                IN THE SUPREME COURT OF IOWA
                           No. 58 / 04-1730

                          Filed June 2, 2006

ALLAN T. THOMS,

      Appellant,

vs.

IOWA PUBLIC EMPLOYEES’
RETIREMENT SYSTEM and
EMPLOYMENT APPEAL BOARD,

      Appellees.

________________________________________________________________________
      Appeal from the Iowa District Court for Polk County, Robert J.

Blink, Judge.



      Appeal from district court judgment affirming administrative

agency’s determination of retiree’s pension benefits. AFFIRMED.



      Alice E. Helle and Douglas E. Gross of Brown, Winick, Graves,

Gross, Baskerville and Schoenebaum, P.L.C., Des Moines, for appellant.


      Gregg A. Schochenmaier, Des Moines, for appellees.
                                            2

CADY, Justice.

        In this judicial review proceeding, an Iowa Public Employees’

Retirement System (IPERS) pensioner who retired, returned to work, and

retired again claims he was entitled to have his retirement benefits

calculated by adding the years of his original employment to the years of

his reemployment. Instead, IPERS calculated the amount of his benefits

by   separately       determining     his   benefits    based     upon     his   original

employment and adding them to the benefits calculated from the period

of his reemployment. The district court affirmed the Employment Appeal

Board decision that affirmed a decision by an administrative law judge

(ALJ) that found IPERS properly determined the benefits. On our review,

we affirm the district court.
        I.       Background Facts and Proceedings

        Allan Thoms was a State employee covered by IPERS. In 1994, at

age fifty-six, he retired from his State employment after 14.75 years of

service. He began receiving monthly IPERS benefits of $570.78 in July

1994.        In April 1995, he returned to IPERS-covered employment.                  His

retirement benefits were suspended after his earnings exceeded the

limitation in Iowa Code section 97B.48A (1995). 1 Thoms worked for the

        1That   section provided:

                 If, after the first day of the month in which the member attains
        the age of fifty-five years and until the member’s sixty-fifth birthday, a
        member who has a bona fide retirement under this chapter is in regular
        full-time employment during a calendar year, the member’s retirement
        allowance shall be suspended for as long as the member remains in
        employment for the remainder of that calendar year. However, effective
        January 1, 1992, employment is not full-time employment until the
        member receives remuneration in an amount in excess of seven
        thousand four hundred forty dollars for a calendar year. Effective the
        first of the month in which a member attains the age of sixty-five years, a
        retired member may receive a retirement allowance after return to
        covered employment regardless of the amount of remuneration received.
                                           3

State for an additional 6.5 years, and retired again on October 26, 2001.

He then applied for retirement benefits.

       On January 30, 2002, IPERS notified Thoms by letter that his final

wages had been credited to his account, and his reemployment

termination notice had been processed. IPERS gave Thoms the choice of

a lump-sum refund or monthly benefits for the remainder of his life.

Thoms      requested      monthly      benefits,     which     were     subsequently

recalculated to be $1441.83. This amount was based upon his original

monthly benefit of $570.78, added to the monthly benefit of $871.05

derived from his period of reemployment.
       Thoms appealed the recalculation of benefits, asserting his “benefit

should be recalculated to take into account his additional years of

service, additional earnings and increased age at the time of his ‘re-

retirement,’ with a single recalculated retirement allowance being paid.”

See Iowa Code § 97B.20A (2001) (“If the party appeals the decision of the

department, the department shall conduct an internal review of the

decision and the chief benefits officer shall notify the individual who has

filed the appeal in writing of the department’s decision.”).                  In other

words, Thoms wanted his retirement benefits recalculated based on the

total years of service from his two periods of employment and the

circumstances existing at the time of his second retirement.                   The two

different methods of calculations resulted in a significant difference in

the amount of benefits. 2 IPERS conducted an internal review and issued
________________________
Iowa Code § 97B.48A(1) (1995).

        2Thoms wanted IPERS to add his first period of employment, 14.75 years, to his

second period of employment, 6.75 years, for a total of 21.5 years. This increases his
total benefit more than just adding the two calculated benefits together because IPERS
benefits are calculated using a “fraction of years of service,” in which the numerator is
the years of service, and the denominator is 30. The formula for calculating monthly
IPERS benefits is:
                                            4

a final agency determination affirming its recalculation of Thoms’s

benefits. See id.

