Wednesday, January 04, 2006

Legislature's Billion Dollar Heist

ONE BILLION DOLLARS! That’s how much greedy legislators treated themselves and their families to at the expense of Indiana taxpayers when legislative leaders quietly amended their health care benefits five years ago. Brian Howey makes this astonishing disclosure in his Howey Report this week concerning the “legislator health care for life package”:

Auditor of State Connie Nass told HPR this morning that she is awaiting approval from the executive branch before she can conduct an actuarial study of the lifetime legislator health care benefits package.Indiana Senate and House sources tell HPR that it could be as high as $1 billion. Nass, who talked to HPR this morning in the company of two certified public accountants, said it would be “impossible” to know how much the liability is without an actuarial study. “We have not done an actuarial study,” said Nass, adding the liability to taxpayers is “going to be a hefty cost.”

According to Howey, Nass is requesting the actuarial study to comply with the federal Government Accountability Standards Board, Statement 45, which requires all local governments to disclose non-pension, post-employment benefits. Nass submitted a contract to the Department of Administration on November 30, which still must be signed off on by State Budget Director Chuck Schalliol, Department of Administration Commissioner Earl Goode and Attorney General Steve Carter.

What’s at issue is a legislative change legislative leaders made about five years ago to sweeten retirement benefits for themselves. Under the change, any state legislator with at least six years of service is entitled to health care benefits for life, along with their spouses, children, widows, widowers and even ex-spouses. According to Howey, the prime movers behind the self-serving measure were Senate President Pro Tem Robert Garton, then-House Speaker John Gregg, and then Senate Finance Committee chairman Larry Borst.

Howey reports that House Speaker Brian Bosma believes that the legislature needs to reform the law to avoid the huge liability, but Senate President Garton is saying no way. “Multiple sources are telling HPR that Sen. Garton is ardently opposed to rolling back any of the benefits,” Howey said. “The issue is politically explosive because an estimated 40 percent of Hoosiers have no health benefits,” Howey concludes.

And just who are these needy legislators? Garton, who has been Senate President Pro Tem for three decades, is a double-dipper, holding down a near six-figure salary to serve as “Vice President of Professional Development” for Ivy Tech Community College. He is one of four legislators holding similar jobs for the community college—jobs that pay big bucks, require that you show up for work when you feel like it and make sure you use all your political influence to make sure that Ivy Tech is well-funded. Before holding that job, Garton worked as a motivational speaker for businesses. Virtually all his business clients had business before the legislature. He gave up that job after the Indianapolis Star made it clear it didn’t pass the smell test.

Former House Speaker John Gregg was formerly self-employed at his own law practice in Vincennes while he served in the legislature for 16 years. His wife was pulling down a six-figure salary as ISU’s general counsel. Gregg briefly served as the interim president of Vincennes University. He now is a partner at the law firm of Bingham McHale, where he undoubtedly pulls down a six-figure salary. He also hosts a Saturday morning talk show on WIBC-AM where he can be heard trumpeting his conservative, fiscal views ad nauseum.

Former Finance Committee Chairman Larry Borst was a successful self-employed veterinarian on Indianapolis’ south side. He now works as a lobbyist for Baker & Daniels, where he no doubt pulls down a hefty salary for a part-time job. He was defeated for re-election in 2004, in part, on receiving too many legislative perks from too many years in the Senate, where he too served for more than 30 years.

So while everyday Hoosiers struggle with how they are going to pay for their health care when they retire, Bob Garton, John Gregg and Larry Borst, along with all those other esteemed public servants who did their time in the Indiana legislature, will be taken care of for life. And so too will their spouses, and their kids and their ex-spouses. And you’re paying for it. Where’s the outrage?


Anonymous said...

I suspect that most folks without health insurance can't afford the luxury of outrage—something about it contributing to heart attacks, strokes, high blood pressure, addictions, road rage...

As for those that can afford the luxury, I truly hope that they're not just pissed because they're paying for their servants' health care; but ARE pissed because 40% of Hoosiers go without health benefits--that's the real outrage!

Gary R. Welsh said...

The uninsured problem as Howey notes makes this issue more relevant, but it is a totally separate issue.

All retirees qualify for Medicare benefits, which now will include prescription drug coverage. The problem I have with this proposal is that we are footing the bill for health care benefits not only when they reach retirement age, but after they leave the legislature after 6 years of service. Many of these former legislators take jobs where the employer furnishes them a health care plan--nonetheless, they can still take advantage of the more generous plan taxpayers are furnishing them. They will have no need for Medicare and Medicare supplemental insurance that the rest of us get when they do reach retirement age--again, because the taxpayers are picking up the tab for a more generous plan.

Remember, these are part-time positions they hold as legislators. Their annual salary is only about $14,000, not counting their per diem allowance. Taxpayers will pay out far more to them in health care benefits than they ever earned as legislators, not to mention the overly-generous pension benefits they receive.

When they leave their job as legislators, like everyone else in the workplace, they should turn to their new employer for their health insurance benefits or, if they are self-employed, their own self-financed plan. There is absolutely no justifiable public policy for providing this absurd benefit. It is an outrage in and of itself.

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