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Monday, August 31, 2009

Light A Candle

And hope. In checking around I've learned that the first thing that happens in a Special Session of the Legislature is a review of all bills vetoed by the Governor in the previous regular session. This means that SB 897 - the PERS "clean up your act" bill - will get reviewed again in the special session in January/February. This makes it imperative that we contact each of our own legislators (first in the Senate, then in House) and urge them to hold firm in their original votes to pass this bill. If we can retain all the votes SB 897 got during the regular session (100% of those voting in both bodies), the Governor's veto can be overturned. As soon as Labor Day passes and the silly season begins (always the day after Labor Day), you can consider writing a letter urging continued support for SB 897. This bill is common sense. It calls for PERS to take some responsibility for its estimates and actually work to assure members and retirees that they have ACCURATE information upon which to make a life-altering decision. This bill's statutes would not take effect until 2011, which gives PERS plenty of time to develop the QA mechanisms required for accuracy. We cannot tolerate the "eets not my job mon" attitude of PERS any longer. Customer service and honest representation of your trustees should not be that big a headache.

Saturday, August 29, 2009

After The Thrill is Gone

I've been writing about PERS issues since mid-2001. This started out as a private email list to my colleagues at PSU, in which the messages would be forwarded to others at UO, OSU etc. Eventually, my work evolved into a pre-blog, web-based diary. That led to the current blog, which has been running pretty continuously since late 2003. Along the way I've made thousands of friends inside of PERS, in the Legislature, in the legal community, in all aspects of public employment, and even some of journalists with whom I compete for news reporting. All of this has been richly rewarding. I've even had people offer to pay me for looking at their personal PERS situations. I've always refused to take money for my observations or advice because I've always believe that money compromises objectivity. I still believe that.

Along the way, I've actively participated in one newsgroup (OPDG), started another one as a competitor (POD), and helped to organize the incredibly valuable PERS Document Library, which contains virtually all relevant documents pertaining to PERS, the litigation, the legislation, the policy papers.

If I have one fault (I'm sure I have many) it is my abject refusal to engage with people who continually try to hijack the primary raison d'etre for all my endeavors - PERS and closely related retirement issues. I loathe political arguments. I am unapologetically left of center and have no use for the politics of the political right wing. This doesn't mean I don't have friends who come from both sides of the political aisle. We've managed to co-exist as friends so long as we agree not to discuss the one topic (along with religion) that is guaranteed to explode friendships and destroy any semblance of order - politics.

This leads me to the primary point of this entry, which isn't what some are worried about. No, my participation in this blog and my participation in POD and PERS Document Library will continue UNABATED. These are things I value and feel I continue to have information to share, sources to access, and opinions. But politics is not my metier. For the past several years, as PERS news appears to have diminished (an illusion, really), one of the groups (OPDG) where I participated actively has been hijacked by its owner and one or two other members and given over almost totally to noisome, tiresome, hostile, and irrelevant political chatter. In some ways the newsgroup reads like an online version of certain radio and television shows, which I won't dignify by naming here. I've tried to maintain my membership in the group to help out the occasional brave soul who dares post a PERS-related question. Moreover, I've periodically popped in over there to tweak the owner, in particular, to try to get off the political bandwagon and return the group to its roots. Unfortunately, my style can be abrasive, especially when the owner and two or three of his henchmen are guaranteed to jump all over anyone who disagrees with him/them for any reason. Political opponents have either shut up and merely lurk in the background, or they have been banned from the group. Apparently, the owner can dish it out, but he can't take any form of disagreement, whether it be respectful or hostile. In the end, it became a fool's errand to bother to post anything there. Finally, and to no one's surprise, least of all mine, the owner finally banned me from his group. As of today, I am no longer a member of OPDG. I have been banned.

One of the reasons POD was formed was to offset all the deficiencies of OPDG. POD has no membership requirement to read our posts. If you like to have RSS or Atom syndication, our group can be accessed by any newsreader, such as Google Reader. Membership is required to post, but unlike OPDG, you don't have to join just to read our information. A second major difference between POD is that the content is limited to PERS information, questions and answers, and closely related topics (e.g. Social Security, post-retirement health care). Any politically motivated post will be deleted by any of our three moderators. We rarely have to enforce this policy because most members quickly understand that we really mean it when we say we don't want politics to interfere with the group. So far, while we don't get the volume of posts that our ?competitor? gets, we get triple or quadruple the volume of relevant posts. We really are a PERS-related group.

So, if you are looking for up-to-date PERS discussion with interested public employees who share the desire for a NO POLITICS ZONE, please give us a visit. Take a look at the last month's worth of topics. If you belong to the ?other? group, compare the content. Do you see a difference? If so, and you like what you see at POD, please consider joining and participating.