       Thoms appealed IPERS’s determination to the Department of

Inspections and Appeals (DIA). See id. (“The individual who has filed the

appeal may file an appeal of the department’s final decision with the

department under chapter 17A by notifying the department of the appeal

in writing within thirty days after the notification of its final decision was

mailed to the party’s last known mailing address.                  Once notified, the

department shall forward the appeal to the department of inspections

and appeals.”). An administrative law judge (ALJ) with the DIA held a

hearing. Thoms and IPERS entered into a stipulation of facts (agreeing

to the facts set forth above) and submitted it to the ALJ. The ALJ issued

its decision on January 20, 2004. The ALJ found IPERS was correct in

calculating separate benefits based on the separate employment periods

________________________
                                                           Years of service
       1/12 × (.60 × three-year average covered wage) ×           30

Iowa Code § 97B.49A(3) (2001); Iowa Code § 97B.49(5)(b) (1995).

        Thoms also wanted to use a figure of approximately $100,000 for his three-year
average covered wage, not the $35,666 average wage used by IPERS. The $35,666
figure is the average of Thoms’s wages in 1992, 1993, and 1994—the three years before
his initial retirement.     Before Thoms retired the second time, his salary was
approximately $100,000.

        Finally, Thoms wanted to calculate his benefits based on his age at the time of
the second retirement, 64. When he retired the first time, he was 56, so IPERS applied
an early-retirement penalty. See Iowa Code § 97B.50(1)(a) (1995) (“[A] vested member,
upon retirement prior to the normal retirement date . . . is entitled to receive a monthly
retirement allowance . . . reduced as follows: . . . For a member who is less than sixty-
two years of age, by twenty-five hundredths of one percent per month for each month
that the early retirement date precedes the normal retirement date.”). He wanted IPERS
to do a new calculation of his benefits as of 2001, when he was 64, so no early-
retirement penalty would apply. See Iowa Code § 97B.50(3) (2001) (“A member who is
at least sixty-two years of age and less than sixty-five years of age, and who has
completed twenty or more years of membership service and prior service, shall receive
benefits under 97B.49A through 97B.49G, as applicable, determined as if the member
had attained sixty-five years of age.”).
                                     5

and adding them together to send a single check. Thoms petitioned for

review by the Employment Appeal Board. See id. § 97B.27. The Board

affirmed and adopted the ALJ’s decision.

      Thoms filed a petition for judicial review in district court. See id.

§ 97B.29 (“Judicial review of action of the system may be sought in

accordance with the terms of the Iowa administrative procedure act.”).

Thoms claimed the agency decision was subject to reversal under each of

the fourteen grounds for reversal in the administrative procedure act.

See id. § 17A.19(10)(a)-(n).    The district court affirmed the agency’s

decision. Thoms appeals.
      II.   Standard of Review

      The Iowa Administrative Procedure Act, Iowa Code chapter 17A,

governs the scope of our review in this case. Iowa Code § 97B.29. Under

the Act, we may only interfere with the agency decision if it is erroneous

under a ground enumerated in the statute, and a party’s substantial

rights have been prejudiced. Id. § 17A.19(10).     Thoms did not specify

which of the grounds in the statute supports reversal of the agency’s

decision. However, Thoms is challenging the agency’s interpretation of

Iowa Code section 97B.48A, the statute governing benefits upon

retirement after employment.      Section 17A.19(10)(c) provides that an

agency’s action is subject to reversal if it is “[b]ased upon on erroneous

interpretation of a provision of law whose interpretation has not clearly

been vested in the discretion of the agency.” Id. § 17A.19(10)(c); see also

Arthur E. Bonfield, Amendments to Iowa Administrative Procedure Act

(1998) Chapter 17A, Code of Iowa (House File 667 As Adopted) 62 (1998)

