Press

Findings from TUA’s pension project on Wayne County, Michigan, are featured in the following Detroit News article.
Christine MacDonald/ The Detroit News
Detroit — Forty ex-Wayne County employees retired with annual pensions of more than $100,000, according to a report released today by a national taxpayers’ rights group.
Among the top annual pensions to retirees: Dr. Michele Harris, health director $159,477; Ronald Yee, director of retirement system, $152,856; Daniel Kerber, deputy director of airport, $136,050; Sawait Kanluen, a doctor with the medical examiner’s office, $130,181; William Wolfson, corporation counsel, $125,020; James Lacey, $124,010 and Veda Sharp, director of Detroit-Wayne County Community Mental Health Agency, $123,090
“We have found the amounts are very high,” said Christina Tobin, vice president of Taxpayers United of America, which used the Freedom of Information Act to collect the pension data.
“It’s unsustainable. If we don’t implement pension reform, it will collapse.”
Total payouts for those pensioners making more than $100,000 could range between $3.3 million to $5.7 million in their lifetime, according to the group’s analysis, which assumes the individual retires at 55 and then receives benefits for another 30 years.
County spokesman Lynn Ingram said Executive Robert Ficano has made several reforms, including moving to end a bonus check to retirees and seeking an end to a 5-to-1 match for a defined contributions savings plan, which has existed for years for some employees.
“The county has established a new hybrid retiree pension program to get away from the large defined benefit plans that existed well before the current administration,” he said.
The group analyzed the top pensions of several other Michigan counties, the state police, state employees and teachers. Tobin said they have gathered similar data in four other states as a part of its push for pension reform, such as requiring current employees contribute more to pensions and moving new hires to 401k systems.
A “top 50” list of state employees compiled by the watchdog group shows only one with a six figure annual pension, but 49 more with pensions of between $97,000 and $74,000.
More than half of the top 100 Michigan teacher pensioners get more than $100,000 and the other 49 receive more than $90,000 a year. The top 25 Michigan State Police retirees receive between $88,000 and $64,000 a year.
“The time will come when there is no more money in the kitty,” said Rae Ann McNeilly, the group’s outreach director, at a press conference in downtown Detroit.
Josh Franzel, vice president of research at the Center for State and Local Government Excellence in Washington, D.C., said simply listing top paid retirees is not a good way to assess a retirement plan.
“To see how well a plan is working, look at the funding ratio,” he said. “Are they making their annual contributions?”
Michigan’s public sector retirement plans are funded at between 75 and 78 percent, like the majority of state and local retirement plans throughout in the nation, according to the group. Analysis last year found 47 percent nationwide were funded at between 60 and 79 percent, about 33 percent at between 80 and 99 percent, and only 6 percent are funded 100 percent or better. The organization determined 15 percent of the nation’s public retirement plans are funded at between 40 and 59 percent.
“Often, those who stand out when you simply list amounts were the highly compensated managers and experts. The medical school instructor who was the world renowned heart surgeon at a university medical facility,” Franzel said.
But changes are being made.
“We are seeing a lot of movement in requiring employees to contribute more. Most of the changes are being made within the framework of a deferred benefit plan, reductions in benefits for new employees, increased contributions, reduced benefits for early retirement, and use of different equations for calculating final salaries for setting retirement benefits,” Franzel said. “New employees are getting hybrid plans and defined contribution plans. Changes are being made.”
Officials with the Wayne County Retirement System did not immediately return phone calls.
In many cases the county retirees had to contribute tens of thousands of dollars upon retirement to fully fund their pensions. Some took the money from separate investment accounts or were able to apply unused vacation payouts toward their pensions. Others took a reduced pension and diverted a portion of their monthly payout back into their fund.
Michele Harris, the largest pensioner, retired April 1 and gets a pension of $13,290 a month. However, county records show she had to contribute $832,970 into her account. It doesn’t say where that amount came from.
McNeilly said they haven’t compared Michigan’s pensioners to other states because there are too many variables to make a fair comparison.
Other top county pensioners are:
Richard Unger, $121,980
Victoria Holland, former director of engineering, $$120,881
Michael Molitor, $119,571
Timothy Taylor, former human relations director who was fired as a county contractor this fall for his involvement in the Turkia Mullin severance scandal, $117,839
Richard Padzieski, $117,340
Linda Hryhorczuk, former county child psychologist, $117,282
cmacdonald@detnews.com
(313) 222-2396

Findings from TUA’s pension project on Grand Rapids, Michigan, are featured in the following video by WOOD-TV 8.

Updated: Tuesday, 06 Dec 2011, 8:07 PM EST
Published : Tuesday, 06 Dec 2011, 5:40 PM EST

• By Anne Schieber

GRAND RAPIDS, Mich. (WOOD) – A retired teacher in Michigan will receive $6 million in a pension payout, the highest government payout in the state, claims a taxpayer advocacy group.
Taxpayers United of America is researching and publishing top government pensions across the country and was in Grand Rapids Tuesday to release their state findings.
The group is highlighting government retirees getting a guaranteed pension through what’s known as a defined benefit program.
In Grand Rapids, the group claims, the highest annual pension being paid by the city is more than $96,000 per year. Based on a life expectancy of 85, that payout tops $3.4 million. That’s followed closely by payout among police and fire retirees – $3.3 million.
The top payout in Kent County is $2.5 million, and the next 24 pensions on each list all exceed $2 million.
“Our hope is to shed light on this issue,” said Christina Tobin, the VP of Taxpayers United of America. “Taxpayers see these names. They have a connection. This is my neighbor.”
The group also looked at pensions for judges, state workers and teachers.
Most government workers receive guaranteed pensions. In the local private sector, only 7% of workers get them, according to The Employers Association.
Defined benefit plans for government workers have been in place for decades, and were designed to make up for lower government salaries.
“That situation doesn’t exist today,” said the group’s Rae Ann McNeilly, adding government workers “are paid almost twice as much as those in the private sector, on the national level.”
County Administrator Daryl Delabbio told 24 Hour News 8 on Tuesday in an email statement that Kent County doesn’t offer retiree healthcare. Instead, he said, the county offers a monthly stipend of up to $350 depending on how long the retiree served the county.
Delabbio said that Kent County’s Other Post-Employment Benefit (OPEB) is lower than that of many other counties.
“For instance,” he pointed out, “Kent County OPEB liability is roughly 35-36 million dollars; Wayne County’s OPEB is over 800 million dollars.”
Delabbio also said that “Kent County’s pension system is managed very well, is funded appropriately, and we have taken steps over the past 18 months to modify pension contributions by employees and retirement eligibility to further contain our costs.”
City and county commissioners, the city manager and the state teacher’s union did not respond to a request for comment from 24 Hour News 8.

Findings from TUA’s pension project are featured in the following article by WLNS 6.