I'm pretty sure that the thrill has gone out of the other group. Its large membership is a result of inertia. Most people don't even bother to read the posts, but don't bother to unjoin either. If you are interested in participating in a group with more than 1100 members and two active posters whose posts only marginally (at the outer 0.0001% of the margin) relate to anything relevant to PERS (I may be exaggerating; maybe it is only 0.000001%) then OPDG is the place to be. If you also want a case-study of what happens if you let politics hijack a group, OPDG is textbook. If you are truly interested in PERS-related news brought to you by members, many of whom actually attend PERS Board meetings, and can actually answer questions without going to the PERS website to look up PERS' sketchy information, please stop by and give us your eyes for a few minutes. I think you'll be quite pleasantly surprised by what you see.

Wednesday, August 26, 2009

We're No Here

No, there isn't a typo in the title. My mailbox runneth over with people getting estimates from PERS that contain one or more inconsistency or plain error. I've gotten emails this week (and today's only Weds) from five different readers, each of whom had requested estimates for a December 1, 2009 date (significant because that is the last retirement date before the revised method of mortality factors goes into effect on January 1, 2010). The errors I'm seeing are in erroneous entries for the 2008 ending balance, mismatches between Option 1 estimates in multiple places on the same page, variable costs for purchasing waiting time, and a new "error" of having the online calculator refuse to estimate benefits beyond two years away from retirement, even for inactive members. This kind of sclerosis is the sort of thing that drives members stark, raving, bonkers. And it is especially aggravating because PERS accepts no responsibility for these errors. What is to assure us that these kind of inept errors won't occur in one's notice of entitlement. We've already learned that from a legal point of view, the NOE isn't worth the paper it is printed on. If PERS makes a mistake and later catches it, you (the retiree) get to pay for it regardless of whether you could have identified it when you retired or not. Some people just aren't "numbers" people, and PERS doesn't do much beyond the online calculator to provide an individual with guidance. Have you ever tried to find out the method used to calculate buyback costs? Obviously it is individual, but the method of calculation should be the same for each member, especially for the 6 month waiting time. But how do you check that?

I hate to keep harping on this point, but SB 897 was supposed to force PERS to "clean up its act." Now that our feckless Governor has vetoed a unanimously passed bill, PERS' accuracy has declined dramatically in my opinion. I haven't received this many incorrect estimates (plus those from previous weeks) in all of the 6+ years I've been writing this blog. So, it leads me to wonder whether PERS even cares whether its estimates are accurate. Do they have ANY QA supervising the drones doing the estimates?

Please, please, please. If you find an error or anything that doesn't make sense to you please do the following: 1) bring it to PERS' attention and ask for a replacement estimate that isn't charged against your yearly limit; 2) send a copy of the complaint to Paul Cleary (paul.cleary@state.or.us); 3) send a copy to the Legislative leaders (I'll post email addresses in a comment to this post); 4) send a copy to your local Representative and State Senator; 5) send a copy to Governor Kulongoski. Finally, in each of the latter 4 copies, remind all of them that SB 897 was designed to make PERS accountable for these kinds of errors and that the error rate is increasing rather than decreasing since the Governor's veto. It can't hurt to remind all the Legislators as the Legislature will be in Special Session in early 2010 and we can possibly assert the need for an override of the Governor's veto. The excuse that there is pending litigation is true, but entirely irrelevant since this is the subject of a civil suit brought by a single individual with a jury trial. There is no way the outcome of that case can possibly force PERS to change its ways. Only Legislative action or an Administrative law case can do that.

Tuesday, August 18, 2009


I've been out of town for a few weeks and my posts have been sparse. Needless to say, so is PERS news these days. After our cowardly Governor vetoed SB897, the only talk I'm hearing is the "possibility" that a group of Legislators from both parties may try to mount an effort to overturn the Governor's veto of SB897. It is rare to ever have any bill passed unanimously by both House and Senate and unheard of for a Governor to veto that bill. That's just dumb, even for a lame duck. Ostensibly, the reason for the Governor's reluctance to sign SB 897 was that there is still outstanding litigation about the subject of SB 897 and the Governor felt that the litigation should be allowed to run its course before the Legislature gets involved. Besides being hypocritical (the City of Eugene case was still in litigation when the Governor proposed a complete overhaul of the PERS system to "solve" some of the problems identified by the PERS reform bills), it is also plain incorrect. The *only* litigation still ongoing is PERS' appeal of the ruling in the Kay Bell civil trial. Regardless of what happens in that case, only one person will benefit from its resolution - Kay Bell. It isn't a class action case. It isn't an administrative rule hearing. It has no application outside Kay Bell and has no possibility of inducing or requiring PERS to change its ways. In fact, SB 897 was designed to solve the problem that Kay Bell and many others found themselves in well after retirement.

