...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