Tuesday, July 30, 2002
CalPERS Notifies Retired Jurists That Budget Impasse Will Delay Pension Payments; Vickrey Urges Connell to Pay
By ROBERT GREENE, Staff Writer
Retired California judges who began their bench careers before 1994 have been sent mixed messages about their August pension checks, which fund officials have said will not be sent out until the state budget deadlock is resolved.
California Public Employees’ Retirement System chief James E. Burton sent a letter Thursday to retired jurists receiving monthly checks from the Judges’ Retirement System, warning them that they will not get their Aug. 1 payment until two or three days after a budget is adopted.
But Administrative Office of the Courts director William Vickrey followed that with a letter to state Controller Kathleen Connell saying that failure to pay would breach a vested contract right. Sources in Connell’s office said the controller’s legal staff is studying the question.
The Legislature is nearly a month past its statutory deadline for adopting a budget, meaning the state is officially without authority to make payroll and state employees may have to forgo paychecks while elected officials work through their differences.
In his letter, Burton told the state’s more than 1,400 retired jurists, survivors and beneficiaries in JRS that their pension checks would also be affected because the Judges’ Retirement System is funded on a “pay as you go” basis.
JRS is one of two judicial pension programs. Judges who took the bench beginning in 1994 are in JRS II, a system that offers slightly different benefits and is funded differently—and consequently is not affected by the state budget debacle.
Both programs are administered by CalPERS, which has plenty of money on hand to pay ex-state employees. But Burton said it was not possible to transfer money from the state fund or from JRS II to the Judges’ Retirement System.
“In the meantime, I understand many California banks are offering loans at little or no interest to assist with this situation,” Burton said in his letter.
Vickrey wrote retirees Friday, sending a copy of a letter he sent Connell. “[I]f a budget is not enacted, it is our view that they have to process your checks on a timely basis,” Vickrey told the pensioners.
To Connell, he cited case law that he said establishes that “a public employee’s pension rights are an integral element of compensation and a vested contractual right accruing upon acceptance of employment,” and that such rights extend to judicial pensioners.
It is “constitutionally impermissible to impair such vested contract rights in the absence of a police powers ‘emergency’ serving to protect a ‘basic interest of society,’” Vickrey wrote.
“Other state pensioners will receive payments notwithstanding the budget impasse, including beneficiaries of the Judges Retirement System II, and JRS I beneficiaries should not be singled out for adverse treatment,” Vickrey wrote.
Neither Vickrey nor Burton were available for comment yesterday.
Many retired judges of the Los Angeles Superior Court, the 24 now-defunct municipal courts and the Second District Court of Appeal would be affected if the payments, due Thursday, are held up.
Former Superior Court Judge Kenneth Chotiner, who first took the bench as a Los Angeles Municipal Court Judge in 1981, expressed outrage at the prospect of pension checks being delayed.
“It’s shocking that people who have devoted their careers to public service are rewarded by a system that depends on the political whims and infighting of the Legislature,” Chotiner said.
Superior Court spokesman Allan Parachini said the state Administrative Office of the Courts has forwarded enough funds for the court this month to meet its $6 million payroll for current judges and $19 million for employees.
“They do not foresee a problem” with pay during the budget deadlock, Parachini said of the AOC.
But he added that the court’s services and supplies budget is frozen until a budget is passed.
Copyright 2002, Metropolitan News Company