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Title 9 - Retirement Systems
RETIREMENT SYSTEM FOR JUDGES AND SOLICITORS
The following as used in this chapter, unless a different meaning is plainly required by the context, shall have the following meanings:
(1) "System" means the Retirement System for Judges and Solicitors of the State of South Carolina.
(2) "State" means the State of South Carolina.
(3) "Board" means the State Budget and Control Board.
(4) "Member of the System" means any person included in the membership of the System, as set forth in Section 9-8-40.
(5) "Credited service" means service for which credit is allowable as provided in Section 9-8-50.
(6) "Retirement allowance" means monthly payments for life under the System payable as provided in Section 9-8-80.
(7) "Beneficiary" means any person in receipt of a retirement allowance or other benefit as provided by the System.
(8) "Aggregate contributions" means the sum of all the amounts deducted from the compensation of a member of the System, or directly remitted by him to the System, and credited to his individual account in the System.
(9) "Regular interest" means interest compounded annually at such rates as shall be determined by the Board for a particular purpose in accordance with Section 9-8-30.
(10) "Accumulated contributions" means the member's aggregate contributions, together with regular interest thereon.
(11) "Actuarial equivalent" means a benefit of equal value when computed on the basis of the tables and regular interest rate last adopted for the particular purpose by the Board, as provided in Section 9-8-30.
(12) "Date of establishment" means July 1, 1979.
(13) "Compensation" means the total salary paid to a judge or solicitor for service rendered to the State.
(14) "Employee annuity" means annual payments for life derived from the accumulated contributions of a member.
(15) "Employer annuity" means annual payments for life derived from money provided by the State.
(16) "Judge" means a justice of the Supreme Court or a judge of the court of appeals, circuit or family court of the State of South Carolina.
(17) "Solicitor" means the person holding office as described under Section 1-7-310 of the 1976 Code.
System created; powers and privileges; corporate name.
A retirement system is hereby created and placed under the administration of the Board to provide retirement allowances and other benefits for judges and solicitors commencing July 1, 1979. It shall have the power and privileges of a corporation and shall be known as the Retirement System for Judges and Solicitors of the State of South Carolina, and by such name all of its business shall be transacted, all of its funds invested, and all of its cash, securities and other property held.
Administration of System; actuary; salaries and expenses.
(1) The administration and responsibility for the operation of the System and for making effective the provisions of this chapter are vested in the State Budget and Control Board.
(2) The Board shall engage such actuarial and other services as shall be required to transact the business of the System.
(3) The Board shall designate an actuary who shall be the technical advisor of the Board on matters regarding the operation of the System and who shall perform such other duties as are required in connection therewith.
(4) At least once in each five-year period following the date of establishment, the actuary shall make an actuarial investigation into the mortality, service and compensation experience of the members and beneficiaries of the System and shall make a valuation of the contingent assets and liabilities of the System. The Board, after taking into account the results of the investigations and valuations, shall adopt for the System such mortality, service and other tables as shall be deemed necessary.
(5) On the basis of regular interest and tables last adopted by the Board, for purposes of actuarial valuations, the actuary shall make a valuation of the contingent assets and liabilities of the system at least every other year.
(6) The Board shall keep in convenient form such data as shall be necessary for the actuarial valuation of the contingent assets and liabilities of the System and for checking the experience of the System.
(7) The Board shall determine from time to time the rates of regular interest for use in calculations, with the rate of four percent per annum applicable for all purposes other than for actuarial valuations unless changed by the Board.
(8) Subject to the limitations hereof, the Board shall, from time to time, establish regulations for the administration of the System and for the transaction of business.
(9) The Board shall keep a record of all its proceedings under this chapter which shall be open to public inspection. Notwithstanding any other provisions of law governing the System, all persons employed by the Board and the expenses of the Board to carry out the provisions of this chapter shall be paid from the interest earnings of the System.
Membership in System; cessation of membership.
(1) All persons who are judges or solicitors on July 1, 1979, and who have not attained age seventy-two shall become members of the System as of such date. All other persons shall become members of the System on their taking office as judge or solicitor prior to attaining age seventy-two.
(2) If a member of the System ceases to be a judge or solicitor for reasons other than death or retirement, he shall thereupon cease to be a member of the System, whether or not he withdraws his accumulated contributions.