I don't know how likely it is that the Legislature will take up the SB 897 veto during its winter Special Session. Typically, these sessions are scheduled in advance when pressing financial problems make it necessary for some mid-term adjustments to the State's budget or agency budgets. It may take a lot of tubthumping to get SB 897 back on the front burner. But you can write your legislators (House and Senate) and urge each to support a plan to overturn the Governor's veto. Otherwise, PERS pre-retirees will continue to go blindly into retirement without any legal assurance that the estimates as well as the final Notice of Entitlement might fall prey to another of PERS' FUBARS. No one is asking PERS to pay anyone more than they are owed. It would just be nice to know with certainty that you are not retiring on a promise compromised by fingers crossed behind PERS' back.

Saturday, August 08, 2009

If I Had A Rocket Launcher

I'd use it on our Governor. In an unbelievable show of stabbing all his supporters in the back with multiple knives, Governor Kulongoski VETOED SB 897. This was one of the few significant PERS bills passed virtually unanimously in the Oregon Legislature. Among its most important elements was a section, due to take effect in 2011, that would have required PERS to "own" the final estimates and Notices of Entitlement given to PERS members just before and just after they retired. This bill was sponsored by OPRI and motivated by the Kay Bell case in which PERS denied repeatedly that there were errors in Kay's estimate and then long after she retired decided there were significant errors and reduced her benefit by a very large amount. It is very hard for me to reconcile a Democratic Governor who self-servingly solicits and gets money from the various public employee unions, gets support from those unions and then deliberately and provocatively points a loaded gun at them and vetoes a bill they strongly support. I have no idea what the Governor's reasoning was and I really don't give a damn. This was a needed bill designed to curb the reign of errors of PERS. It was supported strongly by both parties in the Legislature (passing virtually unanimously in both the House and Senate), and then vetoed by the Governor on the VERY LAST DAY he was permitted to have any impact on this bill.

This was a cowardly act by a cowardly Governor. Ted, you have earned your place in history as the most ineffective and chicken-shit Governor in Oregon history. May you rot in obscurity.

Wednesday, August 05, 2009

Throw A Stone

At PERB, just for fun. As reported several weeks ago, the PERS Board (PERB) agreed with Mercer to adopt a new methodology for calculating the mortality factors that make up the biennial actuarial table revisions. The Board also adjusted the timing of the various studies that make up the basis of the AEF (mortality factors) and the employer contribution rates. Not surprisingly, the Board decided to hold the assumed rate ("the guarantee") at its current 8% rate.

As is normal for this Board, whenever they issue good news (keeping the 8%) rate, they always seem to dilute the excitement by providing offsetting bad news. Today's adventure has to do with the calculation of the mortality factors. PERS has posted a general explanation of how the new method ("generational mortality") will affect members who retire on or after January 1, 2010. Basically, you can expect that your monthly benefit under Money Match will decrease by about 2%, while the Formula+Annuity retirees will see their benefit decrease by 1%. PERS suggests that if members want to retain the benefit under the current mortality tables, they can either retire before 1/1/2010 (i.e. 12/1/2009) or plan to work an additional 3 or 4 months. You can read PERS' own explanation on their web site, which you can reach via a link on the left side of this blog.

If you were planning to retire anyway I would advise you to do everything possible to make your retirement effective on 12/1/2009 (i.e. get your papers in before 12/1 and separate from your employer no later than 11/30/2009). This will have a minimal effect on your benefit and preserves your mortality factors under those currently in force. The challenge for those who want to wait to see what the actual impact will be under the new mortality tables, be aware that the new factors won't be voted on until the November 2009 meeting. You would have to act fast if you don't like what you see. Keep in mind that the older you are, the greater the effect the change in methodology will have. You can see this clearly in the illustration provided at PERS' website.

My advice is to be very careful in making your decision. If it is a no brainer to retire at the end of November; it requires some careful thought to wait longer unless you have no choice. Leave it to PERS to keep members constantly on their toes watching out for their own interests. So much for the concept of a trustee looking out for your own good.

Tuesday, August 04, 2009

Non Entity

That's what I think of our Governor. I had expected some action on SB 897 while I was away. I must have been on some hallucinogenic drug to think that. It has long been rumored that the Governor was unhappy with SB 897 and more rumors that he might veto it. In true cowardly form, the Governor seems to be choosing the "easy" way out. With near unanimous votes for this bill in both the House and the Senate, truly bipartisan support, the Governor would have to be crazy to veto it. It isn't that I haven't thought of him that way, but it appears more likely that the Governor will let SB 897 become law without his signature. Ted has until Thursday to sign or veto the bill. If we get through Thursday and the Gov has done nothing with SB 897, it automatically becomes law on Friday as it contains an emergency clause that makes it effective as soon as it is law.

It is truly a good thing that he is lame-ducked (dead-ducked). I could not ever imagine voting for that dolt again, regardless of who were to oppose him. The man has no backbone whatsoever, and he truly knows how to bite the hands that feed him. Can you say m-o-r-o-n.