Ohio padlocks pension records from public

By Rick Armon

Akron Beacon Journal

Despite spending more than $4 billion annually on state and local government pensions, Ohio taxpayers have little access to retirement records.

They cannot find out how much individual public retirees receive.

Or how much workers — and taxpayers — paid toward their pension.

Or how many years they worked.

Or even, in some cases, who’s getting the benefits.

State law prevents Ohio’s five public pension systems from disclosing many details about individual retirees.

With state leaders discussing reforms for the pension systems and the possibility that taxpayers may be asked to contribute at least $325 million more annually, that lack of openness raises several questions.

How can taxpayers be assured that they aren’t being taken advantage of? How well do the pension systems track and catch potential abuse? And how can state lawmakers consider changes without examining specific details?

“It’s outrageous. That is not the kind of transparency that we need in government,” said Matt Mayer, president of the Buckeye Institute for Public Policy Solutions in Columbus. “These gold-plated pensions are one of the greatest drivers of public government and if we can’t determine how we are compensating these folks with taxpayer money, we can’t fix the ever-increasing cost of government.”

But not everyone is upset. Many defend keeping the financial information private, saying that the retirees are no longer public workers and their pension income isn’t the public’s business.

“Once that money is paid, and it’s in the trust fund, the money no longer belongs to the taxpayer,” said Bill Winegarner, administrator with Partners in Retirement in Westerville, an association of retired public workers in Ohio. “It belongs to the individual. It’s their private business.”

Pension history

Ohio’s pension systems date to 1920, when the teachers’ system was created. The other statewide systems were added later.

In the beginning, financial records for individual retirees were considered public documents. But the Legislature moved in 1965 and 1976 — just as it significantly improved benefits — to exempt them from public view.

Today, the Ohio Public Employees Retirement System, State Teachers Retirement System and School Employees Retirement System will release the names and addresses of retirees and members but nothing else.

The Ohio Police & Fire Pension Fund and the Ohio State Highway Patrol Retirement System will release no details related to individual retirees — not even their names.

The five systems this year denied public records requests for financial information about retirees. The requests were filed by the Akron Beacon Journal on behalf of the state’s eight largest newspapers.

Unlike Ohio, at least 21 states — including New York, Florida and Illinois — consider financial benefits for retirees a matter of public record, according to a newspaper survey. (At least 26 states also prohibit the release of such information. Other states did not return calls for comment.)

Government-watchdog groups and the media in the open states have exposed eye-popping pensions and potential abuses — details that are hidden from Ohio taxpayers.

For example, a Chicago Sun-Times investigation last year found 4,000 Illinois public retirees receiving more than $100,000 a year, and three who have topped $3 million in pension benefits since retiring. The newspaper also discovered 14,280 retirees with pensions that pay them more than their final salaries, thanks to automatic 3 percent increases in pension benefits each year.

In Ohio, nearly 400,000 public retirees receive benefits from the five pension systems. Ohioans now pay more than $4 billion a year toward those benefits.

Records show that a growing number of public employees are receiving annual salaries in excess of $100,000, particularly in the State Teachers Retirement System. As a result, they are qualifying for pensions of $100,000 or more, and with guaranteed cost-of-living raises, their annual retirement benefit could exceed their working wage within a few years.

However, the average annual pension benefit ranges from $10,552 for SERS retirees to $38,555 for STRS retirees, according to the pension systems’ financial reports. Police and firefighters receive an average $36,243 and $34,710, respe ctively.

PERS retirees received $20,214 a year, and Highway Patrol retirees got $38,076.

Unless they had a job in the private sector, they receive no Social Security benefits.

Currently, pensions are awarded based on the highest three years of salary — although there are proposals to raise that to five.

Some individuals spike their salaries with overtime or other pay in those final years to boost their pension. Others may work low-paying jobs for years and then nab a high-paid political position just before they retire, meaning they paid little toward their large pension check.

In other cases, workers retire and go immediately back into the same public job, improving their personal income by collecting a paycheck and pension at the same time. State pension officials estimate that about 31,700 retirees, or nearly one in 10, have retired and gone back into a public job — so called “double dippers.”

There are no estimates on how many others have retired and taken jobs in the private sector at a time when 652,000 Ohioans are looking for work.

Without access to financial records, it’s unclear how common these practices are.

Even some state lawmakers and pension board members said they were unaware that financial data aren’t available for scrutiny by the public.

State Sen. Kirk Schuring, a Republican from Jackson Township, questioned why the financial details are withheld. He serves on the Ohio Retirement Study Council, a group that provides oversight for the pension systems.

He noted that salaries of current public workers are available to taxpayers.

“Whatever the law is that pertains to active employees should also apply to retired, ex-employees,” Schuring said. “Why shouldn’t it?

“The employer contribution is paid by the taxpayer. The employees will argue that their contribution is paid out of their salaries. But there is a nexus between the taxpayer and the retiree.”

State Reps. Matt Lundy of Elyria, and Stephen Dyer of Green — both Democrats and former journalists who have focused on public records issues since being elected — said it would be easier for lawmakers if the financial details were available.

“You can’t make a tough decision if you don’t have all the information,” Lundy said, adding that he also was unaware that the financial data were not available to the public.

Dyer said he and Lundy are drafting legislation to require more openness.

Tom Curtis, a retired Plain Local Schools teacher who lives in North Canton and has been an outspoken critic of fund managers, said he’s not surprised that such information is secret.

“It’s a good-old-boys network at the top, and they pretty much do what they’re going to do,” he said.

Scott Maynor, former chairman of the Ohio Police & Fire Pension Board of Trustees and a lieutenant with the Lyndhurst Fire Department, said he understands the public’s interest.

The board receives periodic reports showing averages and a graphic illustrating pension amounts as a bell curve.

When he saw a “couple of ridiculous” high-end pensions, Maynor admitted he wondered how they came about and whether the workers paid enough into the system to warrant the amount. But he didn’t wonder who is receiving them.

Overall, the pension averages are reasonable, he said.

William Estabrook, executive director of the Ohio Police & Fire Pension Fund, said he wouldn’t have a problem with making some financial records public. As someone who has worked four decades in public jobs, he’s used to his salary being available to taxpayers.

PERS, the largest pension system with nearly 171,000 retirees and the one most ripe for political abuse, did not respond to multiple requests for comment about the issue of public records.

Aristotle Hutras, executive director of the Ohio Retirement Study Council, said the topic of public access has never been discussed in the 20 years he has led the organization.

He also said he doesn’t believe the information is being hidden from taxpayers.

If people want to know how much a retiree receives, they can find the final salary of the worker and then estimate the pension, he said.

But that process would be lengthy and possibly inaccurate. It also would be time-consuming to research and produce data for nearly 400,000 public retirees.