Debate Forum Topic, 1/10/12

Ohio legislature to review practice of double-dipping

The troublesome issue of public double-dipping, the practice of retiring and receiving a government pension and then being rehired by the same or even a different government entity, and receiving a second salary, is once again before the Ohio legislature. State Rep. Rex Damschroder (R-Fremont) is introducing legislation to curtail the practice. Damschroder stated that the legislation was in response to the “public outrage” every time a well-paid school superintendent or judge retires, becomes eligible for a pension and then returns to the job.

Dramschroder’s bill, which is House Bill 388, would prevent someone from collecting a pension check and a salary at the same time. So if a retiree returned to a public job, his or her pension payments would be set aside in a separate account. The employee would get those deferred payments when he or she leaves government employment for good.

The “double-dipping” bill could possibly be considered as part of a pension reform with House Bill 69. During this economic downturn, government pension plans have faced rising health-care costs and retirees living longer. The state’s pension plans have submitted new funding proposals that include higher retirement ages, lower cost-of-living adjustments and bigger deductions from employee salaries. Those proposals are now part of House Bill 69. Some are suggesting that the two bills might be joined as an overall effort for pension reform.
A recent report in 2010, in a joint project by some of the state’s largest newspapers, outlined the practice and how the system encourages superintendents and other educators to retire early and then negotiate to be rehired at a slightly lower salary for the same job. The school district justifies the rehire because the district has the same official at a slightly lower salary thereby saving money for the district. The advantages for the employee are obvious as they will be eligible for two incomes.

The practice is widespread in Ohio. The 2010 report related that one in four public school leaders in Ohio’s 614 districts collected both pensions and paychecks, and one in two superintendents of educational service centers also received both. The report also found that about 32,000 state and local employees collected more than $1 billion in pension payouts on top of their government paychecks; 75 percent of that money went to public school employees.

The proposed legislation would affect members of Ohio’s legislature. According to Innovation Ohio, there are presently sixteen legislators who are collecting state pensions in addition to their salaries. Another legislator receives a congressional pension and yet another member receives retiree pay from the Navy, according to research compiled by the liberal policy group Innovation Ohio. Fourteen of these legislators are Republicans and four are Democrats.

Public employees are carefully watching the bill to see if the legislature attempts to exempt elected officials from the proposed legislation. They would perhaps argue that what’s good for the proverbial “double-dipping” goose is also good for a “double-dipping” gander.

Forum Question of the Week:

Should Ohio pass legislation which prohibits “double-dipping” by public employees?

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