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  #631  
Old 05-02-2017, 11:37 PM
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CALPERS
CALIFORNIA
GOVERNANCE

http://www.nakedcapitalism.com/2017/05/jj-draft.html

Quote:
CalPERS Hides Bogus Persecution: Promised Public Hearing for Lone Effective Director Held in Secret
Posted on May 2, 2017 by Yves Smith
Thanks to an audience member making a video of a CalPERS board meeting in January that would otherwise have gone undocumented, we were able to publicize that the giant public pension fund was launching a full bore attack against JJ Jelincic, the only board member who does his duty by asking questions of staff. That appears to be a hanging crime in Sacramento.

This plan was so clearly dubious that not only did former general counsel, now law professor Bill Black savage the conduct of CalPERS’ board and its general counsel, Matt Jacobs, but reporter Mike Hiltzik of the Los Angeles Times also criticized CalPERS, in an article titled, One CalPERS board member asks tough questions about its investments. Why are his colleagues trying to muzzle him?

The only potential check on this kangaroo court was that Jelincic asked for and was promised a public process.

Apparently CalPERS is determined to censure Jelincic yet recognizes that its charges and procedures won’t stand up to scrutiny. The result is that CalPERS reneged on its promise to Jelincic and the public and insisted on a secret process. CalPERS even tried to gag Jelincic by cheekily asserting that an early April meeting was attorney-client privileged even though Jelincic had his own counsel and his interest was clearly adverse.

.....
From the statements that CalPERS has made to the media and Jelincic, it is apparent that they have a bizarre view of confidentiality. While it is true that the contents of the non-public portions of CalPERS board meetings are confidential, it is also a well-settled legal principle that information that is public cannot be made private simply by trying to assert that it is confidential. Thus, for instance, the board regularly reviews the status of litigation in which CalPERS is involved. However, for cases already filed, those discussions are almost certain to include material that is in court documents. For a board member to discuss something that is already a matter of public record would not be a violation of confidentiality, yet members of CalPERS’ board seem to believe otherwise.

And of course, you can see Feckner stonewalling Flaherman, which is hardly a demonstration of good faith or fair dealing with Jelincic and the public at large.

The board’s deeply misguided sense of priorities strongly suggests that rather than find a way to beat a quiet retreat, they will instead persist in trying to find a way to smear Jelincic, no matter what the cost to their and CalPERS’ reputation.

This entire procedure is shameful. The board owes Jelincic an apology. But even if some board members now recognize that they will do themselves more harm if they allow this bogus procedure to continue, too many board members seem obsessed with punishing Jelincic rather than doing a better job of overseeing staff. And bear in mind, they can’t hide behind the excuse that this train wreck is Slaton’s and Feckner’s doing. Feckner is proceeding with the delegated authority of the board. He is their operative and they all bear responsibility for the outcome.
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  #632  
Old 05-05-2017, 11:22 PM
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NORTH CAROLINA

http://www.citizen-times.com/story/n...ted/101276366/

Quote:
Public employee pension, health benefits phase-out debated

RALEIGH - Employee groups and some senators from both parties raised questions Wednesday about a Republican-backed proposal to phase out traditional pensions and free or discounted health care coverage for North Carolina government retirees to rein in their unfunded costs.

A Senate committee debated but did not vote Wednesday on the proposed legislation, which would apply to workers hired on or after July 1, 2018. The bill sponsors are seeking to keep unfunded financial obligations they say totals roughly $60 billion from worsening.

The measure would ultimately end what have been two attractive employee benefits. At least one committee member was worried about making such changes without support from new Republican State Treasurer Dale Folwell, who has taken no opinion on the bill, a spokesman said.

“I think before we do something this big, it’s incumbent upon us to have him give his recommendation,” said Republican Sen. Rick Horner of Wilson, but “we have got a liability you cannot ignore. Kicking the can down the road on this one isn’t an option.”

Unfunded retiree health coverage liabilities are estimated at $43 billion. Billions more cover the gap between pension funds now in hand and what the state is obligated to pay to current and future retiree pensioners. The measure also would promise to earmark $300 million over the next two years to slowly narrow the pension gap and ensure traditional retirement plan employees are covered.

