TITLE 2 PUBLIC FINANCE
CHAPTER 82 EDUCATIONAL RETIREMENT
PART 1 GENERAL PROVISIONS
2.82.1.1 ISSUING AGENCY: Educational
Retirement Board, P. O. Box 26129, Santa Fe, New Mexico 87502-0129
[2.82.1.1 NMAC - Rp,
2.82.1.1 NMAC, 11/15/2012]
2.82.1.2 SCOPE: This
rule addresses the organization and operations of the educational retirement
board.
[2.82.1.2 NMAC - Rp, 2.82.1.2
NMAC, 11/15/2012]
2.82.1.3 STATUTORY AUTHORITY: The
Educational Retirement Act, Section 22-11-1 to 22-11-55 NMSA 1978.
[2.82.1.3 NMAC - Rp,
2.82.1.3 NMAC, 11/15/2012]
2.82.1.4 DURATION:
Permanent
[2.82.1.4 NMAC - Rp,
2.82.1.4 NMAC, 11/15/2012]
2.82.1.5 EFFECTIVE DATE:
November 15, 2012, unless a later date is cited at the end of a section.
[2.82.1.5 NMAC - Rp,
2.82.1.5 NMAC, 11/15/2012]
2.82.1.6 OBJECTIVE: The
purpose of this rule is to establish procedures and functions of the
educational retirement board, its director, officers
and committees.
[2.82.1.6 NMAC - Rp,
2.82.1.6 NMAC, 11/15/2012]
2.82.1.7 DEFINITIONS: [RESERVED]
2.82.1.8 BOARD MEMBERS AND OFFICERS: Ex-officio members of the board shall take
office upon their qualifying for the offices enumerated in Section 22-11-3
NMSA 1978. The board member elected by the New Mexico
educational association shall be elected in the manner prescribed by the
constitution of that body and shall take office on January 1 following such
election. The board member elected by the New Mexico members of the American
association of university professors shall be elected in accordance with the
constitution of that body and shall take office on July 1 following such
election. The board member elected by the New Mexico association of educational
retirees shall be elected in the manner prescribed by the constitution of that
body and shall take office on July 1 following such election. The board member
elected by the American federation of teachers New Mexico shall be elected in
the manner prescribed by the constitution of that body and shall take office on
July 1 following such election. The board members appointed by the governor
shall take office upon their receipt of appointment. All board members shall
hold office until their successors qualify regardless of the length of the term
and office. At the regular August meeting of each year, the members of the
board shall elect a chairman, a vice-chairman, and a secretary. The duties of
the officers shall include the following.
A. The chairman shall preside at all
meetings of the board.
B. The vice-chairman shall serve as the
chairman in the absence of the chairman.
C. The secretary shall attest to the
official actions of the board when such is required. The vice-chairman may attest to the official
actions of the board in the secretary’s absence.
[2.82.1.8
NMAC - Rp, 2.82.1.8 NMAC, 11/15/2012; A, 05/24/2022]
2.82.1.9 MEETINGS:
A. The New Mexico
educational retirement board shall hold regular meetings in the months of
February, April, June, August, October and December;
provided however, that the board may change the date of a meeting by board
action, which action shall be noted in the minutes. Special board meetings may be held in
accordance with state law at the call of the chairman or by any three board
members. Committee meetings shall be
scheduled as directed by the chairman of each committee.
B. Five members of the board shall
constitute a quorum at any regular or special meeting.
C. Notice of all meetings of the board and
its committees shall be made in accordance with the Open Meetings Act (Chapter
10, Article 15, NMSA 1978) and the Open Meetings Resolution adopted by the
board and shall be posted on the board’s website and distributed as otherwise
directed by the board. Notice shall be
given at least eight days in advance of any regular meeting scheduled by the
board at its last meeting. Notice shall be given at least three days in advance
of any special meeting called by the chairman or any three members of the board.
D. The chairman
shall set the agenda of board meetings; provided however, that if the
chairman refuses to place an item on the agenda, three individual board members
may petition in writing and place an item on the
agenda without the chairman's consent.
