Milwaukee Prosecutors Seek State Help in Pension Probe

January 18, 2008 (PLANSPONSOR.COM) - Local prosecutors in Milwaukee say they plan to consult with the Wisconsin Attorney General's Office in deciding how to proceed with a probe of Milwaukee County's pension practices.

The Milwaukee Journal Sentinel said the two groups of prosecutors will decide whether a preliminary probe kicked off by the Milwaukee County District Attorney’s office last year should be upgraded into a full criminal investigation.  Assistant District Attorney David Feiss told the newspaper that a decision should come soon.

Feiss said Milwaukee County District Attorney John Chisholm opted to bring in state officials to not only provide extra resources but to avoid conflict-of-interest issues. Some prosecutors and DA’s office investigators are county pension system members, he explained.

Chisholm opened the review after Milwaukee County Executive Scott Walker suggested publicly in September that crimes may have been committed in the granting of lucrative “buybacks” of pension credit. A Journal Sentinel investigation into the buyback benefit last year prompted the county and its pension board to admit ordinance and federal tax law violations. The Pension Board closed the plan to new applicants after 2006.

One aspect of the buyback benefit allowed hundreds of employees to get credit for part-time or seasonal service worked in their youth, qualifying many for the generous and controversial pension and cash sick leave benefits handed out in the 2001 pension package.

Hundreds of retirees have collected six-figure backdrops; the top payout so far is $684,000, according to the newspaper (SeeNew Milwaukee County Exec Attacks Inflated Pensions). In February 2002, five county officials resigned amid accusations that they inflated the county’s plans to provide million dollar payouts to politicians at the expense of ordinary workers (See Pumped Pension Payouts Prompt Resignations ).

Public outrage over that package forced County Executive F. Thomas Ament into early retirement and prompted the recall of several County Board supervisors from office.The state Justice Department spearheaded a criminal probe into the 2001 pension deal that resulted in criminal charges against former county Human Resources Director Gary Dobbert. Dobbert served jail time in 2004 on convictions related to lying about getting an actuarial study of the new plan  (See  WI Pension Calculation Designer Sentenced to Jail ).