Phasing out benefits “has no impact on current employees. It has no impact on current retirees,” said bill sponsor Sen. Andy Wells, a Hickory Republican. “It has no impact on anybody hired in the next 14 months.”

But workers hired after the date would participate in a 401(k)-style retirement plan, instead of a traditional “defined benefit” plan where workers get a guaranteed monthly payment based on age, years of service and salary.

New hires would choose their level of regular contributions, which would be matched, up to a certain amount, by the state. Unlike a pension, workers can take the money they accumulated in the “defined contribution” plan if they leave government. But the risks of poorly-performing investments shift to the worker.

.....State Employees Association of North Carolina lobbyist Ardis Watkins said retirement reforms are needed but high outside investment management fees in recent years are to blame for the funding gap. Since taking office, Folwell has been working to reduce investment fees.


https://www.ai-cio.com/news/north-ca...-rises-4-1-1q/

Quote:
North Carolina Pension Fund Rises 4.1% in 1Q

North Carolina reported a 4.1% gain for the first quarter of 2017 for the state’s pension fund, bringing its total assets to $92.2 billion, from $89.1 billion at the end of 2016.

“Our public equity portfolio did especially well during the first quarter of this year,” said North Carolina State Treasurer Dale Folwell. “But fixed-income continues to lag due to historically low interest rates.”

The state’s pension fund is up 9.6% from the same time last year, and has returned 4.9%, 6.8%, and 5.3% over the last three, five, and 10 years, respectively.

Public equity, which makes up more than 40% percent of the total fund’s asset allocation, rose 7% for the first quarter, and is up 14.9% over the past year, while private equity gained 2.3% for the quarter, and 6.6% over the past year. Non-core real estate assets grew 3.6% for the quarter, and 12.1% since the first quarter of 2016, while core real estate investments rose 3.2% during the first quarter of 2017, and 8% over the past year.

Opportunistic fixed income returned 2.7% for the quarter, and 12.9% for the year, while investment grade fixed-income investments gained 1% during the quarter, and 0.9% over the past 12 months. Inflation-sensitive and diversifier investments increased 3.3% for the quarter, and have risen 10.9% since the year-ago period.

All of the performance figures are reported net of all fees and expenses.

....
Folwell also said he would work toward reducing the pension plans’ expected rate of return. Last month, North Carolina’s Teachers’ and State Employees’ Retirement System (TSERS) and Local Government Employees’ Retirement System (LGERS) voted to lower the investment return assumption for the fund from 7.25% to 7.20% beginning with the December 31, 2016, valuations.

“We are focused on reducing complexity and fees in the state pension plans,” said Folwell. “We also want to gradually lower the expected rate of return to more accurately reflect historical gains.”


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  #633  
Old 05-05-2017, 11:36 PM
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LOS ANGELES, CALIFORNIA

http://www.scpr.org/news/2017/05/03/...-pension-woes/

Quote:
A new wrinkle in LA's pension woes

At the city's budget hearing Tuesday, Los Angeles city council members got some sobering news: Investment analysts expect the city's two pension funds to produce a lower rate of return in the coming years.

The city is already spending more than ever on pension contributions for its retirees – nearly $1.1 billion, which is nearly 20 percent of the city's general fund, according to a recent report from L.A.'s Interim Chief Administrative Officer Richard Llewellyn.

Costs have approximately doubled over the past decade as a wave of baby boomers retired and are now living longer on the generous pensions they were promised. The city expects another wave of retirement in the coming years, coupled with higher health care costs. The news of a lackluster investment forecast adds yet another financial obstacle.

L.A.'s pension funds, known as LACERS (Los Angeles City Employees Retirement System) and the LAFPP (Los Angeles Fire and Police Pension) currently have a rate of return of about 7.5 percent, but representatives from both funds told the city's Budget and Finance Committee they expect the rate of return to decline to about 6.5 percent over the next decade.

Ray Ciranna, general manager of the Department of Fire and Police Pensions, told the committee the expectations come from capital market assumptions on how public pension funds will perform.

