Public employee pensions now shrouded in secrecy

Gov. Steve Sisolak has signed into law a bill that will make it impossible for the public and even elected officials to act as a watchdogs and catch abuses in the taxpayer-funded Public Employees’ Retirement System (PERS).

Senate Bill 224, sponsored by Democratic Sen. Julia Ratti, declares much of the information about state and local government retirees confidential. Only the names of pensioners and pension amounts would be public records. Such vital information as the last employer, years of service credit, the retirement date and whether the benefit is a disability or retirement benefit are all confidential.

The bill passed both the state Senate and Assembly largely along party lines, with only a handful of Democrats voting in opposition.

Ironically, when Democratic Gov. Sisolak was a Clark County commissioner, he used public records to expose abuse of county firefighter overtime pay and sick leave. According to the Las Vegas newspaper, Sisolak spearheaded reforms that resulted in an 80 percent drop in sick leave among fire department battalion chiefs.

Without the ability to analyze the information made secret by SB224 the public will not be able to tell whether government retirees are drawing excessive pensions.

PERS costs $2 billion a year and the taxpayers are on the hook for $40 billion in unfunded liabilities.

According to an analysis by American Enterprise Institute, the average Nevada public employee pension is $64,000 a year, the highest in the nation, while the average Social Security annual benefit is $16,000. Currently more than 1,500 Nevada public employee pensioners are drawing more than $100,000 a year.

The law that set up PERS states: “It is the policy of this State to provide, through the Public Employees’ Retirement System: A reasonable base income to qualified employees who have been employed by a public employer and whose earning capacity has been removed or has been substantially reduced by age or disability.”

Yet, in a court case seeking PERS records, Nevada Policy Research Institute’s (NPRI) attorney Joseph Becker observed that there are retirees in their 40’s collecting six-figure disbursements from PERS, while still earning income from other sources. “Only through the publication of name, pension payout and related data can the public better understand how the system works and the legislative purpose be effectuated,” Becker wrote.

During hearings on SB224, NPRI’s policy director, Robert Fellner, noted that a tip to California’s fraud hotline resulted in the system recovering more than $200,000, causing CalPERS to release a statement praising “the great value of the public’s assistance in CalPERS’ efforts to protect the state pension system from fraud, waste, and abuse.”

Fellner also noted the importance of disclosing whether PERS payments are for disability or retirement. A Los Angeles television station, using public records, discovered that a police officer who was drawing a disability pension from one city was working full-time as a police officer for another agency.

SB224’s backers argue revealing the names of pensioners might expose them to identity theft and fraud. The Nevada Supreme Court dismissed that claim in a 2013 ruling, saying, “Because PERS failed to present evidence to support its position that disclosure of the requested information would actually cause harm to retired employees or even increase the risk of harm, the record indicates that their concerns were merely hypothetical and speculative. Therefore, because the government’s interests in nondisclosure in this instance do not clearly outweigh the public’s presumed right to access, we conclude that the district court did not err in balancing the interests involved in favor of disclosure.”

Now, the secrecy is embedded in law and the public is blindered. — TM