J.C. Bongivengo v. City of New Castle Pension Plan Board and The City of New Castle

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Joseph C. Bongivengo, :
Appellant :
:
v. : No. 877 C.D. 2018
: Argued: February 11, 2019
City of New Castle Pension Plan :
Board and The City of New Castle :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE ROBERT SIMPSON, Judge
HONORABLE P. KEVIN BROBSON, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE BROBSON FILED: March 25, 2019
Appellant Joseph C. Bongivengo (Bongivengo) appeals from an order
of the Court of Common Pleas of Lawrence County (common pleas), dated
May 29, 2018. The order denied Bongivengo’s appeal from the City of New Castle
Council’s (City Council) determination that Bongivengo, a City of New Castle
(City) firefighter, was not yet eligible for retirement benefits because he had not
reached the required minimum years of age. For the reasons that follow, we will
affirm common pleas’ order.
The City’s firefighters are represented for collective bargaining
purposes by the International Association of Firefighters, Local No. 160 of New
Castle, Lawrence County, Pennsylvania (Union). As a result, over the years the City
and the Union entered into a series of collective bargaining agreements (CBA(s)).
The City hired Bongivengo as a firefighter on August 1, 1988. During that time, the
City and the Union operated under the terms of a CBA governing the
years 1987 through 1990 (1987 CBA). Although the 1987 CBA did not expressly
provide for retirement pension benefits, it contained a clause rendering null and void
any provisions of the CBA that conflicted with the Third Class City Code.1
(Reproduced Record (R.R.) at 63a.) The Code requires an ordinance establishing a
firefighter’s pension fund to mandate a minimum period of continuous service of 20
years and a minimum age (if prescribed) of 50.2
In 1987, the City adopted an ordinance establishing retirement pension
benefits for firefighters hired after January 1, 1988 (Pension Ordinance). The
original terms of the Pension Ordinance required firefighters to attain the age of 60
and contribute 20 years of service in order to be eligible for retirement pension
benefits. (R.R. at 83a.) In 1991, the City amended the Pension Ordinance (1991
1
The General Assembly enacted what was then commonly referred to as the Third Class
City Code through the Act of June 23, 1931, P.L. 932, as amended, 53 P.S. §§ 35101-39701, which
the General Assembly repealed (and recodified) by the current version of the Third Class City
Code, now codified at 11 Pa. C.S. §§ 10101-14702. This opinion refers to the statutes
interchangeably as “the Code” or refers to the statutes as the “former Code” or “current Code,” as
appropriate.
2
Section 14321(a) of the current Code, 11 Pa. C.S. § 14321(a), provides:
Ordinance.—With regard to continuous service and minimum age requirements,
the ordinance establishing or regulations governing the firefighters pension fund
shall prescribe as follows:
(1) A minimum period of continuous service of not less than 20 years.
(2) If a minimum age is prescribed, a minimum of 50 years of age.
(Emphasis added.) At the time of the 1987 CBA, Section 4321 of the former Code, as amended,
53 P.S. § 39321, provided for the same period of continuous service and minimum age. Thus, the
provisions of the former and current Code pertaining to firefighters’ pensions that are applicable
to this matter were the same for purposes of this opinion throughout the relevant time period.
2
Amendment) to reduce the minimum age requirement for firefighters hired after
January 1, 1988, from 60 to 55.3 (R.R. at 87a.)
By letter dated January 20, 2017, Bongivengo notified the Chief
Administrative Officer for the City’s Fireman’s Pension Plan (Plan CAO) of his
intent to retire upon his 50th birthday, in September 2017. (R.R. at 2a.) With respect
to retirement pension benefits, the CBA in effect for the years 2017 through 2019
(2017 CBA) provided, in relevant part:
Employees hired as of or promoted to Firefighter after
January 1, 1998, but before January 1, 1992, may retire
after completing twenty (20) years of service as a
Firefighter and attaining the age of fifty-five (55)
years. . . . The monthly amount of the normal retirement
benefit for those who retire on or after January 1, 1998
shall be equal to seventy-five percent (75%) of the
participant’s average compensation.
(R.R. at 208a-09a.) Moreover, beginning with the CBA covering the years 1998
through 2002 (1998 CBA), the City and the Union removed from their CBAs any
express reference to the Code, particularly the null and void clause in the 1987 CBA.
In its place, subsequent CBAs, including the 2017 CBA, provided: “Any provisions
of this Agreement inconsistent with the applicable provisions of the Optional Third
Class City Charter Law[4] or other applicable law are hereby deemed to be null and
void.” (R.R. at 197a (emphasis added).)
