TITLE
2 PUBLIC
FINANCE
CHAPTER
82 EDUCATIONAL RETIREMENT
PART
1 GENERAL PROVISIONS
2.82.1.1 ISSUING AGENCY: Educational Retirement Board, P. O. Box 26129, Santa Fe, New
Mexico 87502-0129
[2.82.1.1 NMAC - Rp, 2.82.1.1 NMAC,
11-15-12]
2.82.1.2 SCOPE: This rule addresses the organization and operations of the
educational retirement board.
[2.82.1.2 NMAC - Rp, 2.82.1.2 NMAC,
11-15-12]
2.82.1.3 STATUTORY AUTHORITY: The Educational Retirement Act, Section 22-11-1 to 22-11-55, NMSA 1978.
[2.82.1.3 NMAC - Rp, 2.82.1.3 NMAC,
11-15-12]
2.82.1.4 DURATION: Permanent
[2.82.1.4 NMAC - Rp, 2.82.1.4 NMAC,
11-15-12]
2.82.1.5 EFFECTIVE DATE: November 15, 2012, unless a later date is cited at the end of a
section.
[2.82.1.5 NMAC - Rp, 2.82.1.5 NMAC,
11-15-12]
2.82.1.6 OBJECTIVE: The purpose of this rule is to establish procedures and functions
of the educational retirement board, its director, officers and committees.
[2.82.1.6 NMAC - Rp, 2.82.1.6 NMAC,
11-15-12]
2.82.1.7 DEFINITIONS: [RESERVED]
2.82.1.8 BOARD MEMBERS AND OFFICERS: Ex-officio members of the
board shall take office upon their qualifying for the offices enumerated in Section 22-11-3. The board member elected by the New Mexico educational
association shall be elected in the manner prescribed by the constitution of
that body and shall take office on January 1 following such election. The board
member elected by the New Mexico members of the American association of
university professors shall be elected in accordance with the constitution of
that body and shall take office on July 1 following such election. The board
member elected by the New Mexico association of educational retirees shall be
elected in the manner prescribed by the constitution of that body and shall
take office on July 1 following such election. The
board members appointed by the governor shall take office upon their receipt of
appointment. All board members shall hold office until their successors qualify
regardless of the length of the term and office. At the regular August meeting
of each year, the members of the board shall elect a chairman, a vice-chairman,
and a secretary. The duties of the officers shall include the following.
A. The
chairman shall preside at all meetings of the board.
B. The
vice-chairman shall serve as the chairman in the absence of the chairman.
C. The
secretary shall attest to the official actions of the board when such is
required. The vice-chairman may attest
to the official actions of the board in the secretary’s absence.
[2.82.1.8
NMAC - Rp,
2.82.1.8 NMAC, 11-15-12]
2.82.1.9 MEETINGS:
A. The
New Mexico educational retirement board shall hold regular meetings in the
months of February, April, June, August, October and December; provided
however, that the board may change the date of a meeting by board action, which
action shall be noted in the minutes. Special
board meetings may be held in accordance with state law at the call of the chairman
or by any three board members. Committee
meetings shall be scheduled as directed by the chairman of each committee.
B. Four
members of the board shall constitute a quorum at any regular or special
meeting.
C. Notice
of all meetings of the board and its committees shall be made in accordance
with the Open Meetings Act (Chapter 10, Article 15, NMSA 1978) and the Open
Meetings Resolution adopted by the board and shall be posted on the board’s
website and distributed as otherwise directed by the board. Notice shall be given at least eight (8) days
in advance of any regular meeting scheduled by the board at its last meeting.
Notice shall be given at least three (3) days in advance of any special meeting
called by the chairman or any three members of the board.