"Most of the larger money managers are looking at a capital market that is trending downward overall. And these are the headwinds that we are facing as we move forward," he said.

Any investment declines would force the city to increase its contributions to compensate for the loss, said Thomas Moutes, general manager of LACERS.

"While we certainly do not want to burden the city's general fund with a higher contribution rate in the coming years, our fiduciary responsibility to our members requires that we ensure the city contribute adequate amounts to keep the benefit promises to tens of thousands of active and retired city employees," Moutes said.

Llewellyn estimates the city would pay an additional $100 million a year in pension costs if the rate of return fell by just 0.25 percent.

Both Moutes and Ciranna said they expect mortality rates to further push up costs.

"People are living longer, which is a good thing. But with folks in our plan, if they retire at 55 and live another 25-30 years that does weigh heavy on the system," Ciranna said.

LACERS and LAFPP each has a board of trustees that decides whether to lower the assumed rate of return. LACERS' board will meet in July.

If the assumed rate of return drops, the city would not need to act until the 2018-19 fiscal year, Moutes said.



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  #634  
Old 05-05-2017, 11:38 PM
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KENTUCKY

http://www.wave3.com/story/35324698/...-in-anchorage#

Quote:
WAVE 3 News finds answers, more questions, about Gov. Bevin's new home in Anchorage


LOUISVILLE, KY (WAVE) – WAVE 3 News has uncovered answers to some of the questions that tie Gov. Matt Bevin together with a historic home and the state’s pension fund.

The home is the 150-year-old Anchorage Place. It's the home after which the city of Anchorage is named.

At the beginning of this year, it was owned by local businessman Neil Ramsey. Now, Bevin lives there. The timeline of the sale and a state board appointment for Ramsey is what's creating questions.

Ramsey bought the home in 2004 along with other land. In 2013, he sold the home to himself under a company called The Anchorage, LLC. An LLC is a type of company that shields someone from liability or debt. The selling price was $3 million.

It's now the home of Bevin and his family. That sale happened after Bevin appointed Ramsey as a board member for the Kentucky Retirement System in 2016.

Ramsey has impressive credentials for the job, managing billions of dollars for private clients. That could raise conflict-of-interest questions, especially since he sold his home to the man who appointed him.

The state's Executive Branch Ethics Commission is responsible for investigating conflict-of-interest claims.

"I've never felt that in my time with the commission that the commission has ever made decisions based on politics," said Katie Gabhart, the commission's executive director. "I believe we provide a service for the commonwealth. We are a watchdog entity."

Gabhart couldn't discuss the deal specifically but Ramsey did, responding to WAVE 3 News' questions only via email.

"We go to great lengths to ensure there are no overlaps or conflicts of interest," he wrote. "We can't make a decision that would benefit our funds, my company or me personally."

Ramsey shed some light on the sale of the house to Bevin, though some parts remain unclear.

In March, a few months after Ramsey's appointment, he sold the historic home at 804 Evergreen Road, to Anchorage Place, LLC. This is not a company Ramsey owns.

.....
When asked whether he had any regrets about the house deal with Bevin, Ramsey provided the following in-depth answer.

"I have no regret. I hope that the Governor and his family have found a home they can raise their family and he can continue to work hard serving our state. His family deserves some expectation of privacy.

I would like to add the following with regards to serving on the KRS board. I am really proud of the work we are doing. I believe in the need to serve the people of Kentucky to have built their lives on KRS. It is certainly a difficult, time-consuming task with a long way to go to ensure it is viable and meets the needs of those who depend on it. But, we have already gotten a lot done.

1. We've brought in new board members with real investment expertise, which I'm told has not been a focus before.
2. We've addressed our actuarial assumptions in a much more realistic way so that the legislator and the governor can make more informed decisions as to how to solve our pension problem.
3. We've reoriented the way we categorize risk considering the return and liquidity needs of each of the programs.
4. We've cut the hedge fund portfolio by 60% because a large portion of the allocations were adding no value and were very high cost.
5. We've redefined how diversifying strategies can add value to our portfolio and the guidelines for inclusion.
6. We've implemented a differential asset allocation program based on the liquidity needs of each individual retirement plan.
7. We've reduced consultant costs.
8. We've restructured the way we consider new investments in less liquid strategies to greatly lower our costs and improve our investment returns.
And there is still a lot to do.

