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Nasty battle erupts in Shores over pensions

STORY BY MEG LAUGHLIN, (Week of March 7, 2013)

A nasty battle in Indian River Shores over pensions for three retirees has pit town council members against each other and the town manager.

Where residents fall on the matter could determine who gets elected to three available seats in the upcoming March 12 town council election.

At  issue is the council’s recent decision to replace monthly retirement pension checks, which are paid to three Shores retirees (and which they expected to have paid to them for the rest of their lives), with a lump sum payment equal to nine additional years of those monthly checks.

At one point, debate last week got so testy that one councilman suggested the town manager be fired, calling the long-time employee “incompetent.”

The three retirees impacted by the move say the decision is a real slap in the face for years of service.

“What’s the message from the town we served and love for so many years – fall off a cliff by 81 or run out of money?” asked retired town clerk Barbara Readdy, 72, who, along with retired town manager Virginia Gilbert, 69, and retired postmaster, Alice Hayslip, 70, is very worried by the sudden switch.

Both Mayor Tom Cadden and Vice Mayor Jerry Weick say they made a mistake voting to replace the women’s monthly pension checks with a lump sum payout. They want to change their vote, they say, because they misunderstood what they were voting for. 

“We thought we were voting to close the plan for the future with the exception of the three retired employees who could choose to remain in it,” said Weick. “We didn’t realize we were killing their pension plans without any say from them.”

Cadden agreed. “We made a dumb mistake. All three were great employees and we don’t want to injure them by stopping the monthly checks.”

While Cadden and Weick want to keep the checks coming, council member Richard Haverland, joined by Fran Atcheson, is dead set against the continuation of the pension payments

Mike Oschner also voted to end the monthly payments, and now says he would like to help the three women find worthwhile ways to invest the replacement lump sum.  

“Now, because they’re getting feedback from the three retirees about being upset, Weick and the mayor are suddenly going soft,” said Haverland. “But the council voted unanimously to terminate the pension plans, and the retirees will get the lump sum they’re entitled to, as figured out by an actuary.”

“Is less than 10 years more of payments in a lump sum check what we’re entitled to when we were told we’d get the monthly checks for life?” asked Gilbert.

“No one is stopping them from investing the money and increasing it. If they want to run through it like drunk sailors, that’s their choice,” said Haverland.

“We’re not investors. We just want what we had every reason to expect we’d get,” said Hayslip. “I can’t tell you the anxiety and sleepless nights this unexpected switch is causing the three of us.”

After the January vote to terminate the pension plan in favor of the payout, the council directed Town Manager Richard Jefferson to write an ordinance reflecting that decision as well as writing the three retirees to inform them of the change.

Neither Jefferson’s ordinance nor his letter, however,  reflected the council’s unanimous vote to end the monthly checks.

Instead, the ordinance said the opposite: The pension plan “will continue to pay the current 3 retirees ... a monthly benefit.”

Jefferson’s letter also told them that “their current benefits will remain in effect as they are.”

“That’s what I understood the vote to be,” said Jefferson. “I thought they were closing the plan after them, not closing them out of it.”

At last week’s council meeting, Haverland demanded that the ordinance be rewritten to reflect the unanimous vote to kill the monthly payments.

“This ordinance bears no relationship to what we agreed to,” a frustrated Haverland told Jefferson.

“You’re going to screw these employees out of their retirement?” Jefferson asked.

“Yes,” said Haverland.

“You’re a real humanitarian,” said Jefferson.

After the meeting, Haverland said he would call for the resignation of Jefferson, until a couple of years ago the town building inspector and now one of the highest paid public employees in Indian River County with a salary of about $232,000.

“He’s incompetent,” said Haverland, who repeated that stopping the monthly pension payments was “legally permissible.”

Besides, he said, his concern is for the taxpayers of Indian River Shores who have to pay the bills, not for the retired employees.

Meanwhile, the three retirees hope their monthly pension checks continue or that they receive lump sum payments for more than they’ve been offered.

“At least enough to get an annuity that almost equals the monthly amount,” said Readdy.

The council, as a whole, decided to look more into options and revisit the pension issue in a month after the town election.