More than one in 10 people who worked for South Shore cities and towns are getting beefed-up disability retirement pensions: 72 percent of their last year’s pay, tax-free, and more. Those pensions amount to $23 million each year. Police and firefighters account for most of them.
George “Fred” McCray said nothing in 2006 as the Quincy Retirement Board debated his request for an accidental disability retirement.
He had retired in 2002 as a captain with the Quincy fire department. After 32 years of service, he received his maximum retirement benefit – $65,000 a year.
SEE WHO'S COLLECTING A DISABILITY PENSION IN YOUR COMMUNITY
Four years later, he came back with a doctor’s statement saying he was permanently disabled from an on-the-job injury. He was hard of hearing. That was the result, he said, of the noise he endured from sirens and loud fire trucks. The retirement board voted 3-1 to reclassify him as retired because of a job-related disability. One of the board members said he personally didn’t agree with McCray’s request, but voted for it because it met legal criteria.
That vote put thousands more dollars a year into McCray’s pocket. Public employee pensions are not taxed as income by the state, but they are by the federal government. The exceptions are accidental disability pensions, which aren’t subject to either tax.
McCray, who to this day has not worn a hearing aid, was chairman of the Quincy Retirement Board that took that vote in 2006, and abstained from voting. He is still on the Quincy Retirement Board, and still its chairman.
McCray’s situation is not unique. More than one in 10 people who worked for South Shore cities and towns are getting these beefed-up disability retirement pensions: 72 percent of their last year’s pay, tax-free, plus lifetime health insurance. Those figures don’t include teachers who are covered by a statewide retirement system.
These accidental disability pensions amount to $23 million a year in 26 communities south of Boston. Taxpayers may be surprised by some of the individuals getting the special pensions, and why.
Selectmen in Carver voted to fire Police Officer Bruce Pollitt after finding he faked a knee injury to go on paid sick leave, but let him resign instead. Pollitt turned around and put in for disability retirement. He automatically got it under a state law that presumes high blood pressure among police and firefighters must be related to the stress of their jobs. Pollitt, 51, will have collected more than $1.5 million from his pension if he lives to 76, the average life expectancy of U.S. males.
Randolph’s former police chief, John Barkhouse, is collecting $81,219 a year for life from what town officials will only say is a “stress-related” disability caused by the job. He was approved for it while awaiting trial on sexual assault charges. He was later acquitted.
Quincy Patrolman Michael Cronin was 10 years on the force when he resigned in 2004. A year before, he drove his Mercedes into the back of a car in Quincy and witnesses told police he kept going – the wrong way on a one-way street. In June of 2004, he was arrested for drunken driving after a crash in Quincy Point. He resigned within a month but, at 33, was not old enough and did not have enough years of service for a regular pension. Both accidents were while he was off duty, and he had been sent home once for allegedly showing up drunk for a police detail.
Enter the disability pension. Within days of resigning, Cronin got an orthopedic doctor to certify that he had been permanently injured on duty. The nature of the injury is not available from public records. Cronin was approved for a $56,000-a-year pension. He will collect well over $2 million in taxpayer money from that pension if he lives to 76. Additionally, he gets health insurance coverage for the rest of his life. In 2005, a mistrial was declared on the drunken driving charge after a jury couldn’t reach a verdict.
Public records furnished by the nine retirement systems that cover the region show that 729 out of a total of more than 6,750 retired city and town employees – about 11 percent – are on accidental disability retirement.
The lifetime benefits are for public employees deemed permanently disabled – either mentally or physically – on the job and no longer able to do the work. Many cases are absolutely clear cut and are part of society’s bargain with public employees who work difficult and often dangerous jobs.
More than two-thirds of the people collecting the special pensions are retired police and firefighters, largely because of laws that say any heart problem or high blood pressure they experience must be job related and therefore automatically qualifies them for a disability pension. Among firefighters, lung disease and many cancers also mean automatic qualification for a disability pension as a job-related injury.
Some doctors bristle at these so-called presumptive laws and say they make the medical opinion of doctors worth nothing.
To some, the number of people receiving the special pensions seems high. To others, it makes sense considering how broad the term disabled is and the laws in place for awarding disability pensions.
“I’d say the numbers are shockingly high,” said Michael Widmer of the Massachusetts Taxpayers Foundation, a watchdog group on public spending. “Does it pass the straight-face test that there is this number of individuals legitimately qualified to get these? The short answer is no.”
During a public hearing last month, the head of the state’s retirement commission defended the numbers – about 12,935 out of a total of 186,700 public sector retirees statewide had been judged permanently disabled by their jobs, or about 7 percent.
“Not everyone who walks in the door and says they have a bad back, a bad foot or a swollen finger gets a disability benefit,” said Joseph Connarton, the executive director of the Public Employees Retirement Administration Commission, commonly known as PERAC.
The special disability pensions are tax free – neither the state nor federal government collect income tax on the money going to disabled retirees, a perk that makes getting one even more attractive.
They cost taxpayers more than regular pensions, since most people who get them retire earlier, stop paying into the system earlier and collect longer.
Plus, they pay more than regular retirements. The average town or city pension on the South Shore is between $19,000 and $21,500; the average accidental disability pension is about $31,500, or more than 50 percent higher.
Instead of retiring immediately, public employees can continue to work with a disability, building up retirement benefits until they choose to apply for the special disability pension.
