Employees of Political Subdivisions

V.S.A. tit. 3, ch. 16, subch. 2

in effect

3 V.S.A. § 481 Definitions

481. Definitions The following words and phrases as used in this subchapter, unless a different meaning is plainly required by the context, shall have the following meanings: (1) “Employee” shall mean any regular officer or employee who is employed for not less than 40 calendar weeks in a year, other than a person engaged under retainer or special agreement. In all cases of doubt, the Retirement Board shall determine whether any person is an employee as defined in this subchapter. (2) “National Guard employees” shall mean employees of the Vermont National Guard hired under 32 U.S.C. § 709. (3) “Employer” shall mean any political subdivision of the State of Vermont and the Vermont National Guard as to employees thereof hired under 32 U.S.C. § 709. (4) “Governing board” shall mean the governing body, by whatever name known, of such employer. (5) “Local retirement fund” shall mean any retirement, pension, or benefit fund partially or wholly maintained at the expense of an employer. (6) “Retirement Board” shall mean the Retirement Board of the State Retirement System. Added 1971, No. 231 (Adj. Sess.), § 4; amended 1973, No. 251 (Adj. Sess.), § 1; 2013, No. 22, § 6.

3 V.S.A. § 482 Participation by local governments; election by employer

482. Participation by local governments; election by employer (a) Any governing board of an employer that elected to have its eligible employees participate in the Vermont State Retirement System shall, by virtue of said election, have its eligible employees participate in the Vermont State Retirement System. Any members of the Vermont Employees’ Retirement System, in the employ of such employer, shall have the shares credited on their account to the various funds of that Retirement System transferred to the Fund of the Vermont State Retirement System, in accordance with the provisions of section 473 of this title. Thereafter, all contributions on behalf of such members shall be made by such employer and member to the Vermont State Retirement System for deposit in the Fund. (b) Membership of National Guard employees will commence effective the first day of the first pay period for which the federal government makes the required employer contribution, and will end on the failure of the federal government to make such contribution. Membership and benefits for this class of employee shall be a contributory money purchase type on such terms as are mutually agreed by the representatives of the federal government, national guard technicians of the State of Vermont and the trustees of the Vermont State Retirement System. The employee contribution shall be not less than the percentage contributed by the federal government. (c) All National Guard employees who became members of the Vermont Employees’ Retirement System pursuant to section 432 of this title and who, on the date of establishment, were members of that System shall become and continue to be members of the Vermont State Retirement System until the failure of the federal government to make contributions on their account. All shares credited to the Vermont Employees’ Retirement System on account of such National Guard employees shall be transferred to the fund of the Vermont State Retirement System, in accordance with the provisions of section 473 of this title. Thereafter all contributions on behalf of such members shall be made by the federal government and the member to the Vermont State Retirement System for deposit in the Fund. Added 1971, No. 231 (Adj. Sess.), § 4; amended 1973, No. 251 (Adj. Sess.), § 2; 2007, No. 13, § 17.

3 V.S.A. § 483 Petition by employees; transfer of assets

483. Petition by employees; transfer of assets (a) Should a majority of the members of any local retirement fund elect to become members of the Vermont State Retirement System, by a petition duly signed by those members, the participation of those members in the Vermont State Retirement System may be effected as provided in section 482 of this title as though such local retirement fund were not in operation and the provisions of this section shall then apply, except that the existing pensioners or annuitants of the local retirement fund who were being paid benefits on the date that participation in the Vermont State Retirement System becomes effective shall be continued and paid at their existing rates by the Vermont State Retirement System and the liability on this account shall be included in the computation of the accrued liability contribution rate as provided by section 487 of this title. Any cash and securities to the credit of the local retirement fund shall be transferred to the Vermont State Retirement System as of the date participation begins. The trustees or other administrative head of the local retirement fund as of the date participation becomes effective shall certify the proportion, if any, of the assets of the local retirement fund that represents the accumulated contributions of the members, and the relative shares of the members as of that date. Shares shall be credited to the respective account of such members in the Fund of the Vermont State Retirement System as though contributed under the provisions of said System. The balance of the assets transferred to the Vermont State Retirement System shall be offset against the accrued liability before determining the special accrued liability contribution to be paid by the employer as provided by section 487 of this title. The operation of the local retirement fund shall be discontinued as of the date participation becomes effective. (b) Any members of a local retirement fund who, pursuant to the provisions of section 433 of this title, became members of said System shall become members of the Vermont State Retirement System and shall have the shares credited on their account to the Fund of the Vermont State Retirement System in accordance with the provisions of section 473 of this title. Thereafter all contributions on behalf of such members shall be made by such employer and member to the Vermont State Retirement System. Added 1971, No. 231 (Adj. Sess.), § 4; amended 2007, No. 13, § 18; 2025, No. 18, § 10, eff. May 13, 2025.

