What one hand giveth, another taketh away.
Gov. Kate Brown knows how it works.
Just as a task force she appointed puts out a report on how PERS’ massive unfunded actuarial liability (UAL) might be reduced, Brown appoints two legislators to jobs that will drain PERS of hundreds of thousands of dollars.
The Task Force, which Brown charged with identifying options to generate additional funding to reduce the PERS UAL by up to $5 billion over the next five years, issued its report yesterday (Nov. 1). Ideas put forward in the report to generate revenue for PERS , which would impact all Oregonians, include:
- Privatize state universities
- Sell surplus port and airport property
- Sell additional Common School Fund land assets
- Expand the types of gaming the Oregon Lottery offers and direct revenue from these new options toward PERS
- Impose a charge for new water rights based on market prices.
- Sell or do an IPO of SAIF
- Institute more aggressive foreclosures on properties with property tax and other liens (“Cities could use their own discretion to use the streamlined process (in order to make sure they don’t evict 85-year old grandmothers,” the report notes.)
- Increase OLCC’s flexibility to operate the spirits business to maximize profits; Increase alcohol licensing fees and excise taxes on beer and wine; impose a surcharge on all distilled spirit (liquor) sales in Oregon, calculated as a percentage of the retail sales price (e.g., 1%, 5%, or 10%).
While all this revenue-raising analysis is going on, Gov. Brown is proposing to undermine PERS’ financial health by conspiring with Sen. Richard Devlin (D-Tualatin) and Sen. Ted Ferrioli (R-John Day) to enrich the legislators, fleece PERS and drive up the costs of PERS payers, such as schools and local governments.
As I’ve pointed out previously, on Oct. 23, Brown nominated Devlin and Ferrioli to the Northwest Power & Conservation Council, a federally funded panel that provides policy and planning leadership on regional power, fish and wildlife issues. The Senate Rules Committee is scheduled to consider the nominations on Nov. 13.
The council positions come with a $120,000 annual salary, substantially more than Devlin and Ferrioli have been making from their legislative salaries.
Furthermore, as The Oregonian’s Ted Sickinger reported this past week, both men will likely end up raiding PERS for big payouts.
The jobs “…will allow both legislators to double dip, turbocharge their public pensions, or both,” Sickinger reported.
As Sickinger explained it:
“Ferrioli already draws a $33,083 annual pension from the Public Employees Retirement System. That benefit stems from 6½ years working for the Oregon Department of Veterans Affairs in the late ’70s and early ’80s…And because he is already at retirement age, he is allowed to double dip, continuing to collect it while working full time at the council.
Meanwhile, Ferrioli is eligible for a separate pension for his 20 years of legislative service. And if his Senate colleagues confirm him to the new position, that pension will be calculated using his new higher salary and the extra years of service he earns at the power council, according to PERS.
It’s unclear how much service credit Ferrioli earned during his years at the Legislature, given the part-time work. But assuming he sticks with the job for the first three-year term, the new salary could quintuple his legislative pension, which could translate to hundreds of thousands of dollars in extra benefits over the course of his retirement (emphasis mine). And he could start drawing that while continuing to work at the council.
Devlin, too, could see a similar multiplier in his legislative pension if confirmed. He, too, has 20 years of legislative service and is eligible to start drawing his pension. But if he holds off, the new salary and service at the power council would balloon those benefits after three years.”
This brazen attempt to exploit PERS when it is already suffering from billions in unfunded liabilities needs to be cut off at the pass.
If they want to maintain their reputations as public servants, Devlin and Ferrioli should either decline the Council appointments or they should refuse any additional PERS benefits that may arise because of them.
And Gov. Brown and the Legislature need to put a stop to this practice of raiding PERS to enrich former Legislators. It’s time to stop taking Oregonians for rubes.