According to the Associated Press, even though most employees’ monthly payments will only be lowered by a few percentage points, the decision will mean about 1,900 state employees will have to repay an average of $28,000 to settle the overpayment.
“The nature of this debt is very sensitive,” said Chris Gasperini, a manager in the Oregon Department of Revenue, according to the Associated Press. “These are retired folks who, through no fault of their own individually, have had a court decision that really affected their lives. I have faith in human beings that they recognize that they owe it and that they will pay it … I’m really hoping everyone just pays.”
The board is hoping that repayments – which if paid in full would amount to about $53 million – will make some headway on putting money back into the state’s beleaguered pension system.
In August 2005, the state Supreme Court upheld a 2002 decision by a Marion County judge who said that the pension board improperly paid out money to employee accounts for 1999 earnings that should have been held in reserve. As a result, about 75,000 current employees who joined the Public Employees’ Retirement System (PERS) before 1996, as well as about 36,000 who have retired since 2000, would see a cut in their monthly pension checks. The ruling also meant that those who have retired since 2000 would also be asked to repay excess 1999 earnings that were paid out (See Oregon Supreme Court Turns Away PERS Ruling Challenge ).
The board decided that employees who opted for lump-sum
payments instead of life payments will also have to hand
over some of roughly $400,000 to $800,000 they received,
according to the AP.
Officials of the PERS told the AP that they plan to mail the letters to request repayment in September.