Republicans make their PERS move. Kitzhaber … ?

Plan C: Retire today. You have to drive to Salem and submit the paperwork at PERS by COB today. Rumor is that it will be a madhouse, get there early. Then submit your TRP plan retroactively like UO let Frohnmayer do (surely Doug Blandy will do the same for the rest of us, though he won’t answer my email about it) and get another part-time job to supplement your PERS.

Retirement forms etc. are here.

5/31/2013: Hannah Hoffman reports the Republican plan includes a cut in the annuity rate from 8% to 4%:

Their plan also calls for employee contributions to be redirected from their individual accounts into the main PERS fund; for Money Match accounts to be annuitized at 4 percent, rather than the current 8 percent; and to prohibit employees from using unused vacation time or more than 40 hours of unused sick leave in calculating their final salary.
Kotek and House Majority Leader Val Hoyle, D-Eugene, have been clear in the past that none of these ideas resonate well within their party.

That did not seem to deter Republicans. Ferrioli said they were searching for the “sweet spot” on PERS reform and weren’t in any rush to do it by the end of June, the tentative date for ending the current session.

“Getting it done on time is not nearly as important as getting it right,” he said.

So, perhaps there will be a window to retire early and get the 8%, if this does go through? What a mess.

5/30/2013: Christian Gaston and Esteve have more details here. This new story seems to suggest the inactives would indeed get screwed.

5/30/2013: Harry Esteve reports in the Oregonian: Is it just me or does he seem a bit skeptical?

Republicans legislative leaders unveiled their version of public pension reform Thursday, a plan that relies heavily on ideas that Democrats already have rejected as unconstitutional, unfair to retirees or politically infeasible. …

The bulk of the savings in the Republican plan would come from nearly doubling the cuts in cost-of-living increases for PERS retirees.

Under a plan that passed with all Democratic votes, retirees who get more than $20,000 annually in PERS benefits would face smaller caps on yearly increases. The current cap of 2 percent stair-steps down at higher benefit levels. In all, the plan shaves $460 million from the cost of PERS over the next two years.

The Republican plan calls for steeper cuts, with stiffer limits after the first $20,000 in annual benefits. It would add another $447 million in savings to the Democratic plan.

Other elements of the Republican proposal include reducing benefits for PERS members who no longer work in public jobs, reducing the employer contribution to PERS accounts and ending the practice of counting unused sick leave and vacation time toward retirement benefits.

I think this means the inactive definition wouldn’t apply to current faculty? And the last doesn’t matter to the MM folks. But an end of the 2% COLA for amounts over $20K would seriously cut benefits. Assume you retire at 65 with $60K PERS. Currently you’d get $87.4K at age 85. Under this plan you’d get $69.1K – very unlikely to keep you even with inflation, not that I’m a macroeconomist.


5/29/2013: State offers SEIU swap of 6% retirement pickup for 6% raise. I don’t get the point of this. Anyone?

And my post below is a little too paranoid – this is nothing new, just a centralization of existing special plans to work around IRS limits on the amount of income these highly paid employees can shelter under regular retirement plans. See below for OUS Counsel Ryan Hagemann’s prompt response.

5/28/2013: Meanwhile, deep inside the bunker, OUS plans a figures out how to maintain their special supplemental retirement scheme for presidents and coaches after an OUS break-up:

and spends taxpayer’s money on an administrator to run it for them:

OUS Chair Matt Donegan will be at Matt court for President Gottfredson’s Investiture. If anyone goes, give him a shout-out about this.

And maybe Chancellor Melody Rose knows what’s up:

From: UO Matters
Subject: retirement plan for coaches and presidents, public records requestDate: May 28, 2013 8:46:27 PM PDT
To: “Melody_Rose@ous.edu”
Cc: Ryan Hagemann , Charles Triplett , Diane Saunders

Dear Chancellor Rose:
I saw in the announcement of the 3/15 meeting for the Board Committee on Governance & Policy that there was to be discussion of a special retirement plan for university presidents and coaches: http://www.ous.edu/sites/default/files/state_board/meeting/letters/call130315-GPFA.pdf and that OUS was hiring an administrator for this.

I’d appreciate it if you could ask your public records officer, Chuck Triplett, to send along any public records describing this plan or proposed plan.

I ask for a fee-waiver, on the basis of public interest in retirement plans, which is currently quite high given the various proposals to cut PERS for state employees.

From OUS Counsel Ryan Hagemann:

The reference to retirement plans in the March 15, 2013 Governance & Policy Committee docket was not a proposal to create a new retirement plan. The plans listed are existing plans of the Oregon University System. The materials were included as part of a discussion of services that might be shared if one or more of the OUS institutions achieves an institution board. Because retirement plans-now administered across the system-are complex and touch on the lives of employees, the Committee thought it a reasonable place to start in approaching the principles and substantial work that would be necessary to conceive of shared services. I have included the links to the materials that were used for this discussion on shared services and retirement plans.

http://www.ous.edu/sites/default/files/state_board/meeting/dockets/ddoc130315-GPC_SSE_Retirement_Plans.pdfhttp://www.ous.edu/sites/default/files/state_board/meeting/dockets/ddoc130315-GPC_shared_services_pension.pdfhttp://www.ous.edu/sites/default/files/state_board/meeting/dockets/ddoc130315-GPC_multiple_employer_plans.pdf


5/28/2013: Peter Keyes (Architecture) sends his analysis of the possible PERS changes:

How a long-term, full-time faculty member in the OUS system could get hammered by changes aimed at “inactive” PERS members.


Background: The Optional Retirement Plan (ORP)