About one-tenth of the accidental disability pensioners on the South Shore maxed out their retirement benefits – they worked for at least 32 years – then filed for and got a disability pension.
Accidental disability retirements are a part of the tax-paying public’s contract with the people who work to keep their communities safe and government functioning. The consensus among budget watchdogs and retirement officials alike is that the vast majority of cases are legitimate under the rules.
Still, stories of abuse persist, most notably in Boston where a federal grand jury is investigating the high rate of firefighters going out with disability pensions: more than 75 percent of firefighters retiring between 2005 and 2007 got disability pensions. The rates for South Shore departments are much lower – for example, it’s about 25 percent for Quincy police.
“You can never totally eliminate the people who are going to work the system,” said state Sen. Brian A. Joyce, D-Milton. “But everybody gets painted with that broad brush of abuse when the vast majority of people are not guilty of that.”
At a time when public pensions of all kinds are under scrutiny and communities are facing one of the worst budget scenarios in memory, disability pensions have largely gone unnoticed – or at least, uncommented upon – by the people in a position to make a change: state legislators.
Public pension reform has been a mantra on Beacon Hill for more than a year now. But legislation passed last week corrected only a half dozen flagrant abuses available to a handful of people – mostly politicians themselves – and left to a blue ribbon panel the task of addressing larger problems.
Retirement officials say that the system in place now is vastly better than the one it replaced in the mid-1990s. Each disability pension application goes through several rounds of approvals, including a panel of three doctors hired by the state to determine whether the applicant is mentally or physically unable to do the job, whether the disability is permanent and whether it was job-related. Two out of the three doctors have to agree that the applicant was permanently disabled on the job.
“Theoretically, it’s a much tighter system,” said William Farmer, director of the Plymouth County Retirement Board. “The fakers don’t apply as much.”
Part of the problem, argue supporters of the present system, is the public’s perception of what constitutes a permanently disability.
“That’s the biggest hang up with people” said James Machado, president of the Massachusetts Police Association and a member of the state retirement commission. “They say, ‘He can play golf, he’s not disabled.’ But someone, for example, who has had a heart attack can come back from it and play golf. He can’t be a police officer or firefighter anymore, but he can still have a life.”
Whatever the reason, no one on Beacon Hill is rushing to overhaul or even tweak the disability retirement system for public employees.
“Going to have to trust that the series of eyes looking at these are going to make the right decision,” said Sen. Michael Morrissey, D-Quincy. “You cannot address legislatively every single problem.”
Elizabeth Crowley may be reached at firstname.lastname@example.org.
Accidental disability pension process
Local retirement boards say it usually takes about eight or nine months to process an application for an accidental disability pension. The process and the state law that governs public employees retirements are notoriously complex. Here’s how it works:
1) Worker submits an application including a signed doctor’s statement saying he is:
- Mentally or physically incapable of performing the job
- The disability is likely to be permanent
- The disability is job-related
2) The local retirement board asks the state Public Employees Retirement Administration Commission to convene a three-doctor medical panel.
3) The three doctors review the applicant’s medical records then examines him, either together or individually. Two out of three have to agree the person was permanently disabled on or because of the job.
4) The local retirement board votes. It can overrule the medical panel’s decision on whether the disability was job-related but cannot overrule the doctors on the questions of whether the person is disabled or if it is likely permanent.
5) If the local board votes yes, the case goes back to the Publinc Employees Retirement Administration Commission for review and approval.
If the local board votes no, the applicant can appeal to the Contributory Retirement Appeals Board. If that board says no, the applicant can take the case to court.
6) A state nurse case manager reviews the answers and can order a re-exam by a medical panel once a year for the first two years after retirement and once every three years after that.
Disability pensions pay more
Normal pensions are subject to federal tax. Accidental Disability pensions are not.
A regular pension is based on the highest three consecutive years’ wages while an accidental disability pension is based on the most recent salary.
Regular retirees’ annuities – what they paid into the system – are returned to them as part of their total retirement allowance. Annuities for accidental disability retirees are in addition to a percentage of their last salary.
A regular retiree would have to be on the job 29 years and be at least 55 (for police and firefighters) or 65 to get a 72 percent retirement. There is no age or years of service requirement for accidental disability retirements. A worker hurt on the first day on the job can qualify.
Public employee pensions
There are three types of retirement for public employees in Massachusetts:
- Regular retirement called superannuation,
- Ordinary disability for people injured off the job
- Accidental disability retirement for people injured while working.
People can begin collecting after either 20 years on the job or at the age of 55 with at least 10 years on the job. Retirement allowance is based on formula that factors in age, years on the job and highest three-year average of pay.
The maximum retirement is 80 percent of the highest three-year average pay, an annuity and lifetime health benefits.
Police, firefighters and some correction officers reach the maximum retirement allowance at 55 years old and 32 years on the job. Most other public employees reach it at age 65 and 32 years on the job.
Pensions, except accidental disability pensions, are taxed by the federal government.
A retirement allowance consists of two parts: an annuity and a pension. The money that the public employee had deducted from his paycheck over the years and a portion of the interest that money generated is the annuity. The difference between the total retirement benefit and the annuity is the pension. The average retirement benefit is approximately 80-85 percent pension and 15-20 percent annuity. Public sector retirees also get lifetime health care coverage.