In his letter, Bongivengo acknowledged that the 1991 Amendment to
the Pension Ordinance sets a minimum retirement age of 55. Bongivengo
3
The 1991 Amendment provides: “Each member shall be entitled to receive a pension
benefit provided he/she has completed at least twenty (20) years of continuous service with the
employer and has attained the age of 55.” City of New Castle, Pa. Ordinance 7060 (Dec. 26,
1991) (emphasis added).
4
Act of July 15, 1957, P.L. 901, as amended, 53 P.S. §§ 41101-45000 (Charter Law).
3
contended, however, that the 1991 Amendment was in conflict with the Code, which
allowed him to retire at the age of 50 with 20 years of service. As between the two,
Bongivengo contended that the Code prevails. He asked the City to confirm his
eligibility to retire at the age of 50 pursuant to the Code. Bongivengo did not
reference any CBA provision in his letter.
The Plan CAO responded by letter dated February 14, 2017.
(R.R. at 3a-4a.) She informed Bongivengo that any request for retirement benefits
must comply with the terms of the 2017 CBA and the Pension Ordinance, as
amended, neither of which allows for a retirement pension at the age of 50.
Moreover, she gave three reasons why Bongivengo’s reliance on the Code was
misplaced. First, she contended that Bongivengo is bound by the terms of
the 2017 CBA, even those that may be illegal. Second, the pension provisions of
the 2017 CBA are not illegal, because the City, operating under an optional charter,
is not subject to the Code. Finally, she contended that the Municipal Pension Plan
Funding Standard and Recovery Act (Act 205)5 authorized the pension plan
eligibility terms. Nonetheless, she notified Bongivengo that she would forward his
inquiry to the Plan Administrator for a determination.
The Pension Board thereafter denied Bongivengo’s request for
retirement pension benefits, referring Bongivengo to the earlier explanation
provided by the Plan CAO. (Id. at 6a.) Bongivengo appealed the Pension Board’s
decision to City Council, which, after a public hearing on the matter, denied
Bongivengo’s appeal and adopted the proposed findings of fact and conclusions of
law as submitted by the Pension Board. (Id. at 18a.) The following adopted findings
5
Act of December 18, 1984, P.L. 1005, as amended, 53 P.S. §§ 895.101-.1131.
4
of fact—gleaned from the public hearing—supply a helpful factual background for
the purposes of this appeal:
2. The City Firemen pension ordinances since
December 26, 1991 and the collective bargaining
agreements since 1992 have provided that a
firefighter hired in 1988 must reach 20 years of
service and age 55 in order to retire under [n]ormal
[r]etirement.
3. The current collective bargaining agreement (for the
period [January 1, 2017, to December 31, 2019),] as
well as the predecessor arbitration award (for the
period [January 1, 2014, to December 31, 2016,])
provide that a City Firefighter hired in 1988 must
reach 20 years of service and age 55 to retire under
[n]ormal [r]etirement.
4. The pension request of [Bongivengo] has been
handled pursuant to Plan Appeal Procedure
including [a] Local Agency [Law][6] hearing before
[City] Council on August 22, 2017.
5. No request to change the normal retirement for
those firefighters hired in 1988 was made an issue
in dispute in the bargaining leading up to the
[January 1, 2017, to December 31, 2019] collective
bargaining agreement. Also, no request to change
the normal retirement for those officers hired in
1988 was made an issue in dispute leading up to the
arbitration award for the period [January 1, 2014, to
December 31, 2016].
....
8. The Auditor General Compliance Audit Report for
the period January 1, 2014[,] to
December 31, 2015[,] issued August 2016 for this
Plan states that the normal retirement requirement
is 20 years of service and age 55 for a fireman hired
in 1988.
6
2 Pa. C.S. §§ 551-555, 751-754.
5
9. The Auditor General is tasked with completing
audits of local government pension plans which
includes review of benefit structures for legality.
10. There is no finding from the Auditor General’s
Office in the 2014-2015 Compliance Audit Report
that 20 years of service and age 55 is an illegal
benefit.
11. The 2015 actuarial valuation (the most recent
valuation available at the hearing date) lists normal
retirement for firemen hired in 1988 as 20 years of
service and age 55.
12. The Fire Plan funding level is just under 60%.
The 2017 minimum municipal obligation [] to fund
the Plan is over $1,000,000 and state aid relative to
this Plan for 2016 was about $200,000 thus
resulting in a substantial shortfall and substantial
City contribution to this Plan. Any additional
pension benefits would place an additional strain on
the City[’s] financial position.
13. The Pennsylvania Auditor General has issued a
memorandum which provides that an Optional
Charter City is not bound by the Third Class City
[Code] pension provisions which means the City
does not have to follow the normal retirement
provisions for firefighters as described in the . . .