In the early 1990s, the State of Oregon instituted the Optional Retirement Plan (ORP) for faculty
and some administrative employees of the OSSHE (now OUS) Oregon University System. This
was a defined-contribution plan, in contrast to the defined-benefit feature of PERS. This has a
good feature for the employees, who would have a portable retirement plan which could follow
them to another state if they changed jobs (which often happens with young academics). It also
had benefits for the State, as it would greatly reduce the amount of money the State of Oregon
would contribute to these employees’ pensions in the long run. The ORP can be seen as the
first of the actions that the State subsequently took to reduce its PERS liabilities.
Tier 1 PERS employees had to make an irrevocable decision to enter the ORP program by
September 27, 1996. If they did, henceforth the State would place an amount into the
employee’s ORP account that was equivalent to the amount the employer would have continued
to contribute to PERS if the employee had remained. (This amount comprises both the
employer’s contribution, and the State’s “pick-up” of the employee’s 6% contribution.)
If employees were vested in PERS, they had the option of transferring the balance of their
PERS Employee Accounts into their ORP accounts (in which case they would “…forfeit the
existing balance in my Oregon PERS Employer Account and I forfeit all rights to future Oregon
PERS benefits..”), or leaving that balance in their now “inactive” PERS account, and be eligible
for future PERS benefits. Any amount left in PERS would continue to receive the return on
investment, either in the variable account, or the fixed return of 8%.
Some employees kept their PERS accounts, conservatively hedging their retirement bets by
having both a defined-benefit (PERS), and a defined-contribution plan (ORP). The terms of the
“inactive” PERS deal were clear – if one was in the 8% fixed account, one’s balance at
retirement could be calculated in advance, as could the Money Match and Full Formula benefit
calculations. This was the benefit – calculated according to the rules set up by the State – that
many of us have counted on in all our long-range financial planning over the past 16 years.
The proposal: eliminating the Money Match Option for “inactive” PERS accounts
If the legislature goes forward with the proposal to eliminate the Money Match Option for
“inactive” PERS accounts, ORP members will have to use the Full Formula Option, which will
base their PERS benefit solely upon their highest salary and years of service before they
entered the ORP. The Full Formula Option was intended to be used by active employees,
based upon their salary at retirement, not what their salary happened to be 16 to 30 years
before their retirement. The Money Match Option allows one’s Employee Account to
compound until retirement, then uses the same annuity formula for that balance as is used by all
other PERS members.
What are the costs and benefits of the ORP?
How much money does the State save by having these employees who opted into the ORP,
and how much do these members stand to lose? Let’s look at two employees whose cases
define the range of current employees in the ORP:
  • A faculty member who began employment in 1978, switched to the ORP in 1996, and plans to retire in 2013. This faculty member essentially has the first half of her pension in PERS, and the second half in the ORP.
  • A faculty member who started work in 1990, switched to the ORP in 1996, and plans to retire in 2025. He had passed the years of service for vesting in PERS, but had a relatively small PERS balance in 1996.

Each of these employees has already saved the state a lot of money by opting into the ORP. If
we assume a 20-year life expectancy after retirement, how much does the State save on
pension costs for each of these employees, under the current rules, which maintain the Money
Match option?
Current ORP condition compared to base-case PERS
So the decision of faculty members to go into the ORP turns out to have been very good for the
State of Oregon, while it turns out to have been not so good for the employees, who can expect
a retirement income that will be between 10% and 24% less than if they had stayed in PERS.
(Note that this is not just the decline in PERS income, but in total income, including from ORP.)

Costs and benefits of eliminating the Money Match for “inactive” PERS accounts
However, now the State is thinking of changing the deal the faculty signed on to, eliminating the
Money Match option for “inactive” employees. How much money will the State save by doing
this? And how badly will this hurt current employees in the ORP? The numbers are rather
shocking:
The only possible conclusion is that the elimination of the Money Match Option for OUS
employees who opted into the ORP and so became “inactive” PERS members will result in a
retirement income that is 33% to 55% less than they were planning on (and had been
promised), and 49% to 60% less than if they had stayed in PERS. This is for people who
stayed at their university as full-time employees, for 35-year careers.
Immediate Effects on the University

Many ORP members nearing retirement in the next few years are considering retiring
immediately, as the deadline for putting in retirement papers is June 1. If the elimination of the
Money Match is not publicly taken off the table quickly, we may see a large exodus of key
faculty members this week, as they will not want to risk up to 55% of their retirement income.
Peter Keyes

May 26, 2013


To find your current PERS balance and calculate possible annuity payouts use the official PERS calculator: https://orion.pers.state.or.us/SelfService/viewPage?component=/mhome.jsp&dialog_id=DState_44&mode=MBR

Hannah Hoffman delivers more potentially bad news about PERS, and every other state pension plan.


5/27/2013: Saul Hubbard on PERS politics in the RG:

Roller-coaster nego­tiations over how and how deeply the state Legislature should alter the Public Employee Retirement System this year have taken another twist.

Oregon Democrats have declared themselves open to one final avenue of PERS reform, if the minority Republicans agree to provide the needed votes for $200 million in tax increases, probably aimed at high-income individuals and big businesses.

The Democrats’ new PERS proposal, first presented by Democratic Gov. John Kitz­haber, would eliminate, or greatly reduce, the “money match” retirement formula for “inactive” PERS members – most often former state employees who haven’t yet retired, meaning their PERS pension accounts are still open.

Good article, seems like anything could happen. Harry Esteve has more in the Oregonian.

5/27/2013: TRP not such a good idea?

I’ve suggested that faculty with who switched from PERS to ORP in 1996 might want to consider retiring and going on the TRP before the legislature acts, to try and lock in their annuity at the current 8% rate. I just learned of one disadvantage of the TRP, from Ernie Pressman:

The ORP Plan document is clear that no contributions can be made to the ORP after faculty finish the tenured full time part of the program (up to 3 years). You can take a distribution from the ORP after the 3 years are up, but no further contributions until after the 5 year/3000 hour time is over. Same is true of PERS. Once an employee begins to take a PERS benefit no more contributions are made.

Currently for Tier 1 facult UO pays about 22% of your salary, pre-tax, into the ORP. But that stops when you got on TRP. This reduces your effective pay while on TRP by 18%. Additionally, once you start taking the PERS benefits (typically when you start the TRP although I think that’s flexible) the total money match amount is locked in, so you lose what is (currently) an effective 16% rate of return on that, and in addition your annuity is reduced because you started taking it at a younger age.

Maybe I’m missing something, but the TRP is starting to look like a pretty lousy deal. Including retirement contributions, the payoff from putting in another 1.5 years at full time and then retiring is 22% higher than the payoff from working 3 years at 0.5 FTE under the TRP, without the contributions. But of course you do get a 6% raise when you commit to retire within 3 years. So if you know you are going to retire within 3 years you should sign the TRP papers now. In a pinch you could always get in another 1.5 FTE after that. (One person told me that UO used to make contributions for TRP people but stopped a few years ago.)

The TRP agreement is here. I couldn’t find anything about how it affects your UO health insurance – you get it for the quarters you are teaching? If you do 0.5 FTE TRP in a year do you get health benefits for the whole year?

If you have a lot of pre 1996 years it still might might sense to try and jump the gun on the legislature. But for others it might be worth sticking it out, collect the UO contributions, and hope that the annuity rate cut is not all the way to 4% and that the courts will rule the cuts are illegal.


5/26/2013: Ted Sickinger reports on the PERS machinations in the Oregonian.

DOJ doesn’t want to defend cuts just to inactives in court – easier if the cut is to everyone. Kitzhaber’s plan to cutting the assumed rate from 8% to 4% is back on the table. This means everyone close to retirement that has any PERS stake, active or inactive, should be thinking about retiring immediately, before the bill gets through. July 7 is the last day of the session.

5/26/2013: Questions to VPAA Doug Blandy on retroactive TRP and sabbatical repayments:

From: Bill Harbaugh
Subject: retirement rulesDate: May 26, 2013 9:00:34 AM PDT
To: Douglas Blandy
Cc: Ernie Pressman , Russ Tomlin

Hi Doug –

I assume you’ve been following the possibilities of substantial PERS changes that might result in large reductions in retirement income for many UO faculty. From what I’ve been reading it seems possible that the legislature might implement change very quickly, and that it might therefore be very advantageous for a fair number of faculty to go on the TRP immediately, before they are in place.

