Loopholes in Washington State’s Retirement System Need to be Fixed

It doesn’t matter whether you’re a conservative or liberal; Washington State’s Retirement System needs radical changes to be credible. At a time when college tuition is being greatly increased, classes and programs are being cut, teaching professionals are being let go and money is not even available for many teaching fellowships for graduate students, some colleges and universities around Washington State have been rehiring back to their old jobs, people who have retired as state workers and allowing them to both be paid a salary and collect retirement funds.

As the Seattle Times reported on June 27, 2010, this process has resulted in a mockery of public funding of our higher education system. The example of just one Washington State University official shows why:

“Greg Royer ranks among the state’s top-paid employees, with a salary of $304,000. But that’s just part of his income. For nearly seven years, he’s also collected an annual pension of $105,000.
Royer, the vice president for business and finance at Washington State University, tops a long list of college administrative staff members who’ve been able to boost their incomes by up to 60 percent by exploiting a loophole in state retirement laws.
A Seattle Times investigation has found that at least 40 university or community-college employees retired and were rehired within weeks, often returning to the same job without the position ever being advertised. That has allowed them to double dip by collecting both a salary and a pension. …
A Times analysis of state payroll and retirement records shows that, as of the beginning of this year, about 2,000 people were collecting both wages and a pension from the state. In about two-thirds of those cases, however, retirees had returned to a state job on a part-time or on-call basis.
The Times found that 58 workers “including the 40 in higher education” had retired and been rehired full-time within three months. WSU and the University of Washington together accounted for 30 of those cases. A number of state agencies, most notably the Washington State Patrol, accounted for the cases outside of higher education.”

Washington State’s current state retirement system allows workers to retire with regular benefits at age 60 or after 35 years of service. It’s easy to understand taxpayer’s being angry when many are just looking for one salary to meet family needs. To allow state workers to game the system by double dipping, while cutting services and asking for more taxes is not acceptable.

Compare this with the headline in an article today in the Seattle Times that says for most workers, who are dependent on social security to make ends meet that “70 might become new retirement age”.  Current retirement age for folks like me born between 1943 and 1954 is age 66.  For those born after 1960, it is 67. And as I understand it, if I earn over a certain amount each year when I retire, my social security benefits are cut.

Washington State legislators need to act now to reform the state retirement system.  While I am a strong advocate for the state funding essential public services like higher education, I am offended that the state continues to allow its retirement system to be abused. Washington state legislators need to correct this problem now!

As Ryan Blethan of the Seattle Times noted in an editorial in today’s Seattle Times:

“More is expected of those who lead our public institutions, especially those who sit atop our colleges and universities. …”

Blethan goes on to note that action needs to be taken and that we’re not talking peanuts here.

“…there are about 2,000 double-dipping state employees, costing the state approximately $85 million annually. The Times investigation found some of these rehires happened within weeks and the positions were never advertised. A state employee can only be rehired after a month of retirement.
The problem seemed to slide by in healthy economic times even though it should not have. The Legislature needs to close the double-dipping loophole during the next session, even if that next session is a possible extra session.
Legislators do not have any other choice unless they are not serious about adjusting the state’s budget to economic reality. If addressed quickly and aggressively this is low-hanging legislative fruit”.