Credited service; cancellation of credited service upon cessation of membership; credit for military service; transfer of service credit to other systems.
(1) The credited service of a member shall include all service as a judge or solicitor since he last became a member of the System and in respect of which he makes contributions to the System. It shall also include, in the case of a member of the System who remained a member continuously until his death or his retirement under the System, service which he was, or would be, entitled to claim as creditable service under any other retirement system of the State of South Carolina, notwithstanding that he may not have been a member of such retirement system if, within twelve months of the date he becomes a member of the System, the full amount of his contributions required to be made under the other system in respect of such service shall be paid to this System by transfer or otherwise. Such amount shall not be less than the amount that the member would have contributed with respect to his position had he been a member of this System for the same period of time, plus interest.
On or after July 1, 1980, the Board may determine the contributions required by this section but it shall not be less than four percent of the annual compensation of the position at the time of payment for each year of service.
(2) When membership in the System ceases for any reason other than death or retirement, the service previously credited to the member of the System shall be cancelled and, should he again become a member of the System, he shall enter the System as a new member not entitled to credit for previous service, unless he left his accumulated contributions in the System or repays any amounts previously withdrawn, with interest to the date of repayment.
(3) Any member with two or more years of credited service shall receive additional credited service for the period of his active military service, at the rate of one year of military service for each two years of his credited service excluding any period of credited military service, if he was discharged or separated from the military service under conditions other than dishonorable, and pays to the System, by a single payment prior to his retirement or death or by such other method as may be prescribed from time to time by the Board, all payments to the System he would have been required to make for the period to be credited had he been employed in the position he held immediately prior to the commencement of his military leave during the period of such military service, together with the regular interest which would have been credited thereon from the date the contributions would have been made to the date of payment. In the case of a member whose military service was rendered prior to his becoming a member of the System, such payments shall be determined on the basis of what a member in the position contributed for the same period of time plus interest. No member shall receive credit for more than six years of military service and such duty performed subsequent to July 1, 1974, shall not be creditable.
(4) Any member upon termination who does not qualify for a monthly benefit may elect to transfer his service credit to the South Carolina Retirement System or other applicable system. Upon such election, the director must transfer to the receiving system the required employee and employer contributions. A member is vested after twelve years of service in the position as judge or solicitor and if he terminates services and leaves his contributions on deposit with the System, he is eligible for a monthly benefit beginning at age fifty-five which is a pro-rata proportion his total credited service is to the benefit payable with twenty-four years of service credit.
Retirement; retirement allowance; disability retirement; beneficiaries of other systems.
(1) A member of the system may retire upon written application to the board setting forth at what time, not later than the end of the calendar year in which the member attains age seventy-two and not more than ninety days prior nor more than six months subsequent to the execution and filing thereof, the member desires to be retired, if the member at the time so specified for retirement is no longer in the service of the State, except as a member of the General Assembly, and has completed ten years of credited service as a judge or eight years of credited service as a solicitor or was in service as a judge or solicitor on July 1, 1984, and has either attained the age of sixty-five and completed at least twenty years of credited service, or attained age seventy and completed at least fifteen years of credited service, or attained age sixty-five with at least four years' service in the position and has at least twenty-five years' other service with the State, or completed at least twenty-five years of credited service regardless of age. A solicitor is eligible to retire upon completion of twenty-four years of credited service regardless of age. A person is not eligible to receive a retirement allowance under this system while under employment covered by the South Carolina Retirement System and the South Carolina Police Officers Retirement System.
A person receiving retirement allowances under this system who is elected to the General Assembly continues to receive the retirement allowances while serving in the General Assembly and must also be a member of the General Assembly Retirement System unless the person files a statement with the State Budget and Control Board on a form prescribed by the board electing not to participate in the General Assembly Retirement System while a member of the General Assembly. A person making this election shall not make contributions to the General Assembly Retirement System nor shall the State make contributions on the member's behalf and the person is not entitled to benefits from the General Assembly Retirement System after ceasing to be a member of the General Assembly.
(2) A retired member shall receive a monthly retirement allowance which is equal to one-twelfth of seventy-one and three-tenths percent of the current active salary of the respective position.
