Are county library board employees in Arkansas considered 'county employees' for retirement and insurance benefits?

Plain-English summary

Representative Dwight Tosh asked whether the four full-time employees of the Poinsett County Library Board were "county employees" for purposes of APERS retirement benefits and other insurance benefits. The library was created in 1978 under Act 742 of 1977. Salaries were funded by a millage collected by the county collector, deposited into the County Library Fund, and paid via checks issued by the county clerk and signed by the county treasurer. The county had been treating the library employees as county employees and making APERS contributions on their behalf.

Tosh also asked a hypothetical: if the county passed an ordinance under Act 1162 of 2005 transferring payroll duties to the Library Board (with its own tax ID number) and giving the board the millage funds in gross each month, would the library employees still be county employees?

Attorney General Leslie Rutledge concluded:

• For APERS purposes, the library employees were "county employees" under Ark. Code Ann. § 24-4-101(14)(A). The statute defines county employees as those whose compensation is "payable, either directly or indirectly, by county participating public employers." The library board was a "duly constituted agenc[y]" of the county within § 24-4-101(13), so it qualified as a county. Compensation came from county-collected funds, so the link was direct.
• The APERS Board of Trustees has "the final power to decide the question" of who is a county employee in any case of doubt under § 24-4-101(14)(B). The AG did not have the last word.
• For "insurance benefits," the answer depended on which benefit. The AG could not opine without specifics. As a baseline, county employee policies are required to be "uniform in application to all employees of the county" under § 14-14-805(2), so a benefit offered to other county employees should generally be available to the library employees too.
• For the hypothetical ordinance scenario, the AG declined to give a definitive answer (because of the no-hypotheticals rule), but tentatively said the library employees would probably still be county employees even if the Library Board took over payroll. The control test in ConAgra Foods, Inc. v. Draper and the APERS statute's "directly or indirectly" language pointed that way.

Currency note

This opinion was issued in 2017. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Q: Why is a county library board considered an "agency" of the county for APERS? A: The library board was created under Act 742 of 1977 (now codified at Ark. Code Ann. § 14-14-401 et seq.), which authorized counties to create "administrative boards for the conduct of county affairs." Library boards are explicitly listed as one such board under § 14-14-705(b)(2)(E), (F). Section 24-4-101(13) defines "county" for APERS purposes to include "all . . . boards . . . that are duly constituted agencies of the county." The library board fits.

Q: What was the "directly or indirectly" payment rule? A: Under § 24-4-101(14)(A), county employees include those whose "compensations are payable, either directly or indirectly, by county participating public employers." The Poinsett County setup was direct: county collector collected millage, county clerk issued the paychecks, county treasurer signed them. Even if the Library Board issued the checks itself (the hypothetical), the funding source was still the county-collected millage, so the indirect path still made the employees "county employees."

Q: What were the time-and-pay thresholds for APERS coverage? A: Under § 24-4-101(17)(B)(viii)-(ix), an employee qualifies for APERS by working "at least eighty (80) hours per month during a period of ninety (90) consecutive calendar days" and earning at least the federal minimum wage. The AG took Tosh's "full-time" descriptor to mean those thresholds were met.

Q: Why did the AG hesitate on the "insurance benefits" question? A: "Insurance" was too vague. It could mean health, dental, vision, life, retiree health, supplemental, workers' compensation, or any number of specific products. Each is governed by different rules and county-level policies. The AG declined to offer a one-size answer, but pointed to the uniformity requirement in § 14-14-805(2) (county employee policies must apply uniformly) and the comparable-coverage rule in § 13-2-407(d) (employees of a regional public library system are entitled to "comparable retirement and fringe benefit coverage as are other county employees in the headquarters county").

Q: Could the county simply assign payroll duties to the Library Board to escape APERS coverage? A: The AG suggested no. Substituting the Library Board for the county treasurer and clerk for purposes of payroll administration would not change the underlying funding source (county-collected millage) or the library board's status as an "administrative board[] for the conduct of county affairs." So the employees would remain in the APERS net.

