As part of the ethics legislation recently passed by the General Assembly, a provision was included affecting pension benefits. The provision relates to the forfeiture of pension benefits if convicted of a felony arising out of a person’s official capacity.

Tennessee Code Annotated § 8-35-124 outlines the requirements of a pension forfeiture due to official misconduct that constitutes malfeasance in office. The law is currently applicable to persons who become members of the pension plan after July 1, 1982 if convicted of a state felony or May 31, 1993 if convicted of a federal felony. The new provision adds a consent to the forfeiture upon initial election and each reelection thereafter. The provision also covers all service accrued in a public pension plan, not just the service related to the elected capacity. In addition, the provision applies to service in the Tennessee Consolidated Retirement System, any superseded retirement system, or any other public pension plan in Tennessee.

The provision found in Section 42 of Public Chapter 1 of the Acts of 2006 states in part as follows:

     (3) Notwithstanding any other law to the contrary, each time a person is elected to a public office of this state or any political subdivision thereof, such person shall, as a condition of such election, be deemed to consent and agree to the forfeiture of such person’s retirement benefits from the Tennessee consolidated retirement system, any superseded retirement system or any other public pension system if such person is convicted in any state or federal court of a felony arising out of that person’s official capacity, constituting malfeasance in office. Notwithstanding the provisions of § 8-35-124(e) or any other law to the contrary, this subdivision (a)(3) shall apply regardless of the date the person became a member of the public pension system, such person having consented to the provisions of this subsection as a condition of such election.

Persons convicted of a felony arising from their official duties, who were members of the pension system prior to the dates noted in the second paragraph above as set out in Tennessee Code Annotated § 8-35-124(e), and are not elected or reelected to public office are not affected.

If you have questions concerning the new law, please talk to your plan administrator.