If a local law enforcement officer is in two retirement systems, can both systems' service count toward the Special Separation Allowance, and who decides whether the officer qualifies?

Plain-English summary

Winston-Salem's Public Safety Attorney asked the AG a structural question about the Law Enforcement Officer Special Separation Allowance, the supplemental retirement benefit that bridges the gap between an officer's early retirement and Social Security age. The city employed officers who were members of both the Local Governmental Employees Retirement System (LGERS) and the city's own retirement system, and wanted to know two things: what counts as "creditable service" for purposes of the allowance, and which body decides whether an officer qualifies.

The AG answered both:

"Creditable service" means service credited under either retirement system the officer belongs to. G.S. 143-166.41(b) defines creditable service as "the service for which credit is allowed under the retirement system of which the officer is a member." G.S. 143-166.42 carries that definition over to local-government officers. The AG read the singular "the retirement system" as not blocking double-system coverage: if the officer belongs to both LGERS and a city system, both sets of credited service add together for purposes of the Allowance.

The AG gave a worked example. An officer who joined the city system as a sworn officer on January 1, 1957, and joined the Law Enforcement Officers' Retirement System on January 1, 1960 (LEO service was later transferred to LGERS effective January 1, 1986), would have 30 years of creditable service on January 1, 1987. If the officer was not yet 62 years old, that officer would qualify for the Special Separation Allowance, and the benefit calculation would use the 30 years plus any additional creditable service for military time, unused sick leave, and similar add-ons.

There is an important qualifier the AG flagged: as amended effective January 1, 1987, G.S. 143-166.41(b) required that at least 50% of the officer's creditable service be served as a law enforcement officer. G.S. 143-166.42 carries that 50% rule over to local officers. So a long-tenured non-LEO city employee who only put in a few years as a sworn officer would not qualify, even if total service hit the threshold.

Eligibility decisions belong to the local government employer. G.S. 143-166.42 explicitly states that "the governing bodies for each unit of local government shall be responsible for making determinations of eligibility for their local officers" who claim credit through LGERS. The AG noted that nothing in the statute carves out a different decisionmaker for officers also claiming credit through a city retirement system. So in all cases, the city or county that employs the officer makes the call. Neither the LGERS Board of Trustees nor the Retirement Systems Division of the Department of the State Treasurer handles the determination, even when the officer ultimately retires under N.C.G.S. § 128-27(a) (the LGERS retirement procedure).

That eligibility-determination rule matters operationally. It means a city HR department or a county personnel office has to read the statute, verify the officer's service in each system, apply the 50%-as-LEO test, and pay the benefit out of local funds. The Retirement Systems Division does not certify eligibility or cut the checks for this particular benefit.

Currency note

This opinion was issued in 1986. 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.

The Special Separation Allowance framework in Article 12D of Chapter 143 has been amended several times since 1986. The Allowance amount, calculation formula, age and service thresholds, the 50%-as-LEO test, and certain coordination rules have all been adjusted. Some local retirement systems have also been consolidated or eliminated. Local HR officials computing current benefits should check the current statute, the current LGERS retirement handbook, and any recent appellate decisions on LEO eligibility before relying on the 1986 sketch.

Common questions

Q: I served as a city LEO before LGERS absorbed the LEO retirement system in 1986. Does that count?
A: The AG said yes. The opinion's worked example assumed exactly that fact pattern. Service in the predecessor LEO Retirement System (and the city's own system) all counts toward the total creditable service for the Allowance, as long as the officer is a member of LGERS at the time of retirement and the 50%-as-LEO test is met.

Q: Who pays the Special Separation Allowance check?
A: The Allowance is paid by the local government employer out of local funds. It is not paid out of the state retirement system. That is connected to the eligibility-determination rule: the employer makes the determination and the employer writes the check.

Q: Does the 50%-as-LEO rule mean only sworn time counts?
A: It means at least half of the officer's total creditable service must have been as a law enforcement officer. If someone served 30 years total but only 5 years as a sworn officer, the 50% test fails. The AG opinion did not address how to handle dual-status work where the same time period might be claimed under both systems; that kind of double-counting question would be a current-law check.

Q: What if the city's HR director and the LGERS Board disagree about eligibility?
A: Under the AG's reading, the local government employer's determination governs. The LGERS Board of Trustees and the Retirement Systems Division do not have a parallel say on the Special Separation Allowance specifically. If an officer is denied and wants to challenge it, the dispute runs through the local government's processes and ultimately the courts, not the Retirement Systems Division.

Background and statutory framework

Article 12D of Chapter 143 sets up the Special Separation Allowance, a supplemental benefit paid to law enforcement officers who retire early but who have to wait years before Social Security or full pension benefits kick in. There are two parallel provisions:

• G.S. 143-166.41 covers state law enforcement officers. Subsection (b) defines creditable service and (as amended effective January 1, 1987) requires that at least 50% of creditable service be as a law enforcement officer.
• G.S. 143-166.42 carries the same terms and conditions over to local law enforcement officers and adds the explicit local-employer-makes-the-determination rule.