The attached TRP contract for former President Frohnmayer shows that your predecessor Russ Tomlin allowed Frohnmayer to enroll in the TRP program retroactively. I am wondering if UO has done this in other instances, if UO will extend that same courtesy to other faculty if this legislation advances, and what the rules for such retroactive enrollments are.

I hope you can provide a quick explanation for the faculty, given the speed of events and the potentially large amounts of money that are involved.

Thanks,
Bill Harbaugh

And:

From: Bill Harbaugh
Subject: year of return after sabbatical?
Date: May 26, 2013 11:02:53 AM PDT
To: Douglas Blandy
Cc: Ernie Pressman , Russ Tomlin , Gary BLACKMER

Hi Doug – A second retirement question:

UO has traditionally told faculty that they must return for a full year at full-time after a sabbatical, or pay back their sabbatical salary. Secretary of State auditor Gary Blackmer has said that, actually, the relevant OAR (OAR 580-021-0220) just requires faculty to return for a year, and is silent on that year being full-time or part-time.

Your predecessor Russ Tomlin has said that UO interpretation of the rule has sometimes not been enforced, and that some faculty have been allowed to use one quarter of part-time TRP time to count towards the year of return requirement.

My question is this: Will UO allow a faculty member to use a full year of TRP work, even if only at 1/3 time, to complete the year of return sabbatical requirement, as the OAR rule allows?

Given the news from Salem on PERS cuts, this issue may be crucial for at least a few UO faculty, and I would appreciate a speedy reply. There is more info at https://uomatters.com/2013/05/kitzhaber-plan-to-throw-orp-faculty.html#more

Thanks,
Bill Harbaugh

5/25/2013: Frohnmayer retirement loopholes may help some ORP victims by allowing retroactive 600 hour retirement contracts and part-time work to satisfy post-sabbatical employment rule.


Also see the latest PERSinfo blog post, here, and Hannah Hoffman’s blog at the Salem-Journal, here.

Disclaimer: This is not financial advice, but it is something to think about very seriously.

If Kitzhaber’s plan to eliminate the money match for inactive PERS members gets through the legislature, many UO faculty who switched into the ORP (TIAA-Cref, Valix, Fidelity etc) in 1996 may find themselves facing cuts in retirement income of as much as 50%. The PERS spokesperson has said that these people will likely be considered inactive, and therefore lose a huge chunk of PERS income, at least given the most recent language he’s seen.

One way out would be to immediately retire under current rules, and go on the 600 hour program. This allows you to work between 1/3 and 1/2 time for up to 5 years after retirement. (So, for example, 5 years at 1/3 time, or 3 years at 1/2 time). This will be particularly attractive because the PERS hit increases the earlier you started at UO before 1996. Faculty close to retirement face the largest potential losses.

It’s quite possible the bill could take effect in a very short period of time, giving people only a week or so to get this done. If you are anywhere close to retirement you might want to talk with your dean and prepare the 600 hours paperwork, which takes quite a while. You don’t have to sign it yet. As explained below, VPAA Russ Tomlin let Frohnmayer sign his retroactively, but that doesn’t mean you’ll be allowed to!

Another issue is that OUS rules and UO sabbatical contracts require you to repay your sabbatical earnings unless you work at UO for a year afterward. The VPAA has traditionally told faculty that returning on the 600 hours program does not count, you have to work full-time as a regular employee. So if you took some sabbatical time this year – even just one quarter – you could be in a serious bind: take the PERS hit, or repay $60K or so to UO.

Fortunately, Dave Frohnmayer may have found a loophole that could work for others as well. His retirement contract did not include the clause about repayment of sabbatical money. He took the sabbatical his last year of regular employment, then retired and went on 600 hours. Back in 2011 I asked the state Audits Division to look into this and see if he should have to repay UO.

Their report noted that his contract should indeed have included this clause, but that he didn’t have to repay anything because he had returned to UO for a full year of work afterwards. My take on their interpretation of the rules was that the VPAA had been misinterpreting them. One full year of post-retirement employment under the 600 hours program, even though it’s not full time, satisfies the post-sabbatical requirement.

So, if you do decide to prepare for the potential loss of a major part of your PERS benefits by preparing to retire immediately, ask your dean and VPAA Doug Blandy if UO will also apply this interpretation to you, and count a year of 600 hours employment as satisfying the post-sabbatical employment requirement.

Here is the mail from the auditor:

From: “Sandra K HILTON”
Subject: Audit Manager ContactDate: December 1, 2010 1:27:22 PM PST
To:
Cc: “Gary BLACKMER”
** Confidential **
Dear Mr. Harbaugh,
I wanted to let you know that I am the audit manager at the Oregon Audits Division that is your contact person for the concerns surrounding former President Frohnmayer’s contracts. If you have any additional documentation, you can forward it to me. Also, I would appreciate it if you could direct me to the appropriate OAR or OUS Policy that requires sabbatical salary to be returned if the academic staff member does not return to regular full time employment. I reviewed OAR 580-021-0220 which requires the staff member to return to the institution for a period of at least one year, but I do not see anything that specifies service must be full time. Thank you.
Sincerely,
Sandra Hilton, CPA
Audit Manager
Oregon Audits Division
(503) 986-6359

VPAA Russ Tomlin’s earlier email on this:

From: Russ Tomlin <tomlin@uoregon.edu>
Date: August 16, 2010 10:10:51 AM PDT
To: Bill Harbaugh <wtharbaugh@gmail.com>
Subject: Re: Public Records Request – Current Frohnmayer Employment
Contract
Bill–
Just back from vacation this morning.
Prior practice on sabbatical has permitted faculty to count one term
(or semester) of TRP service toward the required one-year continued
service after sabbatical. I have approved this for a couple of cases on
my watch, following prior institutional practice.
–Russ

In addition, VPAA Russ Tomlin allowed Frohnmayer to sign his 600 hours contract retroactively. I can imagine that this courtesy, while it sounds a little dicey legally, could be extremely important if the Kitzhaber legislation does go forward:

The full set of Frohnmayer contracts and the auditors report are here.

5/23/2013: Kitz plan gets more support. Hannah Hoffman reports. No updates on whether or not this would affect the many current UO employees who shifted from PERS to ORP in 1996.


5/20/2013: Panic update: Hannah Hoffman reports that negotiations are on again. One mathy prof reports that this would cut his retirement income by 40%.

5/16/2013: Hannah Hoffman has the news that Kitz has bailed on this plan. The Republicans aren’t willing to raise taxes on the richest 2% in exchange. And state tax revenues are up. And the stock market is up so much that PERS is back to looking fairly robust. Many people are wanting to buy shares while the economy is in a good place which is driving the economy up even more. So PERS looks safe for this session at least.