Committee chairmen shall set the agendas of their respective
committees. Notice of agendas shall be
made in accordance with the Open Meetings Act and the Open Meetings Resolution
adopted by the board and the director shall distribute board and committee
agendas to board members, post the agendas to the board’s website, and
distribute the agendas as otherwise directed by the board.
E. Board members and their designees
may attend and participate in any regular or special board meeting by telephone
or other electronic device if:
(1) the member or designee cannot attend
the meeting due to an emergency or unforeseen circumstance;
(2) the member or designee can clearly be
heard by everyone attending the meeting and the member or designee clearly
identifies themself before speaking or participating in a vote;
(3) the member or designee has not
attended regular meetings electronically more than twice in a rolling 12 month period;
(4) no more than two members or designees
who otherwise qualify for participation under this section may do so at the
same meeting; and
(5) the member or designee otherwise
complies with the Open Meetings Act.
F. Failure of any
board member other than the state treasurer, secretary of public education or
secretary of higher education to attend four consecutive regular meetings
unless such absence is excused by the board at a board meeting will be considered resignation from
the board by that board member. Failure
of the designee of the state treasurer, the secretary of public education or
the secretary of higher education, respectively, to attend four consecutive
regular meetings when the state treasurer, the secretary of public education or
the secretary of higher education is absent will be considered resignation from
the board by that designee. An excused
absence must be recorded in the board meeting minutes.
G. Board
members not officially assigned to the committee which is meeting may be
temporarily appointed to the committee by the committee chairperson when
necessary to achieve a quorum.
[2.82.1.9 NMAC - Rp,
2.82.1.9 NMAC, 11/15/2012; A, 9/26/2017; A, 05/24/2022]
2.82.1.10 SANCTIONS AND ENFORCEMENT:
A. Any breach of a board member’s
fiduciary duty or violation of the rules or policies adopted by the board made
known to the board or of which the board becomes aware shall be reviewed by the
board. If a majority
of the entire board so request, an alleged breach or violation may be
investigated by an independent person or entity not otherwise associated or
affiliated with any member of the board or the board’s staff. Such person or entity shall be selected by at
least five board members and designees, if such be
sitting for board members.
B. Any hearing addressing an alleged breach of fiduciary
duty or violation of the rules or the policies adopted
by the board shall be conducted by the entire board, excepting the member
accused of such a breach or violation, in accordance with the rule governing
administrative appeals adopted by the board prior to the alleged breach or violation
having occurred. If the rule governing
administrative appeals is amended between the time that an alleged breach of
fiduciary duty or violation of such rules or policies occurred and the time of
the hearing, the board shall conduct the hearing in accordance with the rule
that existed prior to its amendment.
C. Removal of a board member should occur only when
necessary for the board to fulfill its fiduciary duty. A decision to remove a board member should be
based on a determination that allowing the member to continue to serve on the
board would be a violation of the other board members’ fiduciary duty and would
be detrimental to the educational retirement fund and the board. Removal should not be undertaken solely to
inflict a penalty for a board member’s past action(s) unrelated to the matter
before the board.
(1) Removal is appropriate in instances
of gross misconduct, violation of the board member’s fiduciary duty, repeated
violation of the rules and policies adopted by the board, or failure to fulfill
the duties of a board member. "Gross
misconduct" is defined as violation of a clearly established rule or
policy, dereliction of duty, unlawful behavior involving matters of dishonesty
or deception, gross negligence, but not negligence or carelessness.
(2) Removal of a board member other than
the state treasurer, the secretary of public education or the secretary of
higher education shall occur only after a full investigation, hearing, and an
affirmative vote by not less than five board members and designees,
if such are sitting for a board member.
(3) The state treasurer, the secretary of
public education and the secretary of higher education may be removed from the
board only by removal from their respective offices by an authority possessing
such power. The board may nevertheless,
in compliance with the procedures set forth herein, make a finding that the
actions of a state treasurer, a secretary of public education or a secretary of
higher education warrant removal from the board and report such finding to
appropriate authorities. A designee of
the state treasurer, the secretary of public education or the secretary of
higher education, respectively, shall not participate in board discussions or
votes related to the board’s consideration of a matter pursuant to this
subparagraph that involve the board member who named that person as a designee.