[hereinafter Bonfield] (“Normally, the interpretation of a statute is a pure

question of law over which agencies are not delegated any special powers
                                            6

by the General Assembly so, a court is free to, and usually does,

substitute its judgment de novo 3 for that of the agency and determine if

the agency interpretation of the statute is correct. That is what the first

ten words of paragraph (c) say.”).              This section utilizes the familiar

correction-of-errors-at-law standard of review.                Section 17A.19(10)(l)

provides that an agency’s action is subject to reversal if it is “[b]ased

upon an irrational, illogical, or wholly unjustifiable interpretation of a

provision of law whose interpretation has clearly been vested by a

provision of law in the discretion of the agency.”                         Iowa Code

§ 17A.19(10)(l); see also Bonfield at 62 (“[W]here the General Assembly

clearly delegates discretionary authority to an agency to interpret or

elaborate a statutory term based on the agency’s own special expertness,

the court may not simply substitute its view as to the meaning or

elaboration of the term for that of the agency but, instead, may reverse

the agency interpretation or elaboration only of it is arbitrary, capricious,

unreasonable, or an abuse of discretion.”).                 This section utilizes a

deferential abuse-of-discretion standard of review.              Bonfield at 62.       To

determine which section governs our review—and, consequently, how

much deference we give to the agency’s interpretation—we must

determine whether the interpretation of section 97B.48A has “clearly

been vested in the discretion of” IPERS.



        3De novo, of course, means “anew.” Black’s Law Dictionary 447 (7th ed. 1999).

When we interpret a statute “de novo,” what we are doing is employing our familiar
correction-of-errors-at-law standard of review. See, e.g., Norwest Credit, Inc. v. City of
Davenport, 626 N.W.2d 153, 155 (Iowa 2001) (stating that under correction-of-errors-of-
law standard, we are not bound by lower tribunals’ determinations of law but instead
interpret the law on our own and determine whether our conclusion mirrors that
already made); see also Bonfield at 62 (“[M]ost Iowa cases treat agency interpretation of
the meaning of a statute as a pure question of law over which they have de novo review,
allowing the court simply to substitute its opinion of the meaning of the statute for that
of the agency . . . .”).
                                     7

      Chapter 97B makes IPERS the administrator of the retirement

system established under Iowa Code chapter 97B.         See id. § 97B.4(2)

(setting forth IPERS’s powers and duties); see also id. § 97B.1(1) (“The

Iowa public employees’ retirement system shall administer the system

established under this chapter.”).    Section 97B.4 provides IPERS with

rulemaking authority:

            The system may adopt . . . rules . . . and take other
      action it deems necessary for the administration of the
      retirement system in conformity with the requirements of
      this chapter, the applicable provisions of the Internal
      Revenue Code, and all other applicable federal and state
      laws. The rules shall be effective upon compliance with
      chapter 17A.

Id. § 97B.4(2)(a).    We have held that similar language vested the

interpretation of a statute in the relevant agency’s discretion. In City of

Marion v. Iowa Dep’t of Revenue & Finance, we concluded that Iowa Code

section 422.68(1), which provides, “The director shall have the power and

authority to prescribe all rules not inconsistent with the provisions of

this chapter, necessary and advisable for its detailed administration and

to effectuate its purposes,” vested the interpretation of section 422.45(20)

with the department of revenue and finance. City of Marion, 643 N.W.2d

205, 207 (Iowa 2002); accord Auen v. Alcoholic Beverages Div., 679

N.W.2d 586, 590 (Iowa 2004) (concluding section 123.21, granting the

agency authority to adopt rules “necessary to carry out this chapter”

“clearly vested the interpretation of section 123.45 with the agency”);

Becker v. Iowa Dep’t of Human Servs., 661 N.W.2d 125, 128-29 (Iowa

2003) (“We give weight to administrative interpretations of statutes that

agencies administer.” (citing Iowa Code § 4.6(6); City of Waterloo v. Black

Hawk Mut. Ins. Ass’n, 608 N.W.2d 442, 445 (Iowa 2000); In re G.J.A., 547

N.W.2d 3, 6 (Iowa 1996))).    Thus, we utilize a deferential standard of
                                           8

review in this case. This does not mean the agency’s interpretation is

conclusive, but we give it “appropriate deference.”                See Iowa Code

§ 17A.19(11)(c) (stating that with respect to matters vested by law in an

agency,      we   “[s]hall   give   appropriate    deference”     to    the   agency’s

interpretation); see also Bonfield at 72 (defining “appropriate deference”