As far as any personal conflicts I may have serving as a Board member of KRS, I have already proven that I have chosen the interests of KRS over my personal interests by serving on the board and putting in a lot of hard work. I guess there are two schools of thought on how to deal with this.

1. Avoid all appearances of conflict by appointing people who have no experience and little competence. Or
2. Get the most experienced and competent people you can find and make sure they have integrity.

I think this Governor and the other KRS board members from both sides of the political aisle have chosen number 2. I hope my performance for the people of Kentucky will validate their choice."


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  #635  
Old 05-05-2017, 11:42 PM
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OHIO

http://www.daytondailynews.com/news/...tOUe1PITKofxO/

Quote:
Pension cuts looming for Ohio teachers and retirees

The financial strength of the State Teachers Retirement System — the second largest pension fund in the state — is being questioned after actuaries told trustees to make big changes. Now, teachers and retirees may face benefit cuts.

STRS Ohio’s expected annual investment return — 7.75 percent — is too rosy, retired teachers are living longer than expected and payroll growth isn’t keeping pace with assumptions.

Trustees agreed to change assumptions after Segal Consulting recommended the changes based on a review of five years worth of data. The assumed rate of return will be dialed back to 7.45 percent — though some board members wanted to be even more conservative and set it at 7 percent.

STRS Ohio is the retirement system for 490,000 teachers and retirees. It had $72.1 billion as of June 30, 2016.

All told, the changes will pile on an additional $6.5 billion in accrued liabilities — a gap in money available to pay promised benefits. Ohio pension systems are required to be able to pay off their unfunded liabilities within a 30 year window.

But changing the assumptions used by STRS means the system’s funding period will jump from 26.6 years to 59.5 years. This will require STRS to come up with a new plan to get back within the 30-year window.

“They’re trying to make the best decisions they can with the bad hand they were dealt,” said John Cavanaugh, executive director of Ohio Retired Teachers Association.

STRS told members in its March newsletter that the board is looking at changing benefits “to preserve the fiscal integrity of the pension fund.”

One option on the table is to cut or suspend the Cost of Living Adjustment for teachers and retirees. A 2012 change in state law allows pension boards to change the COLA without approval from the General Assembly.

A vote on the COLA is expected at its meeting in Columbus on April 20, though it could be delayed, said STRS spokesman Nick Treneff. “The COLA is a big lever because it impacts all the retirees and all of the members,” he said. The COLA now is 2 percent of the base pension, starting on the fifth anniversary of retirement.

The STRS board also voted to change up its “asset mix,” so that its investment portfolio has less risk and volatility. That configuration, though, means it’ll likely bring a lower rate of return: 6.84 percent over the next decade, according to consultants.

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  #636  
Old 05-05-2017, 11:45 PM
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NEW YORK CITY

https://www.ai-cio.com/news/nyc-comp...ble-investing/

Quote:
NYC Comptroller Seeks Investment Managers for Sustainable Investing

The NYC Comptroller’s Office, on behalf of the New York City Pension Funds, said it is seeking index managers who can proactively account for, and focus on, various types of indexes, including low-carbon investments, and environmental, social, and corporate governance (ESG) factors.

“Climate change is real, the science is real, and the threat to both our planet and the global economy is real,” said Stringer in a statement. “When we invest in companies that recognize the irrefutable realities of global warming, we’re making smart investment decisions and boosting returns.”

Stringer said the pension funds already have $3.6 billion invested in clean and renewable energy, and energy-efficient assets. He also said that 24% and 40% of the pension funds’ infrastructure and real estate portfolios, respectively, are in environmentally-conscious investments, and are LEED or Energy Star Certified.

The managers selected will either receive an immediate investment under a three-year contract, or become part of a pool of managers who would be eligible to compete for future allocations.

