Bill Summary – FastDemocracy

SB 761
                      Department of Legislative Services
                             Maryland General Assembly
                                   2021 Session
                           FISCAL AND POLICY NOTE
                              Third Reader - Revised
Senate Bill 761                 (Senator Elfreth)
Budget and Taxation                                                        Appropriations
   State Retirement and Pension System - Executive Directors - Membership and
                                     Vesting
This bill requires that the Executive Director of the Alcohol and Tobacco Commission be
(1) a sworn police officer with specified powers and (2) a member of the Law Enforcement
Officers Pension System (LEOPS) as a condition of employment. It also transfers any
service credit (and any applicable member and employer contributions) earned by the
current Executive Director of the commission in the Employees’ Pension System (EPS)
between December 1, 2020, and the bill’s effective date to LEOPS. The bill also establishes
that an individual who commences employment as the Executive Director of the State
Retirement Agency (SRA) on or after January 1, 2021, has immediate vesting rights in
EPS. Finally, it requires SRA to report to the Joint Committee on Pensions, by
December 1, 2021, on relevant positions that are eligible and ineligible for immediate
vesting. The bill takes effect June 1, 2021.
                                    Fiscal Summary
State Effect: As the bill pertains only to two individuals at any given time, it has no
discernible effect on State pension liabilities or contribution rates. SRA can complete the
required report with existing budgeted resources. No effect on revenues.
Local Effect: None.
Small Business Effect: None.
                                         Analysis
Current Law:
Alcohol and Tobacco Commission
The Alcohol and Tobacco Commission must (1) educate the public on a variety of topics
related to the lawful consumption of alcohol and tobacco and (2) subject to federal
approval, ensure that all alcoholic beverages sold in the State with an alcohol content of at
least 4.5% have a large and conspicuous label with their alcohol content. The commission’s
Field Enforcement Division consists of sworn police officers with the powers, duties, and
responsibilities of peace officers with regard to the enforcement of provisions related to:
      the unlawful importation of alcoholic beverages and tobacco into the State;
      the unlawful manufacture of alcoholic beverages in the State;
      the transportation and distribution of alcoholic beverages and tobacco that are
       manufactured illegally and on which taxes are due and unpaid; and
      the manufacture, sale, barter, transportation, distribution, or other form of owning,
       handling, or dispersing alcoholic beverages or tobacco by an unlicensed individual.
The Executive Director of the commission must have the training and experience needed
to direct the work of the commission and devote full time to the duties of the office.
Law Enforcement Officers’ Pension System
LEOPS was established on July 1, 1990, with participation a condition of employment for
21 specified categories of public safety officers. The most recent group added was
employees of the Warrant Apprehension Unit of the Division of Parole and Probation
within the Department of Public Safety and Correctional Services (Chapter 268 of 2015).
In addition, members include specified law enforcement officers employed by participating
governmental units that elect to participate in LEOPS.
Members of LEOPS earn 2% of their average final compensation (AFC) for each year of
creditable service. The member contribution is 7% of earnable compensation, up to
32.5 years of service, when contributions are no longer required. Vested members qualify
for a normal service retirement benefit at age 50 or with at least 25 years of creditable
service. However, the normal service allowance is capped at 65% of AFC, meaning that
members stop accruing benefits after 32.5 years of service (2% x 32.5 = 65%).
SB 761/ Page 2
Vesting
In general, members of EPS hired after June 30, 2011, vest in the system after 10 years of
service. However, an individual who is a Secretary of a principal department or a head of
a department, office, or other unit of State government serving at the Governor’s pleasure
has immediate vesting rights. As the SRA Executive Director serves at the pleasure of the
State Retirement and Pension System Board of Trustees, he or she is not eligible for
immediate vesting rights.
                               Additional Information
Prior Introductions: None.
Designated Cross File: HB 1336 (Delegate Proctor) - Appropriations.
Information Source(s): Comptroller’s Office; Department of Public Safety and
Correctional Services; State Retirement Agency; Department of Legislative Services
Fiscal Note History:     First Reader - March 3, 2021
rh/vlg                   Third Reader - March 29, 2021
                                Revised - Amendment(s) - March 29, 2021
Analysis by: Michael C. Rubenstein                    Direct Inquiries to:
                                                      (410) 946-5510
                                                      (301) 970-5510
SB 761/ Page 3
Statutes affected: 
Text - First - Alcohol and Tobacco Commission - Executive Director - Clarification: 1-302 Alcoholic Beverages, 1-309 Alcoholic Beverages, 1-313 Alcoholic Beverages, 26-101 State Personnel and Pensions, 26-201 State Personnel and Pensions, 26-202 State Personnel and Pensions, 26-201 State Personnel and Pensions
Text - Third - State Retirement and Pension System - Executive Directors - Membership and Vesting: 1-302 Alcoholic Beverages, 1-309 Alcoholic Beverages, 1-313 Alcoholic Beverages, 26-101 State Personnel and Pensions, 26-201 State Personnel and Pensions, 26-202 State Personnel and Pensions, 26-201 State Personnel and Pensions, 29-304 State Personnel and Pensions, 2-021 State Personnel and Pensions