to mean “the agency action is subject to review by the unreasonable,

arbitrary, capricious, or abuse of discretion standard”).                We will not

reverse an agency action based on an interpretation of law whose

interpretation has been clearly vested by a provision of law in the

agency’s discretion, unless the agency’s interpretation is “irrational,

illogical, or wholly unjustified.” Iowa Code § 17A.19(10)(l); see also Niles

v. Iowa Dist. Court, 683 N.W.2d 539, 541 (Iowa 2004) (explaining that in

interpreting statutes, specific terms (such as “irrational, illogical, or

wholly    unjustified”)      control   general    terms   (such    as    “appropriate

deference” (citing Burton v. Univ. of Iowa Hosps. & Clinics, 566 N.W.2d

182, 189 (Iowa 1997); Christenson v. Iowa Dist. Ct., 557 N.W.2d 259,

262-63 (Iowa 1996))).
      III.     Discussion

      Section 97B.48A(3) determines how benefits are to be calculated

when an IPERS member retires from covered employment, then resumes

covered employment, and retires again.                Both parties agreed the

resolution of the correct computation of benefits rests with this statute.

It provides:

            Upon a retirement after reemployment, a retired
      member may have the retired member’s retirement allowance
      redetermined under this section or section 97B.48, section
      97B.50, or section 97B.51, whichever is applicable, based
      upon the addition of credit for the years of membership
      service of the employee after reemployment, the covered
      wage during reemployment, and the age of the employee
      after reemployment. The member shall receive a single
                                     9
      retirement allowance calculated from both periods of
      membership service, one based on the initial retirement and
      one based on the second retirement following reemployment.
      If the total years of membership service and prior service of a
      member who has been reemployed equals or exceeds thirty,
      the years of membership service on which the original
      retirement allowance was based may be reduced by a
      fraction of the years of service equal to the number of years
      by which the total years of membership service and prior
      service exceeds thirty divided by thirty, if this reduction in
      years of service will increase the total retirement allowance of
      the member. The additional retirement allowance calculated
      for the period of reemployment shall be added to the
      retirement allowance calculated for the initial period of
      membership service and prior service, adjusted as provided
      in this subsection. The retirement allowance calculated for
      the initial period of membership service and prior service
      shall not be adjusted for any other factor than years of
      service. The retired member shall not receive a retirement
      allowance based upon more than a total of thirty years of
      service. Effective July 1, 1998, a redetermination of a
      retirement allowance as authorized by this subsection for a
      retired member whose combined service exceeds the
      applicable years of service for that member as provided in
      sections 97B.49A through 97B.49G shall have the
      determination of the member’s reemployment benefit based
      upon the percentage multiplier as determined for that
      member as provided in sections 97B.49A through 97B.49G.

Iowa Code § 97B.48A(3).

      Based on this statute, IPERS calculates retirement benefits for

members who retire after reemployment by taking the sum of the

benefits calculated from the initial period of employment and the benefits

calculated from the period of reemployment.           These two separate

calculations are then added together into a single retirement allowance.

One administrative rule promulgated by IPERS similarly explains the

recomputation of benefits by a member who is reemployed in covered

employment after retirement and retires again. It provides:

             A member who is reemployed in covered employment
      after retirement may, after again retiring from employment,
      request a recomputation of benefits.          The member’s
      retirement benefit shall be increased if possible by the
      addition of a second annuity, which is based on years of
                                     10
      reemployment service, reemployment covered wages and the
      benefit formula in place at the time of the recomputation. A
      maximum of 30 years of service is creditable to an individual
      retired member. If a member’s combined years of service
      exceed 30, a member’s initial annuity may be reduced by a
      fraction of the years in excess of 30 divided by 30. The
      second retirement benefit will be treated as a separate
      annuity by IPERS. Any contributions that cannot be used in
      the recomputation of benefits shall be refunded to the
      employee and the employer.

Iowa Admin. Code r. 495—12.8(3) (2004) (emphasis added).