According to Fossil Free, an environmental activist group, New York City and New York state’s pension funds contain billions of dollars of investments in fossil fuel companies, including fracking companies, as well as the companies supporting the Dakota Access Pipeline. The group has called on Stringer to do more to divest from companies in the fossil fuels industry. It wants the comptroller to immediately stop any new investments in the top 200 fossil fuel companies, and divest from the top 200 fossil fuel companies by 2020.


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Old 05-05-2017, 11:46 PM
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MICHIGAN

https://www.ai-cio.com/news/michigan...sion-overhaul/

Quote:
Michigan Business Leaders Propose Pension Overhaul

A group of Michigan business leaders is calling for a complete overhaul of the state’s pension system, including moving all new public employees into defined contribution plans, and revising all assumptions.

“Defined benefit plans and other postemployment benefit obligations represent significant long-term risks to the fiscal stability of schools, local governments and, indirectly, the state,” said Business Leaders for Michigan in a recently released report.

The report said Michigan’s pension funds’ unfunded liabilities were a major reason for the need to revamp the state’s pension system. It cited the Michigan Public School Employees Retirement System (MPSERS) and the state’s Municipal Employees’ Retirement System (MERS) as having unfunded liabilities of $25 billion and $3.6 billion, respectively.

The group said that other reasons for the need to change the pension system included unrealistic assumptions and increases in retiree benefits. Business Leaders for Michigan is composed of the chairpersons, CEOs, and senior executives of the state’s largest employers and universities.

“The assumptions supporting how much to be saved each year may be faulty,” said the report. “All assumptions supporting DB plans should be thoroughly reviewed. The percent rate of return assumed on DB plan assets is often criticized, but other assumptions, including the discount rate and assumed payroll growth, should not be ignored.”

According to the group, reducing the assumed rate of return for MPSERS by one percentage point increases the unfunded liability by 29%, from $25 billion to $32.1 billion, the equivalent of $40,000 per active plan member, or approximately one year of payroll for active plan members.

“However, keeping faulty assumptions in place because of concerns over the current cost of making a change is what leads to fiscal instability in the long term,” the report said

The report also said that “increasing benefits when employees are close to retirement can create a shortfall.” It said a common example of this are so-called “early out” programs, in which early retirement incentives that increase an employee’s retirement multiplier are offered in exchange for the early retirement.

In addition to pension funds, changes to other postemployment benefit (OPEB) obligations are also necessary, the group said, adding that Michigan’s unfunded OPEB liability for schools, cities, villages, townships, and counties currently exceeds $20 billion.

“Rising healthcare costs and an increasing ratio of retirees to active workers has resulted in OPEB liabilities consuming an ever-increasing share of government budgets,” said the report. “Funding OPEB shortfalls and, for that matter, DB plan shortfalls, means using current taxes to pay for services consumed in the past. Levying taxes on current residents without using the funds to provide services to those residents can make cities uncompetitive, leading to population loss.”

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Old 05-05-2017, 11:47 PM
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PENNSYLVANIA

https://www.ai-cio.com/news/pennsylv...ive-investing/

Quote:

Pennsylvania to Move $2.4 Billon in Equity Investments into Passive Investing

Pennsylvania Treasurer Joe Torsella is moving all of the treasury’s $2.4 billion public equity investment holdings to a passive investment strategy, which he says will save the state an estimated $5 million a year in fees.

“We shouldn’t treat investing public funds like a casino game, trying to ‘beat’ the market, and paying casino prices to do it,” said Torsella in a statement. “Instead, we should capture the underlying market return at the lowest possible cost. The broad strategic allocation of investment funds is the single most important decision for any investment portfolio. We can’t control investment performance or consistently beat the market, but the one variable we can control is costs.”

Torsella said the move will also reduce investment risk and improve return to taxpayers.

“Study after study has shown that a passive investment approach for stocks, by dramatically reducing the costs to taxpayers, has a high likelihood of performing much better than a high-fee active investment approach over the long term.”

According to the Pennsylvania state treasurer’s office, the total savings from shifting to passive investments would translate to approximately $195 million when compounded over 20 years.

Torsella instructed the state treasury’s investment team to transition all public stock holdings to passive strategies over the next six months. Approximately $1 billion of the total $2.4 billion equity portfolio is currently actively managed, and will be redirected to lower-cost passive investments.

