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...Supremes hear PERS case Continuing education at OPEIU Office and Professional Employees Local 11 was the host local for the annual West/Northwest Area Educational Conference held Oct. 30-Nov. 2 at the Benson Hotel in downtown Portland. The intense three-day conference drew 65 OPEIU members from the West Coast, Florida and Louisiana. Labor educators Art Wheaton and KC Wagner of the Worker Institute at Cornell University, and Mark McDermott led workshops on Bully Busting, Strategies for Conducting and Accessing Research, and Making the American Dream Work for Everyone. Portland labor attorney Michael Tedesco discussed social media and dealing with impasse. Also in attendance and leading workshops were OPEIU International President Michael Goodwin and Secretary- Treasurer Mary Mahoney. Local 11 members received certificates of completion from Goodwin (center, wearing name badge). They are from left to right: Matt DeVore, president; Rick Wilson, union rep; Mike Richards, executive secretary treasurer; Maureen Colvin, union rep, and Barbara Melton, vice president. FREE HOME BUYER SEMINAR Low Prices! RSVP TO Bob Krueger, GUILD MORTGAGE 503 490-0349 Email: bkrueger@guildmortgage.net Reservations required Mon-Fri 9-6, Sat 9:30-5:30, Sun 12-6 (From Page 1) Hartman told the seven assembled justices that over the past 40 years, the Oregon Supreme Court has engaged in a clear pattern of decisions as to what constitutes a statutory contractual agree- ment — which is what PERS is to its recipients — and what can and cannot be added or taken away. “The bill that changed the COLA for retirees is a full-scale assault on prior case decisions,” charged Hartman. “If this court applies its ‘standard analysis’ to our case, you will have to rule in our favor.” Hartman contended that the COLA statute is clearly contractual in nature, tied to the general concept that a pen- sion plan is a promise to pay recipients for services rendered. He noted a 1996 decision, the Oregon State Police Offi- cers Association vs. State of Oregon, which involved sick leave benefits. The sick leave statute that was the center- piece of that case is, said Hartman, structured similarly to the COLA statute involved in Moro. Hartman walked the court through the 1971 bill that created PERS as we know it today, which included enacting the COLA language. The 1971 Legis- lature took great pains, Hartman pointed out, with some tweaking from the 1973 session, before landing on 2 percent as the annual COLA percentage rate. “Those legislators were extremely careful to strike a balance between what was enough, in terms of the 2 percent COLA, and what would have been too much, in terms of PERS’ long-term fi- nancial health,” said Hartman. “We can’t parse out this piece here or that piece there; this is all part of the PERS retirement package.” Justice Martha Walters noted that members of the Oregon Public Service Retirement Program (OPSRP), the third tier of PERS created by the 2003 Legis- lature, can have some retirement num- was the respondents’ third speaker. bers changed, and asked Hartman why Gary has argued the bulk of recent not other PERS members? He re- PERS-related cases against Hartman sponded that the legislation creating both in court and in front of legislative OPSRP specifically reserved that right committees; his law firm represents a for future sessions of the Oregon Legis- variety of local government clients. lature to make changes — but there’s no Some of his points actually contradicted Cutler, but Gary’s main language allowing such contention was that the leeway for PERS Tier 1 COLA amount has always and 2 members in the “The bill that been discretionary and that law. changed the the burden of proof to Attorney George prove otherwise was on the Riemer, retired counsel COLA for PERS Coalition and the for the Oregon State retirees is a plaintiffs. Bar Association, took During the rebuttal pe- on the issue of the out- full-scale riod, Hartman again reiter- of-state tax offset. assault on prior ated that the COLA bene- When federal courts de- fits were just like any other cided in the 1980s that case decisions.” part of the PERS statutory states could not tax fed- eral and in-state public retirees differ- contract and cannot be separated. He ently, Oregon added a 9.9 percent bump disagreed with Cutler that COLA bene- to Oregon PERS members’ benefits to fits were just an add-on and not related offset the federal tax. The 2013 legisla- to years of service. He also noted that tion eliminated that provision from Ore- Oregon, by virtue of previous court de- gon PERS recipients who move out-of- cisions, is a “unilateral contract state” state, with the idea that such recipients when it comes to PERS, not an “ac- weren’t paying Oregon income taxes crued benefits state.” The hearing ended a little over two and therefore shouldn’t receive an “ex- tra” tax offset. Riemer argued that the hours after it began, What happens next? There is no set law contains no “expiration date” for out-of-state retirees to receive that timeline for the court to render its ver- dict. Typically, decisions are announced money. Three attorneys appeared for the re- between four and six months after oral spondents, who were arguing on behalf arguments, which would be somewhere of state and local governments, who in the March to May 2015 range. Hart- lobbied for the pension cuts to avoid in- man believes the issues at hand in Moro creases in their employer contributions. are not complicated, which could possi- The ensuing legislation reduced em- bly lead to a sooner-rather-than-later an- ployer pension contributions by roughly nouncement. Justice Jack Landau recused himself $800 million during the current two- from the case because his son is an at- year budget cycle. Keith Cutler represented PERS. He torney employed by Gary’s legal firm. was peppered by questions from vari- Therefore, Oregon Court of Appeals ous justices, and his responses continu- Chief Judge Rick Haselton sat in on the ously revolved back to one assertion: case and will be the seventh vote, along that while the concept of a retiree with Walters, Chief Justice Thomas COLA was indeed contractual, the Balmer and justices Richard Baldwin, amount was not. The 2 percent figure David Brewer, Virginia Linder and was a ceiling, said Cutler, but not a Rives Kistler. guarantee. Cutler termed the COLA an (Editor’s Note: Don Loving is com- “add-on” that was not related to benefits earned by retirees when they were munications director for Oregon AF- SCME Council 75.) working. In an unusual situation, retired Ore- gon Supreme Court Justice Mick Gillette took a turn at the lectern, ad- dressing his former colleagues. He pon- tificated that while the COLA issue may be a statutory contract, it was still a statute and therefore could be changed. The Labor Education and Research Longtime Hartman foil Bill Gary Center (LERC) at the University of Oregon will hold an Collective Bar- gaining Institute Dec. 7-12 at the Menucha Retreat Center in Corbett. IRS PROBLEMS? The course is designed for union staff and leaders who have a key role • Haven’t filed for ... years? in labor negotiations. Participants will • Lost records? learn how to develop and carry out ef- • Liens - Levies - Garnishments? fective bargaining strategies, both at • Negotiate settlements. the table and in other arenas, focusing • Prepare offer in Compromise. on what it takes to build bargaining Call Nancy D. Anderson Enrolled Agent power. NPTI Fellow/America’s Tax Expert Enrollment is limited to 30 partici- LTC-1807 pants. For more information, contact www.nancydanderson.com Lynn Feekin at 541-346-2789 or 503-244-2577 email: feekin@uoregon.edu. LERC to host Collective Bargaining Institute Dec. 7-12 PAGE 4 NORTHWEST LABOR PRESS NOVEMBER 7, 2014
