Taxpayers on the hook for pensions of lawbreaking former lawmakers

Op-Ed by Gina Diorio. The following commentary originally appeared at Broad + Liberty.

Once upon a time, Bob Mellow was one of the most powerful members of the Pennsylvania Senate. For 21 years of his four-decade tenure, he was the chamber’s top Democrat, serving as Minority Floor Leader and President Pro Tempore.

When Mellow announced his retirement in 2010, he was set to receive a six-figure pension. But he lost it all two years later after pleading guilty to using his taxpayer-funded staff for campaign purposes and filing a false tax return.

Fast forward five years, and he got it all back, thanks to a decision by the board of the Pennsylvania State Employees’ Retirement System (SERS).

Today, Mellow’s taxpayer-guaranteed pension is roughly $20,415 — per month. A bit less than half of this goes to his ex-wife under their divorce agreement, with Mellow getting $11,579.91. For comparison, Pennsylvania’s median household income is $61,744 — per year. In addition, the Mellows received a $1.3 million lump-sum payment for the time his pension was suspended.

The issue of taxpayer-backed pensions for lawmakers-turned-criminals came to the forefront again last summer when former Rep. Margo Davidson resigned from office after being charged with stealing from taxpayers. Early reports suggested Davidson would keep her pension, thanks to Attorney General Josh Shapiro charging her with second-degree misdemeanors and election code violations, instead of higher crimes that would translate into a pension loss.

I submitted a Right-to-Know request to SERS, asking just how much Davidson is receiving. The answer? Davidson took a lump-sum payment of $65,564.24 and is receiving an additional $1,271.88 per month, or $15,262.56 annually.

For context, if this were a regular 401k retirement account, Davidson would need $459,000 in that account right now to receive $1,271.88 in monthly withdrawals for 40 years.

Davidson isn’t alone in cashing out post-crime.

In July, a story came out on “21 lawmakers who found themselves charged or convicted of being on the wrong side of the law” and left office as a result. I submitted a Right-to-Know request to SERS to learn how many of these lawbreaking former lawmakers receive pensions — and the amount of those payments.

What I found is that, counting former Rep. Davidson’s pension, Pennsylvania taxpayers are guaranteeing more than $55,000 per month to fund the retirements of 10 former lawmakers who ran afoul of the law (along with one ex-wife). That’s more than $670,000 per year — every year … for the rest of their lives! 

Annual payouts range from a low of about $3,500 to a high of $245,000, with the average being about $67,000.

Specifically, here’s how much these fallen former lawmakers get paid annually:

• Former Sen. William Slocum (who resigned after being sentenced for dumping raw sewage into a stream) — $3,516 
• Former Rep. Harold James (who took $750 in cash during a special election campaign from an informant posing as a lobbyist) — $33,387 
• Former Rep. Frank LaGrotta (who gave “no-work” taxpayer-funded jobs to two relatives) — $36,587
• Former Rep. Ron Waters (who took $8,750 in cash from an undercover informant posing as a lobbyist trying to bribe Waters) — $37,230 
• Former Sen. Leanna Washington (who used up to $100,000 in taxpayer dollars for political purposes) — $42,880 
• Former Rep. Michelle Brownlee (who took, $2,000 from a lobbyist who was also an undercover operative) — $73,277 
• Former Rep. Stephen Stetler (who used taxpayer-funded resources and employees for political purposes) — $87,511 
• Former Rep. Louise Bishop (who didn’t report money she took from an undercover informant posing as a lobbyist) — $96,136 
• Former Sen. Bob Mellow — $245,000 (about $106,000 of this goes to his ex-wife)

That’s a whopping $670,786 per year to former lawmakers who violated the public trust, broke the law, and yet are guaranteed an annual income from taxpayers for the rest of their lives.

Attorney General Josh Shapiro had the opportunity to address this madness when he charged Rep. Margo Davidson last year for stealing from the taxpayers. Instead, Shapiro gave her a sweetheart deal, letting another disgraced legislator keep her pension for the rest of her life at taxpayers’ expense.

It is true that these lawmakers contributed to their pensions, but so did taxpayers. And taxpayers guarantee these pension payouts for the rest of the lawbreakers’ lives. So, when there is a shortfall in the pension fund due to poor investment returns or other factors, taxpayers are on the hook to keep paying.

We can debate pension reform until we’re blue in the face, and the reform of 2017 was a significant first step in a conversation that needs to continue.

But at the very least, we should all agree that lawmakers who violate the public trust — whether through stealing from taxpayers, accepting bribes, or using taxpayer dollars for political purposes — should not be able to force taxpayers to continue to fund their retirements.

# # # 

Gina Diorio is the Public Affairs Director at Commonwealth Partners Chamber of Entrepreneurs, an independent, non-partisan, 501(c)(6) membership organization dedicated to improving the economic environment and educational opportunities in Pennsylvania.www.thecommonwealthpartners.com.