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May 04, 2014 08:23 PM UTC

Business Groups Educate Judges on Public Pension "Crisis." No Conference Yet Scheduled on Corporate Welfare "Crisis."

  • 3 Comments
  • by: PolDancer

A number of prominent U.S. business interests that stand to benefit from the reduction of contractual public pension obligations are graciously sponsoring (multiple) conferences to ensure that U.S. judges are well-informed in this important public policy and legal arena.  (I do not know if any Colorado judges have attended or plan to attend the scheduled events.  Readers new to this public policy issue should know that the State of Colorado is currently attempting to abrogate its Colorado PERA public pension contractual obligations.)

It is somewhat odd that judicial conferences are being held to address a perceived public pension "crisis," yet there seems to be a relative dearth of conferences designed to educate judges regarding the U.S. corporate welfare "crisis" (multiples of the purported "public pension crisis.")  The most recent "impartial" judicial conference intends to address "the looming financial and structural crisis facing state pensions systems."

David Sirota on the U.S. Corporate Welfare Crisis:

"While public pensions face a $46 billion annual shortfall, the report found, it is 'dwarfed by the $80 billion a year states and cities spend on corporate subsidies.'"

http://www.truth-out.org/news/item/23401-koch-brothers-major-corporations-sponsor-pension-reform-seminar-for-judges

As readers have seen, I also find it curious that state and local government contractual public pension obligations (which will consume 2-3 percent of state and local revenues in the coming decades) constitute a "crisis."

On the other hand, I am encouraged by the fact that Professor Amy Monahan of the University of Minnesota School of Law is a participant in planned judicial education events.  Colorado PERA retirees have followed Professor Amy Monahan's work over the last few years, and noted her opinions on the Colorado Legislature's attempt to escape its contractual PERA pension obligations.  (I would be interested in following the lectures at the planned judicial education events.  However, I am not sure if the events will be public, or if audio/video of the events will be available.)

The administration of our own Colorado Governor Ritter (who signed the Colorado PERA pension contract breach legislation in 2010) agrees that the SB10-001 taking from Colorado PERA retirees was substantial:

“In Colorado, a class action lawsuit has been filed challenging recently passed statutory reductions in annual COLA increases which for an average member would result in $165,000 of reduced benefit over a 20 year period.”

“COSC agrees that an obligation exists since the government entity has entered into a duty, contract, or promise to provide compensation in the form of benefit payments during retirement; and furthermore, we agree that this obligation is a present obligation to the extent that the benefits owed have already been earned through past services, and are legally enforceable once vesting provisions have been met.”

“Because the exchange transaction which gave rise to this present obligation was made between the employer and the employee who is also a member of the pension plan, a reduction in member benefits (such as COLAs), or an increase in required employee contributions both serve to change the net economic benefit to the employee that was entered into at the time of the exchange transaction agreement.”

“The criteria suggested as the basis for differentiating these COLAs (automatic) versus ad-hoc COLAs is the statutes that exist as of the date of the employer’s financial statements.”

“The essential difference between an automatic COLA and an ad hoc COLA is the legal requirement; with this core difference there is no way for the two not to be substantively different. The legal difference in this instance is critical to the determination of whether the government is unable to avoid the surrender of resources to meet the obligation.”

http://www.gasb.org/cs/ContentServer?site=GASB&c=Document_C&pagename=GASB%2FDocument_C%2FGASBDocumentPage&cid=1176157387791)

Colorado PERA officials in a written document, to the Colorado General Assembly’s Joint Budget Committee on December 16, 2009 state that the PERA COLA benefit IS a contractual obligation of PERA, “The General Assembly cannot decrease the COLA (absent actuarial necessity) because it is part of the contractual obligations that accrue under a pension plan protected under the Colorado Constitution Article II, Section 11 and the United States Constitution Article 1, Section 10 for vested contractual rights.”

http://www.kentlambert.com/Files/PERA_JBC_Hearing_Responses-12-16-2009_Final.pdf

The aforementioned Professor Amy Monahan is the preeminent legal scholar in the United States on public pension contracts.  "Amy Monahan is a professor and the Solly Robbins Distinguished Research Fellow at the University of Minnesota Law School."

Professor Monahan on Colorado's Public Pension Lawsuit, Justus v. State:

"In Colorado, retirees challenged actions by the state legislature that reduced the COLA retirees were eligible to receive.  The plaintiffs included individuals who had retired under Colorado’s public employee retirement system at a time when there was a guaranteed 3.5 percent COLA in place."

Professor Monahan: The Denver District Court's Initial Decision in Justus v. State was Surprising in Light of Colorado Public Pension Case Precedent.

Professor Monahan:

"The (Denver District) court’s ruling is surprising both because the court appeared to break from earlier Colorado decisions that found pension benefits to be contractually protected prior to retirement and because the change could be characterized as a retroactive change to benefits, which is the type of change that invites the most scrutiny under a contract clause analysis."

From a recent article in Truthout:

"Koch Brothers, Major Corporations Sponsor Pension Reform Seminar for Judges."

