I've just run across a PERS horror story that tops almost every single one I've read about. I now have first hand information from the affected party so I feel confident that I understand what happened. Doris (a pseudonym) retired from her employer in 2002 on a disability. The disability was because of a brain injury. She hadn't been working all that long and I don't know how old she was at retirement. Nevertheless, the story goes like this. Doris' initial computed benefit was $3500 per month. Because Doris was unaware of how PERS really worked, she didn't think anything about the benefit. Fast forward 5 years to 2007. Doris gets her repayment/adjustment letter, but doesn't understand it and doesn't ask about it (remember the brain injury?). PERS discovers that Doris not only had been over credited by $2000 for 1999, but also that they has miscomputed her benefit by more than $2000 per month. So Doris' benefit is adjusted downward to $1400 per month, leaving a balance due of $59,000 resulting NOT from the 1999 over credit, but from the computational error PERS made in 2002. PERS decides not to collect starting in 2007; I'm not clear why but they seem to apply the Circuit Court's ruling to ALL collections, not just those due to the 1999 over credit. Of course, you can guess what has now happened. If you guessed that PERS wants its $59,000 you would be absolutely correct. But, PERS has decided, at least initially, to take a hard line and insist that all repayments be recovered in 10 years or less. There is, to the best of my knowledge, no statutory requirement that PERS collect in 10 years or less. It is simply a policy that the Board has adopted to collect the 1999 over credit. However, in its usual inflexible, hidebound system, it has determined that Doris must suffer the additional indignity to repay her "owings" in about 10 years. They are proposing that her current $1500 monthly benefit be REDUCED BY $500 per MONTH, leaving Doris nearly destitute. While I have written to PERS about this case and am doing everything I can to help Doris, I'm afraid she has been a victim of a very cruel and cynical ploy by PERS to hew to an inflexible and irrelevant standard. My reading of ORS 238.715 indicates that PERS must get permission from a beneficiary to reduce benefits by more than 10% due to a recovery action. This reduction is 33% of Doris' monthly benefit. Moreover, she suffered an initial 60% reduction in benefit due to PERS original error. Now to add insult to injury, Doris is expected to repay an unseemly amount to liquidate an overpayment that occurred 10 years ago, and had nothing to do the PERB error in 1999. PERS' fundamental error here is to confound two different issues and expect a single solution to both for their convenience, without regard to its effect on the payee. PERS should have begun collecting the mistaken amount (about $57,000) in 2007, rather than let it continue to ride another 5 years. Now Doris is 10 years older than when she was when she retired. PERS squandered an opportunity to begin the repayment without court injunction 5 years ago. While it wouldn't have been any fairer to Doris, PERS wasn't overrun with the idea that payments had to be collected in 10 years or less. PERS totally misinterpreted the Court's injunction and applied it to a clerical error unrelated to the error under litigation. Totally screwed up.
I don't understand PERS' inflexibility in this case. Post your comments and thoughts in the comment section. I'm sure Doris would appreciate your sentiment, positive or negative. I hope that PERS gets a heart and a brain and decides to give Doris a much longer payment schedule so that she doesn't risk slip sliding away.