Democrats and Republicans override Kulongoiski veto on PERS bill

Democrats and Republicans vote to override veto on PERS bill
By Both Senate Democrat Office and Republican Office,

Salem, OR — The Oregon Senate voted this morning to override a veto of Senate Bill 897 from the 2009 session. Democratic and Republican Leaders agreed that the bill is crucial to protecting public employees from unfair retirement calculation errors. The bill passed the Senate 28 — 0 in the 2009 legislative session. “A retiree shouldn’t be responsible for state agency math errors,” said Senate Republican leader Ted Ferrioli (R-John Day). “Under a policy advanced by the current administration and defended by Governor Ted Kulongoski’s veto, if bureaucrats screw up, retirees lose. That is wrong, and this bill sets things right.”

The bill is intended to protect fairness and encourage accountability in Oregon’s Public Employee Retirement System (PERS). The bill allows more PERS retirees to purchase health insurance benefits, allows all eligible service to be credited towards retirement, and allows a retiree to occupy the Board position designated for a PERS member. “Both Democrats and Republicans feel strongly that public employees deserve accountability and reliability when planning for their retirement,” said Senate Majority Leader Richard Devlin (D-Tualatin). “It’s a basic issue of fairness. A person who is retiring should know what their retirement will look like ahead of time and shouldn’t be surprised after the fact.”

Most importantly, the bill demands that data used to calculate retirement benefits be verified by state officials and locked in. In the past, the discovery of misapplied formulas has changed benefit calculations after the fact, leaving retirees with lower retirement income than their plan selection promised.

In some cases, retirees have been ordered to pay back the difference months after the error, upending retirement plans and forcing some workers out of retirement.

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Posted by at 01:47 | Posted in Measure 37 | 17 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Jerry

    You would think these people could do the math. It is not that complicated.

  • eagle eye

    Good for the Republicans and Democrats.

  • Gary

    Jerry,

    Unfortunately, in some cases PERS hasn’t been able to reliably calculate how much retirement benefits would be for employees planning to retire. The result has been some pretty negative financial consequences for employees who gave up their jobs AND ended up having to pay money back.

    Why the governor vetoed this bill in the first place is beyond me!

  • Rupert in Springfield

    So PERS retirees shouldn’t have be responsible for screw ups by bureaucrats. That sounds pretty fair, but lets face it, what that works out to is the taxpayer being held responsible for the screw up. God knows we could never hold the actual bureaucrat responsible.

    So if the bureaucrat estimates wrong on the high side, we are saying the PERS retiree gets to keep the goodies? But if the bureaucrat estimates wrong on the low side, the PERS retiree can challenge and get benefits increased?

    Sounds like a pretty sweet deal to me.

    Heads state workers win, tails taxpayers lose.

    PERS retirees shouldn’t be held responsible for screw ups by bureaucrats, but they shouldn’t be unfairly enriched by those screw ups either.

    • Jerry

      Agreed. And the employees who can’t do the math should be removed from duty.

    • Ron Glynn

      Hey Rupert!

      I am a PERS retiree and I deserve every cent I receive. I played by the rules and I expected my employer to do likewise. When I started working for the State in 1976 at age 25, they sat me down and explained the PERS program which required me to pay 6% of my wages into PERS. I was told to expect a pension of 60% of my final salary after 30 years of work. Overtime, Republican and Democrats lunkheads both agreed to more changes to the system that lead to most of the fiscal probems it has today.

      I retired in 2003 with 26 years in and my retirement pay was more than my work pay was. The only difference was that I had to pay my own medical and dental premium which amounted to 20% of my pension. Yes, I jhad hit the Jackpot! It was thanks to my good decision work until I could l Retire and to the bad decisions made by a boatload of decision makers in government.

      I and thousands of other PERS employee have for years been slammed repeatedly and treated like we personally were responsible for the problems caused. At this point, I have had enough. We are proud to be PERS retirees! On behalf of them, I am holding up a finger to all the whiners about the PERS retirees getting a good pension. It is up to you and the others to figure out what finger it is.

      • Rupert in Springfield

        Well, my guess would be the reason why people don’t have a lot of respect for you is your middle finger reaction when the suggestion is made that you should get what you are entitled to and not reap a windfall because of a bureaucratic math error.

