Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, May 12, 1994 TAG: 9405120195
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: By DAVID M. POOLE STAFF WRITER
DATELINE: RICHMOND LENGTH: Medium
``I think it was worse than a bipartisan defeat,'' Finance Committee Chairman Richard Cranwell, D-Roanoke County, said after the 19-1 vote. ``That sucker was dead as it could be.''
The lopsided vote was not unexpected. Retiree groups had condemned Gilmore's $234 million offer that would have provided refunds of 50 cents on the dollar to federal and military retirees whose pensions were taxed in the 1980s under a state policy later found to be unconstitutional.
Gilmore sought to put the best face on the defeat, saying it would give him much-needed guidance in settling a lawsuit by retirees seeking more than $700 million in refunds and interest.
In fact, a fresh round of legal negotiations began immediately after the House panel rejected Gilmore's offer during a one-day General Assembly session.
Michael J. Kator, a Washington, D.C.-based attorney representing pensioners in the litigation, put forward a $400 million counter-proposal that he said would provide full refunds, with no interest.
Kator said a full settlement may cost less than the state's estimate of $468 million. ``I think a lot of people are not going to seek a refund, even though they are entitled,'' he said.
Gilmore refused to comment on the counter-proposal. He has refused to budge from his $234 million offer, saying it was his responsibility to provide limited relief to federal retirees and to reduce the potential burden on the state's taxpayers.
Gilmore passed along Kator's offer to House Speaker Thomas Moss, D-Norfolk, who earlier in the day said the legislature would fund any ``reasonable'' offer. Moss could not be reached for comment Wednesday night.
If the General Assembly cannot agree, Kator said the federal pensioners are willing to take their chances in court.
Earlier this year, an Alexandria judge said the pensioners are not entitled to refunds. The retirees have appealed to the Virginia Supreme Court, which could take up the case as early as this fall.
Keywords:
GENERAL ASSEMBLY 1994
by CNB