5/15/2013: Too early to panic, but many UO faculty switched from PERS Tier 1 to ORP in 1996 when it was introduced. Their PERS balances have accumulated since then, and when they retire they typically use the money match formula, which doubles the balance, which they then take as an annuity. This is presumably how people like Dave Frohnmayer get $257K a year in PERS, even though his salary when he left the plan was only $121K. Obviously the deal for most faculty is considerably smaller, but still potentially $50-60K a year. The reports on Kitzhaber’s new plan say it would prevent people who have left PERS from getting the money match. Instead they’d have to use a considerably less generous plan, based on their last years of earnings while in the plan – i.e. 1996. No inflation adjustment! Would this also apply to UO faculty who switched out but still work for the state? Not yet clear. Also not clear if this will get through the legislature – the Democrats and unions are opposed, but it may be the price of income tax increases for the top 2%.

OK, start panicking. In response to a Q from UO M, former UO student journalist Hannah Hoffman, now at the Salem Journal and the reporter of the best piece on this so far, offers her interpretation:

… “inactive” is anyone no longer in the PERS system. That would include anyone who left it for another retirement plan. If the employer isn’t making contributions to PERS for them, and they aren’t contributing to PERS, they won’t count. It’s all preliminary, and there may be exceptions, but it looks like it would apply to these faculty.

Or maybe not quite yet: Ernie Pressman from HR, one the many excellent UO administrators who keep this place working, and are not afraid to answer questions, reports that he is on it:

I am acutely aware of this situation and am working with OUS on the definition of “inactive” and how that applies to ORP participants.

Or maybe panic right now: response to a query from Hannah Hoffman, from PERS spokesperson:

From: David CROSLEY <david.crosley@state.or.us<mailto:david.crosley@state.or.us>>Date: May 16, 2013, 9:34:13 AM PDT
To: “Hoffman, Hannah”Subject: Re: Question about inactive members

Hi Hannah:
If a non-vested Tier One or Tier Two member elects the OUS Optional Retirement Plan (ORP), the member’s account is transferred to the ORP and membership in PERS is terminated.

Vested Tier One or Tier Two members who elect the ORP may leave their PERS accounts intact or transfer their accounts to the ORP. Those who leave their accounts with PERS become inactive PERS members. To the extent any legislation affects inactive members, they would be affected as would any other inactive member, with the hedge that the actual impact cannot be determined until the actual text of a bill is reviewed. Vested members who transfer their accounts to the ORP terminate PERS membership.

Best regards,
David Crosley

There’s more in the persinfo blog here, under “Train Robbery”.

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74 Responses to Republicans make their PERS move. Kitzhaber … ?

  1. Mike Kellman says:

    This is no small matter — as reported in a case example in the Statesman Journal, people could lose 90% or more of the money they thought they would be getting from PERS.

    It would put almost the entire burden of PERS cuts on a small class of PERS members — “inactive” members who are no longer public employees but haven’t started drawing PERS.

    I have no idea how this would apply to ORP faculty — I don’t know if they’d thought it through that far. I don’t see how it would stand up in court, but I’m neither an attorney nor an economist!

    A very good time to contact relevant legislative people, Kitzhaber is demanding to move very quickly.

  2. Anonymous says:

    Back of the envelope, anyone thinking of retiring in the next 5 years should keep an eye on this, and consider going on 600 hours before this change takes effect.

  3. Anonymous says:

    Well, how does 600 hrs. apply to ORP people? I am completely ignorant. I can see possibility of getting totally screwed by Kitzhaber plan.

  4. The Truth says:

    Plenty of cash wll be left in PERS for Belotti and Frohnmayer though!

  5. daffy duck says:

    If this idea includes ORP members, then it is already too late to retire under money match if it is eliminated as of june1. If an ORP member retired yesterday, the earliest effective date would be June 1–screwed in my sleep?

  6. Anonymous says:

    This comment has been removed by a blog administrator.

  7. Anonymous says:

    Why are they targeting inactive members only? It’s breathtakingly cynical. The latest Statesman Journal article gets it:

    “Notably, the people affected would not be members of politically powerful public-employee unions because they no longer work for the government.

    The leaders of the Service Employees International Union released a statement saying they remain opposed to cutting retirement benefits, but praising the governor’s push to raise taxes.”

    I

  8. Anonymous says:

    Let’s hope OUS puts out a statement soon, with backup from Ernie Pressman for UO. Otherwise, the lawsuits will begin even before the legislation is passed. The Governor may think he can evade the unions by attacking “inactives” but if active faculty members are included, many of them will have their own unions actively backing them in the courts.

  9. Anonymous says:

    It is clear that the state government is out to screw a certain class of people, namely inactives. Whether the Democrats mean this or are just trying to wrest tax increases from the Republicans before the court declares the PERS changes null and void, it’s likely to become very nasty. People should read that blog that UOMatters posted. The Assoc Or Fac and the unions need to get on this right away.

  10. Anonymous says:

    What about those of us who have been employed all along but who can no longer contribute to PERS due to having that option ended? We may be Tier 1 and now are in the IAP. Will contributions to the IAP suffice to make us “active” PERS members?????

    • Anonymous says:

      Sounds like you are an ORP member? Then they have you in their sights, they are out to screw you out of a good chunk of your PERS pension, maybe almost all of it. Better keep informed, consider early retirement if that’s possible, be ready to support the class action suit.

    • Anonymous says:

      Oh calm down people. They are talking about eliminating the money match for people who were in PERS but no longer working for the State. IF you are still employed by OUS this is not you. Also you have to ask, IS it fair if someone made $2,000 a month 10 years ago but due to money match will be now earning $2,000 or more per month in retirement? What is a reasonable retirement expectation? 100% of salary is probably more than what was bargained for (remember the target amount was about 60% of salary at retirement.

    • Anonymous says:

      Oh, stop frothing, last poster. You don’t know whether it applies to people working for OUS or not. The opinion from a state employee posted above by UOM certaintly doesn’t agree with you.

      And your comment shows complete ignorance of factors like inflation, compounding, time of compounding. If you get paid in 2012 dollars according to the formula for money that was earned in 1982 dollars and invested and compounded since then, you are going to get screwed.

      And even if it doesn’t apply to OUS people the other “inactives” — mostly, little people, litter than UO faculty — are targeted to get screwed.

  11. Peter Keyes says:

    I just checked the numbers on my retirement projections. If this goes forward to eliminate the Money Match option, and ORP members are considered “inactive”, my annual pension payment from my PERS account will decline 91%, leading to a likely 33% overall decline in my annual retirement income.

    This is particularly galling since my electing to go into the ORP, instead of continuing with PERS, will probably save the state over $1 million (present-valued) over my lifetime, even with the Money Match option still intact. So I made this decision back in 1996, which turns out to have been a good deal for the state, and a bad deal for me, and the state is now trying to make it even worse.

