Fight the System, not the User



Is going back to work after retiring double dipping? We take a look at the issue in Friday’s editorial:

We’ve heard the complaints for years about those who take advantage of retire-rehire policies and the state’s Teacher and Employee Retention Incentive program. It seems to come up every time somebody prominent takes advantage of the option.

When Myrtle Beach City Manager Tom Leath and Police Chief Warren Gall, for example, took advantage of the option in December, it prompted a groundswell of grumbling about unfairness and “double dipping” into the coffers.

The idea has some prominent detractors as well. At the town hall meeting Gov. Nikki Haley held in Myrtle Beach in March, she came out against the practice, saying of those who had been rehired, “we’re going to send them on their way.”

And at a meeting of the Carolina Patriots at the end of March, Republican Rep. Thad Viers of Myrtle Beach espoused a similar sentiment, saying “we need to get rid of a government porkulus program that only benefits government workers.”

Bills have been introduced in the House and Senate with regularity for the past few sessions, attempting to close the programs to new employees. But do those who use the program really deserve the criticism?

Let’s look at the facts. The way the state’s retirement system is set up, any employee who pays into the state’s retirement system, including city employees, state employees, teachers and others, can retire at 28 years of service. Police officers can retire with full benefits at 25 years. That means if a teacher begins work right out of college at around 22 years old, he can retire at age 50.

Does anybody really think that those people will never want to work again or should never work again? Many are nowhere near ready to sit at home or spend their days on the golf course. So they head back to work. Horry County Schools has 118 teachers who have already taken advantage of the TERI system, and a number of people in city governments have also been rehired after retirement. Often, the place these workers can best use their talents is the same place they just left.

It does not cost the city or school district any extra money. The rehired workers collect the same salary that their employer was already paying or would theoretically pay to their replacement. The workers also continue to contribute to the retirement system. The only difference is that the employee also takes advantage of the benefits that he or she was promised and had been contributing toward for years.

The common complaints are two: That these employees are double dipping and that the process keeps younger workers from moving up the ladder. Hopefully, we have already put to rest the first complaint. The idea that these workers are taking something not due them makes as much sense as complaining that a person who had invested for years is double dipping by working and taking advantage of the dividends of that investment at the same time.

As to the second, abolishing the practice of allowing workers to retire and then be rehired doesn’t seem likely to change the prospects of younger workers. Instead, it would more likely mean that workers who would otherwise have retired will keep working, still filling those positions that younger workers covet. That brings us to the only fair point that can be made against the system.

The early retirement age prescribed by the state provides an undue incentive for workers to retire earlier than they might have otherwise. Some workers undoubtedly take the opportunity to collect both retirement benefits and salary when they would not have retired had the option not been made available. In this case, any blame should be cast upon the state system rather than those who are using the system provided.

After lowering the retirement age for years, it’s time to consider moving it back the other direction. While we appreciate the hard work our state employees do, there’s no reason the taxpayers should be subsidizing a retirement that could easily last longer than their careers. The governor has agreed that something needs to be done and said she plans to make changes to the retirement system, saying that we can’t afford the benefits we’ve already promised.

But reform this far-reaching should never be undertaken lightly or without due diligence. Therefore, while we always wish problems could be fixed yesterday, it was good news this week to hear that Eleanor Kitzman, the director of the Budget and Control Board, will be awaiting the results of an independent report on the retirement system, to be finished by the end of August, before she attempts any sweeping changes. In the meantime, it’s hard to make a case against those who’ve followed the current rules, even the poorly conceived ones.

 

The idea has some prominent detractors as well. At the town hall meeting Gov. Nikki Haley held in Myrtle Beach in March, she came out against the practice, saying of those who had been rehired, “we’re going to send them on their way.”

And at a meeting of the Carolina Patriots at the end of March, Republican Rep. Thad Viers of Myrtle Beach espoused a similar sentiment, saying “we need to get rid of a government porkulus program that only benefits government workers.”

Bills have been introduced in the House and Senate with regularity for the past few sessions, attempting to close the programs to new employees. But do those who use the program really deserve the criticism?

Let’s look at the facts. The way the state’s retirement system is set up, any employee who pays into the state’s retirement system, including city employees, state employees, teachers and others, can retire at 28 years of service. Police officers can retire with full benefits at 25 years. That means if a teacher begins work right out of college at around 22 years old, he can retire at age 50.

Does anybody really think that those people will never want to work again or should never work again? Many are nowhere near ready to sit at home or spend their days on the golf course. So they head back to work. Horry County Schools has 118 teachers who have already taken advantage of the TERI system, and a number of people in city governments have also been rehired after retirement. Often, the place these workers can best use their talents is the same place they just left.

It does not cost the city or school district any extra money. The rehired workers collect the same salary that their employer was already paying or would theoretically pay to their replacement. The workers also continue to contribute to the retirement system. The only difference is that the employee also takes advantage of the benefits that he or she was promised and had been contributing toward for years.

The common complaints are two: That these employees are double dipping and that the process keeps younger workers from moving up the ladder. Hopefully, we have already put to rest the first complaint. The idea that these workers are taking something not due them makes as much sense as complaining that a person who had invested for years is double dipping by working and taking advantage of the dividends of that investment at the same time.

As to the second, abolishing the practice of allowing workers to retire and then be rehired doesn’t seem likely to change the prospects of younger workers. Instead, it would more likely mean that workers who would otherwise have retired will keep working, still filling those positions that younger workers covet. That brings us to the only fair point that can be made against the system.

The early retirement age prescribed by the state provides an undue incentive for workers to retire earlier than they might have otherwise. Some workers undoubtedly take the opportunity to collect both retirement benefits and salary when they would not have retired had the option not been made available. In this case, any blame should be cast upon the state system rather than those who are using the system provided.

After lowering the retirement age for years, it’s time to consider moving it back the other direction. While we appreciate the hard work our state employees do, there’s no reason the taxpayers should be subsidizing a retirement that could easily last longer than their careers. The governor has agreed that something needs to be done and said she plans to make changes to the retirement system, saying that we can’t afford the benefits we’ve already promised.

But reform this far-reaching should never be undertaken lightly or without due diligence. Therefore, while we always wish problems could be fixed yesterday, it was good news this week to hear that Eleanor Kitzman, the director of the Budget and Control Board, will be awaiting the results of an independent report on the retirement system, to be finished by the end of August, before she attempts any sweeping changes. In the meantime, it’s hard to make a case against those who’ve followed the current rules, even the poorly conceived ones.