3 V.S.A. § 484 Election by employee; service credits

484. Election by employee; service credits Membership in the Vermont State Retirement System shall be optional with employees who are in the service of the employer on the date when participation becomes effective pursuant to subsection 482(a) or subsection 483(a) of this title and any such employee shall become a member as of that date or as of the date of completing three years of continuous service for the employer, if later, unless he or she files with the Retirement Board within 30 days of his or her eligibility a notice of his or her election not to be included in the membership. Any such employee who becomes a member of the Vermont State Retirement System within one year of the effective date of participation of his or her employer shall be credited with creditable service covering such periods of service prior to such effective date with such employer or predecessor employer for which the employer is willing to make accrued liability contributions. Thereafter service for such employer on account of which contributions are made by the employer and member shall also be considered as creditable service. Added 1971, No. 231 (Adj. Sess.), § 4.

3 V.S.A. § 485 Compulsory membership

485. Compulsory membership Membership in the Vermont State Retirement System shall be compulsory for all employees entering the service of such employer after the date participation becomes effective, and shall be effective upon the date of hire. Added 1971, No. 231 (Adj. Sess.), § 4; amended 2013, No. 22, § 7.

3 V.S.A. § 486 Duty of local officers

486. Duty of local officers The chief fiscal officer of the employer, and heads of its departments, shall submit to the Retirement Board such information and shall cause to be performed with respect to the employees of such employer such duties as shall be prescribed by the Retirement Board in order to carry out the provisions of this subchapter. Added 1971, No. 231 (Adj. Sess.), § 4.

3 V.S.A. § 487 Rates of contribution

487. Rates of contribution Employees who become members of the Vermont State Retirement System under the provisions of this subchapter shall contribute at the same rate and in the same manner as if they were employees of the State of Vermont. The actuary of the System shall compute the contributions that would be payable annually by the employer on behalf of such members corresponding to the contributions that the State of Vermont makes on behalf of State employees, except that each employer of members participating in the Vermont State Retirement System as provided in this subchapter shall make a special accrued liability contribution on account of the participation of its employees, which shall be determined by an actuarial valuation of the accrued liability on account of the employees of such employer who become members, in the same way as the accrued liability rate was originally determined for employees of the State of Vermont. This special accrued liability contribution, subject to such adjustment as may be necessary on account of any additional credits for service prior to the date of participation of its employees in the System awarded by such employer, shall be payable in lieu of the accrued liability contribution payable on account of other employees in the Vermont State Retirement System. The expense of making the valuation to determine any special accrued liability contribution shall be assessed against and paid by the employer on whose account it was necessary. Prior to the determination of the special accrued liability contribution, the employer shall make accrued liability contributions at the accrued liability rate payable by the State of Vermont on behalf of State employees. Added 1971, No. 231 (Adj. Sess.), § 4.