(3) No member shall be permitted to retire and resign on account of being totally and permanently disabled and to receive the retirement benefit herein provided for until it is proven to the satisfaction of the Supreme Court, or a majority of the justices thereof, that the member is totally and permanently disabled, physically or mentally, or both, from further rendering useful and efficient service in the position. Upon the finding of the Supreme Court that any member is totally and permanently disabled, the Supreme Court shall notify the director of its findings. A member shall have a minimum of five years of credited service to qualify for disability retirement.
(4) Any beneficiary receiving a retirement allowance under any other system of the State providing retirement benefits for judges or from the Solicitors' Retirement Program established pursuant to Article 4 of Chapter 7 of Title 1 shall become a beneficiary under this System as of July 1, 1979, and shall receive a retirement allowance under this section adjusted in accordance with the provisions of this section or Section 9-8-90, whichever is applicable, in lieu of any retirement allowance under such other system. The full amount of any accumulated contributions or assets held by that system on behalf of the beneficiary shall be transferred to this System promptly pursuant to the provisions of this Chapter. Notwithstanding anything herein to the contrary, no beneficiary under this section shall receive an allowance which is less than the allowance he would have received under such other system as of July 1, 1979.
(5) A member who retires, who has completed at least twenty-five years of credited service, or twenty-four years in the case of a solicitor, shall receive a monthly retirement allowance which must be equal to one-twelfth of seventy-one and three-tenths percent of the current active salary of the respective position plus one-twelfth of two and sixty-seven hundredths percent of the current active salary of the respective position for each additional year of active service over twenty-five, or twenty-four in the case of a solicitor. The monthly retirement allowance may not exceed one-twelfth of ninety percent of the current active salary of the respective position.
Retirement compensation authorized if employed by public institution of education.
Notwithstanding any other provision of law, a retired justice or judge may draw retirement compensation while employed by a public institution of education; provided, however, that a justice or judge while so employed may not contribute to, or receive service credit in, the South Carolina Retirement System for teachers and employees of the State and political subdivisions or agencies or departments thereof.
Optional retirement allowance.
Until the first payment of a retirement allowance becomes normally due, a member may elect, by filing written application with the board, to convert the retirement allowance otherwise payable on his account after retirement into a retirement allowance of equivalent actuarial value under which a reduced retirement allowance is payable during the beneficiary's life, with the provision that one-third of the reduced allowance continues after his death to and for the life of the contingent beneficiary designated by him in the application, if the beneficiary were to survive him. For purposes of this section, the member may not designate his spouse as contingent beneficiary.
Until the final payment of a retirement allowance becomes normally due, a member may elect, by filing written application with the board, to convert the retirement allowance otherwise payable on his account after retirement into a retirement allowance of equivalent actuarial value under which a reduced retirement allowance is payable during the beneficiary's life, with the provision that one-third of the reduced allowance is payable in equal shares to and for the life of each of two or more beneficiaries or to the trustee or trustees of the beneficiaries, for so long as each beneficiary survives him. The benefit reduction factor must be based on the average age of the beneficiaries.
The board may approve a five-year, pay-out plan developed by the actuary on the basis of the total retirement allowance for surviving beneficiaries, other than a spouse.
Allowances shall be payable in monthly installments.
All retirement allowances are payable in monthly installments. Upon the death of a retired member, the retirement allowance for the month the retired member died, if not previously paid, must be paid to the member's spouse, or if the member designated a nonspouse beneficiary or beneficiaries, then to the nonspouse beneficiary or beneficiaries living at the time of the member's death, otherwise to the estate of the member. A spouse's entitlement to a benefit pursuant to Section 9-8-110 commences in the month after the retired member's death. If the retired member elected a survivor option pursuant to the optional retirement allowances in Section 9-8-70, any allowance payable to a survivor beneficiary or beneficiaries commences in the month after the death of the retired member.
Increase in allowances based on Consumer Price Index.
As of the end of each calendar year commencing with the year ending December 31, 1980, the increase in the ratio of the Consumer Price Index to such index as of December 31, 1979, or the most recent December thirty first subsequent thereto as of which an increase in retirement allowances was granted, shall be determined, and if the increase equals or exceeds three percent, the retirement allowance of each beneficiary, other than a retired member or his spouse, in receipt of an allowance as of December 31, 1979, or the most recent December thirty first subsequent thereto as of which an increase was granted, shall be increased by four percent. Such increase shall commence the July first immediately following the December thirty first that the increase in ratio was determined. Any increase granted hereunder shall be permanent, irrespective of any subsequent decrease in the Consumer Price Index, and shall be included in determining any subsequent increase.
