Is a retired Arkansas mayor's pension calculated using the salary he earned as mayor, or the salary the current mayor earns when he starts collecting?
Plain-English summary
Representative Wayne Long asked the AG to resolve a long-standing puzzle about Arkansas mayoral retirement benefits. Under A.C.A. § 24-12-123, a qualified retired mayor receives an annual benefit equal to one-half of "the salary payable to the mayor at the time of retirement." A 2019 amendment to the law (Act 948) appeared to some readers to have changed the calculation. Long asked which mayor's salary controls (the retiring mayor's last salary or the sitting mayor's salary at the time benefits start) and whether a vested benefit can be reduced.
The AG concluded that the retiree's own last salary controls. The 2019 amendments did not change the law substantively; they clarified existing law that had been temporarily muddled by a codification quirk. So question 2 (about reducing a vested benefit) becomes moot.
The interpretive history is unusually complex:
Act 414 of 1987 (as enacted). The original Act 414 provided benefits equal to "one-half of the salary payable to such mayor at the time of his retirement." The terms "his" and "such mayor" pointed clearly back to the retiring mayor. There was no ambiguity at enactment.
Codification of Act 414 (gender-neutral revision). When Act 414 was codified at A.C.A. § 24-12-123, the Arkansas Code Revision Commission, apparently trying to eliminate gendered pronouns, dropped "his" and "such" and substituted neutral terms: "one-half (½) of the salary payable to the mayor at the time of retirement." That edit introduced a new ambiguity: which mayor? The codified text could be read as the sitting mayor or the retiring mayor.
Predecessor opinions disagreed. In Op. 2005-203, one predecessor said the law was ambiguous and the better reading favored the retiring mayor. In Op. 2009-003, another predecessor said the law was unambiguous and required the sitting mayor's salary. Both opinions worked from the codified text.
This opinion's reading. Under Arkansas law, when a codification introduces a substantive change to the original act, the act as enacted controls (Ortho-McNeil-Janssen Pharms.). The Arkansas Code Revision Commission lacks authority to change substance during codification (A.C.A. § 1-2-303(d)(1)). So § 24-12-123 must be read against Act 414 as enacted, where "his" and "such mayor" pointed to the retiring mayor.
Of the two omitted words, the AG concluded the more important one is "such." "Such" is a demonstrative pointing word that refers back to its antecedent. The only possible antecedent in Act 414 is "his," which itself refers to the retiring mayor. So the omitted "such" is materially determinative: it locks in the retiring mayor as the referent.
Act 948 of 2019. This act was a clarification, not a substantive change. It explicitly tied the benefit to the retiring mayor's own salary. Because the law at enactment already had that meaning, the 2019 act did not reduce a vested benefit. So Long's second question (can a vested benefit be reduced?) is moot.
The AG agreed with Op. 2005-203's conclusion (retiring mayor controls) but disagreed with its reasoning (the law as enacted was not ambiguous; only the codification was). The AG also agreed with Op. 2009-003 that the law is unambiguous, but disagreed with its conclusion (the AG read it as the retiring mayor's salary, not the sitting mayor's).
The opinion includes some practical caveats: the assumption is that the mayor met all the statutory eligibility requirements under A.C.A. § 24-12-123(a). If the mayor took a lump sum, rolled benefits over, continued working under another retirement plan, or otherwise forfeited eligibility, the analysis may differ.
What this means for you
Retired Arkansas mayors
If you served at least 10 years as mayor and reached age 60, or served at least 20 years regardless of age, your retirement benefit is one-half of the salary you were earning at the end of your last term as mayor. That number does not adjust based on what your successor or any later mayor is paid. Your benefit is locked to your own last salary.
If a city has been calculating your pension based on the sitting mayor's salary (under the prior reading of Op. 2009-003), this opinion supports your right to have it recalculated to your own last salary instead, prospectively.
Sitting mayors and municipal officials
Update your municipal pension calculation practice. Use the retiring mayor's own last salary, not the salary of whoever is in office when benefits begin. Op. 2009-003's contrary reading is repudiated by this opinion.
For mayors currently in office and approaching retirement, the planning implication is straightforward: you control the input that drives your benefit by what salary you set for yourself before retirement. Any salary adjustments in your final term affect the lifetime benefit.