D. The
chairman shall set the agenda of board meetings; provided however, that
if the chairman refuses to place an item on the agenda, three (3) individual
board members may petition in writing and place an
item on the agenda without the chairman's consent. Committee chairmen shall set the agendas of
their respective committees. Notice of
agendas shall be made in accordance with the Open Meetings Act and the Open
Meetings Resolution adopted by the board and the director shall distribute
board and committee agendas to board members, post the agendas to the board’s
website, and distribute the agendas as otherwise directed by the board.
E. Board
members and their designees may attend and participate in any regular or
special board meeting by telephone or other electronic device if:
(1) the member or designee cannot attend the meeting due to an
emergency or unforeseen circumstance;
(2) the member or designee can clearly be heard by everyone attending
the meeting and the member or designee clearly identifies his- or herself before
speaking or participating in a vote;
(3) the member or designee has not attended regular meetings
electronically more than twice in a rolling twelve (12) month period;
(4) no more than two members or designees who otherwise qualify
for participation under this section may do so at the same meeting; and
(5) the member or designee otherwise complies with the Open
Meetings Act.
F. Failure of any
board member other than state treasurer or secretary of public education to
attend four consecutive regular meetings unless such absence is excused by the board
at a board meeting will be
considered resignation from the board by that board member. Failure of the designee of the state
treasurer or the secretary of public education, respectively, to attend four (4)
consecutive regular meetings when the state treasurer or the secretary of
public education is absent will be considered resignation from the board by
that designee. An excused absence must
be recorded in the board meeting minutes.
[2.82.1.9 NMAC - Rp, 2.82.1.9 NMAC,
11-15-12]
2.82.1.10 SANCTIONS AND ENFORCEMENT:
A. Any breach of a board member’s
fiduciary duty or violation of the rules or policies adopted by the board made
known to the board or of which the board becomes aware shall be reviewed by the
board. If a majority of the entire board
so request, an alleged breach or violation may be investigated by an
independent person or entity not otherwise associated or affiliated with any
member of the board or the board’s staff.
Such person or entity shall be selected by at least five board members
and designees, if such be sitting for board members.
B. Any hearing addressing an alleged
breach of fiduciary duty or violation of the rules or the policies adopted by
the board shall be conducted by the entire board, excepting the member accused
of such a breach or violation, in accordance with the rule governing
administrative appeals adopted by the board prior to the alleged breach or
violation having occurred. If the rule
governing administrative appeals is amended between the time that an alleged breach
of fiduciary duty or violation of such rules or policies occurred and the time
of the hearing, the board shall conduct the hearing in accordance with the rule
that existed prior to its amendment.
C. Removal of a board member should
occur only when necessary for the board to fulfill its fiduciary duty. A decision to remove a board member should be
based on a determination that allowing the member to continue to serve on the board
would be a violation of the other board members’ fiduciary duty and would be
detrimental to the educational retirement fund and the board. Removal should not be undertaken solely to
inflict a penalty for a board member’s past action(s) unrelated to the matter
before the board.
(1) Removal is appropriate in instances
of gross misconduct, violation of the board member’s fiduciary duty, repeated
violation of the rules and policies adopted by the board, or failure to fulfill
the duties of a board member. "Gross
misconduct" is defined as violation of a clearly established rule or
policy, dereliction of duty, unlawful behavior involving matters of dishonesty
or deception, gross negligence, but not negligence or carelessness.
(2) Removal of a board member other than
the state treasurer or the secretary of public education shall occur only after
a full investigation, hearing, and an affirmative vote by not less than five board
members and designees, if such are sitting for a board member.
(3) The state treasurer and the secretary
of public education may be removed from the board only by removal from their
respective offices by an authority possessing such power. The board may nevertheless, in compliance
with the procedures set forth herein, make a finding that the actions of a state
treasurer or a secretary of public education warrant removal from the board and
report such finding to appropriate authorities.
A designee of the state treasurer or the secretary of public education,
respectively, shall not participate in board discussions or votes related to
the board’s consideration of a matter pursuant to this subparagraph that involve
the board member who named that person as a designee.
