Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, February 25, 1994 TAG: 9402250152
SECTION: VIRGINIA PAGE: B-1 EDITION: METRO
SOURCE: By DAVID M. POOLE STAFF WRITER
DATELINE: LENGTH: Long
The pension controversy, however, has created only a small ripple as the council hopefuls appear to be avoiding issues while courting the votes of a few thousand Democratic faithful.
One candidate, Jim Harvey, even told a reporter that he saw no point in discussing issues until after the primary, when the general election campaign gets under way.
"You have to understand," he said, "this is a primary."
When pressed, Harvey agreed to discuss his role in the 2-for-1 pension controversy that rocked City Hall two summers ago.
The uproar began in August 1992 when a Roanoke Times & World-News investigation showed that City Council members had given themselves and six top administrators the most lucrative municipal pensions in the state.
The disclosure, which came a few months after council gave top administrators 10 percent raises, led critics to accuse council and the officials of padding their pockets at taxpayers' expense.
Public pressure forced council to cap the value of the pensions and prompted several council members to give up their 2-for-1 benefits, which would have given them two years' credit in the city's retirement plan for every year of service.
The three primary candidates who played no role in the controversy are quick to condemn the 2-for-1 pensions.
John Edwards, Nelson Harris and Linda Wyatt said that council made a mistake by enacting the pensions in 1989 and extending them in 1992.
"For the average citizen out there, that was real hard to take, especially those of us who live from paycheck to paycheck," Wyatt said.
The three candidates who voted for the 2-for-1 pensions had some regrets, but generally defended their actions.
"I don't think it was a mistake under the original concept," said Jim Trout, who was a City Council member in June 1989, when the 2-for-1 issue surfaced.
Trout said beefing up pension benefits for six council-appointed officials made sense because the city had just begun negotiating a merger proposal with Roanoke County.
Trout contended that top administrators needed financial security because their jobs could have been eliminated in the merger plan. (Roanoke County made no such provision for its administration.)
The 2-for-1 plan provided a windfall for the city administrators. They were able to keep the deferred compensation packages they had received in lieu of a city pension. They were added to the city's retirement system, with their past service doubled.
For instance, City Manager Bob Herbert immediately qualified for an annual city pension of more than $50,000.
Trout contended that council had no justification for extending the 2-for-1 benefits in 1992, after the threat of consolidation had lifted.
But Trout, who left council in 1990, stopped short of criticizing fellow Democratic primary candidates Bill White and Harvey.
"I wasn't in the back room, and I don't know why they did it," he said.
White said he voted to extend 2-for-1 benefits without fully understanding the size of the windfall for top administrators.
White blamed himself for not asking tougher questions of staff, particularly ex-Finance Director Joel Schlanger, who also benefited from the extention.
"If I had been aware of the magnitude of the benefits that accrued to top administrators, my vote probably would have been different," he said.
Harvey has no regrets for his vote in May 1992 to extend 2-for-1 benefits, saying it did little to expand benefits already in place.
"It was a technicality," he said.
The original benefits were capped by an Internal Revenue Service ruling that froze employees' salary and service at July 1989 levels. The 1992 vote lifted the cap, opening a three-year window that increased the pensions of some top administrators by as much as 10 percent.
The second vote also brought White and Harvey, who had joined council in 1990, under the 2-for-1 plan.
White was not vested before council capped the 2-for-1 benefits. He said he would favor continuing such benefits for council members because it would allow them to retire with a $4,160 annual pension after eight years in office.
"It would help stimulate turnover," White said.
Harvey, who is vested in the city's retirement system, said he had not decided to accept his 2-for-1 benefit.
Harvey agreed, however, that the enhanced pension would be a small benefit for a part-time council position that is fast becoming a full-time job.
"You're not talking about that much money," he said.
Trout has benefited from the 2-for-1 plan.
The retired railroad planner would have been in line for a $3,840 city pension when he left council with 16 years of service in 1990. The 2-for-1 plan raised his pension to $6,500.
"I don't need it, and I'd like to do without it," he said.
Trout said he tried to give up his pension in 1989, but said Schlanger told him he had to accept the money.
In 1992, four council members wrote to the city Finance Department stating their intent not to accept any benefits under the 2-for-1 plan. The four were Howard Musser, Mac McCadden, Beverly Fitzpatrick Jr. and White.
Keywords:
POLITICS
by CNB