City treasurers and municipal pension administrators
Adjust your benefit calculation worksheets to use the retiree's own last mayoral salary. If you have outstanding calculations under the Op. 2009-003 reading, consult counsel on whether to retroactively correct.
The eligibility test (10 years and age 60, or 20 years regardless of age) is in A.C.A. § 24-12-123(a)(1)(A). A city ordinance may add an option to retire at age 55 with 10 years of service under § 24-12-123(a)(1)(B). Cost-of-living increases are authorized under § 24-12-123(a)(5)–(6).
Note the dual-coverage prohibition in A.C.A. § 14-42-117: a mayor receiving retirement benefits from a city cannot also collect retirement benefits from another state-authorized plan covering the same period of service.
State legislators
The codification problem here is a useful case study. The Arkansas Code Revision Commission's neutralizing edits sometimes introduce ambiguity that distorts the underlying enactment. When statutes seem ambiguous, the law as enacted (Acts of the General Assembly) controls over the codified text (A.C.A. § 1-2-303(d)(1)).
If your view is that mayoral retirement benefits should be tied to the sitting mayor's salary instead, that policy change would require a fresh enactment with clear language to that effect. The current statute as both enacted and clarified ties the benefit to the retiring mayor.
City attorneys
This opinion is useful when you are advising on a calculation dispute. The reasoning chain (codification cannot change substance; Act 414 as enacted clearly used "his" and "such mayor"; the omitted "such" is the dispositive referent) gives you a clean argument for the retiring-mayor reading.
Common questions
What is A.C.A. § 24-12-123?
Arkansas's mayoral retirement statute. Sets eligibility requirements (10 years and age 60, or 20 years regardless of age) and the benefit amount (one-half of the relevant salary).
Does this apply to all mayors?
The statute covers municipal mayors who meet the eligibility criteria and have not forfeited or alternately structured their benefits. Various carve-outs apply for mayors who took lump sums, rolled benefits over, or are covered by other retirement plans for the same service period.
Can a city raise its mayor's salary before retirement to boost the benefit?
Yes. The statute ties the benefit to the retiring mayor's last salary, so any pre-retirement salary adjustment that takes effect during the last term will affect the lifetime benefit. That fact is built into the statute's design.
What about cost-of-living adjustments?
A.C.A. § 24-12-123(a)(5)–(6) authorizes cities to provide cost-of-living increases. The base calculation is still the retiring mayor's last salary; COLAs are then applied to that base.
What does "salary" include?
Op. 2005-203 concluded that "salary" does not include vehicle expenses or fringe benefits like insurance payments, sick leave, or vacation time. Just the cash salary.
What if my city used Op. 2009-003 to compute my pension?
You may have grounds to request a recalculation. The current opinion repudiates Op. 2009-003. Consult counsel on the procedural path for adjustment.
Why does the codification matter so much?
Because the codified text is what most users (city officials, attorneys, mayors) actually read. When the codification differs in meaning from the act as enacted, A.C.A. § 1-2-303(d)(1) makes clear the enactment controls and the codification is unauthorized. But many readers do not look back at the original act, which is how the Op. 2009-003 misreading propagated.
Background and statutory framework
A.C.A. § 24-12-123. Arkansas mayoral retirement statute. Subsection (a)(1) sets eligibility (10 years + age 60, or 20 years regardless of age, or 10 years + age 55 if a city ordinance provides). Subsection (e) prohibits dual benefits with other state-authorized plans for the same service.
A.C.A. § 14-42-117. Single-benefit rule for city employees and elected officials.
A.C.A. § 1-2-303(d)(1). Prohibits the Arkansas Code Revision Commission from making substantive changes during codification.
Acts 1987, No. 414. Original mayoral retirement enactment. Used "his" and "such mayor" to lock the benefit to the retiring mayor.
Acts 2019, No. 948. Amended § 24-12-123 to expressly tie the benefit to "the mayoral salary at the completion of his or her last term as mayor." Per this opinion, this was a clarification of pre-existing law.