Q: Who has the final word in close cases?
A: The APERS Board of Trustees, under § 24-4-101(14)(B). The AG specifically noted that her opinion could not "conclusively advise" on the employees' status; the APERS Board would. So a county or library board with a real factual question about a particular employee should write to the APERS Board for a binding determination.

Background and statutory framework

Arkansas's structure for funding rural and county libraries combines a dedicated millage with administrative oversight by a county-appointed board. The library board has practical control over hiring, salary-setting, and operations, but the funds flow through county fiscal officers. That hybrid structure can blur whether library employees are "of the county" for state-program purposes like APERS.

The opinion's framework is portable. Any time a county-funded but separately-governed entity (libraries, fairgrounds, museums, regional health departments) asks whether its employees are county employees for benefit purposes, the same analysis applies: look at the funding chain, the legal classification of the board, and the actual control over compensation.

Counties or boards uncertain about the answer should request a binding determination from APERS rather than relying on AG opinions alone.

Citations

• Ark. Code Ann. § 24-4-101 (definitions, including § 24-4-101(13), (14), (17), (29))
• Ark. Code Ann. § 14-14-401 et seq. (county government structure, Act 742 of 1977)
• Ark. Code Ann. § 14-14-805(2) (uniform county employee policies)
• Ark. Code Ann. § 13-2-407(d) (regional library employee benefits)
• Ark. Code Ann. § 13-2-404(c)(3)(A)(i) (Act 1162 of 2005, library fund claim)
• ConAgra Foods, Inc. v. Draper, 372 Ark. 361 (2008) (employer-employee relationship test)

