Judges: RICHARD P. IEYOUB
Filed Date: 9/20/2002
Status: Precedential
Modified Date: 7/5/2016
Dear Senator Boissiere:
This office is in receipt of your recent request for an Attorney General's opinion, which has been assigned to the undersigned for research and reply. Specifically, you have requested that we address the following questions, with regard to members of the boards of trustees of the various state and statewide retirement systems:
"(1) Whether a non-paid trustee must report per diem as income for federal and state income tax purposes.
(2) Whether a board trustee of state and statewide retirement systems can be reimbursed or paid for their service on the board.
(a) If so, whether per diem can be considered as salary for purposes of retirement contribution."
Respectfully, we are compelled to refrain from addressing the issues presented by your first question. It is beyond the purview of this office to render tax advice, and our opinions in this regard would not be binding on either the Department of Revenue or the Internal Revenue Service. We are aware, however, and point out for your information, that some, if not all of the retirement systems, issue Internal Revenue Service "1099" forms to their trustees with regard to per diem income the trustees receive.
With regard to your second question, please be advised that the issue of compensation of the members of the boards of trustees of the various state and statewide retirement systems is addressed statutorily. The legislature could, of course, at any time change the method by which such trustees are compensated, as well as provide any necessary funding for new compensation methods it may choose to implement.
Our research reveals that at this time, the trustees of the various retirement systems receive a per diem for attendance at the meetings of their respective boards, and in some cases expense reimbursement as well. In accordance with LSA R.S.
"shall receive for attendance at meetings of the governing boards the same per diem and expenses as they receive for attendance at legislative committee meetings, and from the same sources." LSA-R.S.
11:181 A(2) and B(3).
With regard to the non-legislative members of the governing boards of the above listed state and statewide retirement systems, LSA-R.S.
In accordance with LSA-R.S.
In response to your third question, it is the opinion of this office that amounts received as `per diem' by trustees cannot be considered as "salary' for the purpose of calculating retirement benefits, because salary and per diem are two distinct and separate forms of compensation. In accordance with the American Heritage Dictionary of the English Language, Fourth Edition1, a `per diem" is: "An allowance for daily expenses." On the other hand, a salary is defined as: "A fixed compensation for services, paid to a person on a regular basis."
Please be advised that it is also the opinion of this office, in accordance with the statutory provisions set forth below, that per diem received by the trustees of the various state and statewide retirement systems cannot be considered in the calculation of the trustees' retirement contributions or benefits.
With regard to LASERS, LSA-R.S.
". . . overtime, per diem, differential pay, payment in kind, premium pay, or any other allowance for expense authorized and incurred as an incident of employment, except supplemental pay for certain members as provided by Article
10 (A)(1 ) of the Louisiana Constitution of 1974." (Emphasis supplied).
With regard to Teachers, LSA-R.S.
LSA-R.S.
"`Earnable compensation'" means the full amount earned by an employee for a given pay period." Certain items, such as "operating expenses" and "allowances" are specifically excluded from the definition of earnable compensation. Notably, `per diem' is not excluded, however, it is the opinion of this office that in referring to "a given pay period", the legislature intended earnable compensation to include only a member's actual salary. In accord: Attorney General's Opinion No. 89-155.
LSA-R.S.
LSA-R.S.
We also note that that LSA-R.S.
With regard to Clerks, retirement benefits are calculated on the basis of "monthly average final compensation", which is defined by LSA-R.S.
With regard to District Attorneys, retirement benefits are calculated on the basis of "average final compensation", which is defined at LSA-R.S.
With regard to MPERS, our research reveals that employee contributions to that system are based upon monthly earnings. "Earnings", in accordance with LSA-R.S.
With regard to Registrars, please be advised that LSA-R.S.
LSA-R.S. 11:2313(10), pertaining to Municipal Police, defines "earnable compensation" as follows:
"Earnable compensation" shall mean the full amount of compensation earned by an employee for a given month, including supplemental pay provided by the state of Louisiana, but shall not include overtime."
This provision of law, which was formerly designated as LSA-R.S. 33:2372(13), has already been interpreted by this office, in Attorney General's Opinion 89-155, issued on December 4, 1989, in as follows:
"Compensation earned by an employee for a given month is the salary established by the Civil established by the Civil Service Commission plus supplemental pay. Exclusion of overtime from the definition of earnable compensation shows that the legislature intended to exclude as "earnable compensation" economic benefits received by an employee over and above his straight monthly salary, except for supplemental pay. Economic benefits received by an employee over and above his monthly salary include such things as fringe benefits, use of municipal vehicles, etc. To define "earnable compensation" as all taxable benefits received by an employee would allow contributions to retirement to be based upon use of municipal vehicles or other fringe benefits which are paid by the municipality but taxable to the employee. This simply was not the intent of the legislature "Earnable compensation" includes only the monthly salary plus supplemental pay." (Emphasis supplied).
In reaching our determination herein, we are guided by the following rules of statutory construction: Words and phrases shall be read with their context and shall be construed according to the common and approved usage of the language. LSA-R.S.
We trust the foregoing to be of assistance, and hope that you will not hesitate to contact us if we can be of assistance to you in the future.
Yours very truly,
RICHARD P. IEYOUB Attorney General
BY: ________________________________ JEANNE-MARIE ZERINGUE BARHAM Assistant Attorney General
RPI/JMZB/dam
Date Released: September 20, 2002