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Friday, September 28, 2007

Who'll Stop the Rain

A couple of days ago I wrote about Police and Fire retirees starting to get invoiced. I've now had emails from about two dozen P & F members who have been invoiced in the past month or so. Each of the emails raises the same problem. Although PERS is NOT reducing benefits to cover the repayment of benefits alleged to have been paid in error, PERS is including the amount the member owes and the actuarial reduction amount that WILL BE deducted monthly if PERS is authorized by the Courts to resume collections. The problem is that Police and Fire retirees tend to retire at younger ages and the ARM amounts included on their invoices are completely out of sync with what I've seen for General Service members who are similarly aged at the time of invoice. Controlling for variables such as option and beneficiary age, these amounts SEEM excessively high. I had assumed that PERS had different ARM factors for Police and Fire. PERS disabused me today of that assumption; Police and Fire retirees are subject to the same ARM factors as General Service members. This deepens the mystery. I'd like to be of help here but in order to do so I need to see about a half a dozen examples of real invoices to determine what pattern holds (if any) and whether or not PERS is doing something different than what they say they are doing. The only way this will happen is if recently invoiced Police and Fire (and General Service as well) retirees are willing to share a copy of their invoices with me. I absolutely, positively do not want to see any personal information (no addresses, social security numbers, account numbers or anything else of a personal identification nature) and these invoices can be FAXED to me with all that information blacked out. It isn't relevant. My plan is to use the software I have as well as some other information to see if I can reconstruct why and how PERS is invoicing members under the injunction. If it appears that there is a disjunction between what PERS is saying and what PERS is doing, I'm happy to contact the appropriate lawyers or provide you with information to contact your own representatives on the PERS Coalition. If you are willing to help out, please contact me via email so that I can provide you with my FAX number or other means of contact. Thanks for your help.

2 comments:

mrfearless47 said...

To continue the thread, what I'm wondering about is whether PERS is building in the legal delays into its calculations - kind of like your mortgage payoff amount when you refinance, except on steroids. If PERS is figuring that it may take them two years before they "win", for all we know they could be adding that to your age and figuring that the older you get, the less time you have actuarially to live. Thus, increased payments. I don't know that they're doing this, but, right now, nothing else makes sense. More data please.

mrfearless47 said...

From the looks of what I'm seeing, there is some confusion about what PERS is doing. So far, what I've seen is that the recalculation letters contain ONLY the adjustments resulting from the correction of 1999 earnings at 20% to 11.33, recalibration of the initial benefit to reflect that fact and the subsequent application of COLA to the adjusted benefit. There is no indication of the amount by which the benefit would be adjusted once the actuarial reduction factors are applied to the outstanding balance.

This all makes much more sense to me now. What the P & F correspondents with me have confused is the adjustment of the benefit by recalculation, which is still subject to clarification by Judge Kantor, and the collection of "overpayments" which PERS has been enjoined from doing as a result of Judge Kantor's original ruling. As a result, what PERS is doing is what they claim they were permitted to do. Although this is still subject to dispute, it is not the area clearly the target of Judge Kantor's injunction. I'm afraid there is no "issue" not already being handled by the current litigation and PERS is behaving in the way they told Judge Kantor they would.