History of the North Carolina Retirement Systems
Retirement Systems Division History
The North Carolina Retirement Systems Division was established in 1941, with parts of the division under the management of the State Auditor and State Treasurer. Before the establishment of the North Carolina Retirement Systems Division, the only pension system that was established in the state was for Confederate soldiers.
The first pension law went into effect in 1885 and granted a pension of $30 annually to Confederate veterans who were unable to work due to the loss of an eye, leg, or arm. These benefits were also available to soldiers’ widows as long as they did not remarry. The system expanded later in 1885 to include widows or soldiers who had died of disease while in active service.
In 1866, the pension system began to include those who had obtained a prosthetic limb out of their own funds or those who had limbs that were no longer functional, but still attached. By 1901 the pension became available to all widows, soldiers, and sailors who were unable to perform manual labor due to injuries sustained while serving on behalf of the State of North Carolina or the Confederate States of America. The 1901 pension system was designated as follows:
- first class: totally disabled and entitled to $72 annually;
- second class: lost leg or arm and entitled to $60 annually;
- third class: lost a hand or foot and entitled to $48 per year;
- fourth class: widows, those who had lost an eye, and those who were disabled due to other wounds not classified in the prior categories. This group was entitled to $30 annually.
In 1927, pensioners were again reclassified to include slaves who had been servants to soldiers or slaves who had served in a role of soldier support. Today, public pensions have expanded to include many more North Carolinians under the management of the Office of State Treasurer.
North Carolina State Treasurer History
The North Carolina State Treasurer is a position that is speculated to have been created during the colonial period, more specifically within the years of 1711-1713 at the time of the Tuscarora War. During this early period, the duties of the Treasurer are presumed to have been to collect taxes and cover military expenses. Over the centuries, the state treasurer's job expanded to include collecting all public monies, keeping track of all deposits and withdrawals made to the state’s bank accounts, and borrowing funds in a time of emergency, among other things. In 1943 the state treasurer’s ex officio duties expanded to include working with state agencies dealing with taxes, banking, housing, the financing of hospitals, as well as agencies involved with employee benefit plans, specifically the North Carolina Teachers’ and State Employees’ Retirement System that was established on July 1, 1941.
Firefighters’ and Rescue Squad Workers’ Pension Fund
The state auditor administered the Firemen’s Pension Fund which was created in 1959. This fund was created for certified firemen only, but expanded to include rescue squad workers on January 1, 1982, along with both volunteer and paid employees. As a result of this addition, the fund was to be renamed as the Firemen’s and Rescue Squad Workers’ Pension Fund in 1981. In 1991 the General Assembly moved the Firemen’s and Rescue Squad Workers’ Pension Fund to the Department of State Treasurer to also be managed by the Retirement Systems Division.
Important Dates
- 1939 – Local Governmental Employees’ Retirement System established. The System framework was in place; however, the System did not begin acquiring members until 1945
- 1940 – July 1: Law Enforcement Officers’ Benefit and Retirement Fund established
- 1941 – July 1: Teachers’ and State Employees’ Retirement System established
- 1945 – Local Governmental Employees’ Retirement System begins gaining members and is put into action
- 1951 – July 16: State employees join Social Security, starting the Public Employees’ Social Security Agency
- 1959 – Firemen’s and Rescue Squad Workers’ Retirement Fund established
- 1960s – Teachers’ and State Employees’ Retirement System and Local Governmental Employees’ Retirement System converted from what was internally called a Money Purchase Plan (similar to today's cash balance plans) to a traditional Defined Benefit formula integrated with Social Security
- 1973 – General Assembly suggests Office of State Treasurer take over Law Enforcement Officers’ Benefit and Retirement Fund; however, this does not happen until twelve years later
- 1974 – Deferred Compensation Plan (457) Established
- 1975 – July 1: Teachers’ and State Employees’ Retirement System formula changed to a flat accrual rate, not integrated with Social Security
- 1976 – July 1: Local Governmental Employees’ Retirement System formula changed to a flat accrual rate, not integrated with Social Security
- 1979 – July 1: National Guard Pension Plan put into effect
- 1980 – January 1: Teachers’ and State Employees’ Benefit Trust established
- 1985 – January 1: Consolidated Judicial Retirement System established
- 1985 - State Law Enforcement Officers absorbed into Teachers’ and State Employees’ Retirement Fund
- 1985 - NC 401(k) put into effect
- 1986 – Local Law Enforcement Officers included in Local Governmental
- 1987 – October 1: Register of Deeds’ Supplemental Pension Plan established as a supplement to registers of deeds who retired with the Local Governmental Employees’ Retirement System
- 1988 – January 1: Disability Income Plan for teachers and state employees who participate in the Teachers’ and State Employees’ Retirement System put into effect
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[1] Pension Bureau: Act of 1885 Pension Applications; Archives; http://mars.ah.dcr.state.nc.us/logicrouter/servlet/LogicRouter?OUTPUTXS…
[2] Ibid
[3] Ibid
[4] Ibid
[5] Ibid
[6] Ibid
[7] Ibid
[8] Ibid
[9] State Treasurer Records Group; State Records collection from NC State Archives; http://mars.ah.dcr.state.nc.us/logicrouter/servlet/LogicRouter?OUTPUTXS…
[10] Ibid
[11] Ibid
[12] State Treasurer Records Group; State Records collection from NC State Archives; http://mars.ah.dcr.state.nc.us/logicrouter/servlet/LogicRouter?OUTPUTXS…
[14] State Treasurer’s 1996-1997 Annual Report
[15] Ibid
[16]State Treasurer Records Group; State Records collection from NC State Archives; http://mars.ah.dcr.state.nc.us/logicrouter/servlet/LogicRouter?OUTPUTXS…
[17] Ibid
[18] Ibid
[19] State Auditor Record Group; State Records collection from NC State Archives; http://mars.ah.dcr.state.nc.us/logicrouter/servlet/LogicRouter?OUTPUTXS…] Information provided by Policy Director, NC Retirement System
[23] State Treasurer’s 2006-2007 Annual Report
[24] State Treasurer’s 1996-1997 Annual Report
[25] Ibid
[26] State Treasurer’s 1996-1997 Annual Report and email conversation with Director, 7/10/2008
[27] State Treasurer’s 1996-1997 Annual Report
[28] Ibid
[29] Ibid
[30] Ibid
[31] State Treasurer’s 2006-2007 Annual Report
[32] Ibid
[33] Ibid
[34] State Treasurer’s 2006-2007 Annual Report
[35] Ibid
[36] Information in the entire paragraph gathered from Rules and Regulations of the Law Enforcement Officers’ Benefit and Retirement Fund, 1975
[37] Ibid
[38] Ibid
[39] Ibid
[40] Ibid
[41] Ibid
[42] Information provided by Director Michael Willaimson, 06/19/2008