    I’d suggest that you try to understand how this change will affect you, and I’d strongly suggest calling your legislators immediately.

    • Mike Kellman says:

      All true, Peter.

      The Governor’s PERS “reform” plan — actually, cheating thousands of people out of most of their retirement, many of them people like you who did the state a favor by electing out of PERS, entirely in good faith — has been “tabled” for now, due to the moral and financial imbecility of most people in the Legislature, of both parties, and of course, most noteworthy of all, the Governor himself, who more and more shows signs of derangement.

      But be assured, these people, who are no better than elected gangsters, will be back. It behooves people like you to keep on top of this, be prepared to act quickly. As you say, contact your legislators immediately to apprise them of how awful this scheming is. I did it myself this morning.

    • Mike Kellman says:

      In case it’s unclear, what I meant in referring to the “moral and financial imbecility of most people in the Legislature” is that the various parties more or less, for now, have cancelled each other out, resulting in a good, again for now, outcome. Some of them of course are undoubtedly more blameworthy than others, and some probably deserve some credit.

    • Peter Keyes says:

      Classic. Saved by the Republicans, who kaboshed the deal, because it didn’t screw enough PERS recipients badly enough.

  12. Mike Kellman says:

    Despite the Governor’s apparently giving up, I think there could be another attempt soon at PERS “reform.” The Oregonian is certainly pushing that.

    Itt behooves the UO union — though I’m not a member, as far as I know — to get very up to speed on pension matters, after what happened with the “inactives” proposal. Also the other faculty unions, the AOF (do they still exist?). Work with SEIU (which has been vocal) and AFSCME.

    As it happens, I’ve learned a fair bit about the workings and status of PERS, much more than I ever wanted to. Their current workings basically insure that government agencies will come under stress from rising PERS rates — even if the PERS trust fund is rapidly improving due to good market returns — as it has been the last 16 months.

  13. Anonymous says:

    Dog says

    This is of course, very confusing. In my own case, I transitioned out of Money
    Match being the best deal to Full Formula as the best deal. As far as I know,
    if your on full formula then the cut to the assumed earnings rate for PERS is
    irrelevant. However, if you are on Money Match, that cut is quite significant –
    specifically your probably losing 10-15K in retirement benefits if 8% goes down
    to 4% – personally I don’t think that legislation will be passed.

  14. really pissed off guy says:

    If they really do go from 8% to 4%, it will cut pensions by about 30%.

    For a lot of people, especially those with other assets than PERS, it really might be better to take a “double lump sum” — employee account + employer match — and, if it can still be kept in tax deferred status, i.e. shifted to TIAA or such with no penalty — am looking into this — try to earn the 8% yourself.

    Hell, the way the market is going, 25% a year until it ends! — you might be able to do a lot better than PERS would do for you honoring the deal you thought you made with them!

    At this point, as an ORP person and very much an Inactive PERS member, I might be happy to have my PERS stake as a lump sum, to manage on my own like my ORP account — and say to hell with this wretched state forever.

  15. Anonymous says:

    Who says Oregon can’t elect a Republican governor? I think we have had Republican for the last 20 years in the governors mansion… That is when he is not too good to live in the governors mansion and needs to stay in Portland closer to his corporate handlers.

  16. never wanted to know this much about PERS says:

    rpog is right about a shift 8% –> 4% meaning a 30% reduction in the Money Match pension — and has an interesting perspective on taking a lump sum — but I believe UO Matters is not correct about this being a proposal of the Governor. It is a proposal of the Republicans, according to the reports I’ve been following. As such it is unlikely to be adopted, especially since it is very likely indefensible in court. If they can continue the 8% guarantee for unretired PERS accounts, how can they discontinue it for retirees?

    More likely is an attempt to reduce the rate for ALL accounts, unretired and retired. There is talk that the PERS board itself will try to do this — to 7.75%, 7.5%, or even 7.25.

    The theory being that long-term market returns have declined from their historic 8.0% rate.

    Of course, nobody knows what the yearly market return is, until after the fact, or the long-term return — lately, the stock market has gone up by 150% in 4 years — recovery from the crash and all that.

    • Anonymous says:

      I would not be so sure. PERS cuts are this governors hallmark. His “Governor’s Balanced Budget” was built on the backs of state workers taking the brunt of the cuts, especially here in higher ed where the pain can just be passed on to the students. I have heard it does not matter if the cuts will pass legal muster because as long as the changes have not been overturned the books will balance in the short term, pushing the losses out into later budgets and governors, perhaps in the belief there will be more cash in the coffers at that time.

    • never wanted to know this much about PERS says:

      You may be right about them not being concerned about the legality — but then that is just another example of the shitass-flavor-moonshine-drenched (SFMD) thinking that seems to rule this increasingly hapless and inept state.

      Because if they do spend the money, and it is overturned in court, it will be a disaster a few years down the line — exactly what the PERS bashers say they are trying to avoid.

      You may be right. My guess is the Gov was simply trying to lure the Republicans into granting tax increases in return for his preposterous “Inactives” PERS offer.

      Apparently both the Republicans — see Ferriolli’s statement — and the Oregon School Boards Association — which both have PERS in their sights — have seen the Gov’s proposal for the scam it is, sniffed it, and said no thanks.

      I believe the reason the Gov shifted to the Inactives plan is that Kotek and the legislature have been unwilling, so far, to go either for his other proposals for monkeying with the current PERS benefits; or the Republicans’ much more draconian ones (8% –> 4% “annuity rate” = 30% pension cut for new retirees, probably illegal, see elsewhere for explanation).

      Now that the “Inactives” proposal apparently has dropped off — maybe the Gov laid off the moonshine long enough to have it explained to him how cuckoo this was — they seem to be coming back to his earlier ideas. Will be interesting to see if the Republicans or the Legislature will be ready to budge now.

      Remember, Kotek said she’d budged enough — then seem open to the SFMD plan — will be interesting to see where, if anywhere, her head is.

  17. Anonymous says:

    Bill, you wrote: “This means everyone close to retirement that has any PERS stake, active or inactive, should be thinking about retiring immediately, before the bill gets through.”

    There is no bill to change the 8% to 4% for employees who are active employees, rights? This is about “inactives.”

    So why would you say “active or inactive” in that sentence?

    • UO Matters says:

      “Bill?” If you’re going to comment anonymously, at least give me the fig-leaf of “UO Matters”!

      My understanding is that the plan to just hit the inactives got panned by the DOJ and is now unlikely to get passed.

      The latest plan involves lowering the interest rate used to calculate annuities for all future retirees from 8% to ?%. This was the idea in the original Kitzhaber plan. By lowering future payouts PERS is on a better actuarial basis, and can immediately lower the amount employers have to contribute.

      But it’s all up in the air, and it wouldn’t surprise me if I’ve got it wrong. Anyone?