"As state courts across the nation prepare to referee numerous public pension reform disputes, a gaggle of interested parties — from major corporations to the Koch brothers — will next week sponsor an expenses-paid conference on public pension reform for judges who may decide the cases' fates."

"It's unclear which judges — and how many of them — will be attending the conference, although George Mason's judicial seminars are traditionally open to both state and federal judges.  George Mason does not publicly list conference attendees, and federal judges who attend privately funded educational seminars aren't required to publicly disclose which conference they attended until 30 days after it ends."

David Sirota:

"'We are having a debate over pension shortfalls, calling them an emergency, when in fact they are in aggregate far smaller than what is spent each year on subsidies to business,' Sirota told the Center for Public Integrity. 'And business likes that imbalance.'"

"Hank Kim, executive director of the National Conference on Public Employee Retirement Systems, said he's tired of pension reform advocates claiming that state and local municipalities can only overcome their fiscal problems on the backs of public workers."

"'If it's really about 'shared sacrifice,' which is the terminology folks have been using since the Great Recession, it occurs to us that the groups that aren't sharing the sacrifice are the wealthy and the corporations because they're still getting the tax breaks,' he said. 'You can't be crying poverty when you are still giving away the shop to corporations.'"

"Sirota, for one, said the conference hosted by George Mason's Law & Economics Center is 'an effort to lobby judges.'"

"'It's crossing a line that's not supposed to be crossed,' he said.

'What's next? Is a company going to be able to hire a lobbyist to go lobby a judge in chambers?'"

http://www.truth-out.org/news/item/23401-koch-brothers-major-corporations-sponsor-pension-reform-seminar-for-judges

Excerpts from an agenda at a recent judicial education conference:

"Judicial Symposium on the Economics and Law of Public Pension Reform.

Event Date: Sunday, April 27 to Tuesday, April 29, 2014

Location: Francis Marion Hotel, Charleston, South Carolina

Program Description: The Judicial Symposium on the Economics and Law of Public Pension Reform discussed the looming financial and structural crisis facing state pensions systems across the nation.

It also discussed the legal challenges to reform efforts under state constitutions citing both the contacts clause and the takings clause.

Legal Questions Raised by Pension Reform

Amy B. Monahan, Julius E. Davis Professor of Law, University of Minnesota School of Law

http://masonlec.org/events/event/195-judicial-symposium-economics-law-public-pension-reform

Conference Sponsor List:

https://www.documentcloud.org/documents/1146936-george-mason-public-pension-reform-seminar-funders.html

Visit saveperacola.com.  Support the rule of law in Colorado.  Colorado is better than breach of contract.

Comments

3 thoughts on “Business Groups Educate Judges on Public Pension “Crisis.” No Conference Yet Scheduled on Corporate Welfare “Crisis.”

  1. It looks like the business lobby is out to lobby state and federal judges as their lobby strategy with state legislatures produced mixed results … except it was quite effective in Colorado.  I'd be surprised if Rhode Island judges would be in attendence at any of these upcoming Koch conferences.  Indeed this whole influence peddling effort is quite sordid! 

  2. Hawkeye, according to records at the Colorado Secretay of State's office, one of the groups lobbying for SB 10-001 was the business organization “Colorado Concern.”

    Link:

    http://www.coloradoconcern.com/index.html

    From the Colorado Concern website (in 2010):

    “Colorado Concern’s membership now includes 100 CEOs and business and community leaders from across the state.”

    The Colorado Concern Board of Directors:

    “Joe Blake – Chancellor Emeritus, CSU System
    Dr. Ted Clarke, MD – Chairman and CEO, COPIC
    Steve Farber – President, Brownstein Hyatt Farber Schreck
    Pat Hamill* – Chairman and CEO, Oakwood Homes
    A. Barry Hirschfeld – President, A B Hirschfeld & Sons
    G. “Buck” Hutchison – President and CEO, Hutchison Western
    Bill Hybl – Vice Chairman, Broadmoor Hotel
    John Ikard* – President and CEO, FirstBank
    Walt Imhoff – Retired Managing Director, Stifel Nicolaus & Co.
    Walter Isenberg – President and CEO, Sage Hospitality
    Don Kortz – Chairman of the Board, Fuller Real Estate
    David McReynolds – President, Columbine Health Plan
    Larry A. Mizel – Chairman and CEO, M.D.C. Holdings, Inc.
    Kay Norton* – President, University of Northern Colorado
    Kathryn Paul – President and CEO, Delta Dental of Colorado
    Blair Richardson – Managing Partner, Bow River Capital Partners
    Dan Ritchie – Chairman and CEO, Denver Center for the Performing Arts
    Dick Robinson – Co-CEO, Robinson Dairy, Inc.
    Richard M. Sapkin – Managing Principal, Edgemark Development, LLC
    Sylvia Young – President and CEO, HealthONE”

  3. U.S. Chamber of Commerce, Arnold Foundation, Cato, and Koch Foundation are included in the list of funders (link at end of article.)

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