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

Opinion No. 2016-125
March 3, 2017
The Honorable Dwight Tosh
State Representative
4513 Butler Road
Jonesboro, AR 72404-8829
Dear Representative Tosh:
STATE OF ARKANSAS
ATTORNEY GENERAL
LESLIE RUTLEDGE
I am writing in response to your request for an opinion regarding the status of employees of the Poinsett County Library. You provided the following background information, which I have slightly paraphrased: Poinsett County has a Library Board established in 1978 by means of countywide Ordinance No. 1978-1. The Library Board was established pursuant to Act 742of1977. There are currently four (4) full-time library employees of the library. Their salaries are determined by the Library Board, but are paid from the County Library fund with monies collected from taxpayers using a millage rate billed and collected by the County Collector. Payroll checks are issued by the County Clerk and signed by the County Treasurer with the Poinsett County Tax l.D. number. Poinsett County has treated the Library Board employees as "county employees" for purposes of the Arkansas Public Employee Retirement System ("APERS") and has made APERS contributions on their behalf. In light of the foregoing, you ask whether the library employees are "county employees" for purposes of insurance benefits or APERS benefits as defined in Ark. Code Ann. § 24-4-101 (8)(9)(A) (Supp. 2016). You also stated that the Library Board may maintain a separate tax l.D. number, and that the County may, by ordinance, transfer payroll duties for the library 323 CENTER STREET, SUITE 200 · LITTLE ROCK, ARKANSAS 7::?2Q1 TELEPHONE (501) 682-2007 · FAX (501) 682-8084 ARKANSASAG.GOV The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 2 employees to the Library Board, and may also transfer the funds collectible on tax bills to the Library Board each month in gross pursuant to Act 1162 of 2005. You ask whether, based on this latter scenario, the library employees would no longer be considered "county employees" for purposes of the insurance benefits, APERS benefits, or other benefits that are offered to all other Poinsett County employees. RESPONSE The employees of the Poinsett County Library appear to be subject to the control of Poinsett County in terms of remuneration, and it seems that the County considers the library employees entitled to APERS contributions. For these reasons, my answer is "yes" to your question regarding whether the employees are "county employees" for purposes of APERS. As "county employees" under Ark. Code Ann. § 24-4-101, the library employees would likely be eligible, to the same extent as other County employees, to be insured by the County. Because the term "insurance benefits" as used in your first question might refer to any number of policies or coverafes, however, I cannot definitively answer that specific part of the first question. And I emphasize that the APERS Board of Trustees "shall have the final power to decide the question" of who is a county employee in "any case of doubt."2 Your second question assumes that Poinsett County has passed an ordinance assigning to the Library Board responsibility for maintaining gross receipts of the millage tax that funds the library: This ordinance would also transfer to the Library Board responsibility for the library employees' payroll. You ask if, after the ordinance is enacted, the library employees would remain "county employees" for purposes of APERS and other insurance benefits. The ordinance framing your second question is hypothetical, described in terms of its effects and not its actual (or potential) language. For this reason, I cannot opine as to how this ordinance might change the library employees' status. But I generally believe that substituting the Library Board for the Poinsett County Treasurer and Poinsett County Clerk would not affect the library employees as "county employees" under Ark. Code Ann. § 24-4-101. Regarding the library employees' entitlement to the 1 Retired county employees may continue to participate in a "county health plan," for example. See Ark. Code Ann. § 24-12-128 (Supp. 2016). 2 Id. at§ 24-4-101(14)(8). The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 3 "insurance benefits" owed other employees of Poinsett County, I have the same reservations noted above-the nature of those benefits is unspecified, so I can only say that the library employees would likely still be "county employees" under Ark. Code Ann. § 24-4-101. DISCUSSION Question 1: Are the employees of the Poinsett County Library "county employees" for purposes of APERS benefits as defined in Ark. Code Ann.§ 24- 4-101, or other insurance benefits? Given the background facts you relayed-and with the caveat that "other insurance benefits" is too vague for a definitive response-I believe the library employees likely would qualify as "county employees" under Ark. Code Ann. § 24-4-101.3 Nevertheless, in "any case of doubt as to who is a county employee" for APERS purposes, the APERS Board of Trustees "shall have the final power to decide the question."4 I therefore cannot conclusively advise you of the library employees' status. I also take your description of the library employees as "full- time" to mean they work "at least eighty (80) hours per month during a period of ninety (90) consecutive calendar days," and to mean they make at least the federal minimum wage. 5 If these time-and-pay parameters do not apply to the library employees, they could not be considered "county employees" for purposes of APERS benefits. The first part of this question requires applying the component elements of "county employee" as defined in Ark. Code Ann. § 24-4-101(14)(A) to the individuals employed by the Poinsett County Library. Under subsection (14)(A), county employees are "all employees whose compensations are payable, either directly or indirectly, by county participating public employers."6 A "public 3 As you state in your opinion request, Ark. Code Ann. § 24-4-101 defines terms relevant to the Arkansas Public Employees' Retirement System ("APERS"). And in your first question, you refer to "AC.A. 24-4-10 I (8)(9)(A)." There docs not appear to be a subsection (8)(9)(A) of Ark. Code Ann. § 24-4-101. However, your question can be answered by reference to other statutes and subsections. 