For purposes of this section, "Consumer Price Index" shall mean the Consumer Price Index for Urban Wage Earners and Clerical Workers (all items - United States City average), as published by the United States Department of Labor, Bureau of Labor Statistics.
Repayment of contributions and interest upon cessation of membership.
Should a member cease to be a member of the System, for reasons other than death or retirement, he shall be paid promptly as feasible after his request, but in no event later than six months after the request, the amount of his accumulated contributions as of the date of payment. Should he die before payment has been made, his accumulated contributions shall be paid to his estate or to such person as he shall have nominated by written designation filed with the Board.
Payments on death of member or beneficiary.
(1) Except as provided in subsections (2) and (3) of this section, upon the death of any member of the system, a lump sum amount must be paid to the persons the member nominated by written designation, filed with the board, otherwise to his estate. This amount must be equal to the amount of the member's accumulated contributions. An active contributing member making the nomination provided under this section also may name secondary beneficiaries in the same manner that beneficiaries are named. A secondary beneficiary has no rights under this chapter unless all beneficiaries nominated by the member predecease the member and the member's death occurs while in service. In this instance, a secondary beneficiary is considered the member's beneficiary for purposes of this section.
(2) Unless a married member has designated a beneficiary other than his spouse in accordance with subsection (1), upon his death prior to retirement an allowance equal to one-third of the allowance which would have been payable to him, assuming he was then eligible to retire and had retired on the date of his death, shall be paid to his surviving spouse until her death. This allowance is payable in lieu of the lump sum amount payable in accordance with subsection (1). Upon the death of a retired member who has not designated a beneficiary other than a spouse an allowance equal to one-third of the allowance which would have been payable to him, shall be paid to the surviving spouse until death. For purposes of this subsection, "retired member" shall include those former judges and solicitors who are beneficiaries pursuant to subsection (4) of Section 9-8-60.
(3) If a member dies while in the service of the State, whether as a judge or a solicitor or otherwise, and either is not married or has designated a beneficiary other than his surviving spouse, an allowance in lieu of the lump sum provided in subsection (1) shall be payable to such person as he shall have nominated by written designation in accordance with subsection (1) equal to the amount which would have been payable to such person as if the deceased member had retired at the time of his death and had made an effective election under Section 9-8-70 nominating such person as his contingent beneficiary.
(4) Upon the death of an unmarried beneficiary who has not elected the optional form of allowance under Section 9-8-70, a lump sum amount shall be paid to such person as he shall have nominated by written designation in accordance with subsection (1), otherwise to his estate. Such amount shall be equal to the excess, if any, of his accumulated contributions at the time his allowance commenced over the sum of the retirement allowance payments made to him.
(5) Upon receipt of proof, satisfactory to the Board, of the death of a member in service as a judge or solicitor who had completed at least one full year of credited service in the System or of the death of a member in service as a result of an injury arising out of and in the course of the performance of his duties regardless of length of membership, there must be paid to his spouse unless he has nominated a beneficiary by written designation filed with the Board, if the person is living at the time of the member's death, otherwise to the member's estate, a death benefit equal to the annual compensation of the member at the time his death occurs. The benefit must be payable apart and separate from the payment of the allowance, or the lump sum amount in lieu thereof, pursuant to the provisions of subsection (1), (2), or (3) above. A member may designate his estate to receive this death benefit in lieu of his spouse, or other beneficiary nominated in subsection (1). For purposes of this subsection, a member is considered to be in service at the date of his death if his last day of earned service credit as a judge or solicitor occurred not more than ninety days before his death and he has not retired or withdrawn contributions.
(6) The Board may take such action as may be necessary to provide the death benefit under this section in the form of group life insurance upon a determination that to do so would guarantee a more favorable tax treatment of the benefit to beneficiaries to whom the benefit is payable.
Upon the death of a retired member on or after July 1, 1985, there must be paid to the designated beneficiary or beneficiaries, if living at the time of the retired member's death, otherwise to the retired member's estate, a death benefit of one thousand dollars if the retired member had ten years of creditable service but less than twenty years, two thousand dollars if the retired member had twenty years of creditable service but less than thirty, and three thousand dollars if the retired member had at least thirty years of creditable service at the time of retirement.