(4) The designees of the state treasurer
and the secretary of public education, respectively, may be removed from the board
in accordance with the procedures set forth herein. A designee so removed may not be reappointed
as a designee by either the state treasurer or the secretary of public education.
D. Board members or designees found to
be in violation of the rules and policies adopted by the board or who fail to
fulfill their duties, or who otherwise conduct themselves in a manner that is
not appropriate for a member of a board governing a public pension fund, may be
subject to formal reprimand or admonishment by the board. Reprimand or admonishment shall be done upon
a public vote of not less than five board members and designees, if such are
sitting for board members, and shall be permanently recorded in the board minutes.
(1) The board may choose to reprimand a board
member or designee upon determining that the member’s or designee’s violation
of the rules and policies adopted by the board or conduct as a board member
warrant censure or reproval but do not warrant
removal from the board.
(2) The board may choose to admonish a board
member or designee upon determining that member or designee should be advised
or cautioned regarding actions such as a failure to fulfill the duties of a board
member or conduct that is inappropriate for a member of a board governing a
public pension fund.
E. The board may not impose a fine on a
board member or designee; however, the board may order a board member or
designee to repay expenses paid by the board on behalf of a board member or
designee for education or travel where a board member or designee did not
fulfill the purpose for which the education or travel expense was provided. In addition, a board member or designee may
be required to repay the donor of a gift accepted in violation of Section
22-11-5.1 or the rules and policies adopted by the board.
[2.82.1.10 NMAC - N, 11-15-12]
2.82.1.11 FUNCTION OF THE BOARD:
A. The
board shall function primarily as a policy making body and except for such
ministerial acts as may be required by law, administrative matters shall be the
responsibility of the director. The board shall adopt administrative rules and
regulations through which the director shall implement the policies of the
board.
B. In
the consideration of cases involving individual members of the educational
retirement system, it shall be the stated policy of the board to consider all
appeals on their merits, guided by the Educational Retirement Act and the rules
or regulations adopted by this board.
C. Pursuant
to the board's fiduciary duty to the fund, the board has sole discretion in
determining whether there is adequate funding for any proposed change in
benefits or the funding formula.
[2.82.1.11
NMAC - Rp,
2.82.1.10 NMAC, 11-15-12]
2.82.1.12 ADMINISTRATIVE
BUDGETS: The director shall prepare
budgets and requests for appropriations, which shall be considered and approved
by the board prior to submission to the department of finance and
administration or legislature.
[2.82.1.12 NMAC - Rp, 2.82.1.11 NMAC,
11-15-12]
2.82.1.13 EMPLOYMENT
OF STAFF:
A. The
board, at a regular meeting, shall employ a director who shall serve at the
pleasure of the board and at a salary to be set by the board.
B. The
board shall annually approve an organizational chart coincident with the
adoption of the budget. This chart shall include a description of all positions
required for the operation of the office, and the director shall be responsible
for staffing these positions. This responsibility shall include the authority
for the employment, promotion and dismissal of all employees.
[2.82.1.13 NMAC - Rp, 2.82.1.12 NMAC,
11-15-12]
2.82.1.14 INVESTMENT COMMITTEE: The investments of the retirement fund shall
be under the immediate direction of an investment committee composed of the chairman
of the board, and three members of the board appointed by the chairman and
approved by the board, for terms of one (1) year. The appointments by the
chairman shall take place at the board’s regular October meeting each year. In
the event of a vacancy on the committee, the chairman may appoint a member of
the board to serve for the remaining portion of the one (1) year term. The
appointment shall become effective immediately; provided, however, that it
shall be subject to the approval by the board at its first meeting occurring
after said appointment. The actions of the committee shall be subject to applicable
statutes governing investment of the educational retirement fund, and the
administrative rules and policies adopted by the board relating to investments
of the fund.
