Pony Boy
02-26-2011, 10:08 AM
The pension scandal that broke in 2002 brought county government to its knees, forcing politicians from office and saddling taxpayers with massive unexpected costs that harmed parks, transit and social services.
High stakes outside the courtroom
Scott Walker, from a personal standpoint, has more to gain than lose in the case.
The county executive had nothing to do with the pension scheme, so has nothing to fear from trial testimony. A big win gives Walker a major talking point as he pursues his long-held dream of being governor in the 2010 election.
Still, if the county loses, Walker would have to explain why he backed a losing legal strategy against Mercer instead of going to court in a long-shot bid to halt the flow of some of the big payouts - or suing the Milwaukee law firm that advised the county on pension matters. That firm was led by a close GOP ally of Walker's. He could also take political flak if taxpayers have to fund legal fees in a losing effort.
Milwaukee County Pension Scandal in 2002
Hundreds of Milwaukee County workers have pumped up their pensions by a total of at least $50 million through an obscure program that skirted county laws and federal tax rules, a Journal Sentinel investigation found.
This has allowed many workers to get lump-sum payments well into six figures. Former deputy district attorney Jon Reddin, at age 63, collected the largest to date: $976,000, on top of monthly pension checks of $6,070 each.
Workers ranging from gardeners and grass-cutters to county government's highest-ranking officials have tacked on extra years of service by taking advantage of uncommonly generous "buyback" practices that convert ineligible service into pension-worthy time.
By purchasing credit, in most cases for seasonal or part-time county stints worked in their youth, employees are getting five- or six-figure pension gains over a retirement lifetime. They can retire earlier with full benefits, and some qualify for free lifetime health insurance because of their buybacks.
Few benefited more from the buybacks than Jac Amerell, the former county retirement system director and Pension Board secretary. He was a key force behind instituting the biggest buyback break.
With a one-time payment of $2,872, Amerell converted several summers of grooming Brown Deer Golf Course in the 1950s into pension credits. The credits boosted Amerell's pension by 39% to $30,100 a year.
Amerell wasn't the only prominent pension insider with a personal stake.
County Supervisor Michael Mayo Sr., a former Pension Board member, signed up for a buyback that has helped make him the only sitting supervisor still eligible for the big bonus given in the 2001 pension deal, according to county officials and public documents.
Former Pension Board lawyer Robert G. Ott issued a legal opinion cementing the most lucrative parts of the program - the day after he started to pay for his son's buyback. Ott retired under pressure in 2002 after a furor erupted over the Ament pension deal.
Other top county officials also stand to benefit from buybacks.
Former County Executive David F. Schulz would not have qualified for a county pension on his way out of office in 1992 but for a buyback that cost him $1,767, according to records and interviews with county officials. He gained credit for time worked as an intern.
Schulz is to begin receiving a $17,600-a-year pension in 2009 - 10 times what it cost him to buy the benefit.
Then, to add insult to injury, when they reach a young retirement age of 55, they double dip the system by getting another public sector job...that is until they pack up and leave this over-taxed hellhole of Wisconsin so they don't have to pay their share of taxes on the pension.
http://www.jsonline.com/news/milwaukee/29483804.html
http://www.jsonline.com/news/milwaukee/44156882.html
High stakes outside the courtroom
Scott Walker, from a personal standpoint, has more to gain than lose in the case.
The county executive had nothing to do with the pension scheme, so has nothing to fear from trial testimony. A big win gives Walker a major talking point as he pursues his long-held dream of being governor in the 2010 election.
Still, if the county loses, Walker would have to explain why he backed a losing legal strategy against Mercer instead of going to court in a long-shot bid to halt the flow of some of the big payouts - or suing the Milwaukee law firm that advised the county on pension matters. That firm was led by a close GOP ally of Walker's. He could also take political flak if taxpayers have to fund legal fees in a losing effort.
Milwaukee County Pension Scandal in 2002
Hundreds of Milwaukee County workers have pumped up their pensions by a total of at least $50 million through an obscure program that skirted county laws and federal tax rules, a Journal Sentinel investigation found.
This has allowed many workers to get lump-sum payments well into six figures. Former deputy district attorney Jon Reddin, at age 63, collected the largest to date: $976,000, on top of monthly pension checks of $6,070 each.
Workers ranging from gardeners and grass-cutters to county government's highest-ranking officials have tacked on extra years of service by taking advantage of uncommonly generous "buyback" practices that convert ineligible service into pension-worthy time.
By purchasing credit, in most cases for seasonal or part-time county stints worked in their youth, employees are getting five- or six-figure pension gains over a retirement lifetime. They can retire earlier with full benefits, and some qualify for free lifetime health insurance because of their buybacks.
Few benefited more from the buybacks than Jac Amerell, the former county retirement system director and Pension Board secretary. He was a key force behind instituting the biggest buyback break.
With a one-time payment of $2,872, Amerell converted several summers of grooming Brown Deer Golf Course in the 1950s into pension credits. The credits boosted Amerell's pension by 39% to $30,100 a year.
Amerell wasn't the only prominent pension insider with a personal stake.
County Supervisor Michael Mayo Sr., a former Pension Board member, signed up for a buyback that has helped make him the only sitting supervisor still eligible for the big bonus given in the 2001 pension deal, according to county officials and public documents.
Former Pension Board lawyer Robert G. Ott issued a legal opinion cementing the most lucrative parts of the program - the day after he started to pay for his son's buyback. Ott retired under pressure in 2002 after a furor erupted over the Ament pension deal.
Other top county officials also stand to benefit from buybacks.
Former County Executive David F. Schulz would not have qualified for a county pension on his way out of office in 1992 but for a buyback that cost him $1,767, according to records and interviews with county officials. He gained credit for time worked as an intern.
Schulz is to begin receiving a $17,600-a-year pension in 2009 - 10 times what it cost him to buy the benefit.
Then, to add insult to injury, when they reach a young retirement age of 55, they double dip the system by getting another public sector job...that is until they pack up and leave this over-taxed hellhole of Wisconsin so they don't have to pay their share of taxes on the pension.
http://www.jsonline.com/news/milwaukee/29483804.html
http://www.jsonline.com/news/milwaukee/44156882.html