        The middle finger thing is fine, just don’t expect to get a lot of respect from people when you insist you should be allowed to rip them off. And that’s exactly what expecting to collect on a math error is, ripping people off.

  • eagle eye

    The principle is that retirees shouldn’t get screwed, either by having their benefits undercalculated, or by being promised something and then having it taken away. It’s called fulfilling all the contractual obligations. It’s too bad that Oregon is apparently incapable of running a pension system, but that’s not the fault or responsibility of the hapless retirees.

    I knew someone who gave up his job, with contractual tenure, with the understanding that his pension would be a certain amount. His pension wasn’t that big and he was counting on every dollar. He felt he had been offered a certain deal, and he took it.

    PERS then said they had overcalculated his pension and wanted to be paid back money he had already spent.

    He said he was agreeable, as long as he could have his old job back.

    The agency said no deal. He didn’t sue, but I think he would have had a good case. Violation of the contract and all that.

    • Myrt

      So eagle eye, based on your argument I can safely assume that you are in favor of the Wall Street Bonus agreements should continue as agreed when the executive hired on. It only makes sense. Shoudl the TAX PAYER be on the hook for that also?

      • eagle eye

        I’m no expert on the agreements the Wall St. people had, but yes, I believe their contracts should be honored.

    • Rupert in Springfield

      >or by being promised something and then having it taken away. It’s called fulfilling all the contractual obligations.

      That’s weird, because when I made the argument that I had been ripped off by the raising of the SS retirement age, and thus my benefits estimate changing, you said that was not a contract.

      Now, when it comes to PERS, all of a sudden an estimate of benefits is a contractual obligation.

      Thas so strange, according to you, me bring promised something under an SS estimate is not a contract, PERS retires being promised something under an estimate is a contract.

      Get real, PERS might be a contract, but the estimate, at least before this bill, did not constitute a contract.

      This is one instance where Ted did the right thing.

      • eagle eye

        You are really being obtuse. Social security, whatever it is, is not a contract.

        The contract part of PERS comes in when the state says: “Give up your job (in the case of my friend, a tenured position, which most certainly is a kind of property right; in return, if you make the deal, you’ll get such and such a pension”. The state can’t just go around committing fraud with retirees, anymore than with bondholders, etc.

  • Jan

    Could this apply to the poor hapless unemployed who had their benifits overpaid through no fault of their own? What about those overpaid in welfare benefits?

    Overpayments aren’t their fault, but the state certainly does not cut them any slack.

    No matter, the taxpayer just pays and pays.

    • eagle eye

      You might be right about the principle, but legally, it probably depends on whether the unemployed have a contractual right to the benefits. For example, did they make an agreement with the state? “I will agree to be laid off in return for XXX benefits.” I doubt it.

      This is probably unusual, but my friend was quite serious about being willing to take his job back in return for giving up the lost pension benefits. In other words, renegotiate the deal he thought he had made. But they said no dice.

      Oh, but then they had a situation where they badly NEEDED him to come back for a year. He agreed, but he made them pay him pretty well!

  • Paper or Plastic?

    The trough feeders win another one ….

  • bill

    I have not read this bill, but it is fair and reasonable to ask this question:  Was it reasonable for the retiree to have relied on the information he or she was provided.  Would a reasonable person have recognized that there was probably an error?

    This begs another question:  Do employees have a right to expect a retirement benefit in excess of their highest working salary?  If the goal of PERS was or is a pension that is 75 percent replacement of salary, do employees ever have a contractual right to a taxpayer funded benefit that is more than they ever made working?  The Oregon Supreme Court would answer “yes,” but that court has not shown itself willing to make decisions consistent with clearly estalished precedent when it comes to PERS.

  • bill

    I have not read this bill, but it is fair and reasonable to ask this question:  Was it reasonable for the retiree to have relied on the information he or she was provided.  Would a reasonable person have recognized that there was probably an error?

    This begs another question:  Do employees have a right to expect a retirement benefit in excess of their highest working salary?  If the goal of PERS was or is a pension that is 75 percent replacement of salary, do employees ever have a contractual right to a taxpayer funded benefit that is more than they ever made working?  The Oregon Supreme Court would answer “yes,” but that court has not shown itself willing to make decisions consistent with clearly estalished precedent when it comes to PERS.

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