Benefits May 20, 2002

Unions Fights Pension Cutoff

May 20, 2002 (PLANSPONSOR.com) - A judge is considering a request by Milwaukee County's largest public employee union to block the possible halting of lump-sum retirement payments that have become extremely popular since a pension scandal erupted earlier this year.

Reported by

Fred Schneyer

District Council 48 sought a temporary restraining order from Judge Mac Davis.

County pension board officials postponed any action on halting the lump-sum payments until May 24. Their discussions started after the board heard from state Attorney General Jim Doyle that the controversial plan creating the payments might have been adopted illegally, according to a story in the Milwaukee Journal Sentinel.

County pension officials said about 50 employees have asked about the lump-sum payments since the middle of last week.

The lump-sum benefit was created in 2001 along with other pension enhancements. A retiree who chooses to receive a lump-sum payment upon retirement gets a smaller monthly pension payment in exchange. The lump-sum payments are part of District Council 48’s contract.

In 2001, about $6 million worth of lump sum payments were processed. But after the pension scandal surfaced this past January, nearly $17 million in lump sum payments were processed by March 15, according to Jac Amerell, manager of the county retirement system.

The scandal led to the resignations of the former county executive and handful of other county officials, as well as the recent filing of criminal charges against former county personnel director Gary Dobbert (see Milwaukee Pension Flap Sparks Criminal Charges ).