Ortho-McNeil-Janssen Pharms., Inc. v. State, 2014 Ark. 124, 432 S.W.3d 563. The act as enacted controls when codification introduces a substantive change.
Prior AG opinions. Op. 2005-203 (retiring mayor controls, but reasoning relied on "ambiguous" framing); Op. 2009-003 (sitting mayor controls, based on codified text alone); Op. 2005-097 (eligibility requirements).
Bryan A. Garner, GARNER'S MODERN ENGLISH USAGE 1052 (5th ed. 2022). Definition of "such" as a pointing word that refers to an antecedent.
Citations
- A.C.A. § 24-12-123 (mayoral retirement)
- A.C.A. § 14-42-117 (single benefit rule)
- A.C.A. § 1-2-303(d)(1) (codification limits)
- Acts 1987, No. 414 (original enactment)
- Acts 2019, No. 948 (clarifying amendment)
- Ortho-McNeil-Janssen Pharms., Inc. v. State, 2014 Ark. 124, 432 S.W.3d 563
- Ark. Att'y Gen. Op. 2005-203, 2005-097, 2009-003
Source
Original opinion text
Opinion No. 2023-052
November 15, 2023
The Honorable Wayne Long
State Representative
P.O. Box 456
Bradford, Arkansas 72020
Dear Representative Long:
I am writing in response to your request for my opinion on questions concerning mayoral retirement benefits. You report that a 2019 legislative change to Arkansas law governing mayoral retirement benefits significantly reduced a mayor's annual retirement benefit. You also say that the mayor retired as mayor after serving more than ten years in that capacity.
You ask the following two questions:
- Should the retired mayor's retirement benefits be calculated based upon his actual salary at the time of retirement, or upon other factors and criteria?
Brief answer: The retired mayor's retirement benefits are based upon his mayoral salary at the time of his last term as mayor, regardless of when he qualifies to receive benefits.
- Is it permissible and proper under Arkansas law to reduce a retirement benefit after it has vested and initially conveyed to a retiree?
Brief answer: This question appears to presuppose that, in 2019, the law governing the amount of mayoral retirement benefits was substantively changed. But since, as explained in response to Question 1, the 2019 changes were in wording but not substance, this question appears to be moot.
DISCUSSION
Question 1: Should the retired mayor's retirement benefits be calculated based upon his actual salary at the time of retirement, or upon other factors and criteria?
For purposes of this opinion, I will assume that the retired mayor in question met all requirements to retire and receive benefits under A.C.A. § 24-12-123. If the mayor did not, or if the mayor took a lump sum in benefits, rolled benefits over into a private account, or continued working for the same city under a different retirement plan, then the retired mayor may have not qualified for benefits or may have forfeited some number of benefits.
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Current law. Under current law, a qualified mayor's annual retirement benefit is one-half of that retired mayor's "mayoral salary at the completion of his or her last term as mayor." The law as it stands today is clear and unambiguous. And, as I explain in detail below, the 2019 legislative amendments merely clarified the law without making substantive changes.
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Act 414 of 1987. To see why the 2019 amendments to § 24-12-123 were changes in wording but not substance, one must examine the language of the original act that was later codified at § 24-12-123. This original language controls when the act's codification introduces a substantive change. And Act 414's codification changed a few key words, thereby generating some ambiguity in the law as codified. Act 414 of 1987 established both the eligibility criteria to receive retirement benefits and the amount of benefits to which the mayor was entitled:
- Eligibility for payments: Under Act 414—and still today—a mayor is eligible for retirement pay if he or she: (1) has served the city for at least 10 years and is at least 60 years old; or (2) has served the city for at least 20 years, regardless of the person's age; and
- Amount of payments: A person who fits either of the foregoing two criteria is "entitled to retire at an annual retirement benefit during the remainder of his natural life, payable at the rate of one-half of the salary payable to such mayor at the time of his retirement."
The emphasized terms—his and such mayor—indicate that, when determining the amount of money to which a retired mayor was entitled, the act was referring to the retiring mayor—not the mayor who happened to be serving at the time the retiring mayor became eligible for payments.
