Saturday, February 25, 2006

Shakedown Street

OK. I know it is a recycled title, but it is appropriate for today's entry. The PERS Board is locked and loaded. It will be sending out the first (of two) letters to "window retirees" sometime in March. This letter will notify the window retiree of the "error" in the 1999 earnings, the correction, and PERS' intent to collect the money allegedly overpaid to window retirees. This letter, which will not have details on what PERS alleges the recipient owes, will be accompanied by a notice that gives a 60-day time limit for appealing the notice. Note here that the appeal will be over the process, whether PERS has a claimable error, and whether they have any right to collect. The second letter -- the detailed calculation letter involving the specifics of the recipient's benefits - will be sent starting in the beginning of the summer. PERS expects that these letters ("invoices") will take nearly 3 years to get out. They will start with the earliest window retirees and move forward in time with later window retirees. Thus, it may be several years before the first notice goes out, and the actual invoice letter gets set. PERS assured all stakeholders that the invoice letter WILL contain appeal language that will allow window retirees 60 days to challenge the specifics of the computations.

In other action, the Board authorized drawing down the capital preservation reserve to $0, and the contingency reserve to $250 million (up from $100 million at the last meeting). The rate guarantee reserve will end up with a surplus of approximately $1 billion.

The PERS Coalition and OPRI will be posting updated information on their web sites next week. In particular, there may be some suggestions on how individual members should respond to the PERS notification letter coming next month. In the meantime, the legal actions continue apace with the White case, the Arken case, and the Robertson case all starting to cause stirs in various halls of justice.

Many thanks to friends and colleagues at OPDG for posting the information about yesterday's Board meeting so quickly. Unfortunately, I was unable to go myself.

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