Senator Bertino-Tarrant urges fix to pension code

 SPRINGFIELD— In the year following Illinois’ attempt at reforming the state pension systems, State Senator Jennifer Bertino-Tarrant discovered yet another alarming flaw in some of the systems pension codes.

In 2011, a state employee retired from his position as a Secretary of State investigator with the State of Illinois. Nearly a year later, the State Employees Retirement System Board notified the employee that they had miscalculated his pension, resulting in an overpayment.

The Board informed the employee his monthly pension would decrease and arrangements to collect the overpayment would be forthcoming. The employee opposed the change to his benefit and sued the system.

He won.

An Illinois Appellate court decision was released on January 13, 2014 that stated SERS did not have the statutory power to adjust a person’s payment once it was set. 

Senator Bertino-Tarrant hopes to rectify the issue of mistake in benefits with a pension proposal that passed out of the Senate Executive Committee today.

“We all know that mistakes can happen,” Bertino-Tarrant said. “The systems should be able to fix an error.”

 The proposal makes changes to the General Assembly Retirement, State Employee Retirement and Judges Retirement systems by allowing them to recalculate pension benefits, if they determine that the benefits originally awarded were incorrect.

If the benefit amount is calculated too low, the recipient will receive a lump sum of the difference between what they were owed and what they actually received. If the benefit was set too high, the system can recoup its overpayment by lessening future benefit amounts, as long as the mistake is discovered within three years of the benefit being awarded.

Finally, if the mistake is not discovered during the three year threshold, the system can no longer recoup the over payment, but can adjust future payments to reflect the correct benefit amount. 

Teachers and university employees’ pension systems currently have language allowing them to recalculate a pension when a mistake is discovered.

The Appellate court opinion indicates that “the legislature clearly knows how to grant a pension board the authority to fix errors it makes in pension calculations outside of the 35-day period of review provided by the Administrative Review Law, as it has done so for SURS and municipal police pension boards.”

“My argument during pension reform debate has remained the same,” Bertino-Tarrant said.  “Retired workers should get what they have earned. The same principle applies here.”