The “3 for 30” General Assembly Pension Scam: That’s What McDonnell Should be Changing

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    by Paul Goldman

    First, full disclosure: back in the 1990’s, I managed to get the Supreme Court of Virginia, despite vehement opposition from the Democrats in control of the General Assembly, to hear my case about the political pension scams of the General Assembly. The case grew from my having convinced the Attorney General at that time to block the General Assembly’s illegal pay raise (Speaker Tom Moss cried Uncle and caved in.)

    But after accepting my case – Goldman vs Landsidle – the Supremes realized they had a very hot potato on their hands. Indeed, the General Assembly did something rather unprecedented, they made it clear they were going to agree to some of my proposed changes – such as stopping the practice of including office expenses as the base pay for calculating a legislators pension! – as the case worked it’s way through the courts. They were desperate to avoid my focusing on their “3 for 30” ultimate pension scam.

    Long story short: I won several historic changes in how the General Assembly calculates its pension. Lawmakers told me I had cost them – I countered by saying it saved taxpayers – $10 million at least. But the Supremes, after hearing my oral argument, got nervous about challenging the General Assembly and figured out a way not to decide the case – Goldman vs Lansidle – on the merits.

    THUS, the most outrageous political pension scam of  all – what I call “3 for 30”.- still exists, although it is very possible the Supremes would not have reached that issue anyway given the case.

    What is “3 for 30”? Let me explain.

    Under pension law, the General Assembly has used a loophole – ONLY AVAILABLE TO THEM AND SIMILARLY SITUATED POLITICANS – to do something that could not be done in the private sector!

     

    That’s right: In the private sector, the General Assembly would have to treat themselves like any other person who is considered a part-time worker, due to the constitution and the hours actually worked and documented.

    Thus, the General Assembly couldn’t both keep their legal status as part-time workers, which is consistent with the constitution and other treatment they get, BUT AT THE SAME TIME treat themselves as full time workers for purposes of the state pension fund in order to get a tax payer funded, tax exempt pension!!

    That’s right: THE PENSION SYSTEM WAS CREATED FOR THESE FULL TIME WORKERS, not the politicians in the General Assembly. Indeed, when it was created, General Assembly legislators were pointedly not included!

    Until fairly recently in state history, the idea of part time legislators getting a tax-funded pension was taboo in Virginia.  

    But in recent years, “living off the government” has become fine with even conservative Republican legislators, a point conservative editorial writers and think tanks and whatever conveniently forget.

    What happened to leading by example? We don’t hear this from conservatives in the General Assembly do we?  Instead, the politicians saw a good thing, and decided to use their power to their personal benefit.

    THEN THEY SAW THE WAY TO WIN BIG.

    General Assembly members used their power to give themselves a special benefit – a full year of pension system credit for only part-time work. They created the following: a way to get a big pension that is not available to any other state employee, or anyone in private enterprise.

    How does this work?

    Here is an example. Suppose a legislator serves for 27 years. Under state law, their pension is based on their top 36-month (I believe) consecutive months of salary of documented full-time work. They get the top pension for 30 years of work, I believe.

    SO: What if this hypothetical part-time legislator gets his friend the Governor to give him a high-paying state job for 3 years?

    BINGO! For just 3 years of full-time work, the politician gets what only a few state employees earn for 30 years of hard, full-time work for Virginia. A pension based on his 3 years in a cushy patronage job! Tax exempt here in VA!!

    Precisely how does a conservative Republican Governor justify giving a handful of politicians a taxpayer funded pension under these circumstances?

    But as I say, this “3 for 30” scam goes on.

    When I sued, I cited a famous US Supreme Court case giving me standing to sue for a similar thing under federal law. But this was a state law case, so the case was not controlling on the standing issue in VA. The VA Supreme Court took my case because it was a strong and potentially historic challenge to the pension scams, and a good brief in my view — I had the law on my side in terms of substance.

    The VA Supremes actually let me argue the case before them. Only afterwards, when they realized it was a bombshell, did they suddenly find that I didn’t have “standing to sue” after all. That is to say: After they let me stand there and argue before them, after they heard no objection to my being a proper plaintiff from the Attorney General, only after all that did they suddenly conclude the case should never have been allowed in their courtroom!!

    Anyway, we did save the people $10 million and get the GA to end some scams.

    Today, instead of mandating ultrasounds to women, the Governor would leave a far better legacy by getting rid of the “3 for 30” scam.

    • YelowDawg

      Thanks for the enlightenment. They steal from the sate employee retirement at every opportunity. No wonder they are  thinking of ways to reduce benefits for the ones who earned the retirement in the first place.