February 8, 2013
The (Incomprehensible) Method By Which Scituate Authorized New Pensions
On Monday, WPRI released a detailed expose about how, as Scituate's pension fund was becoming progressively more underfunded, the Scituate Pension Board, from the middle of 1999 and July 2011, met on exactly one occasion. The WPRI story is all original work, well and thoroughly done. It includes, by the way, an aborted, so-called "ambush" interview of the Treasurer and Pension Board Chairman who presided over the twelve years hyatus, Theodore Przybyla. Mr. Przybyla had
refused multiple requests [by WPRI] for an interview to discuss his oversight of the plan.
When WPRI finally tracked him down in person, Mr. Przybyla fled the opportunity of an on-the-spot interview with an admonition about the appropriateness of the Target 12 team's methods. [Cough]
It is important to note, however, that the Valley Breeze did a similar expose almost a year ago. In fact, they revealed that the Pension Board permitted a Scituate staffer to simultaneously receive both a salary and a pension for a previous position that he held with Scituate, a highly illegal arrangement that was discontinued after the Breeze exposed it. (No active links to provide to these Breeze stories but the text of one of the Vallley Breeze's contemporaneous stories is posted after the jump.)
Back to the problems posed by an absentee pension board. Of course, the biggest problem is how they failed to address the mounting shortfall of the pension fund. And apparently, nothing has been set aside for the $4.4 million liability of its retirees' health insurance.
Additionally, though, while the Scituate Pension Board was NOT meeting, pensions were being issued. How did these pensions come into existence if the Pension Board did not meet?
As a result of the Valley Breeze's stories, in March of 2012, Anchor Rising sent a letter asking the then-Scituate Treasurer and then-Chairman of the Pension Board, Theodore Przybyla, among other things,
What was the authorization or process by which you initiated the remittance of pension checks for that period (January 1, 2000 - May 31, 2011)?
We received the following reply to our query. Note that the letter, which is on the Scituate Treasurer's letterhead, is not only not signed, there is no closing or "from" at the bottom - no indication as to who sent the letter.
The Town prepares an authorization (batch) to disburse the funds by the trustee/administrator (trustee). This authorization includes the names and benefit amounts which are to be paid on a monthly basis. Changes are made to this authorization as necessary. These changes require a document to be prepared by the Treasurer's department and communicated to the trustee. The monthly amount is then adjusted and payments processed. The trustee follows the Town's instructions and processes this batch until a revised authorization is transmitted. An example of other changes would be, tax withholding, change of address or direct deposit instructions, etc.
Logistical and legal interpretations of this reply are cheerfully welcome.
And further on the question of legality, as the Pension Board was not meeting and, therefore, not approving anything, isn't the legality of the pensions issued during that period an open question?
[Monique is Editor of the RI Taxpayer Times newsletter.]Continue reading "The (Incomprehensible) Method By Which Scituate Authorized New Pensions"