JANET DIGIANNI vs. CONTRIBUTORY RETIREMENT APPEAL BOARD & another. [Note 1]

ABRAMS, J. The Contributory Retirement Appeal Board (CRAB) and Teachers' Retirement Board (TRB) appeal from a Superior Court judgment under G. L. c. 30A, Section 14 (1994 ed.), reversing CRAB's decision that Janet DiGianni must contribute an additional two percent of her annual salary

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in excess of $30,000 to the retirement system under G. L. c. 32, Section 22 (1) (b 1/2) (1994 ed.), which requires that "[f]or any member . . . who entered the service of the commonwealth . . . on or after January [1, 1979], the treasurer . . . shall withhold on each pay day, in addition to the amounts withhold on each pay day, in addition to the amounts withheld pursuant to paragraph (b), an additional two per cent of such member's regular compensation over thirty thousand dollars." The sole issue for decision is whether DiGianni is a "member . . . who entered the service of the commonwealth or a political subdivision thereof on or after January [1, 1979]." We transferred the case here on our own motion. We affirm the judgment of the Superior Court.

The relevant facts are not in dispute. Janet DiGianni worked as a teacher in the Pathfinder Regional Vocational School System from September, 1977, until June, 1979. She taught in the Billerica public schools from September, 1979, until June, 1981. During the time from September, 1977, until June, 1979, DiGianni was a member of the teachers' retirement system and contributed seven per cent of her salary to the system. When she was laid off in June, 1981, DiGianni requested and received a refund of her accumulated retirement deductions plus interest pursuant to G. L. c. 32, Section 10 (4). [Note 2] Accompanying her refund check was a preprinted notice informing DiGianni that, pursuant to G. L. c. 32, Section 3 (6) (c), she would have to repay the withdrawn contributions with interest as a condition of reemployment as a public school teacher within two years. [Note 3] DiGianni was reemployed as a public school teacher in March, 1982, this time at the Shawsheen Vocational Technical School. She again became

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a member of the teachers' retirement system with a contribution rate of seven per cent. As required, DiGianni repaid the withdrawn contributions with interest.

In 1988, the Legislature enacted the disputed provision, G. L. c. 32, Section 22 (1) (b 1/2). Since January, 1988, TRB has been deducting an additional two per cent of DiGianni's salary in excess of $30,000. DiGianni requested an exemption from the additional two per cent contribution because she "entered the service of the commonwealth" prior to January 1, 1979. TRB refused, stating that, "[a]lthough [DiGianni] entered the system in 1977, the fact that [she] applied for and received an optional refund in 1981 negates [her] 1977 start date. [DiGianni's] new start date is March, [1982,] when [she] returned to teaching." DiGianni appealed TRB's decision to CRAB which affirmed, basing its decision on the fact that DiGianni voluntarily withdrew her contributions.

DiGianni contends that she entered the service of the Commonwealth in September, 1977, when she originally was employed as a public school teacher and originally joined the teachers' retirement system. TRB and CRAB contend that DiGianni lost the right to claim the 1977 start date when she voluntarily served her relationship with the teachers' retirement system by withdrawing her accumulated contributions. [Note 4]

General Laws c. 32, Section 1 (1994 ed.), defines "[m]ember" as "any employee included in the . . . teachers' retirement system." "Service" is defined as "service as an employee in any governmental unit for which regular compensation is paid." Id. Thus, a "member . . . who entered into the service of the commonwealth or a political subdivision thereof on or before January [1, 1979,]" is an employee included in the teachers' retirement system who entered into the service of and was paid regular compensation by the Commonwealth or a political subdivision thereof prior to January 1, 1979. It is not disputed

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that DiGianni fits this definition. Cf. Glorioso v. Retirement Bd. of Wellesley, 401 Mass. 648, 652 (1988) (any person who performed compensated work prior to June 30, 1939, is an employee; retiree entitled to benefits under G. L. c. 32, Section 58); Cardellicchio v. Board of Retirement of Natick, 391 Mass. 760, 764 (1984) (retiree, who was compensated eighty cents by the town for work performed before June 30, 1939, was employed by the town prior to June 30, 1939, and, therefore, eligible for noncontributory retirement benefits under G. L. c. 32, Section 58). See also Retirement Bd. of Concord v. Colleran, 34 Mass. App. Ct. 486, 489 (1993) (an employee who first rendered service for pay part-time in 1977 was employed before January 1, 1978, for purposes of G. L. c. 32, Section 5 [1] [m]). What is disputed is the effect of DiGianni's withdrawal from the retirement system on her status as a "member . . . who entered into the service of the commonwealth . . . on or before January [1, 1979]." DiGianni argues that her subsequent withdrawal does not affect her status. We agree.