[2.82.1.14 NMAC - Rp, 2.82.1.13 NMAC,
11-15-12; A, 12-30-13]
2.82.1.15 MEDICAL
REVIEW COMMITTEE AND APPEAL OF RECOMMENDATIONS:
A. The
board shall engage a medical review committee composed of three physicians well qualified in general medical knowledge. The
committee shall review all disability examination reports and advise the board
of the nature and extent of disability for all applicants for disability
benefits and the nature and extent of disability for those members already
approved for benefits when it becomes necessary to determine their continued
eligibility. The committee shall also render advice to the board on the
selection of physicians or other qualified persons to perform tests and
examinations upon applicants for disability, if necessary, and other medical
matters.
B. The
director may engage physicians and other qualified persons throughout the state
to perform tests and examinations upon applicants for disability, if necessary.
Results of such examinations shall be reported in detail to, and reviewed by,
the medical review committee. The director is authorized to pay a reasonable
fee for the reports and examinations requested by the committee.
C. Applicants
for disability benefits and recipients of disability benefits whose benefits
are subject to re-examination shall be given written notice of those
recommendations of the medical review committee which propose denial of the
application for disability or termination of disability benefits. The written
notice shall contain the following:
(1) the recommendation of the medical review committee, and a
clear and concise statement of the reasons supporting the recommendation;
(2) a statement that the applicant or disability recipient may
appeal the recommendation within thirty (30) days after receipt of the notice
in accordance with 2.82.11 NMAC.
[2.82.1.15
NMAC - Rp, 2.82.1.14 NMAC, 11-15-12; A, 6-16-15]
2.82.1.16 ACTUARY: The director shall
recommend an actuarial firm to be engaged for the purpose of performing routine
actuarial services and actuarial investigations and evaluations to be provided
for in a contract to be approved by the board.
[2.82.1.16 NMAC - Rp, 2.82.1.15 NMAC,
11-15-12]
2.82.1.17 CONDUCT OF BUSINESS:
A. The
business affairs of the board shall be conducted by the director within the
authority outlined by the Educational Retirement Act and rules and procedures adopted
by the board.
B. On
behalf of the board, the director is authorized to execute vouchers, delegate
others to execute vouchers, buy and sell, or assign, or otherwise acquire or
dispose of stocks, bonds, notes, or other securities held by the board, and
execute such other documents as may be necessary to the administration of the Educational
Retirement Act.
C. The
director shall obtain the board’s approval before requesting a formal opinion
interpreting the law from the attorney general. The director may, however,
obtain advice, either oral or written, from the attorney general as the need
may arise.
D. The
rules and procedures of the board may be amended or expanded in the following
manner:
(1) At
any regular meeting, the board may request the director to prepare amendments
or new rules for action at a subsequent meeting of the board.
(2) The
director may, at any time, propose amendments or new rules for action at any
meeting of the board.
(3) Any
proposed amendment or new rule shall be drafted by the director and sent to
each board member with the agenda for the meeting at which the proposal will be
considered, and all proposed rule changes will be sent to all local administrative
units, within a reasonable time, prior to being considered by the board.
E. Interest
rates that are to be set by the board under the Educational Retirement Act may
be changed at any meeting of the board but shall at a minimum be set at a board
meeting held in the final fiscal quarter of the year.
[2.82.1.17 NMAC - Rp, 2.82.1.16 NMAC,
11-15-12; A, 6-16-15]
HISTORY
OF 2.82.1 NMAC:
Pre-NMAC
History: The material in this part was derived from that previously filed with
the State Records Center and Archives under:
ERB 67-3, Rules and Procedures, filed 6-30-67.
ERB 78-1, Rules and Procedures, filed 8-7-78.
ERB
Rule I, Organization and Operation of the Educational Retirement Board, filed
7-2-82.
History
of Repealed Material:
2.82.1 NMAC, General Provisions, filed 11-16-2001 - Repealed
effective 11-15-2012 and replaced by 2.82.1 NMAC, General Provisions, effective
11-15-2012.