The Joplin Globe, Joplin, MO

Local News

August 30, 2013

Settlement talks going on in Joplin pension case

JOPLIN, Mo. — Joplin’s Police and Firemen’s Pension Fund board is broaching settlement of a lawsuit pressed by firefighters who challenged the calculation used to determine death and disability pay.

“There have been some settlement discussions, but we’re just at the talking stage,” said City Attorney Brian Head.

The discussions are about a lawsuit pending against the city and the fund’s board filed on behalf of disabled fireman Tom Robertson and three others representing active-duty firefighters who are members of the Local 2618, International Association of Fire Fighters: Adam Grimes, Larin Trenary and Daniel Jobe.

An attorney representing the firefighters, Dan Tobben of St. Louis, was asked for comment on the discussions but said by email, “At this point, I don’t believe we should be commenting.”

Additionally, a letter by a former pension board member citing concerns about the way some of the pension fund’s business has been handled has resulted in an inquiry by a state committee that oversees public pension funds.

The issue regarding the lawsuit involves a dispute over whether disability pay is calculated correctly. A circuit judge ruled it is not.

Firefighters and police officers who were employed before 2009 are eligible for retirement at 20 years. Firefighters believed they were to receive half pay if they were injured on the job or that their families would receive half pay if they were killed in the line of duty. But, the city has been reducing disability pay by one-twentieth for each year a fireman or police officer was short of the 20-year retirement threshold.

Robertson developed a disabling lung condition from smoke inhalation. The pension board granted his disability benefits, which the city began paying Feb. 1, 2011, but his monthly payment was about $500 a month less than it would have been at half pay.

The issue is the application of two rules in the pension regulations. The city contends that one section of the rules requires death and disability payments to be offset by the number of years less than 20 that were served. The city contended that was authorized by a vote in 1993 to change the pension fund’s rules.

The firefighters contend that the regulation addressing the offset applies only to officers or firefighters who retire because they reach retirement age but have not met the 20-year threshold. They have said that requirement was inserted in the plan to accommodate a police chief who would not work for 20 years because he would reach retirement age before then.

Jasper County Circuit Judge David Mouton held a hearing on the lawsuit in July 2012. He issued a ruling in October 2012 that interpreted the plan’s regulations in favor of the firefighters.

The judge wrote in the ruling that there is no ambiguous language in the plan that should result in an offset. He said the section related to disability is clear that benefits should be half of a worker’s regular pay.

The pension board appealed that ruling and the case is pending now in the Missouri Court of Appeals at Springfield.

There have been disagreements among pension board members over the lawsuit. One firefighter, Tim Woodward, resigned in 2011 after presenting what he regarded as evidence to the board that the 1993 election did not authorize an offset in pay.

A police officer, Larry Swinehart, said at one meeting regarding the lawsuit that he might have voted differently about litigating it if firefighters had “saddled a different horse.”

The pension fund also has been troubled because of a decreasing funding ratio attributed by city officials in part to the enactment of the 20-year retirement benefit, insufficient city contributions and the use of incorrect assumptions forecasting the payouts that would be required from the fund. The funding level before the change to 20-year retirement was 80 percent. It is currently at about 54 percent. The city has been making contributions at the actuarial-recommended rate, which this year was equal to 31.46 percent of payroll. The city also has made lump sum payments of $950,000, borrowed from the public safety sales tax fund, and $1 million.

Some of the issues that led to the lawsuit and the declining funding ratio are the basis of a complaint another retired firefighter and former pension board member, Robert Davidson Jr., has made to a state oversight committee.

The Joint Committee on Public Employee Retirement asked City Manager Mark Rohr to reply to the committee about those concerns.

The state committee voted to ask its staff to talk to Joplin city officials about the issues and offer assistance or recommendations.

Among the issues the committee has inquired about:

• A copy of any log the city has to verify that the board has received training that is required under state statute. Requests in past years to attend training conferences have been denied, with city officials saying instead that in-house training is adequate.

Rohr responded in a letter June 25 to JCPER that the board meets quarterly with the fund’s investment consultant and has annual visits with the fund’s actuary. Some members have occasionally attended a Missouri pension conference.

• Information on whether the plan has ever been audited outside of the city’s annual financial reports because errors have been reported in the amounts some pensioners were being paid.

The city responded that the pension fund receives a separate audit every year. Errors were discovered as the result of city staff review for the lawsuit and were corrected.

• Information on when outside legal counsel is used to advise board members. Davidson raised questions about whether it presents a conflict of interest for the city attorney to advise the board at regular meetings.

The city replied that an attorney who specializes in pension matters is consulted about technical issues. The city does assign litigation work and legal advice on those matters to an outside attorney.

 

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