      Thoms primarily challenges the method of calculation by IPERS by

isolating the second sentence in the relevant statute, “The member shall

receive a single retirement allowance calculated from both periods of

membership, one based on the initial retirement and one based on the

second retirement following reemployment.” Iowa Code § 97B.48(3). He

claims this sentence expresses the legislative intent for retired members

to receive “a single retirement allowance,” not two allowances added

together, calculated from both periods of membership service, meaning

the total years of service. In other words, Thoms claims this sentence

means benefits following retirement after reemployment are determined

by adding the two periods of employment together and computing

benefits based on a single uninterrupted period of employment. IPERS,

on the other hand, asserts this sentence merely means that the member

should only receive one monthly allowance in the form of a single check

for the total of the two benefits added together.

      We interpret statutes by considering them as a whole, not by

looking at isolated parts of the statute. State v. Young, 686 N.W.2d 182,

184-85 (Iowa 2004). Thus, we begin our analysis with the entire statute

in mind.

      A member who retires after reemployment already has an existing

retirement allowance in place.     The benefits are merely suspended or
                                     11

otherwise limited during the period of reemployment. Thus, retirement

after a period of reemployment means the existing retirement allowance

may need to be redetermined based upon the period of reemployment.

Section 97B.48A(3), the statute at the center of this controversy,

addresses how the allowance is redetermined.

      We acknowledge the section is not crystal clear, especially

considering only the first two sentences of the statute.     The statute

addresses a complicated subject matter that involves a very detailed and

intricate process. It is not always easy to express mathematical formulas

in words, and it is understandable how different interpretations can

result from statutes describing the rather enigmatic subject of retirement

and pension plans.     We have recognized the ease with which different

interpretations can result from almost all statutes, and this is even more

so with pension statutes. See Teamsters Local Union No. 421 v. City of

Dubuque, 706 N.W.2d 709, 713 (Iowa 2005) (“Disputes over the

interpretation of a statute can arise even with the most carefully drafted

laws. Disputes arise because it is nearly impossible, even for the most

thoughtful lawmakers, to anticipate all future circumstances and neatly

corral them into communicative words.” (citing 2A Norman J. Singer,

Statutes and Statutory Construction § 45:02, at 15 (6th ed. 2000))).

However, when section 97B.48A(3) is considered in its entirety, it

becomes clear that the redetermination is based upon the sum of the two

separate benefit amounts computed for each period of employment.

Thus, we find it largely unnecessary to lock horns over particular words

and phrases within each sentence of the statute in this case because the

entirety of the statute clearly resolves the dispute.
                                          12

       After the statute describes in the first sentence the three factors

upon which a redetermination is made (“the years of membership after

reemployment, the covered wage during reemployment, and the age of

the employee after reemployment”), and explains in the second sentence

that the member receives a single retirement allowance based on the

redetermination calculated from both periods of service (“The member

shall receive a single retirement allowance calculated from both periods

of membership service, one based on the initial retirement and one based

on the second retirement following reemployment.”), the third sentence

describes the calculation method when the total years of service exceeds

thirty years. While the third sentence is not factually applicable to this

case, it unmistakably clarifies the intended calculation scheme under the

statute for retirement after reemployment.
       It was necessary for the legislature to articulate a specific provision

describing how a retirement allowance would be calculated for retirement

after reemployment in the event the total years of membership service

exceeded thirty years because monthly IPERS benefits equal one-twelfth

of the applicable percentage of the three-year average covered wage

multiplied by the fraction of years of service, which is the years of service

divided by thirty years. Iowa Code § 97B.49A(3). However, this fraction

of years of service, used as the multiplier, can never exceed one.                   Id.

§ 97B.49A(1)(b). Thus, years of service by a state employee in excess of

thirty years do not benefit a member in the calculation process by

increasing the fraction of years of service to a number greater than one. 4

         4Years of service by a state employee over thirty years do add to the applicable

percentage of the applicable wage component in the formula by increasing it up to a
maximum of sixty-five percent. Id. § 97B.49A(1)(a). That is, IPERS benefits are
calculated in part based on sixty percent of the three-year average covered wages. Id.
§ 97B.49A(3). Years of service in excess of thirty can increase this percentage up to
sixty-five percent. Id. § 97B.49A(1)(a).
                                          13

Consequently, when a member retires after reemployment with more

than thirty years of total service, the third sentence of the statute

permits the member to adjust the initial retirement allowance by

reducing the service years used in the calculation by the total number of

service years in excess of thirty, so the calculation of the second

retirement allowance based on the period of reemployment can utilize

those years in the event they will make the total allowance greater.

