Thursday, 4:30 PM
Lawmakers look to close pension loopholes
By Lisa Wangsness, Globe staff
As a trio of their former colleagues fight for higher pension payouts, lawmakers are pushing back with a series of proposals to stop future state retirees from padding their monthly paychecks.
Lawmakers backing a pension overhaul say that recent high-profile controversies underline the need to keep officials from "gaming" the system.
Three retired lawmakers are seeking higher pension payments from the state, based on a court ruling last year that allowed former Senate president William M. Bulger to include the housing allowance he received when he was president of the University of Massachusetts as part of his pension calculation.
The legislative proposals include capping annual pension payments, preventing employees from earning generous benefits after just three years of full-time employment, and eliminating perks such as free parking or a housing allowance from the benefit calculation.
"I feel that public service is not an area where people are intended in the long run to get rich at the taxpayers’ expense," said state Senator Steven C. Panagiotakos, a Democrat from Lowell who has filed a pension overhaul bill.
The state retirement board is scheduled to vote Feb. 22 on whether former state representatives Marie J. Parente, Susan W. Pope, and Thomas N. George should be allowed to include perks such as parking spaces, office stipends, and travel expenses as part of their income for the purpose of pension calculations. Pensions are based on an employee’s age, years of service, and salary during the three highest-earning years.
Concerned about the implications of the Bulger lawsuit, Treasurer Timothy P. Cahill has been working with Senators Michael W. Morrissey, a Democrat from Quincy, and Robert A. Havern, a Democrat from Arlington, on legislation to narrowly define "compensation" as salary, not fringe benefits. Cahill said officials do not make pension contributions on their perks, as they do on their salaries, so they should not ask the pension system to pay them returns on money it never had a chance to invest.
If the three lawmakers prevail, Cahill said, the state could be faced with a wave of similar claims. And even if the Legislature adopts changes, he acknowledged, officials who earned perks prior to the change could still collect.
"It really opens the door to not only any elected official, but any appointed official who gets any kind of nonsalary compensation," he said. "There are probably hundreds of police chiefs, fire chiefs, mayors -- I mean, anyone that gets a car."