(4) The designees of the state treasurer,
the secretary of public education and the secretary of higher education,
respectively, may be removed from the board in accordance with the procedures
set forth herein. A designee so removed
may not be reappointed as a designee by either the state treasurer, the
secretary of public education or the secretary of higher education.
D. Board members or designees found to be in violation of
the rules and policies adopted by the board or who fail to fulfill their
duties, or who otherwise conduct themselves in a manner that is not appropriate
for a member of a board governing a public pension fund, may be subject to
formal reprimand or admonishment by the board.
Reprimand or admonishment shall be done upon a public vote of not less
than five board members and designees, if such are sitting for board members,
and shall be permanently recorded in the board minutes.
(1) The board may choose to reprimand a
board member or designee upon determining that the member’s or designee’s
violation of the rules and policies adopted by the board or conduct as a board
member warrant censure or reproval but do not warrant removal from the board.
(2) The board may choose to admonish a
board member or designee upon determining that member or designee should be
advised or cautioned regarding actions such as a failure to fulfill the duties
of a board member or conduct that is inappropriate for a member of a board
governing a public pension fund.
E. The board may not impose a fine on a board member or
designee; however, the board may order a board member or designee to repay
expenses paid by the board on behalf of a board member or designee for
education or travel where a board member or designee did not fulfill the
purpose for which the education or travel expense was provided. In addition, a board member or designee may
be required to repay the donor of a gift accepted in violation of Section
22-11-5.1 NMSA 1978 or the rules and policies adopted by the board.
[2.82.1.10 NMAC - N,
11/15/2012; A, 05/24/2022]
2.82.1.11 FUNCTION OF THE BOARD:
A. The board shall
function primarily as a policy making body and except for such ministerial acts
as may be required by law, administrative matters shall be the responsibility
of the director. The board shall adopt administrative rules and regulations
through which the director shall implement the policies of the board.
B. In the consideration of cases
involving individual members of the educational retirement system, it shall be
the stated policy of the board to consider all appeals on their merits, guided
by the Educational Retirement Act and the rules or regulations adopted by this
board.
C. Pursuant to the board's fiduciary
duty to the fund, the board has sole discretion in determining whether there is
adequate funding for any proposed change in benefits or the funding formula.
[2.82.1.11
NMAC - Rp, 2.82.1.10 NMAC, 11/15/2012]
2.82.1.12 ADMINISTRATIVE BUDGETS: The director shall prepare budgets and requests
for appropriations, which shall be considered and approved by the board prior
to submission to the department of finance and administration or legislature.
[2.82.1.12 NMAC - Rp,
2.82.1.11 NMAC, 11/15/2012]
2.82.1.13 EMPLOYMENT OF STAFF:
A. The board, at a regular meeting,
shall employ a director who shall serve at the pleasure of the board and at a
salary to be set by the board.
B. The board shall annually approve an
organizational chart coincident with the adoption of the budget. This chart shall
include a description of all positions required for the operation of the
office, and the director shall be responsible for staffing these positions.
This responsibility shall include the authority for the employment, promotion and dismissal of all employees.
[2.82.1.13 NMAC - Rp,
2.82.1.12 NMAC, 11/15/2012]
2.82.1.14 INVESTMENT COMMITTEE: The investments of the retirement fund shall
be under the direction of an investment committee composed of the chairman of
the board, and two members of the board appointed by the chairman and approved
by the board, for terms of one year. The chairman shall appoint two members to
the investment committee at the board’s regular October meeting each year. In
the event of a vacancy on the committee, the chairman shall appoint a member of
the board to serve for the remaining portion of the one year
term. The appointment shall become effective immediately; provided, however,
that it shall be subject to the approval by the board at its first meeting
occurring after said appointment. The actions of the committee shall be subject
to applicable statutes governing investment of the educational retirement fund,
and the administrative rules and policies adopted by the board relating to
investments of the fund.