4 Ark. Code Ann.§ 24-4-101(14)(B). 5 Id. at§ 24-4-101(17)(B)(viii, ix). 6 See also id. at § 24-4-I 01 ( l 7)(a)(i)(A) ("Employees" are all "employees ... whose compensations were or are payable from funds appropriated by the public employer."). The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 4 employer" includes all Arkansas counties "whose employees are included in the membership" of APERS.7 And a "county" may be any county in Arkansas, "includ[ing] all ... boards ... that are duly constituted agencies of the county."8 According to the background information you provided, the Poinsett County Library Board was formed in 1978 pursuant to Act 742 of 1977.9 Act 742 authorized, among other things, the creation by ordinance of "administrative boards for the conduct of county affairs."10 Library boards are one such administrative board. 11 Thus, the Poinsett County Library Board falls within the APERS definition of "county" as a board duly constituted by the County. 12 The information you provided suggests that the Library Board is also a "public employer," which is to say an agency of a county "whose employees are included in the membership of the Arkansas Public Employees' Retirement System."13 According to your opinion request, Poinsett County has "treated the Library Board employees as 'county employees' for purposes of [APERS], and [has] made APERS contributions on their behalf." And you indicate that the library employees are compensated with "funds appropriated by a public employer," i.e. the millage administered by the Poinsett County Collector.14 Finally, you indicate that "all other Poinsett County employees" are offered APERS benefits. Because Poinsett County seems to compensate the library employees, I believe they are "county employees" for purposes of APERS benefits. But I must note that under the common-law rule, "payment of salary alone does not equate to a 7 Id. at § 24-4-101 (29)(A), (31 ). 8 Id. at§ 24-4-101(13). 9 Codified at Ark. Code Ann.§ 14-14-401 et seq. (Supp. 2016). 10 Ark. Code Ann.§ 14-14-705(a) (Supp. 2016). 11 Id. at§ 14-14-705(b)(2)(E, F); see also id. at§ 13-2-401 (Supp. 2016). 12 See id. at§ 24-4-101(13). 13 Id. at § 24-4-101(29)(A). I have no doubt that Poinsett County itself is a "public employer" under the APERS scheme. 14 Ark. Code Ann.§ 24-4-101(17)(a)(i)(A). The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 5 finding of employment by the entity paying the salary."15 That is, whether an employment relationship exists may be a question of fact, with the putative employer's control of the worker the most important element.16 However, the APERS statute defines "county employees" in terms of the public entity responsible for compensation. You explain that the library employees' salaries are paid with checks issued by the Poinsett County Clerk. These checks are drawn on the County Library Fund, made up of deposits from a millage collected by the Poinsett County Collector. The County's involvement with the library employees' payment-and the source of those funds-certainly suggests that their "compensations are payable, either directly or indirectly, by [a] county participating public employer[]."17 Based on the facts informing your first question, I believe the library employees are "county employees" under Ark. Code Ann.§ 24-4-101(14)(A).18 I am unable to address whether the library employees would also be entitled to "other insurance benefits" because this term is vague. It is unclear what insurance policy you refer to, and what insurance regulations might be implicated. Statutes generally applicable to county employees, however, suggest that whatever "insurance benefits" are available to Poinsett County employees should also be available to the employees of Poinsett County Library. For example, a quorum court may establish "employee policy and practices of a general nature, including, but not limited to, establishment of general vacation and sick leave policies."19 And such policies "shall be uniform in application to all employees of the county" once promulgated.20 To the extent the other insurance benefits you reference were 15 Op. Att'y Gen. 2016-106 at 3 (citing Op. Att'y Gen. 2001-202 for the proposition that "[e]ven if the city or county[s] ... pay the municipal court clerk's salary, that fact does not conclusively establish the clerk as an employee."). 16 See, e.g., ConAgra Foods, Inc. v. Draper, 372 Ark. 361, 366, 276 S.W.3d 244, 249 (2008). 17 Ark. Code Ann. § 24-4-101(14)(A). 18 The origin of the Library Board and the mechanics of the library employees' compensation distinguishes your query from APERS questions my office has received in the past. For example, one of my predecessors noted the absence of "potentially significant facts, such as whether the