Torsella cited research by Standard and Poor’s that shows over the most recent 10-year period, more than 87% of all actively managed US stock funds underperformed a broad market index.

“Overwhelming research shows that while some active managers will, of course, manage to outperform the markets in any given period,” said Torsella, “it is both extremely difficult for a manager to do so consistently over time, and extremely difficult for investors to identify which managers will outperform in the future. And trying to find those managers by looking in the rearview mirror doesn’t help.”

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Old 05-05-2017, 11:48 PM
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HOUSTON, TEXAS

http://www.click2houston.com/news/vo...d-amid-concern

Quote:
Vote on pension reform plan set for weekend


HOUSTON - Houston Mayor Sylvester Turner is going to Austin on Thursday to prepare for what could be the decisive battle in the city’s pension reform fight.

The showdown happens Saturday when the Texas House is scheduled to vote on the city’s pension reform plan.

Turner plans to spend the rest of this week lobbying legislators.

He believes that the House pension bill has the support needed to pass, but he said it’s not a done deal.

"We’re going to continue to contact the members, be in their offices, making phone calls, utilizing social media, encouraging the general public to contact members of the Texas House as well,” Turner said.

Turner said pension reform is needed to avert layoffs and reverse the city’s $8 billion pension deficit.

A similar version of the bill passed the Senate last week, with the addition of an amendment requiring police and firefighters to adopt what’s called a “cash balance” retirement system if their pension funds fall below a certain level.

Houston firefighters opposed that bill and oppose the one coming up in the House.

“The bill that is affecting firefighters is punitive and is a direct attack on firefighters," Marty Lancton of the Houston Professional Firefighters Association said.

Firefighters said the reform plan cuts too much in future benefits and uses their healthy pension fund to make up for deficits in those of police and municipal workers.

"At what point does it become unpopular to stand with firefighters, the men and women who put their life on the line every day? And that’s a decision they all have to make for themselves," Lancton said.

Saturday's vote will likely be the definitive test of political clout for both sides.

http://www.pionline.com/article/2017...on-reform-bill

Quote:
Texas Senate passes Houston pension reform bill

The Texas Senate on Monday approved a pension reform bill for Houston's three pension funds.

The measure passed the Senate by a 25-5 vote. The House is expected to vote on its version of the bill Saturday.

The bill includes benefit reductions for participants in the three pension funds that would help reduce the funds' $8.2 billion in total unfunded liabilities, according to a Monday news release from the mayor's office.

The pension reform package also requires Houston to make the full annual required contributions to the $3.8 billion Houston Firefighters' Relief and Retirement Fund, $3.9 billion Houston Police Officers' Pension System and $2.3 billion Houston Municipal Employees Pension System; adopts a 30-year closed amortization schedule to pay off the remaining unfunded liabilities across the three pension funds; and calls for the issuance of pension obligation bonds to further reduce liabilities.

The plan further reduces the pension funds' assumed rates of return to 7% from the current rates — which range between 8% and 8.5% — and would shift new employees to a new cash balance plan if the plans' funding ratios fall below certain levels.

Houston Mayor Sylvester Turner praised the Senate's passage of the bill on Monday. “Today, the Senate approved a locally developed and agreed-to solution that will place the city of Houston on a sustainable financial path,” Mr. Turner said in the release. The release noted that the bill has the support of two of the three pension fund boards.

David L. Keller, Jr., chairman of the firefighters' pension fund board, said in a statement on the pension fund's Facebook page on Monday that he was disappointed by the Senate bill's passage.

A spokeswoman for the mayor's office could not immediately be reached for additional information.


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Old 05-05-2017, 11:51 PM
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PENNSYLVANIA
CRIMINAL OFFICIAL

http://www.post-gazette.com/news/sta...s/201705040069

Quote:
Convicted state senator wants $20,509-a-month pension restored

HARRISBURG — Nearly five years after a longtime leader of Pennsylvania’s state Senate went to prison on a federal corruption charge, state officials are weighing the unusual step of restoring his $20,509-a-month pension.

