Beebe: System 'can be abused'

Retirees still on job could run afoul of law, governor says

By Seth Blomeley

Posted: July 28, 2009 at 4:57 a.m.

• Print item
• E-mail
• Share
• Tweet

LITTLE ROCK — Gov. Mike Beebe said Monday it looks to him as if "some folks" didn't retire properly.

Beebe was responding to reporters' questions about some county officials in Garland and Desha counties collecting early retirement - without vacating their offices - and going back on the county payroll.

Two legislators representing those areas said the Legislature ought to look at changing the law in 2010 to make county officials vacate their office before taking advantage of the retirement program.

The head of the state group representing county officials said he expects that the county officials in "good faith" followed rules of the Arkansas Public Employees Retirement System.

And, the head of that system said her agency has done nothing wrong.

The governor said that when he was a legislator he initially questioned the practice of state employees stepping down to collect pensions and later returning to work to collect salaries as well.

But he said colleagues convinced him that it was a good thing because "we were losing some valuable experienced employees" to retirement.

"This was a way to retain them and not give them an incentive to just go away," Beebe said.

The period between retirement and when officials could come back on the payroll was reduced to 30 days during the 1999 session and was increased to 90 days in 2001, Beebe's last session in the Legislature.

During this year's session, the Legislature increased it to six months.

"The process can be abused," Beebe said. "Obviously, some folks didn't do it right if the newspaper accounts are correct. Whether that's confusion and misunderstanding, whether it's intentional abuse, that's the basis for what the people that are doing the checking will find out."

Beebe said he's confident that reviews by Attorney General Dustin McDaniel and the Division of Legislative Audit will sort everything out.

An attorney general's opinion issued June 1 said county officials who took themselves off the payroll to collect retirement probably didn't meet the legal requirement of first having their employment terminated.

The opinion didn't say whether the county officials should vacate their offices, which sets in motion a process by which the governor would appoint a replacement to serve the term.

Eddie Jones, executive director of the Association of Arkansas Counties, issued a statement saying he believes such retirement actions are not widespread among county officials.

"The fact is - the Arkansas Public Employees Retirement System confirmed their retirement through their own regulations at the time of each retiree's retirement," Jones said. "I would not disagree that stricter and specifically defined regulations should be put in place to properly ascertain the definition of 'termination.'"

Sen. Jimmy Jeffress, D-Crossett, a former chairman of the retirement committee and whose district includes parts of Desha County, and Sen. Terry Smith, D-Hot Springs, whose district includes Garland County, said the issue should come up in the 2010 legislative session.

"I think that will probably happen without a doubt," Jeffress said.

Smith said he expects that the issue would get the two-thirds vote of each chamber necessary to bring it up during 2010 session, a margin needed to consider non-budget matters.

He said the law probably should specify that elected officials must vacate the office before retiring.

"If the AG looks at it and says we need to clarify it then yes we need to," Smith said. "I would think that's something that should be made clear if the law isn't clear."

Jeffress said it "ought to be part of the deal" that if someone is going to take advantage of that early retirement benefit that they should notify the Quorum Court so the court could declare the office vacated.

"It ought to be very transparent and easy to swallow," Jeffress said.

Jeffress said the Arkansas Public Employees Retirement System "should have been more engaged. If you have a rule that says you are to retire [before receiving benefits] there should be a way to check and see if you retire."

System Executive Director Gail Stone disputed that her agency failed to properly monitor benefits awarded.

"APERS has no audit or investigative authority," Stone said.

She said before her agency computes benefits the employer, or in the case of counties, the county clerk, must submit a "verification of wages" form.

Stone said that the form says, "I certify that based on my knowledge or the information provided to me this member has or will terminate employment with the agency of the date given above and will remain terminated after that date."

She said the form says any person "who knowingly makes false statements ... to defraud the system" would be guilty of a misdemeanor and would face as much as six months in jail, according to Arkansas Code Annotated 24-4-102.

Further, Stone said her agency doesn't take into account the time period an employee must be terminated before going back to work under the early retirement option. She said that by law benefits start the day someone retires.

Jones said he didn't know the precise language of the form that county clerks must sign. He said he knew that they had to certify the retirees were "off the payroll." He said that's how the retirement system has historically defined "termination."

Northwest Arkansas, Pages 7, 8 on 07/28/2009

Comments

To report abuse or misuse of this area please hit the "Suggest Removal" link in the comment to alert our online managers. Please read our comment policy.

Use the comment form below to begin a discussion about this content.