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In re Martorana

July 12, 2007

IN THE MATTER OF JOHN MARTORANA


On appeal from Board of Trustees of the Public Employees Retirement System, Docket No. PERS 2-10-131156.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued May 1, 2007

Before Judges Skillman and Grall.

John Martorana appeals from a final order of the Board of Trustees of the Public Employees' Retirement System (the Board) requiring him to repay disability retirement benefits for years 2001 through 2004 in the amount of $62,591.25. Because the Board's findings are supported by substantial credible evidence in the record and its determination is neither arbitrary nor capricious, we affirm.

There is no dispute that Martorana received a disability retirement allowance to which he was not entitled during the relevant years. His disqualification is based on his acceptance of new employment in a position that made him eligible to participate in the Public Employees' Retirement System (PERS). The disqualification is statutory. In pertinent part N.J.S.A. 43:15A-44 provides:

b. If a disability beneficiary becomes employed again in a position which makes him eligible to be a member of the retirement system, his retirement allowance and the right to any death benefit as a result of his former membership, shall be canceled until he again retires.

Pursuant to N.J.S.A. 43:15A-7d, an employee working in a position included in PERS is ineligible for enrollment only if his or her "annual salary or remuneration is fixed at less than $1,500.00."

After retiring on ordinary disability, Martorana accepted a new job in a position that made him eligible to participate in PERS and received annual remuneration far in excess of the $1500 limit. On that basis he was not entitled to his retirement allowance while so employed. Martorana does not dispute that point. He contends that the Board's decision to require him to repay what he earned over a four-year period is arbitrary and inequitable.

John Martorana was born on July 9, 1945, and enrolled in PERS on November 1, 1978, after accepting employment as a Code Enforcement Officer and Housing Inspector for Voorhees Township. He held several other positions over the course of his career as an employee of Voorhees before he was awarded an ordinary disability retirement allowance effective September 23, 1994.

He was earning between $38,000 and $40,000 per year when he retired. His retirement allowance was approximately $1600 per month.

At the time of his retirement, Martorana did not receive information notifying him that employment in a position covered by PERS would result in a termination of his benefits. On January 12, 2001, Martorana accepted part-time employment with the Borough of Avalon as a Recreation Supervisor. His employer did not reenroll him in PERS. Martorana did not contact the Division of Pensions and Benefits (Division) to inquire about the impact of his employment on his retirement allowance or to report his employment. He thought he could earn up to $17,000 per year. Martorana's post-retirement earnings were as follows: 2001, $14,162.75; 2002, $17,211.25; 2003, $16,424.52; 2004, $14,792. According to the Division, accurate information about restrictions on post-retirement earnings of retirees was available upon request and included in mailings sent to retirees.

In 2004 the Division undertook efforts to detect retirees whose reemployment or earnings disqualified them from receiving benefits. At that time, the Division gained access to records of earnings kept by the Department of Labor. The records permitted the Division to identify disability retirees who violated restrictions on earnings and public employment. Martorana was one.

By letter dated December 22, 2004, the Division informed Martorana that it had reviewed his "post-retirement earnings history through the Department of Labor and determined" that his employment in a position that made him "eligible for enrollment in the PERS" required termination of his retirement allowance and repayment of benefits he had received since his reemployment. Martorana was given a date by which he must resign to avoid termination of his benefits. He was also informed that the Division would notify him of the amount owed for benefits previously paid. Martorana immediately resigned from his position with the Borough. The Division ...


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