Breaking down Perry’s early retirement controversy

Gov. Rick Perry, R-Texas(Courtesy: Office of the Texas Governor)

Click on the link labeled “Retirees Who Return to Work” on Texas’ Employees Retirement System online, and a one-page document with the words “Publication under revision” pops up.

ERS tells KXAN the feature was taken offline on Dec. 16 – that’s the same day the Texas Tribune published a story that caused quite a stir about Gov. Rick Perry’s retirement.

“Perry officially retired in January so he could start collecting his lucrative pension benefits early, but he still gets to collect his salary and has in turn dramatically boosted his take-home pay,” the Tribune article stated. “Perry makes a $150,000 annual gross salary as Texas governor. Now, thanks to his early retirement, Perry, 61, gets a monthly retirement annuity of $7,698 before taxes, or $6,588 net. That raises his gross annual salary to more than $240,000.”

People asked KXAN whether ERS took down the web form as a result of the discovery in Perry’s latest presidential campaign finance report. ERS told us it was pure coincidence.

The agency’s communications and research director, Catherine Terrell, said the document instead needed several updates:

  • Remove information about long term care, as no new enrollments would be allowed after Jan. 1
  • Add information about Humana Medicare Advantage Plan, which goes into effect for retirees with Medicare on Jan. 1
  • Update old ERS logo and branding

“It had nothing to do with the governor,” Terrell said. “We counsel people on their retirement. As far as I know, that’s what we did for him, too.”

While on the campaign trail in Iowa, Perry told the Tribune he did not find the process to be “out of the ordinary.”

“ERS called me and said, ‘Listen, you’re eligible to access your retirement now with your military time and your time and service, and I think you would be rather foolish to not access what you’ve earned.’”

Terrell explained that there are two retirement classes related to this matter. The “elected class” is for elected state officials (ESO) like state legislators, district attorneys and statewide elected officials. State employees are in the “employee class.”

“State law allows certain elected state officials to establish and transfer service from one class to the other, and to retire in one class and work, contribute and accrue service in a different class,” Terrell said.

Perry can eventually retire from both systems. Right now, he is retired from the “employee class,” and he will retire from the “elected class” when he leaves office.

“(Perry) receives annuity from employee class and continues to pay 6 percent of his salary into elected class as allowed by Texas law,” Perry’s campaign spokesperson Ray Sullivan told KXAN on Monday.

Perry can legally collect employee class annuity under the “rule of 80,” which means “the combination of (Perry’s) U.S. military service, state service and age exceeded 80 years and qualifies him for the annuity under Texas Government Code 813.503 as amended in 1991,” according to Sullivan in the Tribune article.

KXAN obtained a copy of ERS’ “return to work” document previously posted online and found, if Perry had only been in one class – the employee class – he would not be able to both collect retirement and resume earning his salary as governor.

The document said that employees’ retirement can be cancelled if they have promise of employment:

  • IRS and ERS rules say that you cannot have a promise of employment with the State when you retire
  • State law says you cannot return to work within 90 days of retiring

Terrell said the revised version of the ERS document would be available online Jan. 1.

Copyright 2014 KXAN.COM. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

 

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Texas (change)

 
Republican Rick Perry is Governor of Texas. Two Republicans represent Texas in the U.S. Senate, and Texas has 32 representatives in the U.S. House: 20 Republicans and 12 Democrats.
 
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Governor: Rick Perry
Lieutenant Governor: David Dewhurst
Attorney General: Greg Abbott

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