Monkey Business Report: Getting filthy rich on the public’s dime

monkeyI am usually not one to play the class warfare game.  If you work hard and make it big — GOOD for you. If you can negotiate yourself a contract with a killer payoff — GOOD for you.  However, I do have a problem with people who jump into government service, stay there forever, and work with their cronies to fix the system so they can get filthy rich AT OUR EXPENSE.  

The N&O’s Dan Kane has excavated some more state government monkey business vís – a – vís  public employee pensions:

Some of the state’s highest-paid government retirees are benefiting from a supplemental fund set up by state lawmakers in 2013 so the retirees can receive pensions that otherwise would be too high under federal law.

The pensions of 17 public retirees in North Carolina exceed the federal limits in 2014, in many cases by tens of thousands of dollars. The state’s top-paid retiree, former UNC Athletic Director Dick Baddour, received just over $64,000 of his $281,000 annual pension from the fund.

Other beneficiaries include former Wake County Manager David Cooke, who retired in 2013, and former Durham Schools Superintendent Carl Harris, who left in 2009 to join President Barack Obama’s administration.

In all cases, the retirees and their former employers met their obligations under state law by paying required contributions into the system during the retirees’ working years.

The supplemental fund, known as a qualified excess benefits arrangement, or QEBA, was created by state lawmakers last year to get around a potential problem the state could have fixed nearly 30 years ago, when Congress lowered the pension limits. But back then, no state or local employees in North Carolina were making the kind of money that would bring the limits into play.[…] 

Again, this COULD  SHOULD have been fixed THIRTY YEARS AGO.  MORE: momoney

“They probably looked and said, ‘It’s never going to apply to anyone,’ ” said Sam Watts, a policy development analyst for the State Retirement Systems Division, which is under State Treasurer Janet Cowell.

Retirement system officials realized about three years ago that some retirees were exceeding the federal limits, which are based on factors such as years of service and retirement age. The limits are typically adjusted upward annually. An employee who retired in 2014 at age 65, for example, was limited to a pension of no more than $210,000. Those who retire at a younger age have a lower pension limit.

Congress gave public pension systems the opportunity to make arrangements for excess retirement benefits in 1996, as those systems began finding some of their retiring employees bumping up against the pension limits. In 2013, officials with the state retirement system asked the legislature to set up a similar supplemental fund.

Lawmakers went along with the request, but they threw in a catch. Access to the supplemental pension money ended Dec. 31, 2014. Those who had not retired by then could find themselves receiving a reduced benefit in line with federal limits.

Schorr Johnson, a spokesman for the state treasurer, said the contributions from high-paid employees and employers typically are enough to cover their pensions. But the amount of pension that is above the federal limit has to come from a separate fund, so the retirement system stays in compliance with federal law. Public pension systems not compliant with federal law could lose their tax-exempt status.

The sunset provision in the 2013 law may have prompted a few public employees to retire before the end of 2014, retirement system officials said. That’s out of a group of roughly 40 people who retirement officials estimated could have been affected by the limits.government-cloak-of-secrecy-open-government-300x237

State Sen. Tom Apodaca, a Hendersonville Republican and co-chairman of the Senate committee on pensions and retirement, said he wanted a sunset to make sure the state retirement system isn’t on the hook for paying what could be a growing number of pensions that exceed the federal limit in future years. “I just don’t like carving out exceptions for one small group, and we’re responsible for the health of the state retirement plan,” Apodaca said.[…]

I have a problem with leftists who scream about the salaries and pensions of various corporate CEOs.  In those cases, you need to point the fingers at the various boards that approved the deals.  If someone wants to offer me a $40 million contract, I’m not turning it down. I don’t blame those CEOs one bit. 

But THAT is the private sector — where you get rewarded for the profits, the success, you bring your company.

Legislators are on the hook for paying these pensions.  But there really needs to be some investigation of who approved these sweetheart salary and pension deals and how they went down.  There is something inherently wrong with paying a local housing authority director a wage comparable with that of the governor.  There is something wrong with paying a local ABC commission director or a university athletic director TWICE the governor’s salary. It’s also quite wrong to rush through big pay raises right before the pension limits kick in.  

There needs to be some serious sunshine on the salary and benefits packages awarded to government officials.