[employees'] positions were authorized by the quorum court; whether their compensation from the grant funds was set by the quorum court; and whether the grant funds are deposited into and distributed from the county general fund." Op. Att'y Gen. 2000-105, p. 3. 19 Id. at§ 14-14-805(2). 20 Id. The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 6 authorized by the Poinsett County Quorum Court as an "employee policy and practice[] of a general nature," it appears those benefits would inure to the library employees as well. Likewise, employees of a regional public library system "shall be entitled to the comparable retirement and fringe benefit coverage as are other county employees in the headquarters county."21 I do not know if the Poin ett County Library established under Act 742 of 1977 is prut of a 'regional public library system."22 But by placing regional library employees on equal footing with other county employees for purposes of "retirement and fringe benefit coverage," the regional- library statutes mirror the statute requiring counties to have uniform "employee policy and practices." Therefore, the employees of the Poinsett County Library would arguably be "entitled to the comparable ... coverage as are other county employees" if the other insurance benefits you reference are in fact retirement or fringe benefits. 23 Question 2: In the event that (1) the Library Board maintains a separate Tax I.D. number; (2) by ordinance, the County transfers to the Library Board payroll duties for the library employees; and (3) by ordinance, the County transfers to the Library Board the funds collectible on tax bills each month in gross under Act 1162 of 2005; will the library employees no longer be considered "county employees" for purposes of insurance benefits or the APERS benefits that are offered to all other Poinsett County employees? Your second question assumes the enactment of an ordinance, and this office has historically declined to analyze hypothetical scenarios.24 I am also prohibited from engaging in the private practice of law. Requests for legal advice or an opinion as to the best course of conduct for a private party must be directed to private counsel.25 Nevertheless, I can offer a tentative opinion with respect to 21 Id. at§ 13-2-407(d); see also Ark. Code Ann.§ 13-2-905(d)(l) (same). 22 Id. at § 13-2-407(a)(l) (providing that library boards and "any combination of counties and cities" may create "a joint city-county public library system or regional public library system, or may enter into an interlocal cooperation agreement among themselves to coordinate public library services among the different jurisdictions"). 23 See also Op. Att'y Gen. 2013-070 at 2, n.5 (opining that a regional library board lacked the authority to establish a sick-leave policy that differed from the sick-leave policy established for other county employees by the quorum court). 24 See, e.g., Op's Att'y Gen. 2014-117 at 5; 2008-023 at 4. 25 Ark. Code Ann.§ 25-16-701 (Supp. 2016). The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 7 whether employees of the Poinsett County Library would remain "county employees" for purposes of APERS benefits. If an ordinance meeting the description in your second question is enacted, I believe the library employees would probably still be considered "county employees." You describe passage of an ordinance under Act 1162 of2005, which among other things states that a "governing library board may certify to the county treasurer a claim against the [library] fund for an amount equal to the undistributed balance of the fund."26 Essentially, the ordinance in your second question would transfer payroll duties to the Poinsett County Library Board by authorizing it to make a monthly claim against the Library Fund. The Library Board, under its own tax identification number, would then issue checks to the library employees. It appears from your second question that the moneys in the Library Fund would still originate from the millage collected by the Poinsett County Collector. It appears that the operative difference between the current arrangement and the hypothetical scenario is that, in the hypothetical case, the library employees' checks would be issued by the Library Board instead of the Poinsett County Treasurer. I express no opinion as to whether the ordinance described in your second question would be valid under Act 1162 of 2005. But I believe that substituting the Library Board for the Poinsett County Treasurer and Poinsett County Clerk for purposes of payroll administration would not affect the library employees' status as "county employees" under Ark. Code Ann. § 24-4-101. As noted above, the most important factor in determining whether individuals are county employees entitled to APERS benefits is whether the employees' "compensations are payable, either directly or indirectly, by county participating public employers."27 Because the Poinsett County Library Board was created under Act 742 of 1977 as an "administrative board[] for the conduct of county affairs," the Library Board should qualify as a participating public employer. 28 Indeed, as a general matter "the hiring of employees of counties [or] administrative boards .. . may be delegated by ordinance to the board."29 And if the Library Board issues paychecks drawn on the Library Fund (itself funded by a millage rate), the library employees would be paid "either directly or indirectly by [a] county participating public 26 See id. at§ 13-2-404(c)(3)(A)(i). 27 Id. at§ 24-4-101(14)(A). 28 Id. at§ 14-14-705(a). 29 Id. at§ 14-14-l 102(5)(B)(ii)(a). The Honorable Dwight Tosh State Representative Opinion No. 2016-125 Page 8 employer[]. "30 In my opm10n, the library employees would remain "county employees" for APERS purposes if the Library Board assumed payroll duties. I cannot say whether the library employees would be entitled to the insurance benefits offered other Poinsett County employees. Again, "insurance benefits" is a term too vague for specific analysis. But I see no reason why the mandate for uniform county-wide "employee polic[ies] and practices" would cease to apply simply because the Library Board began issuing paychecks.31 Nor do I think that the library employees would be less "entitled to the comparable retirement and fringe benefit coverage as are other county employees" if the ordinance you describe were enacted. 32 Just the same, it is impossible to give an opinion regarding unspecified insurance benefits, particularly under a hypothetical scenano. Sincerely,
==::>/A
LESLIE RUTL~
Attorney General
30 Ark. Code Ann. § 24-4-101(14)(A).
31 Id. at§ 14-14-805(2).
32 Id. at § 13-2-407(d) (referring to the retirement and fringe benefits owed employees of a regional public library system); Id. at§ 13-2-905(d)(l) (same).