Return of beneficiary to service of State; practice of law.
Should any beneficiary return to the service of the State, the following provisions shall apply:
(1) If such return is as a solicitor, he shall be a contributing member of the System and shall be credited with all service standing to his credit at the time of his retirement. The retirement allowance payable upon his subsequent retirement shall be based on the total of his credited service rendered before and after his return to service.
(2) Except as otherwise provided below, if this return is in a position other than as a solicitor, the beneficiary, upon cessation of service in the position, is entitled to apply for a retirement allowance at the same rate to which the beneficiary was previously entitled, disregarding any reduction therein resulting from a previous election of an option. If the beneficiary's return is as a member of the General Assembly, retirement allowances continue as provided by Section 9-8-60(1).
(3) Subject to the limitations contained in Section 14-1-215, a retired justice or judge may be called upon and appointed by the Chief Justice of the Supreme Court to perform judicial duties in the Supreme Court, Court of Appeals, circuit courts, and family courts as he may be willing and able to undertake. A retired justice or judge serving as an acting associate justice or as a judge shall serve without pay except for his actual expenses while serving. If a retired justice or judge has performed for a period of three or more consecutive months full judicial duties as an acting associate justice or as a judge his retirement pay for each full month during this period must be increased by an amount equal to the difference between retirement payment and active pay. Upon certification by the Chief Justice setting forth the number of full months of the service the State Treasurer shall make payment accordingly.
(4) A justice or judge drawing retirement compensation who engages in the practice of law may not serve as a justice or judge in any court in this State. Within thirty days of his retirement under this chapter, a retired judge or justice shall make an election as to whether he wishes to engage in the practice of law or be eligible for appointment by the Chief Justice as a judge or justice in the courts of this State. If his election is to engage in the practice of law, it is irrevocable and he may not thereafter be appointed by the Chief Justice to serve as a justice or judge in the courts of this State. If his election is to be eligible for appointment to serve as a justice or judge in the courts of this State and not to practice law, he may at any time thereafter change such election and decide to engage in the practice of law, at which point his decision becomes irrevocable.
Election to receive benefits from General Assembly retirement system while employed as judge or solicitor.
A member of the system who is at least sixty-five years of age and eligible to receive benefits pursuant to Chapter 9 of this title but for the member's current employment as a judge or solicitor may elect to receive retirement benefits from the Retirement System for members of the General Assembly by written notice to the board.
Members' contributions; deduction from compensation; employer to pay required member contributions on earnings after July 1, 1982; tax treatment; funding; retirement treatment.
(1) Each member of the System shall contribute seven percent of each installment of compensation, commencing with July 1, 1979. Such contributions shall be made through payroll deductions and remitted within thirty days after the close of each month to the System.
(2) Every member of the System shall be deemed to have consented and agreed to the deductions made and provided for herein and shall receipt for his full salary or compensation and payment of salary or compensation less such deduction shall be a full and complete discharge of all claims and demands whatsoever for the services rendered by such person during the period covered by such payments, except as to the benefits provided under the System.
(3) Each of the amounts deducted shall be credited to the individual account of the member from whose compensation the deduction was made.
(4) Each department and political subdivision shall pick up the employee contributions required by this section for all compensation paid on or after July 1, 1982, and the contributions so picked up shall be treated as employer contributions in determining federal tax treatment under the United States Internal Revenue Code; however, each department and political subdivision shall continue to withhold federal income taxes based upon these contributions until the Internal Revenue Service, or the federal courts, rule that, pursuant to Section 414(h) of the United States Internal Revenue Code, these contributions shall not be included as gross income of the employee until such time as they are distributed or made available. The department and political subdivision shall pay these employee contributions from the same source of funds which is used in paying earnings to the employee. The department and political subdivision may pick up these contributions by a reduction in the cash salary of the employee. Employee contributions picked up shall be treated for all purposes of this section in the same manner and to the extent as employee contributions made prior to the date picked up.
Contributions of State to System.