The 11 board members who oversee the State Employees’ Retirement System are in the process of voting on the long-fought appeal by Robert Mellow, the Scranton-area legislator who lost the retirement benefit after he pleaded guilty in May 2012.

It’s unclear how long their decision will take or whether it will be made public; the SERS board’s next public meeting is June 14. “The board will deliberate for as long as it needs to,” said its spokesman, Jay Pagni.

Mellow, now 74, couldn’t be reached. A phone message left at a home listed for him Lackwawanna County wasn’t returned. His lawyer didn’t responded to requests for comment.

But if the appeal succeeds, he is likely join a small circle of Pennsylvania public servants to get their monthly payments restored.

Pensions have long been one of the perks of public office, and losing them standard practice for state officials-turned-convicts. Other prominent names to lose them after convictions in recent years include former House Speakers Bill DeWeese and John Perzel, former Sens. Vince Fumo and Jane Orie, and Orie’s sister Joan Orie Melvin, a former state Supreme Court justice.

Because Mellow’s conviction occurred in federal court, it gave him an argument many of the others didn’t have. He contended his crime wasn’t comparable to any of the state crimes listed in the pension forfeiture law.

“Conspiracy is not included in the list of offenses that result in forfeiture,” his attorneys argued in a filing with SERS. “The Pension Forfeiture Act ... cannot in any way be read to apply to conspiracy offenses.”

A similar argument has worked before. In 1999, Commonwealth Court reversed the pension forfeiture of a state corrections officer who had pleaded guilty to a federal charge of making a false declaration before a grand jury, finding that SERS was wrong to conclude the crime was “substantially the same” as the Pennsylvania crime of perjury.

Mellow served 40 years in the Pennsylvania Senate, rising to serve as president pro tempore in the early 1990s and for years as the Senate Democrats’ floor leader. Among the legislation to his credit was an early 1990s measure that prompted thousands of public school teachers statewide to accept early retirement buyouts.

After his decades of service, Mellow was entitled to $246,000 a year. Because he divorced in 2006, the monthly benefits were split: $11,579 for Mellow, and $8,930 to his his ex-wife, Diane Mellow.

He once had been seen as a potential gubernatorial candidate. When Mellow announced in 2010 he would not seek re-election, then-Gov. Ed Rendell praised him for contributing greatly “not only to his district but to the entire state.” And Mellow himself pronounced that he was leaving public office “knowing that I have always strived to meet a high standard of excellence.”

A few months later, federal agents raided his home and office. And early in 2012, he pleaded guilty to conspiracy to commit mail fraud and to defraud the United States. Prosecutors said he had used taxpayer-funded Senate staffers to raise money and work on political campaigns.

Mellow was sentenced to 16 months in prison. He was released from federal custody on March 14, 2014, prison records show.


http://www.washingtontimes.com/news/...sion-restored/

Quote:
Convicted state lawmaker wants pension restored

HARRISBURG, Pa. (AP) - A former leader of Pennsylvania’s Senate who served prison time for corruption is seeking to have his $20,000-a-month pension restored.
The State Employees’ Retirement System board is voting on the appeal by Robert Mellow, but it is unclear when they will decide, the Pittsburgh Post-Gazette reported Thursday. The 74-year-old Scranton-area legislator lost the retirement benefit when he pleaded guilty in May 2012.
After his decades of service, Mellow was entitled to $246,000 a year.
Mellow was charged with tapping Senate staff for political fundraising and campaign work in violation of state law. He continued misusing staff even as fellow lawmakers were prosecuted as part of the state attorney general’s “Bonusgate” investigation, in which lawmakers were accused of handing out taxpayer-funded bonuses for campaign work.
.....
His lawyers argue Mellow’s crime wasn’t comparable to any of the state crimes listed in the pension forfeiture law, because he was convicted in federal court.

Mellow was sentenced to 16 months in prison; he was released in March 2014.
But if the appeal succeeds, Mellow would join an extremely small circle of Pennsylvania public servants to get their monthly payments restored.
Others who lost their pensions include former House Speakers Bill DeWeese and John Perzel, former Sens. Vincent Fumo and Jane Orie, and Orie’s sister, former state Supreme Court Justice Joan Orie Melvin.


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