    • never wanted .... says:

      Bill, I think you’ve got it mostly right — I’m not sure whether it was in Kitzhaber’s original plan, but it’s being bandied about now for sure — one problem with it is this.

      If you reduce the “assumed return” for all PERS members, you reduce future pensions, but you also reduce assumed current returns on the PERS trust fund — and if PERS is presumed (whether correctly or not) to be earning less, the PERS board has to jack up the PERS rates to try to keep things “actuarialy sound” — the PERS board is actually considering them, and it should cause concern, and is to knowledgeable people, to the agencies that will be affected.

      On the other hand, if you reduce the “annuity rate” for retirees from the “assumed return” rate — e.g. keep the assumed rate at 8.0% but, like the Republicans want, reduce the annuity rate to 4.0% — you run into severe legal questions: what is the financial or other basis for discriminating between PERS accounts of unretired and retired members? And what is the contractual justification?

  18. never wanted to know this much about PERS says:

    Anonymous — one Republican proposal is to do exactly that, reduce the assumed rate for retirees — presumably, new retirees — from 8% to 4%. It would apply every bit as much to active PERS employees and inactive.

    The “Inactives” proposal is from the Governor — it would reduce PERS pensions of inactive PERS members, including ORP faculty, by 90% in many cases — while leaving “Actives” alone. The idea, presumably, being that the “Inactives” have nobody to fight for them — they may or may not have forgotten about ORP faculty.

    Of course, the Governor’s plan is so blatantly unfair and discriminatory that it would probably never stand up in Court.

    • UO Matters says:

      OK, suppose you’ve got 200K in a Tier one account. It’s been earning the 8% min for years. You want to retire under the money match, giving you $400K.

      You take it as a PERS annuity, getting maybe $40K a year, with the annuity also calculated under an assumed 8% rate.

      What will the latest proposal to cut the 8% to 4% do? Claw back the $400K amount somehow, or just redo the annuity calculation at 4%, giving you say $28K (a guesstimate).

      And will the answers be any different if you are retired?

      And is there a good link on this for me to post?

    • never wanted to know this much about PERS says:

      answer is:

      redo the annuity calculation at 4%, giving you say $28K (a guesstimate).

      They couldn’t just change that $400K to $280K. And it wouldn’t be necessary if the annuity rate was changed to 4%.

      I’ve read nothing that makes me think they want to change things for the already retired in this way.

      For one thing, the PERS trust fund is about 90% fully funded now.

      If they applied this to everyone, it would be overfunded by a factor of about 90/70 (relative to 100%) i.e. by close to 30% or roughly $20 billion dollars.

      i.e. they would clearly be stealing $20 billion from PERS. That would never be allowed by either the Oregon courts or the feds.

      Sorry I don’t have a good link that provides all this info, I am just stating what I believe to be true from following it closely. As I say, I never wanted to know this much …….

    • UO Matters says:

      Thanks. So this proposed change would cost this person about $240K in retirement earnings. I’d do the PV calculation, but since it seems like the state politicians are pulling interest rates out of their butts, why bother. Let’s call it $120K. Worth retiring 2 years early?

      Will UO still make ORP contributions while a person is on the TRP?

    • never wanted to know this much about PERS says:

      UO Matters — I’ll help keep your cover and not call you Bill here! — I think you’ve got it about right. They’re pulling stuff out of there — and they keep pulling out new ones, makes you wonder whether it’s worth trying to keep up with them.

      Re TRP — I’m just beginning to learn about it, but fast! My belief is that UO will still make ORP contributions while you’re still in the 3-year “induction” period — just like they’d still be making PERS contributions for you — but when you go on reduced “hours” i.e. 1/3 work — you’re retired, and the pension contributions end — it’s assumed that you’re drawing the pension.

      But I’m no expert on TRP yet, only have gotten up to speed on PERS.

      Will be catching up fast on TRP, believe me lol!

    • Anonymous says:

      Dog to never wanted

      Yes your understanding about TRP is correct. In my case, going on TRP
      under Money Match was not very sensible, but now that I am full formula,
      going on TRP soon and the moving to “1/3” time after the induction period (if I were to make it that long) is favorable.

      Bottom Line: I encourage all active faculty near retirement to look
      at their full formula option because I am not sure the ledgeheads in
      Salem can dick with that one, very much.

    • UO Matters says:

      I think this will only work if you are a Lucky Dog who did not switch into the ORP in 1996. (Although maybe not so lucky when the leg. is done with you.)

  19. never wanted to know this much about PERS says:

    alas, dog, I’m ORP and would get totally screwed under full formula — about 5/6 of my PERS money match pension would be gone.

    • UO Matters says:

      Yes, because full formula will use your 1996 salary, with no inflation adjustments.

    • never wanted to know this much about PERS says:

      Exactly. Plus, those early contributions that get market compounding for decades are the ones that count the most in determining a pension in a 401k or money-match type program. I would be totally screwed, along with all the other ORP people.

      It’s looking, though, like the Gov’s plan for ‘inactives’ is going down the toilet where it richly belongs.

      Even though the knuckledraggers like the people at the Oregonian and Tina Kotek, to say nothing of the typical Oregon dimwit, are probably incapable of understanding such basic things about how pensions work.

    • Anonymous says:

      dog says

      correct; I never switched to ORP so this does work out; agreed
      full formula for ORP doesn’t work out for anyone

  20. Anonymous says:

    So, who is expected to be safe for now? Anyone hired after 1996? Do we know?

    • Anonymous says:

      Hey, Fig Leaf! Or anyone else . . .

      Does anyone know whether anything seems likely to affect the “lucky ones” (Tier 1’s) who have been here for ages and didn’t switch out of anything in 1996 because they didn’t understand PERS, and chose to continue teaching and researching in their own disciplines instead of becoming economists?

      Some of us didn’t try to understand things back then, but vaguely understood that even if UO didn’t pay top dollar, it had great benefits, so we accepted that plus the “psychic income” of living in Oregon (one of the arguments — actually true — that were made for not paying us a lot).

      Apparently they (we) will still benefit enormously from Money Match. And apparently the TRP doesn’t make much sense for us because giving us a 6% boost in income for 3 years means essentially nothing under Money Match because it’s what we earned all those years before 1996 (?) that counts into Money Match.

      Is that right?

      Sign me: “Still don’t want to know much about PERS”

    • Anonymous says:

      Dog says

      if your still in tier 1 then your on the money match based on your salary
      up until Dec 2003 (then tier1 switched to IAP) – since 2003 your PERS is
      going up by 8% which means its more than doubled over the last 10 years.
      TRP very much makes sense under the full formula

    • Anonymous says:

      Dog, are you saying that you can do MM on the Tier 1 earnings and TRP/FF on the PERS since 2003? Doesn’t sound right. So we have two accounts (that I know) and each one gets calculated separately and they can use different approaches?