The definition of "law enforcement officer" is found in G.S. 128-21(11b) (LGERS) and G.S. 143-166.50(a)(3). Those definitions feed back into both the eligibility and the 50% rule.

The AG's central interpretive moves were:

1. Multiple system membership is fine. The opinion read "the retirement system of which the officer is a member" as encompassing each system the officer belongs to. That makes the Allowance work for officers who have moved between or held parallel memberships in different systems over the course of a career.

2. Local employers make eligibility calls. The Retirement Systems Division processes regular pension claims, but it does not adjudicate Special Separation Allowance eligibility. The statute explicitly puts that decision on local governments, even when the officer's ultimate retirement runs through LGERS under § 128-27(a).

These two points together mean the Special Separation Allowance functions as a local-government-administered supplement that draws on state-defined service rules but does not pass through the state Retirement Systems Division for eligibility purposes.

Citations

• N.C.G.S. § 128-21(11b) (LGERS definition of law enforcement officer)
• N.C.G.S. § 128-27(a) (LGERS retirement provision)
• N.C.G.S. § 143-166.41 (Special Separation Allowance for state LEOs)
• N.C.G.S. § 143-166.41(b) (creditable service definition; 50%-as-LEO rule)
• N.C.G.S. § 143-166.42 (Special Separation Allowance for local LEOs; local-employer determination)
• N.C.G.S. § 143-166.50(a)(3) (alternate LEO definition)

Source

• Landing page: https://ncdoj.gov/opinions/retirement-law-enforcement-officers-special-separation-allowance-benefit/

Original opinion text

Requested By:

Claire McNaught
Public Safety Attorney
City of Winston-Salem, N.C.

Questions:

QUESTION 1:

What does the term "creditable service" mean for purposes of determining a local law enforcement officer's eligibility for the Special Separation Allowance Benefit as provided in G.S. 143-166.42 and for calculating the amounts of that benefit?

QUESTION 2:

What governmental agency is responsible for determining a local law enforcement officer's eligibility for the Special Separation Allowance Benefit?

Conclusion:

(1) Creditable service is service for which credit is allowed under either retirement system of which the officer is a member.

(2) The officer's local governmental employer.

The facts provided indicate that the city employs a number of law enforcement officers, as defined by G.S. 128-21(11b) or G.S. 143-166.50(a)(3), who are members of both the Local Governmental Employees Retirement System and the city's own retirement system.

G.S. 143-166.42 provides a special separation allowance benefit for law enforcement officers employed by local governmental employers and specifies that the terms and conditions set out in G.S. 143-166.41 shall apply to this benefit. G.S. 143-166.41 provides this benefit for state law enforcement officers. G.S. 143-166.41(b) defines "creditable service" as "the service for which credit is allowed under the retirement system of which the officer is a member." G.S. 143-166.42 makes this definition applicable to law enforcement officers employed by local governmental employers. Therefore, service for which an officer is given credit under either retirement system to which the officer belongs would be creditable service for purposes of determining the officer's eligibility for the special separation allowance benefit and for purposes of calculating the amount of said benefit.

G.S. 143-166.41(b) [as amended effective January 1, 1987] provides that for an officer to be eligible for this benefit, at least fifty percent (50%) of the creditable service allowed under the retirement system must be as a law enforcement officer. Pursuant to G.S. 143-166.42, this 50% requirement is also applicable to law enforcement officers employed by local government employers.

As one example, if an officer joined the city retirement system as a law enforcement officer on January 1, 1957 and if the officer joined the Law Enforcement Officers' (LEO) Retirement System on January 1, 1960 [service in LEO was transferred to the Local Governmental Employees Retirement System effective 1/1/86], that officer would have 30 years of creditable service on January 1, 1987 and, if the officer was not yet 62 years of age, would be eligible for the special separation allowance benefit and the benefit would be calculated upon 30 years of creditable service, plus any creditable service allowed for military service, unused sick leave, etc.

A local law enforcement officer who claims creditable service for membership in the city's retirement system would have his eligibility determined by the city since nothing to the contrary appears in the legislation creating the special separation allowance benefit. Also, G.S. 143-166.42 specifies that "the governing bodies for each unit of local government shall be responsible for making determinations of eligibility for their local officers" who claim creditable service for membership in the Local Governmental Employees Retirement System. This language in G.S. 143-166.42 makes it clear that an officer's eligibility for the special separation allowance benefit is not determined by the Local Governmental Employees Retirement System's Board of Trustees nor the Retirement Systems Division of the Department of the State Treasurer, even when the officer retires pursuant to the provisions of G.S. 128-27(a). A local law enforcement officer's eligibility for the special separation allowance benefit is in all instances determined by the officer's local government employer.

LACY H. THORNBURG
Attorney General

Edmond W. Caldwell, Jr.
Assistant Attorney General