A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

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Even prosperous communities are being pinched. The Beaverton School District, outside Portland, had to get rid of 75 teachers last year when its mandatory pension contribution rose by $14 million. That was after shedding 340 teachers in 2012.

“I have town hall meetings, and the parents are just confounded by this,” said Mark Hass, a Democratic state senator from Beaverton.

A Golden Touch

Oregon’s unusual method for calculating pensions tends to generate lavish payouts.

For decades, PERS calculated pensions two different ways, and retirees could choose whichever produced the bigger numbers.

The first way was similar to what most states do, basing pensions on each worker’s final salary and years of service. But Oregon’s lawmakers included a golden touch, redefining “salary” to include remuneration from any source.

That was how Mr. Bellotti, the former football coach, came to be the state’s third-highest-paid pensioner, at roughly $559,000 a year.

Photo

Mike Bellotti in 2007, when he was the University of Oregon’s head football coach. After retiring as the university’s athletic director in 2010, he started drawing the biggest government pension in the state. Since then, two other retirees have surpassed him. Credit Chris Pietsch/The Register-Guard, via Associated Press

When he retired in 2010 as the university’s athletic director, the standard pension formula was applied to his salary, plus a share of the outside licensing fees and product endorsements the football program brings in. (His pension details, along with those of other retirees in the system, were first obtained in 2011 from PERS by two newspapers, The Oregonian and The Statesman Journal.)

Mr. Bellotti said he never asked for a supersize pension. In 1995, he said, the university started to include a percentage of all endorsement and licensing fees in coaches’ salaries.

“It was basically to augment the university’s ability to pay a competitive salary to its coaching staff,” he said.

When Mr. Bellotti retired, he was partway through a five-year, $1.9 million-a-year contract, which he said was still below the league average of about $3 million.

PERS made up for it with a big pension. “It was pay later as opposed to paying now,” he said.

Dr. Robertson, the former Oregon Health & Science University president, said he had retired and started drawing his pension last fall, after learning he had multiple sclerosis. He said he agreed to stay on through the end of the academic year, without pay, “for the sake of continuity.”

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