Journal retire-rehire series underscores transparency need
As part of Sunshine Week, we ran stories on the controversial retire-rehire program that took place in Marquette County. Sunshine Week, led by the American Society of News Editors and Reporters Committee, is an annual celebration that aims to keep transparency in government through the practice of strong and effective journalism.
A lawsuit filed by a former county employee and retire-rehire participant brought the issue once again to the forefront, in the eyes of former local officials. The question stills remains as to whether the retirements adhered to IRS regulation; we believe the legality of the now-defunct program still needs to be determined.
We call on all county commissioners to bring this issue up at a future meeting. In addition to seeking legal advice on the issue, they should have frank discussions with MERS about how this policy was handled and come up with a way to correct it, if necessary.
In our series, you read that there are two differing opinions on whether Mary Mantyla actually had a legitimate retirement. A letter to MERS from county Administrator Scott Erbisch stated that “after review of the situation as a whole, we determined the evidence was inconclusive,” regarding whether Mantyla had bona fide separation. We also reported that Marquette County Civil Counsel Steve Pence filed a motion for summary disposition in the Marquette County Circuit Court on Nov. 2, 2015 stating that “the discovery in this case has revealed that under no reasonable definition of the word ‘retire’ was there an actual intended real separation from her employment.”
This issue needs to be resolved and it needs to finally be determined if Mantyla, in fact, did have a legal separation. And if it is determined that she did not have a real separation of employment, then each individual case should also be reviewed.
As reported in our stories, more than $6 million was paid to county employees while they were working under the program, through the end of 2016. In our opinion, it doesn’t appear these retirements met IRS standards, which require a bona fide separation of employment.
In definition, that means that there was no formal or informal agreement between an employee and employer for the employee to return to work.
At $34 million, the county’s unfunded liability is a significant issue. Eventually, that cost is going to have a severe impact. Either the county will have to cut expenses or services, or it will have to raise taxes.
Bluntly put, we don’t see a third choice.
We feel that we have done our job as a watchdog for the community to bring this information to the attention of Marquette County taxpayers. Our reporting on this issue in the past was instrumental in getting the retire-rehire program stopped so that it did not continue to have a devastating financial impact on Marquette County.
Now it is up to the taxpayers to contact the Marquette County Board and ask that they address this issue and resolve it. There is a potential significant financial impact passed on to taxpayers because of the retire-rehire program.
MERS has reportedly told Marquette County that if the county comes forward confirming that Mary Mantyla did not have a bona fide separation and its certification of termination was done in error, that it would remedy the plan.
This could mean Mantyla would either have to repay the amount drawn during her re-employment or MERS would stop future payments until the amount was recovered.
As an example, if someone collected 48 months worth of retirement benefits under the retire-rehire program, they would have to go 48 months without any pension payments until they matched the amount they had been paid through the retire-rehire program. If that is true, then it is possible that all the individuals that collected money from the retire-rehire program would have to do the same.
Commissioner Bill Nordeen told us in an interview that he is not sure the county board has the appetite to address this problem, but he went on the record to say, “If you are looking for my opinion as a county commissioner, or as an attorney, or both … none of these people had a bona fide separation.”
We will be watching and listening closely to see where things go from here. We congratulate former county commissioners Bruce Heikkila, Jim Cihak and Deborah Pellow for going on the record and questioning how this was handled.
Pellow had asked at one time to self report to the IRS the details of the retire-rehire program, but she did not get enough support from the other county board members to move ahead with her request. We also compliment Nordeen for recognizing the retire-rehire program as problematic.
The Marquette County Board works for Marquette County taxpayers. There has been enough dodging and weaving on this issue. It is time to take real action.
Finally, we believe, as Sunshine Week concludes today, it’s worth noting were it not for The Mining Journal and it’s professional staff, the details of this very poor public policy would have slipped into history a very long time ago — with zero public accountability and the bill still to be paid.
Holding public officials accountable for their actions is why newspapers are vital to democracy.
That’s why we’re here. And with your help and support, we’re going to stay.