Code.
(R.R. at 12a-13a (internal citations omitted).)
Bongivengo appealed the City Council’s determination to common
pleas. (Id. at 25a.) Common pleas denied Bongivengo’s appeal, concluding, inter
alia, that Bongivengo is bound by the terms of the Pension Ordinance, as amended,
which requires a minimum retirement age of 55 and a minimum of 20 years of
service. (Id. at 51a.) Bongivengo now appeals to this Court.
6
On appeal,7 Bongivengo contends that the 1991 Amendment to the
Pension Ordinance is not enforceable because City Council passed and implemented
the amendment without first negotiating its contents with the Union pursuant to the
Police and Fireman Collective Bargaining Act, commonly referred to as Act 111.8
Because the City did not engage in collective bargaining before implementing the
updated pension eligibility requirements, the City also violated Section 607(e) of
Act 205, 53 P.S. § 895.607(e).9 Next, Bongivengo contends that the Code contains
the controlling language concerning the minimum age and years of service
requirements for pension eligibility. In support, Bongivengo directs the Court to the
null and void provision of the 2017 CBA, which declares all sections in conflict with
the “[Charter Law] or other applicable law” to be null and void. (R.R. at 197a
(emphasis added).) Bongivengo maintains that the phrase “other applicable law”
includes the Code. Accordingly, the Code, which allows for retirement upon
7
“Our review is limited to determining whether an error of law was committed, whether
necessary findings of fact were supported by substantial evidence, whether constitutional rights
were violated, and whether the procedure before the local agency was contrary to statute.” Perrez
v. Fox Chapel Borough, 143 A.3d 520, 525 n.5 (Pa. Cmwlth. 2016).
8
Act of June 24, 1968, P.L. 237, as amended, 43 P.S. §§ 217.1-.10.
9
Section 607(e) of Act 205 provides:
Establishment of a revised benefit plan for newly hired municipal employees.—
The municipality may establish a revised benefit plan of the pension plan applicable
to any employee first hired on or after the effective date of the instrument
establishing the revised benefit plan. At the option of the municipality, the revised
benefit plan may be extended to include an employee first hired prior to the
effective date of the instrument establishing the revised benefit who elects the
coverage. . . . A revised benefit plan for newly hired municipal employees shall be
developed with consultation with representatives of the collective bargaining unit
applicable to the affected type of municipal employee, if any, and shall be within
the scope of collective bargaining pursuant to the applicable law subsequent to the
establishment of the revised benefit plan.
(Emphasis added.)
7
reaching the minimum age of 50, controls over any conflicting provision in
the 2017 CBA.
In response, the City and the Pension Plan (collectively, Appellees)
argue that common pleas’ order should be affirmed, because Appellees are bound
by the Charter Law and not the Code. Further, Appellees argue that Bongivengo is
bound by the terms of the 2017 CBA, negotiated on his behalf by the Union. Lastly,
Appellees contend that Bongivengo seeks an increase in benefits in contravention of
Act 205.
The sole issue in this matter is whether Bongivengo is entitled to a
retirement pension upon reaching the age of 50, as set forth in the Code, or age 55,
as set forth in the Pension Ordinance, as amended, and the 2017 CBA. In Norcini v.
City of Coatesville, 915 A.2d 1243 (Pa. Cmwlth. 2007), this Court affirmed the order
of a common pleas court that refused to compel the City of Coatesville to provide a
certain percentage of annual salary for disability pension benefit pursuant to the
Code, where the CBA in effect provided contrary (but ultimately controlling)
language concerning disability pension benefits. In doing so, this Court stated:
[T]he police pension plan at issue was in place, and
outlined in the CBA, at all times during Norcini’s
employment. . . . Moreover, the CBA was voluntarily
entered into by the parties. Norcini was bound by and
benefited from the provisions of the CBA throughout the
course of his employment, and was equally bound by the
provisions of the CBA at the time of his retirement,
including any shortcomings and limitations.
Norcini, 915 A.2d at 1247.