The contributions of the State to the System shall be determined by the Board each year on the basis of annual actuarial valuations of the System. Each year the Board shall certify to the State the amount of its contribution due the System. The State's contributions shall be appropriated annually from the general fund to the System and shall include such sums as are found necessary in order to create reserves in the System sufficient to cover the cost of the allowances currently accruing under this chapter, to include a contribution each year toward the cost of prior service credits and to cover any administrative expenses which the Board may incur in the operation of the System.
The employer contribution shall be remitted to the System within thirty days after the beginning of each fiscal year.
Director of Retirement System for Judges and Solicitors.
There is hereby created an office to be known as Director of the Retirement System for Judges and Solicitors of the State of South Carolina. The Director of the South Carolina Retirement System shall serve as Director of the System.
Investment of funds; conflicts of interest.
(1) The board is the trustee of the funds of the system and may invest and reinvest the funds in the same manner as funds of the South Carolina Retirement System are invested and reinvested pursuant to Section 9-1-1310.
(2) Except as otherwise herein provided, no member of or person employed by the Board shall have a direct interest in the gains or profits of any investment made by the Board. No member of the Board or employee of the Board shall, directly or indirectly, for himself or as an agent, in any manner use the funds of the System except to make such current and necessary payments as are authorized by the Board; nor shall any member or employee of the Board become an endorser or surety, or in any manner an obligor, for moneys loaned or borrowed from the Board.
Custody of funds; disbursements; cash kept available for disbursements.
(1) The State Treasurer shall be the custodian of the funds of the System. All payments from such funds shall be made by him only upon vouchers signed by two persons designated by the Board. No voucher shall be drawn unless it has previously been authorized by resolution of the Board.
(2) For the purpose of meeting disbursements for retirement allowances and other payments, there may be kept available cash, not exceeding ten percent of the total funds of the System, on deposit with the State Treasurer.
Assets shall be credited to two funds.
(1) All of the assets of the System shall be credited, according to the purpose for which they are held, to one of two accounts; namely, the members' account and the accumulation account.
(2) The members' account shall be the account in which shall be held the contributions made by members.
(3) The accumulation account shall be the account in which shall be held all reserves for the payment of the part of all retirement allowances and other benefits payable from contributions made by the State, and from which shall be paid all retirement allowances payable under the System. All interest and dividends earned on the funds of the System shall be credited to the accumulation account. If a beneficiary is restored to membership, the part of his contributions then standing to his credit shall be transferred from the accumulation account to the members' account.
Exemption of retirement allowance and certain other rights from taxation and legal process; exceptions; assignment.
Except as provided in Section 8-1-115 and subject to the doctrine of constructive trust ex maleficio, the right of a person to a retirement allowance or to the return of contributions, a retirement allowance itself, any optional allowance or payment on death or any other right accrued or accruing to any person under the provisions of this chapter, and the monies of the system are exempted from state or municipal tax, except the taxes imposed pursuant to Chapters 6 and 16 of Title 12, and exempted from levy and sale, garnishment, attachment, or any other process and are unassignable except as otherwise provided in this chapter.
Credit of state not pledged; rights upon termination of System.
All agreements or contracts with the members of the System pursuant to any of the provisions of this chapter shall be deemed solely obligations of the System and the full faith and credit of the State and of its departments, institutions and political subdivisions is not, and shall not be, pledged or obligated beyond the amounts which may be hereafter annually appropriated in the annual state general appropriation act, and other periodic appropriations for the purposes of this chapter. In case of termination of the System, the rights of all members of the System to benefits accrued to the date of such termination, to the extent then funded, shall be nonforfeitable.
Property of System exempt from state and local taxes.
All property owned or acquired by the System for the purposes of this chapter shall be exempt from all taxes imposed by the State or any political subdivision thereof.
Penalty for false statement or falsification of records.
Any person who shall knowingly make any false statement, or shall falsify or permit to be falsified any record of the System in any attempt to defraud the System, shall be deemed guilty of a misdemeanor and, upon conviction, shall be fined not more than five hundred dollars or imprisoned for not more than twelve months, or both, in the discretion of the court.
Compensation used for determining benefits to be subject to federal limitations.
Effective as of January 1, 1996, the annual compensation of a member taken into account for determining all benefits provided under this retirement system is subject to the limitations set forth in Section 401(a)(17) of the Internal Revenue Code of 1986 and any regulations promulgated thereunder. However, the limitation on compensation does not apply to the compensation of an individual who became a member of this retirement system before January 1, 1996.