The statute in question is ambiguous. Cf. McIntire v. Contributory Retirement Appeal Bd., 417 Mass. 35, 37 (1994) (holding that the wording of G. L. c. 32, Section 22 [1] [b], was ambiguous as to whether the date of commencement of employment with the commonwealth or the date of entry into the retirement system determines the rate of contribution). We, therefore, look to legislative history. See Aldoupolis v. Commonwealth, 386 Mass. 260, 264, cert. denied, 459 U.S. 864 (1982). General Laws c. 32, Section 22 (1) (b 1/2), was enacted by St. 1987, c. 697, Section 64, which simultaneously repealed a $30,000 cap on the salary on which pension benefits were calculated. The cap had been added by St. 1978, c. 367, Section 50, and applied only to persons who entered the service of the Commonwealth on or after January 1, 1979. The date of membership in the retirement system was irrelevant for purposes of determining whether the cap applied. The timing of the repeal of the cap and the requirement for an additional two per cent contribution, and the fact that both turned on salary amounts above $30,000, indicate an

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intention on the part of the Legislature to require the additional two per cent contribution only from the population previously affected by the cap. Compare G. L. c. 32, Section 22 (1) (b), the statute at issue in McIntire, supra. Its purpose was revenue-raising and, therefore, it was intended to reach as many employees as was constitutionally permissible. See Opinion of the Justice, 364 Mass. 847 (1973). Because DiGianni entered the service of the Commonwealth before January 1, 1979, she would not have been affected by the cap even after she subsequently withdrew from the retirement system. The additional two per cent contribution under G. L. c. 32, Section 22 (1) (b 1/2), should similarly not apply to DiGianni.

TRB and CRAB rely on McIntire v. Contributory Retirement Appeal Bd., supra, and Manning v. Contributory Retirement Appeal Bd., 29 Mass. App. Ct. 253 (1990). In McIntire, we held that a plaintiff who had worked part-time from 1971 through 1976 could not claim the rate of contribution of an employee who entered service full-time pre-1975. In Manning, the Appeals Court held that the buy-back of creditable service for prior part-time service does not establish the date of membership in the retirement system. DiGianni's situation is factually distinguishable from those of the plaintiffs in McIntire and Manning. DiGianni, unlike McIntire and Manning, was eligible for and had been a member of the teachers' retirement system before the date the change in statute became effective. DiGianni was required to repay the withdrawn amount in one lump sum with interest as a condition of reemployment within two years. The teachers in McIntire and Manning, on the other hand, voluntarily purchased creditable service for a time during which they had not been members of and had not been contributing to the teachers' retirement system. This difference also distinguishes DiGianni's situation from Leary v. Contributory Retirement Appeal Board, ante 344 (1995), where we held that voluntary purchase of creditable service for out-of-State employment does not entitle a member to treat the

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out-of-State service as regular compensation for purposes of calculating his retirement benefits.

Further, DiGianni, unlike the plaintiff in Leary, had a reasonable expectation that she would be treated as a pre-1979 employee. When DiGianni withdrew her accumulated deductions, TRB notified her that "[a] member who withdraws his funds, must, as a condition [of] reemployment, immediately return in one sum an amount equal to the accumulated regular deductions withdrawn with regular interest thereon to the date of reemployment if reemploy[ed] as a teacher in the public schools of Massachusetts within two years from the date of his last separation therefrom, provided the service is subject to membership in the teachers' retirement system. If a former member is reemployed as a teacher in the public schools of Massachusetts after two years from the date of last separation therefrom, his status will be that of a new employee not entitled to credit for previous service . . ." It was reasonable for DiGianni and others similarly situated to infer from this notice that if they met the stated conditions they would not be treated as new employees. Although it is not expressly stated in the statute, the notice implies that an employee who repays the withdrawn deductions is entitled to the same benefits to which he was previously entitled. These reasonable expectations are entitled to respect. See Colo v. Contributory Retirement Appeal Bd., 37 Mass. App. Ct. 185, 189 (1994).

The preprinted notice indicates that, in 1981, TRB shared DiGianni's expectation that if she were reemployed within two years and if she repaid the withdrawn deductions as mandated, she would be treated as if she never left the employ of the Commonwealth. This view, rather than the view TRB currently espouses, is entitled to deference. See Cleary v. Cardullo's Inc., 347 Mass. 337, 343 (1964) ("Significance in interpretation may be given to a consistent, long continued administrative application of an ambiguous statute, . . . especially if the interpretation is contemporaneous with the enactment" [citations omitted]).

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TRB argues that binding them to an implied statement from the 1981 notice impermissibly applies estoppel against a government agency. See Risk Management Found. of Harvard Medical Insts., Inc. v. Commissioner of Ins., 407 Mass. 498, 510 (1990). Estoppel is inapplicable, however, where a prior agency statement is being used to show legislative intent rather than a misrepresentation on the part of the agency or actions contrary to the statute.

We think that there is no rational distinction between leaving the monies in the retirement system during the lay-off period and repaying the total amount withdrawn plus interest on rehire within two years. We conclude that the Legislature did not intend persons who entered the service of the Commonwealth prior to 1979 and were later laid off, reemployed within two years, and required to repay all withdrawn deductions with interest to be within the ambit of G. L. c. 32, Section 22 (1) (b 1/2). The judgment of the Superior Court is affirmed.

Judgment affirmed.