Without this provision, the second retirement allowance could only use

the number of years remaining after the original years of service during

the original period of employment up to thirty. 5
       This procedure is important in interpreting the statute because it

clearly reveals that the single retirement allowance given after retirement

following reemployment is based on two separate calculations, which are

then added together. That is, the calculation process described in the


       5The   operation of this procedure can be best described by using an example.
Assume an employee initially worked for 20 years, then retired, then later became
reemployed for 12 more years. Because the final retirement allowance can only be
based on 30 years of service, 2 years of the employee’s reemployment would essentially
go to waste and could not be used in the “fraction of years of service” used as the
multiplier in determining the retirement allowance. This is true because the fraction
used to calculate the benefit amount for the period of reemployment could only be
10/30, instead of 12/30, since the fraction used to calculate the initial retirement
benefit was 20/30.       However, the legislature recognized that it may be more
advantageous for the employee to have the final allowance calculated based on more of
the reemployment years, as opposed to original employment years. Thus, instead of
using 20/30 for the “fraction of years of service” used to calculate the benefit amount
for the original employment, the statute allows the employee to reduce that fraction by a
fraction in which the “extra” years of service are the numerator, and 30 is the
denominator. This would then permit the retired member to use the full 12 years of
service in the fraction used to calculate the benefit amount for the period of
reemployment. So, in our example, the new fractions would be:

       Fraction of Years of Service                Fraction of Years of Service
          for Original Employment                     for Reemployment
          Was          Now                            Was         Now
          20 − 2 = 18                                  10          12
          30     30     30                             30          30
                                    14

first two sentences reveals that the calculation of the second retirement

benefit amount is based on the period of reemployment, which is then

added to the initial retirement benefit amount for a total single

allowance.    Clearly, if the statute instead contemplated that the

calculation was made after adding together the two periods of

employment, as claimed by Thoms, it would be unnecessary for our

legislature to implement the procedure described in the third sentence

governing reemployment that covers total service years in excess of thirty

years. In other words, it would be unnecessary to have a procedure to

permit a retired member to allocate the thirty-years-of-service cap

between the first period of service and the second period of service to

come up with the most advantageous final retirement allowance if the

two periods of employment were combined together anyway and the

benefit was determined based on factors existing at the time of the

second retirement. It would be unnecessary because the allowance for

retirement after reemployment under that method of calculation would

not change depending on the number of years of service allocated

between the two periods. We will not read a statute so that any provision

will be rendered superfluous. See Miller v. Marshall County, 641 N.W.2d

742, 749 (Iowa 2002) (“Each term [in a statute] is to be given effect, so

that no single part is rendered insignificant or superfluous.” (Citation

omitted.)); 2A Singer § 46:06, at 181 (“ ‘It is an elementary rule of

construction that effect must be given, if possible, to every word, clause

and sentence of a statute.’ ”).

      The remainder of the statute only confirms this interpretation. In

particular, the fourth sentence makes it clear that the additional (second)

retirement allowance calculated for the reemployment period is “added”
                                     15

to the initial retirement allowance, as adjusted, calculated for the initial

period.      See Iowa Code § 97B.48A(3) (“The additional retirement

allowance calculated for the period of reemployment shall be added to

the retirement allowance calculated for the initial period of membership

service . . . , adjusted as provided in this subsection.”). Any doubt cast

by the first two sentences over the question whether the final allowance

is calculated based on separate periods of service or a combination of the

periods of service is amply resolved by considering the entire statute.

      We conclude the interpretation of the statute by IPERS under its

applicable rules and regulations reflects the intent of the legislature to

calculate retirement benefits after reemployment separately on each

period of employment.      The district court correctly concluded that the

interpretation   by   IPERS   was   not   “irrational,   illogical,   or   wholly

unjustified.” Id. § 17A.19(1)(l).
      IV.     Conclusion

      The decision by the district court on the petition for judicial review

filed by Thoms was correct. IPERS correctly determined Thoms’ monthly

benefits by calculating one annuity based on his initial employment, and

adding to it a second annuity based on his reemployment. Accordingly,

we affirm.

      AFFIRMED.
