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Saturday, September 29, 2007

Hold On

I'm afraid the Police and Fire posts got a bit out of hand. My post yesterday netted me a few copies of the invoices in which the retirees had raised questions about PERS' reductions. After reviewing all these invoices very carefully, I've concluded that there's no there there. To understand this, you need to keep two different facts completely separate. The Strunk/Eugene remediation plan involves two DIFFERENT reductions that are only tangentially related. The first reduction involves adjusting the retiree's benefit to WHAT IT SHOULD HAVE BEEN if the 1999 earnings crediting had been posted at 11.33% instead of 20%. This requires PERS to go back to the date of the member's retirement adjust the account balance AT RETIREMENT to what it should have been if 11.33% had been credited instead of 20% and then refiguring the benefit on that basis. That benefit is called the adjusted benefit. To the adjusted benefit PERS then adds the COLAs from that point to the date of adjustment. That is now the new benefit. If that new benefit is greater than your current benefit, then you get the higher benefit. If that benefit is less than your current benefit, your benefit is reduced. The second reduction involves the overpayment of benefits (as a result of the 1999 20% earnings credit instead of 11.33%) from the date of retirement until the date of adjustment. For some retirees, the COLA on the adjusted benefit produces a "cross over" where the adjusted benefit exceeds the current benefit. When this happens, the overpayment amount is reduced by the amount underpaid after the cross-over. The OVERPAYMENT amount is subject to the Actuarial Reduction Method whereby PERS agrees to accept repayment of your OVERPAYMENT by reducing your monthly benefit by an amount based on your life expectancy and that of your beneficiary, if one is germane to your benefit.

With that explanation behind us, I can state confidently that PERS is NOT collecting or even documenting the actuarial reduction amount based on the "overpayment". They have been enjoined from doing that by Judge Kantor in the Arken/Robinson cases. The repayment amount has NO bearing on the amount of reductions Police and Fire members have been seeing on their recent invoices. The reduction of benefits being reported is ONLY the benefit reduction resulting from PERS continuing to adjust benefits (and account balances) to reflect the 11.33% crediting for 1999. Unfortunately, some Police and Fire members just happen to be in a situation where they were nowhere near the "cross over point" and were still being overpaid their benefits.

Apropos of those adjustments to benefits, PERS believes -- and so stated to Judge Kantor during the Status Conference on August 16, 2007 -- that Judge Kantor's injunction did not apply to those adjustments. Judge Kantor, in his (slightly incredulous) reply, let PERS attorneys know in no uncertain terms that he would clarify his final order so that PERS would know and understand exactly what he meant in his injunction. We are still waiting for Judge Kantor to issue that and, hopefully, stop PERS dead in its tracks and force them to reverse any adverse actions taken so far. Moreover, we hope that he will require PERS to follow the Supreme Court's ruling in the Strunk case that would restore COLA to the "fixed benefit" (the one you were receiving before you were invoiced). The Supreme Court was, in my opinion, quite clear on that order, but PERS disagrees and refuses to implement that. The Arken case raises that very issue and Judge Kantor is going to have to confront the Supreme Court's ruling directly in his final order. Whether PERS finds a way to parse the order to its advantage remains to be seen. One thing is certain, however. PERS will appeal Judge Kantor's ruling. So hold on to your hats, glasses, pens, computers, and iPods. It's gonna be a bumpy ride for the next couple of years.

3 comments:

George said...

I'm done holding on, Professor. We window retirees have been holding on for the better part of six years now.

Doesn't ANYONE involved in this dance of the macabre realize that justice delayed is justice denied?

Tomorrow I begin my search for an attorney to file a completely separate set of actions against PERS.

Those actions will include, but not be limited to:

1. Action in Federal District Court under the Fair Debt Collection Act in Title 15. It is a violation of that Act to attempt to collect a debt which has been held in abeyance by a court. The "invoices" are just such an attempt.

2. A request to Judge Kantor to hold PERS in contempt of HIS ruling. Yes, we could wait for His Honor's new, more sharply-worded opinion, but it will just be appealed and then we are back to where we were, and have been several times. A contempt citation means someone gets huge daily fines that tend to open eyes and end procrastination.

3. A petition to the Oregon Supreme Court to hold PERS in contempt of the Oregon Supreme Court on frozen COLAs. In case you haven't looked at your "invoice", those COLAs add up to some tidy sums, and the highest Court in this state has held that we are entitled to them, not PERS.

4. Since PERS has a large number of highly trained actuaries on their staff plus those hired for the purpose, their failure to follow explicit court orders rises to the level of intentional malfeasance, and as an organization, PERS may be sued for RICO (Racketeer Influenced Corrupt Organization). Not criminal RICO, civil RICO, the same way you get to a shady car dealer who rolls back odometers. A RICO judgment means HUGE damages, and the prospect of those might ALSO get PERS' attention.

5. Finally, there's politics. Did I go to sleep and Bill Sizemore got elected Chief Justice, Governor, Speaker of the House, as well as President of the Senate? You'd think so by the way our "friends" the Democrats have ignored the maltreatment of over 38,000 Oregon citizens, the majority of whom are likely registered Democrats.

Ah, but you say, we have an organization, OPRI, who carries the football for us, don't we?

We would have to be in the six thousandth overtime if this was a football game. OPRI is run for the old folks and the tier folks, and too bad if you're a "window" retiree, the outfit isn't run for your benefit.

People, it's time to put our backs up.

It's time for a bar brawl, the Marquis De Queensbury Rules don't seem to have done much for us.

Let's all find sharks, and go after the soft underbellies of these whales at PERS. Perhaps when they feel the pain of subpoenas, perhaps when they see contempt of court cites with their names on them, then we will get a reasonable and quick resolution we all can live with.

mrfearless47 said...

I wish you the best in filing your litigation. Hope this route proves successful in a more significant way than what has happened so far. You've got a creative approach and mucho cojones. I hope your pockets are as deep as your ambitions. Perhaps you can find an attorney who'd take the case on contingency, leaving you financially free to focus on the case. There is a lot at stake if you establish a precedent.

Richard said...

Amen, George.

Perhaps you could benefit from seeing how many of fellow PERS folks would be interested in helping with the attorney fees?

Has anyone thought of bringing suit against the PERB for wasting our funds in pursueing this course of action? It seems that they are being vindictive as well.

Keep us others posted...

RAK