      I really “Still don’t want to know much about PERS” but it would nice to know what you mean by saying that “TRP very much makes sense under the full formula” — and whether it applies to a Tier 1 person “here for ages and didn’t switch out of anything in 1996.”

    • Anonymous says:

      Elaborating Dog

      By Legislative FIAT all Tier 1 PERS members were rolled over into the
      Individual Account Program (IAP) on January 1, 2004.

      Your PERS Tier1 earnings have stay fixed as of Dec 31,2003 with additions
      only occurring through the 8% interest rate. In other words, as of Jan 2004, your 6% retirement has gone into your IAP account.

      Under the PERS Tier 1 you can elected to either take MM or FF – but it
      general FF now provides the best deal (this should be fairly obvious since
      your Tier 1 hasn’t had any deposits in it for 10 years and only grows
      through 8%)

      IN ADDITION, let me say that again, IN ADDITION you have an IAP account
      which pays out under different rules. By law, when you officially retire
      (or gone on “1/3” time) you have to retire both from PERS Tier 1 and IAP.
      Most people elect to rollover their IAP into another annuity. IAP does not
      have a guaranteed interest rate, it is market driven.

      The IAP interest rates have been the following since its inception:

      2004: 12.77%
      2005: 12.80%
      2006: 14.98%
      2007: 9.46% (all good so far and we are happy campers in IAP land)

      2008: -26.75% (hooray we lost most of what we gained)
      2009: 18.47% (now we gained a good portion back)
      2010: 12.13% (still gaining)
      2011: 2.15% (hmm – has the market flattened)
      2012: 14.09 (a surprise)
      2013: 6% so far (which would project to 20% by years end)

      Most of us have more actual money in PERS than in IAP but have 10 years
      of 6% contributions plus the above earnings rate – the IAP amount is roughly
      1/2 of what you have in PERS.

      When you retire you can choose to rollover your IAP or take it out over
      5, 10, 15 or 20 years.

      In my personal case, I plan to a) go on TRP soon, b) retire on PERS FF and
      c) take my IAP account as paid installments over 5 years (yes I know this
      is stupid but I don’t plan to live forever)

      When you go on TRP your pay increases by 6%; FF is calculated on the highest three years of your salary over something like a 10 year window.
      If you get summer salary in addition to 9 mo academic salary – this is a big
      enhancement. So the 6% in many cases will drive people to their highest
      3 years.

    • Anonymous says:

      Dog — do you know what “maximum salary” is for ORP people? Is it their actual maximum salary while working at UO? Or is it maximum salary before they went into ORP?

    • Anonymous says:

      Sorry Dog says

      I actually know jack shit about ORP – someone on this forum
      probably does, though

  21. never wanted to know this much about PERS says:

    I take it, Anonymous, that you stayed in PERS rather than going for ORP.

    One thing that has been proposed is to reduce the assumed “annuity rate” from 8% to 4% for new retirees like yourself. That would most definitely affect you (and people in other situations as well) because it would reduce your pension by about 30% in the Money Match program. I haven’t heard anything that would make me think it would affect the “full formula” types.

    Which are you? PERS is currently required by law to pick the option that gives you the best pension.

    I suggest you go to the PERS estimator which is a good software facility that will estimate your pension under various scenarios e.g. assumed time of retirement. I believe it also lets you know or infer which formula they use to estimate your pension.

    Good luck and let me know if you have trouble finding the PERS estimator.

  22. never wanted to know this much about PERS says:

    Re UOM’s Memorial Day post on TRP: the program a bit confusing, but my understanding is that pension contributions continue during the (up to) 3 year “induction” period. After that one has one’s tenure “reduced” and starts receiving the pension, and then can work for 5 years @1/3 effort (and pay, as I understand it). An immediate 6% raise takes place at the beginning of the induction period.

    To me, it’s a good deal if I know that I want to retire/go on reduced load in three years. First, I get the 6% raise. More important, it guarantees the option of working 1/3 time for up to 5 years at work I still really enjoy i.e. teaching. Yes, it really has gotten more enjoyable with age, a nice surprise! All while receiving what is a good pension, having worked to an age a little later than most people retire. So I can still do sort of hobby work without all the hassles of being a department member, etc. at an age when I probably want to cut back while pursuing my most personally compelling intellectual interests.

    So TRP seems like a really great plan for me. I was going to forego it, but started taking a closer look when it became clear that PERS is becoming a very nasty beast, and it seemed wise to start looking at all options fast.

    The reason for foregoing TRP was that I’m hesitant to sign a paper that basically says “the end” in three years. But the 5 year phased retirement option is a very appealing part of it.

    It doesn’t bother me that pension contributions stop because the pension-fuded induction period won’t end until a time when I’m pretty sure I’ll be OK with that. Especially if, as I understand, I get paid @1/3 for as many as five more years.

    Oh, one more thing, UOM. The current PERS contribution for ORP people is 22%. It’s slated to go up to 27% in the next biennium. No wonder the citizenry has been whipped into a frenzy over PERS. People who have learned even more about this than I tell me this rate increase is unnecessary, but that’s another story.

    • UO Matters says:

      Thanks, fixed. Are you sure it’s scheduled to increase in the coming biennium? I thought SB 822 stopped that.

    • never wanted to know this much about PERS says:

      The Democrats’ bill seeks to stop the increase, whether it will do so is anyone’s guess.

      I’m told that UO is not counting on it, for what that’s worth.

      By the way, I don’t expect a peep from the UO admin over this pension stuff, they don’t want to cross the Governor until that board is in place. (Funny how the independent board sort of fades away as an important issue with all the other stuff going on. I won’t waste my bad word yet, stay tuned.)

      Part of it is delaying contributions due for 13-15 until the next biennium — basically taking into account (as the PERS board bizarrely does not) the latest year’s i.e. 2012’s great market returns to the PERS trust fund (actually, they should completely eliminate the rate hike on this basis, but that’s kind of a side issue now).

      The other part is reducing PERS cola adjustments. This is far more problematic legally — there will be lawsuits aplenty over this, and it’s entirely possible — probable — that the state will lose. Therefore, if they eliminate that part of the PERS rate hike, and they lose, they’ll have to make it up later with even larger rate hikes. Bad path to head down. But this is Oregon, they seem to be compulsive about fucking themselves over and over and over. (Sorry to use the bad word, but it seems so appropriate here.)

    • UO Matters says:

      Thanks, I’m no English professor but your usage seems appropriate.

    • Anonymous says:

      Dog to never wanted

      its not necessarily 5 years @ 1/3
      its basically 10 terms @1/2 that can be taken consecutively
      or can be space out.

      The academic affairs web site on this issue is surprisingly clear.

  23. never wanted to know this much about PERS says:

    By the way, the RG has a Memorial Day article on the Governor’s scheme to attack “inactive” PERS members (including ORP faculty). It’s a few days outdated — the S-J and Oregonian were reporting on it days ago, see above — but it has a nice example of a woman who under this scheme gets screwed out of 90% or so of her pension.