Here, common pleas gave primacy to the terms of the 1991 Amendment
to the Pension Ordinance over any conflict with the CBAs, particularly
the 2017 CBA. With respect to Bongivengo’s retirement pension eligibility,
8
however, there is no conflict. Both the 1991 Amendment and the 2017 CBA provide
that Bongivengo is only eligible to receive a retirement pension after
accruing 20 years of service and attaining the age of 55. Norcini supports the City’s
position that Bongivengo is bound by the terms of the 2017 CBA. We see no merit
to Bongivengo’s contention that because the City passed the 1991 Amendment
before the terms of the ordinance were enshrined in a CBA, the pension benefit
provision of the 2017 CBA is legally infirm.10 Regardless of which came first, the
Union and the City agreed that, with respect to firefighters hired at or around the
time the City hired Bongivengo, the minimum age for retirement benefit eligibility
would be 55.11 Just as we stated in Norcini, Bongivengo is “bound by the total result
negotiated by the union on [his behalf] and cannot selectively choose or reject
aspects of the negotiated agreement.” Norcini, 915 A.2d at 1245-46.12
10
We acknowledge the irony here that by challenging the legality of the 1991 Amendment,
Bongivengo is attacking an amending ordinance that provided for a favorable change in retirement
benefits for him and other City firefighters by reducing the minimum age for eligibility from 60,
as set forth under the original terms of the Pension Ordinance, to 55.
11
The first time an express pension provision appeared in a CBA between the Union and
the City was the CBA covering years 1992 through 1994 (1992 CBA), the period immediately
following passage of the 1991 Amendment to the Pension Ordinance. (R.R. at 128a.) With respect
to firefighters, like Bongivengo, hired after January 1, 1988, but before December 31, 1991,
the 1992 CBA expressly required a minimum age of 55 and 20 years of service for retirement
pension eligibility, consistent with the terms of the 1991 Amendment to the Pension Ordinance.
Every CBA negotiated thereafter included the same eligibility terms for firefighters hired after
January 1, 1988, but before December 31, 1991. Bongivengo, therefore, has known since adoption
of the 1992 CBA that the Union and the City agreed to these eligibility terms.
12
We also note that beginning with the 1998 CBA, the Union and the City agreed to
increase the monthly retirement benefit from 50% of the retiring firefighter’s final monthly average
salary, as set forth in the Pension Ordinance, to 75% of the retiring firefighter’s average
compensation. (R.R. at 185a.) It is clear, then, that over the years the Union has successfully
negotiated with the City for increased retirement benefits for its members, including Bongivengo.
9
This ruling also disposes of Bongivengo’s argument that the City
violated Section 607(e) of Act 205 because it did not engage in collective bargaining
before it implemented the new age and years of service requirements. As noted
above, the City and the Union did collectively bargain for the age and years of
service requirement, as first reflected in the 1992 CBA and subsequently in every
CBA thereafter.
Bongivengo’s final argument is that the null and void clause in the 2017
CBA should be interpreted so that “other applicable law” refers to the Code. With
respect to contract interpretation in Pennsylvania, our Supreme Court, in Lesko v.
Frankford Hospital-Bucks County, 15 A.3d 337 (Pa. 2011), opined:
When a written contract is clear and unequivocal, its
meaning must be determined by its contents alone. It
speaks for itself and a meaning cannot be given to it other
than that expressed. . . . Hence, where language is clear
and unambiguous, the focus of interpretation is upon the
terms of the agreement as manifestly expressed, rather than
as, perhaps, silently intended.
Lesko, 15 A.3d at 342 (emphasis in original). Contractual terms are not ambiguous
if “the court can determine its meaning without any guide other than a knowledge of
the simple facts on which, from the nature of language in general, its meaning
depends.” State Highway & Bridge Auth., Dep’t of Transp. v. E.J. Albrecht
Co., 430 A.2d 328, 330 (Pa. Cmwlth. 1981).
Here, with respect to retirement pension eligibility, the 2017 CBA
clearly and expressly provides for a minimum age of 55 and 20 years of service.
Moreover, we refuse Bongivengo’s invitation to interpret the catch-all phrase “other
applicable law” in the 2017 CBA’s null and void clause as encompassing a particular
law—i.e., the Code—that the City and the Union agreed to remove from the clause
starting with the 1998 CBA and continuing in every CBA thereafter. To us, the
10
substitution of the Charter Law for the reference to the Code in the null and void
clause expresses the clear intent and acknowledgement by the City and the Union
that the former controlled and not the latter. Because the Charter Law does not
provide for a minimum age and years of service requirement, there is no conflict
between the 2017 CBA’s eligibility provisions and the Charter Law.
For the reasons set forth above, we find no error with common pleas’
decision to affirm the City Council’s pension eligibility determination in this matter.
We, therefore, will affirm common pleas’ order, which denied Bongivengo’s appeal
from City Council’s determination.
P. KEVIN BROBSON, Judge
11
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Joseph C. Bongivengo, :
Appellant :
:
v. : No. 877 C.D. 2018
:
City of New Castle Pension Plan :
Board and The City of New Castle :
ORDER
AND NOW, this 25th day of March, 2019, the order of the Court of
Common Pleas of Lawrence County is hereby AFFIRMED.
P. KEVIN BROBSON, Judge