- Act 414's codification. Yet in an apparent effort to be gender neutral, the codification of Act 414 omitted the terms "such" and "his," which generated an ambiguity about which mayor's salary the statute was referring to: the last salary of the retiring mayor, or the salary of the sitting mayor. As this side-by-side comparison shows, Act 414's codification at § 24-12-123 made minor changes to the act that had significant impact:
Act 414, § 1: A qualifying mayor is "entitled to retire at an annual retirement benefit during the remainder of his natural life, payable at the rate of one-half of the salary payable to such mayor at the time of his retirement."
A.C.A. § 24-12-123 (before 2019): A qualifying mayor is "entitled to retire at an annual retirement benefit during the remainder of the person's natural life, payable at the rate of one-half (½) of the salary payable to the mayor at the time of retirement."
These changes and omissions generated an ambiguity in the law as codified that is not present in the law as enacted. Specifically, suppose a mayor serves from 49 to 59 years of age and then accepts other employment. Then on reaching 60 years of age, after a new mayor has been elected and is serving, the former mayor applies for retirement benefits. Under this scenario, whose salary determines the retiring mayor's benefit: the sitting mayor or the last salary received by the retiring mayor?
- My predecessors' disagreement. Two of my predecessors disagreed on the answer to that question. In Opinion No. 2005-203, one of my predecessors thought the statute was ambiguous but that the best reading of law required that the retiring mayor's benefit be calculated based on his or her last salary. But the opinion does not provide any argument for why that is the best reading, other than general references to "legislative intent." In Opinion No. 2009-003, another of my predecessors disagreed. He said the law was not ambiguous and that it required the calculation to be based on the sitting mayor's salary at the time the mayor retired. His argument to support these claims relied entirely on language added during the codification process, saying that his conclusions were required in order to "give[] meaning to the legislature's choice of different terminology" in its use of "the person" in addition to "the mayor." Yet the legislature never made that choice because, as noted above, "the person" was added in the codification process. The law as enacted controls when any substantive changes are inadvertently introduced during codification.
The Arkansas Code Revision Commission lacks the power to make substantive changes to acts during the codification process. A.C.A. § 1-2-303(d)(1) ("In exercising the powers and duties imposed upon it by this subchapter, the commission shall not authorize any change in the substance or meaning of any provision of the Arkansas Code or any act of the General Assembly."). This provision was the law at the time Act 414 of 1987 was codified.
While both predecessors were aware of the fact that the codification changed some of the original act's terminology, they based their arguments on the fact that the codification omitted the pronouns "his" and drew different inferences from that omission. In my opinion, the more definitive omission is the word "such" from "such mayor." The entire dispute here is which mayor's salary counts. The demonstrative adjective "such" directly resolves this question. When used as a demonstrative adjective, as it is here, such is a "pointing word" that refers to an antecedent. The only possible antecedent in Act 414 is "his," which itself refers to the person retiring. Thus, its omission is material. The codification's omission of the critical distinction in the wording of the law compels me to partly agree and partly disagree with both prior opinions:
- Regarding Opinion No. 2005-203: I agree with the opinion's conclusion that the retiring mayor's last salary is the basis for determining the retirement benefits. But I disagree with the opinion's reasoning and the claim that the law—as opposed to its codification—is ambiguous. While the law as codified is ambiguous, the law as enacted is clear.
- Regarding Opinion No. 2009-003: I agree with the opinion's conclusion that the law is unambiguous. But I base that assessment on the law as enacted, not as codified. Further, I disagree with this opinion's conclusion that the sitting mayor's salary is the basis for determining the retirement benefits.
- Conclusion. In conclusion, I believe the law on mayoral retirement benefits, as enacted, is—and has always been—clear. Act 414 of 1987 requires that the retiree's benefits be calculated based on his or her last salary as mayor. And Act 948 of 2019 makes this even more clear. The changes to Act 414 during its codification do not change the law.
Question 2: Is it permissible and proper under Arkansas law to reduce a retirement benefit after it has vested and initially conveyed to a retiree?
This question appears to presuppose that the legislature did, in fact, change the law in 2019 when it passed Act 948. But, as noted above, the law was clarified rather than changed.
Assistant Attorney General William R. Olson prepared this opinion, which I hereby approve.
Sincerely,
TIM GRIFFIN
Attorney General