    The really chilling thing about this is that the example came straight out of the Governor’s office. i.e. they know what they are doing and are completely cold-blooded and cynical about it.

    Also note that Speaker Kotek seems to be on board with this. She claims according to the article not to intend to include “currently active” state employees. But she knows very well — or should, because she’s been informed about it — that many OUS faculty would be targeted who are very much still “current state employees.”

    If you’re concerned about this, as I am, I urge you to write to selected legislators, both Democrats and Republicans.

    The Republicans have certainly picked up the theme that targeting the “inactives” is very, very likely to be thrown out in court.

  24. never wanted to know this much about PERS says:

    I’m no English professor either but my daddy taught me the importance of the proper and respectful use of the English language.

  25. Anonymous says:

    If this gets serious traction, it will be time for bus loads of ORP “inactives” to head to Salem for a demonstration at the legislature and the governor’s office. Writing letters to them won’t do any good — you gotta get in their faces. With media coverage.

  26. Mike Kellman says:

    Without entering into all the details, Peter is basically correct.

    It behooves the various unions and faculty associations to put pressure on the governing officials and start arranging legal challenges to this blatant scheme to cheat the “inactive” PERS members, including ORP faculty, out of the vast majority of their pensions from the time they were in PERS.

    Be assured that key legislators are well aware of the fact that current OUS faculty, who are very much “current employees that we want to protect,” are being targeted along with people who have actually left Oregon public employment.

    They are also well aware that what they are proposing is probably preposterously illegal and will be thrown out in court, federal if not state.

    It’s interesting that I haven’t heard any public response to this travesty either on the part of the OUS or the UO administration. Have I missed anything?

  27. n says:

    About that Hannah Hoffman piece on the Moody’s report on public pensions:

    Basically what they’re doing is saying “OK, let’s asssume that we’re in for a 20-year world depression/recession — assume the discount rate (i.e. rate of return on pension funds) is going to be 5.5% annually instead of the historical 8 or 10% or whatever.

    And so of course, if you assume this, it leads to the conclusion that the pension funds are hopeless — just as it implies that just about everything else is too.

    It’s possible for the world to talk itself into a depression; this is basically what Keynes meant about “animal spirits.”

    But look at Moody’s and the other ratings firms. They were so great at predicting the economic crisis of 2008, right?

    And so of course we should have faith in their prediction about the world economy for the next 20 years.

    After all, look back yourself, to 1993. You foresaw the internet boom and bust, 9/11, the Iraq and Afghanistan wars, the world financial crisis, right?

    So why shouldn’t we believe Moody’s when they say to assume 20 more years of depression/recession.

    Of course, the stock market has been going like gangbusters the last year and a half — so much that IF it continues (I don’t pretend to be a prophet), PERS will be fully funded again in two or three years.

  28. Leeches says:

    Bunker indeed. Unbelievable that JH has not had a word of advice for faculty on this.

  29. Anonymous says:

    How many people are even talking about this, though? No buzz in econ about it.

    • never wanted to know this much about PERS says:

      How many ORP faculty do you think are even aware of it?

      What about the faculty union? The Associated Oregon Faculty?

  30. special plan says:

    Well, that certainly explains why our president is keeping his mouth shut about PERS

  31. Anonymous says:

    Suggest you make it about all people in an Oregon pension plan, not just ORP, because all are being targeted.

    Re: why is the state offering to increase pay in return for ending the pickup? Good question — SEIU is making it clear the state will have to pay for extra payroll tax costs. So the state will lose money on this.

    Won’t they? Well, the major unions may be able to take care of themselves. But what is the state thinking about non-unionized professionals and others like unionized faculty?

    Maybe to order their employers NOT to give pay increases to compensate for the pickup. So basically, stick us with a 6% pay cut. Whether legal, I don’t know, but these guys in the Governor’s office are not worrying about what’s legal.

    Seem far-fetched? So does the inactives proposal, which seems to be out of sight for now.

    These guys are acting like rats. Don’t trust them. They will screw you any way they think they can get away with.

  32. nameless says:

    Maybe the Republicans have gotten the message that plenty of “current employees” are inactive PERS members who are quite willing to sue their asses — they have certainly been informed of that fact, take it from me — but I wouldn’t totally count on it.

    Maybe when all is said and done, the two incompetent, nasty, stupid sides will be unable to come to an agreement, and nothing much will happen.

    With any luck, the stock market will continue helping PERS recover, and all of this will soon be a forgotten part of Oregon’s world-historical attempt to become the most stupid, shitass-hillbilly state in this great republic of ours, which of course is the greatest political entity in the history of our great cosmos, or multiverse, or whatever the hell it is these days —

    hope I haven’t overused the allotment of bad words — have run out of eloquence trying to digest — burp, fart, squat, squirt — the latest news reports — if I have, my apologies — please edit and save this meager epistolary effort.

  33. never wanted to know this much about PERS says:

    I don’t read the Republican plan as screwing the inactives, to the contrary, they know that is extremely unlike to survive in court: Rather, they would screw all new retirees out of about 30% of their money match pension. Actives, don’t think you aren’t in the crosshairs!

    “Sen. Larry George, R-Sherwood, said brokering a deal has been difficult since Democrats limited the negotiations to the provisions of the Democratic PERS bill, which Kitzhaber signed earlier this month, and cutting money match benefits for “inactive” retirees.

    “It’s hard to negotiate,” George said. “There are only a few options that they’re willing to talk about.” ‘

  34. never wanted to know this much about PERS says:

    Re my statement that EVERYONE is in the crosshairs — Tier 3 people, you shouldn’t think that doesn’t include you.

    The 6% pickup is in play. I suspect that the state thinks they can’t stick it to the big unions — they will get a compensating pay raise — but they very well may be thinking that professional workers — yes, that may still include professors — can be forced to simply eat a 6% cut. So you should watch out for that — along with everyone else.

  35. Anonymous says:

    Can we retire any time even during the middle of a term, which looks increasingly like it might be necessary?

    If so, what happens to our courses? If I retire today, I assume I can no longer give finals and grades (and wouldn’t be inclined to if I wasn’t getting paid, even if legally allowed to do the work “free.”)

    So who takes over the courses if there’s a panic exodus?

    These questions really need to be aired openly — like in the Chronicle — what’s going on here in Oregon. It may not be much, but the Oregonians do respond some when you make a national laughingstock of them.

  36. never wanted to know this much about PERS says:

    A statement I had missed about ORP people — from an RG article:

    http://www.registerguard.com/rg/news/local/29915326-75/pers-state-match-members-money.html.csp

    “But lawmakers from both parties said that, since the new PERS proposal was floated by Kitzhaber, they’ve heard a number of complaints from university employees in that exact situation. Kitzhaber spokesman Tim Raphael said no decision has yet been made about whether or not to exempt those employees from potential “Money Match” changes.”

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