States act to curb 'double dipping'
By Brad Heath, USA TODAY
States pummeled by the recession and heavy job losses are moving to bar government employees from "double dipping" the practice of collecting a pension and a paycheck at the same time.
The new rules are meant to curb employees from retiring only to return to their old jobs. They come at a time when unemployment has climbed to its highest level in 25 years.
It's impossible to determine exactly how many government employees also collect pension benefits, but some of the states that studied the issue have identified thousands of workers.
"We have to fix the mess we've made," says Utah state Sen. Daniel Liljenquist, the chairman of a committee that oversees the state's pension system.
Utah lawmakers will consider an overhaul when they convene in January. "It will happen, because it's something we have to do," Liljenquist says.
Officials in other states are taking similar steps:
New Mexico Gov. Bill Richardson proposed changes in November that would bar new government retirees from double dipping. State legislators had already backed a broader plan that would also have limited current retirees.
The board that runs South Dakota's public retirement system will meet this week to consider changes that would make public employees wait four months after they retire before seeking a new government job.
Florida Gov. Charlie Crist signed a law in June that requires new retirees to wait at least six months before returning to work.
Arkansas lawmakers are considering a measure that would stop elected officials who quit from returning to work. "They don't even empty out their desk," state Rep. Allen Kerr says.
Jon Greiner retired as police chief of Ogden, Utah, in 2002 to start collecting benefits, then immediately returned to his job. Greiner, also a state senator, says there's nothing wrong with that arrangement, and that lawmakers shouldn't use the laws to punish public employees. He is currently paid $107,000 annually as police chief; he estimated he makes about $4,000 a month from the pension.
A state audit in Utah identified more than 4,300 public employees in the state who also collected public pensions. A review in Florida found more than 9,000 among them, prison wardens, college officials, and the former chief judge of the state's highest court, according to The St. Petersburg Times.
The nation's state and local retirement systems lost about $800 billion in 2008, says Keith Brainard, research director for the National Association of State Retirement Administrators.
Employees who double dip tend to collect benefits sooner, though Brainard says it has a "relatively small" impact on the overall cost of pension plans.
South Dakota's planned changes will save only about $5 million a year, says the system's executive director, Rob Wylie. New Mexico's proposed changes would save about $7 million. Elsewhere, the bill is bigger: An audit this year for Utah lawmakers suggested that double dipping by employees there could cost the state as much as $900 million over the next decade.