[2.82.1.14
NMAC - Rp, 2.82.1.13 NMAC, 11/15/2012; A, 12/30/2013; A, 3/14/2017; A,
05/24/2022]
2.82.1.15 MEDICAL REVIEW AUTHORITY AND
APPEAL OF RECOMMENDATIONS:
A. The board shall
engage a medical review authority. The authority shall review all disability
examination reports and advise the board of the nature and extent of disability
for all applicants for disability benefits and the nature and extent of disability
for those members already approved for benefits when it becomes necessary to
determine their continued eligibility.
B. The director may engage physicians
and other qualified persons throughout the state to perform independent medical
examinations upon applicants for disability, if necessary. Results of such
examinations shall be reported in detail to, and reviewed by, the medical
review authority. The director is authorized to pay a reasonable fee for the
examinations.
C. Applicants for
disability benefits and recipients of disability benefits whose benefits are
subject to re-examination shall be given written notice of those
recommendations of the medical review authority which propose denial of the
application for disability or termination of disability benefits. The written
notice shall contain the following:
(1) the
recommendation of the medical review authority, and a clear and concise
statement of the reasons supporting the recommendation;
(2) a
statement that the applicant or disability recipient may appeal the
recommendation within thirty (30) days after receipt of the notice in
accordance with 2.82.11 NMAC.
[2.82.1.15 NMAC - Rp, 2.82.1.14
NMAC, 11/15/2012; A, 6/16/2015; A, 9/26/2017]
2.82.1.16 ACTUARY: The director shall recommend an actuarial
firm to be engaged for the purpose of performing routine actuarial services and
actuarial investigations and evaluations to be provided for in a contract to be
approved by the board.
[2.82.1.16 NMAC - Rp,
2.82.1.15 NMAC, 11/15/2012]
2.82.1.17 CONDUCT OF BUSINESS:
A. The business affairs of the board
shall be conducted by the director within the authority outlined by the
Educational Retirement Act and rules and procedures adopted by the board.
B. On behalf of the
board, the director is authorized to execute vouchers, delegate others to
execute vouchers, buy and sell, or assign, or otherwise acquire or dispose of
stocks, bonds, notes, or other securities held by the board, and execute such
other documents as may be necessary to the administration of the Educational
Retirement Act.
C. The director shall obtain the
board’s approval before requesting a formal opinion interpreting the law from
the attorney general. The director may, however, obtain advice, either oral or
written, from the attorney general as the need may arise.
D. The director is authorized to decide whether the agency
will seek lead plaintiff status in securities class action lawsuits in order to
insure a timely decision is made in accordance with
applicable deadlines set out by the court.
The director shall promptly apprise the chair of such decisions. All such decisions shall be presented at the
next board meeting and the board may ratify or reject the director’s decision.
If the board rejects the director’s decision, the agency shall seek to remove
itself from lead plaintiff status.
E. The rules and procedures of the
board may be amended or expanded in the following manner:
(1) At any regular meeting, the board may
request the director to prepare amendments or new rules for action at a
subsequent meeting of the board.
(2) The
director may, at any time, propose amendments or new rules for action at any
meeting of the board.
(3) Any proposed amendment or new rule
shall be drafted by the director and sent to each board member with the agenda
for the meeting at which the proposal will be considered, and all proposed rule
changes will be sent to all local administrative units, within a reasonable
time, prior to being considered by the board.
F. Interest rates that are to be set by
the board under the Educational Retirement Act may be changed at any meeting of
the board but shall at a minimum be set at a board meeting held in the final
fiscal quarter of the year.
[2.82.1.17 NMAC - Rp,
2.82.1.16 NMAC, 11/15/2012; A, 6/16/2015; A, 9/26/2017]
HISTORY OF 2.82.1
NMAC:
Pre-NMAC History:
The material in this part was derived from that previously filed with the State
Records Center and Archives under:
ERB 67-3, Rules
and Procedures, filed 6/30/1967.
ERB 78-1, Rules
and Procedures, filed 8/7/1978.
ERB Rule I,
Organization and Operation of the Educational Retirement Board, filed 7/2/1982.
History of
Repealed Material:
2.82.1 NMAC, General
Provisions, filed 11/16/2001 - Repealed effective 11/15-2012 and replaced by
2.82.1 NMAC, General Provisions, effective 11/15/2012.