Bigger Checks for County Staff Retirees
Thousands of retired Orange County workers will get their share of about $35 million in retroactive benefits beginning immediately, an increase that will range from $60 to $500 a month each, a Superior Court judge has ruled.
County lawyers argued that paying out the money could cause financial problems, but Judge Tully H. Seymour was not convinced and refused to grant either a preliminary injunction or a weeklong delay in the payments.
The $35 million was scheduled to be sent to about 6,800 retirees starting July 1, but those payments were held up until Seymour’s ruling Friday. The payments are part of an October 1997 state Supreme Court decision that ordered 20 counties to increase benefits to retirees and county pensioners.
On Monday, county officials failed to persuade the judge to stop the payments for another week until a court of appeals could rule on whether to grant an injunction.
Retirees attending the hearing were jubilant over the judge’s decision.
“I think it’s outrageous the county is creating this situation,” said Bill Kirkwood, president of the Retired Employees Assn. of Orange County, an organization that joined the Orange County Employees Retirement System board in defense of the payments. “I’m glad that Friday’s verdict was affirmed.”
Lawyers for the retirement board said county officials had ample opportunity to discuss the issue with board members many months ago but failed to do so.
Several hundred checks had been mailed out to retirees Friday, and stopping those payments would “wreak havoc on the retirement board,” board attorney Harvey Leiderman told the judge.
County officials said they would appeal the decision. They argued that the back payments may be illegal and that a higher court must rule before more checks are sent out.
“They rushed to move the payments forward so they could make this argument before you today,” Deputy County Counsel Deborah Gmeiner told the judge.
Gmeiner said in an interview that at least 12 other counties have filed lawsuits challenging the pension payments. The Sacramento County Employees Retirement System has asked that all the pension fund lawsuits be heard before one judge so there will be a clear ruling for everyone.
“Everybody wants to know what is legally required,” she said.
In October, the Supreme Court ruled that Ventura County owed its employees pensions based on salaries and other perks like car allowances and bonuses. The ruling also affected 19 other counties, including Orange.
The debate between Orange County officials and the Orange County Employees Retirement System board stems from the board’s decision last February to grant three years’ worth of back payments to its retired pensioners.
Orange County is the only county that included back payments to its retirees.
The money to pay for the checks will be financed by a $220 million return on investments that the retirement board collected last year.
But county officials still expect to dole out at least $7 million this year to pay for benefits required by the Supreme Court decision.
County officials say the retirement board has not explained how it calculated the amount of money it will pay to retirees. If the board’s methods are wrong, it could become difficult to recoup any overpayments, county officials have said.
Based on the board’s February decision, the amount paid to each retired worker will depend on the years of employment.
Most of the state’s 38 other counties are part of the California Public Employees Retirement System, which has included perks as part of salaries in making its pension contributions.