3 V.S.A. § 488 Payment of contributions

488. Payment of contributions (a) The contributions computed under section 487 of this title together with a pro rata share of the cost of the administration of the Vermont State Retirement System based upon the payroll of the employees of the employer who are members shall be certified by the Retirement Board to the Chief Fiscal Officer of the employer. The amounts so certified shall be a charge against the employer. The Chief Fiscal Officer shall pay to the State Treasurer the amount certified by the Retirement Board as payable under the provisions of this subchapter, and the State Treasurer shall credit such amounts to the Fund of the Vermont State Retirement System. (b) Any payments due that are not received within 30 days after the installment due date set by the Board shall result in a penalty assessment against the employer at the rate of one percent of the amount due for each month calculated from the installment due date, provided that the Board may, in its discretion, waive part or all of said penalty assessment if good cause is shown. The delinquent payments and penalties thereon may be recovered by action in a court of competent jurisdiction against the employer liable therefor or may be deducted by or, at the request of the State Treasurer, from any other monies payable to such employer by the State or any department or agency thereof. Added 1971, No. 231 (Adj. Sess.), § 4; amended 2007, No. 13, § 19; 2025, No. 131 (Adj. Sess.), § 6, eff. July 1, 2026.

3 V.S.A. § 489 Benefits

489. Benefits Persons who become members of the Vermont State Retirement System under this subchapter and on behalf of whom contributions are paid as provided in this subchapter shall be entitled to benefits under the Vermont State Retirement System as though they were employees of the State of Vermont. These employees shall be considered “Group F members” as defined in subdivision 455(a)(11)(E) of this title, except that: (1) elected municipal employees shall not be subject to mandatory retirement requirements; (2) sheriffs and those deputy sheriffs who meet the requirements pursuant to subdivision 455(a)(11)(F)(ii) of this chapter shall be considered members of Group G; and (3) municipal law enforcement officers who meet the requirements pursuant to subdivision 455(a)(11)(F)(iii) of this chapter shall be considered members of Group G. Added 1971, No. 231 (Adj. Sess.), § 4; amended 1977, No. 164 (Adj. Sess.), § 4, eff. March 31, 1978; 2013, No. 22, § 8; 2023, No. 130 (Adj. Sess.), § 3, eff. July 1, 2024; 2025, No. 95 (Adj. Sess.), § 3, eff. July 1, 2026.

3 V.S.A. § 490 Default; paid up deferred annuity

490. Default; paid up deferred annuity The agreement of any employer to contribute on account of its employees shall be irrevocable, but should any employer for any reason become financially unable to make the contributions on account of its employees as provided in this subchapter, then that employer shall be deemed to be in default. All members of the Vermont State Retirement System who were employed by an employer at the time of default shall then be entitled to discontinue membership in the Retirement System and to a refund of their previous contributions upon demand made within 90 days thereafter. As of a date 90 days following the date of the default, the actuary of the Vermont State Retirement System shall determine by actuarial valuation the amount of the reserve held on account of each remaining active member and beneficiary of the employer and shall credit to each member and beneficiary the amount of the reserve so held. The reserve so credited, together with the amount of the accumulated contributions of each active member, shall be used to provide for the member a paid up deferred annuity beginning at age 65, and the reserve of each beneficiary shall be used in providing part of the member’s existing pension as the reserve so held will provide, which pension, together with the member’s annuity, shall thereafter be payable to the member. The rights and privileges of both active members and beneficiaries of the employer shall then terminate, except as to payment of the deferred annuities so provided and the annuities and pensions, or parts thereof, provided for the beneficiaries. Added 1971, No. 231 (Adj. Sess.), § 4; amended 2025, No. 18, § 10, eff. May 13, 2025.

3 V.S.A. § 491 Liability of retirement system

491. Liability of retirement system Anything in this subchapter to the contrary notwithstanding, the Vermont State Retirement System shall not be liable for the payment of any pensions or other benefits on account of the employees or beneficiaries of any employer under this subchapter, for which reserves have not been previously created from funds contributed by such employer, or its employees, for such benefits. Added 1971, No. 231 (Adj. Sess.), § 4.

Source: Vermont General Assembly (legislature.vermont.gov)URL: https://legislature.vermont.gov/statutes/chapter/03/016Fetched: 10/21/2026