needed to: (1) prove custody; and (2) convey or transfer ownership if the County Judge exercises his or her right to sell or dispose of said county property.
Is “county government” exempt from paying sales taxes?
No. As a general rule the seventy-five (75) county governments of Arkansas are subject to the sales and use tax laws – paying sales taxes properly billed on invoices and submitting use taxes to the Department of Finance and Administration on purchases made from out-of-state vendors that do not charge, bill and remit out-of-state sales taxes.
There are a couple of exceptions. County government in Arkansas is exempt from paying sales taxes on “motor vehicles” and on “jail food” (or in certain circumstances food for other uses).
Arkansas Code Annotated 26-52-410(a) says, “No tax shall be levied or collected upon gross receipts derived from the sale of motor vehicles to municipalities and counties………”. A long standing memorandum from the Department of Finance and Administration has defined “motor vehicles” as used in A.C.A. 26-52-410 as rolling stock, which includes vehicles and equipment as long as it is self-propelled and rolls on tires or tracks.Arkansas Code Annotated 26-52-401 exempts various products and services from sales and use taxes. A.C.A. 26-52-401(19) specifically exempts “food, food ingredients, or prepared food to governmental agencies for free distribution to any public, penal, and eleemosynary institutions [an institution supported by charity] (Emphasis added) or for distribution to the poor and needy.” The Department of Finance and Administration has defined ‘governmental agencies’ as used in this code as, “any agency or department of the United States, the State of Arkansas, counties, cities or towns or school districts. ‘Governmental agencies’ does not include a private non-profit organization funded wholly or in part by public monies.”
Is a county liable for paying the normal fees to a county employee for serving as a juror or a prospective juror? If so, is the county allowed to deduct those fees from the regular salary of the county employee? Does the county have to bear all the cost?
Yes, a county employee should be paid the per diem compensation for serving as a juror just like any other person. Arkansas Code Annotated 16-34-103(a)(1)(2) says, “Any person who receives official notice that he or she has been selected as a prospective juror or who is chosen as a juror is eligible to receive per diem compensation for service if: (1) The person actually appears at the location to which the juror or prospective juror was summoned; and (2) The person’s appearance is duly noted by the circuit clerk.”
The per diem compensation, as established by A.C.A. 16-34-103(b)(1)(2), is $50.00 per day for a person who is selected and seated to serve as a member of a grand jury or petit jury. Those who are excused or otherwise not selected and seated as a member of the jury are provided per diem compensation of not less than $15.00 as established by ordinance of the county quorum court for each day that they are required to appear at the location to which they were summoned.
In addition to the per diem established for jurors and prospective jurors, A.C.A. 16-34-104 establishes an avenue for mileage reimbursement in the event and to the extent that a county quorum court adopts by ordinance a policy for reimbursement of mileage costs for jurors. The mileage reimbursement payment is allowed only to those whose primary place of residence is outside the city limits of the court that summoned them for duty and is paid from and to his or her home by the most direct and practicable route at the rate prescribed by the county.
A county may be reimbursed by the State of Arkansas on a quarterly basis for the $50.00 per diem fees paid to persons selected and seated to serve as a member of a grand jury or petit jury. The reimbursement process and time-line is set forth in A.C.A. 16-34-106.
The deduction of jury duty fees from the salary of a county employee is prohibited by state law. A.C.A. 21-5-104(a) says, “No state, county, or municipal employer in this state shall deduct from the usual compensation of any employee, all or any part of the fees or compensation received by the employee for appearing for grand or petit jury duty or serving on any grand or petit jury in any court in this state.”
In fact, a county employer who violates the provision of A.C.A. 21-5-104 is guilty of a misdemeanor and upon conviction can be fined up to $250.00 and the violation constitutes grounds for dismissal of the employer from his or her office or position of public employment.
May a retiring county official or employee keep county health care insurance coverage upon and during retirement? Can they keep dependent coverage and is it mandatory for the county to allow retirees continued health care insurance coverage?
Yes, a retiring county official or county employee may elect to keep county health care insurance coverage if they meet certain criteria in the law and if they pay the entire premium.
Arkansas Code Annotated 24-12-128 [Act 745 of 1995 as amended by Act 822 of 1997] says, “When any county official or county employee retires and, either, is fifty-five (55) years or older and vested in the County Division of the Arkansas Public Employees’ Retirement System, or has thirty (30) or more years of actual service or thirty-five (35) years of credited service in the County Division of the Arkansas Public Employees’ Retirement System regardless of age, the official or employee may continue to participate in the county health care plan as long as the official or employee pays both employer and employee contributions to the health care plan.”
There is no case law available where Arkansas courts have interpreted provisions of A.C.A. 24-12-128 but, there are several Attorney General Opinions addressing questions concerning the practical application of A.C.A. 24-12-128. Here is a list of the AG Opinions that have been issued on this subject:
- AG Opinion No. 2008-008
- AG Opinion No. 2003-235
- AG Opinion No. 1999-053
- AG Opinion No. 1998-066
- AG Opinion No. 1997-108
To summarize and specifically answer your questions – a retiring county official or county employee may elect to continue to participate in the county health care plan if: (1) they are at least 55 years old and vested in the County Division of APERS; or (2) they have 30 or more years of actual service in the County Division of APERS regardless of age; or (3) they have at least 35 years of credited service in the County Division of APERS regardless of age. They must also pay the entire health care plan premium.
The coverage that retirees are entitled to retain under the authority of A.C.A. 24-12-128 is the same coverage that active employees receive. If the county health care plan includes dental, vision, life insurance and dependent coverage, such coverage may be retained by the retiree as long as they pay the entire premium.
It is mandatory on the part of the county to allow the qualifying retiree to participate in the county health care plan. The discretionary term “may” found in A.C.A. 24-12-128 applies to the retiree, rather than the county. This provision leaves the decision as to whether to continue to participate in the county health care plan wholly within the discretion of the qualifying retiree. Because the qualifying retiree has full discretion to choose to participate, it follows that the county is required to permit that retiree to participate.
Since state law affords county retirees the option of continued participation in the county health care plan, constitutional and code restrictions prevent counties from adopting ordinances that restrict or conflict with this state law [A.C.A. 24-12-128]. Amendment 55, Article 1, Section (a) says, “A county acting through its Quorum Court may exercise local legislative authority not denied by the Constitution or by law.” Arkansas Code Annotated 14-14-805 denies several powers to the Quorum Court. A.C.A. 14-14-805 says, “Each county quorum court in the State of Arkansas exercising local legislative authority is prohibited the exercise of the following:” – then you will find 13 sub-sections delineating the prohibited powers. Sub-section (13) says, “Any legislative act contrary to the general laws of the state.” So, a county quorum court is without power to restrict county health care plan coverage to a qualifying retiree in any manner. State law governs the issue and allows county retirees the option of continued county coverage.