Retirement System

Maryland's state retirement system said Thursday that it would once again vote against the election of Wal-Mart Stores' board because it isn't confident in the independence of the directors. The Maryland State Retirement and Pension System, which owns 1.2 million shares of the retail giant, has a policy of voting against all candidates if less than two-thirds of a company's board is independent. Six of Wal-Mart's 16 board members are either company officials or affiliated with the company in another way, according to the system's proxy advisor.

A Baltimore County police union is suing the county retirement system's board of trustees over a $25 million loan the county took from the pension fund to update recycling facilities in Cockeysville. In a lawsuit filed last week in Circuit Court, the Baltimore County Fraternal Order of Police Lodge No. 4 claims the deal reflects a breach of duty, and the board did not get enough advice on the consequences of the loan or obtain adequate security. "We have a responsibility to the people we represent, and quite frankly, all county employees should be concerned about this," said union President Cole Weston.

Maryland's State Retirement and Pension System announced a second consecutive year of strong investment returns yesterday, a development officials say is a sign that retirement benefits for current and former state employees are secure. In the fiscal year ending June 30, the system earned a 9.5 percent return on its invested assets, an increase of more than $1.9 billion over the previous year, according to a news release from the system. In all, the system's assets have grown by $5.3 billion in the past two years.

Baltimore County sold $256 million in pension obligation bonds this week to fund its retirement system, and officials say the borrowing will cost less than they expected. The county borrowed the money at a 3.43 percent interest rate, compared with the 4.25 percent to 4.5 percent originally projected. Officials said Thursday they expect to save $343 million over the next three decades, compared with the $250 million they previously estimated. The county plans to pay the funds back over the next 30 years.

Declining to follow the footsteps of Baltimore County's pension plan, Maryland's state employee retirement system decided Tuesday to leave unchanged its assumption about how much it will earn on investments. The 14-member pension board voted 11-1 to keep the rate at 7.75 percent, in the middle of the pack for public retirement plans nationwide. By keeping the rate where it has been for almost a decade, Maryland will avoid the roughly $12 million gap that a change might have created in next year's state budget.

A Baltimore County police union is suing the county retirement system's board of trustees over a $25 million loan the county took from the pension fund to update recycling facilities in Cockeysville. In a lawsuit filed last week in Circuit Court, the Baltimore County Fraternal Order of Police Lodge No. 4 claims the deal reflects a breach of duty, and the board did not get enough advice on the consequences of the loan or obtain adequate security. "We have a responsibility to the people we represent, and quite frankly, all county employees should be concerned about this," said union President Cole Weston.

For the first time in months, the County Council is stepping out from the shadow of the Gary administration, to the applause of demoralized county employees.In the past week, red-and-white bumper stickers have appeared on fenders and at bus stops that read: "Want to meet a disgruntled employee? Call 911."The grim message is the result of the Republican administration's months-long campaign to cut personnel costs, which account for 75 percent of county spending. Public safety unions won next to nothing at the bargaining table last spring.

State legislators often prioritize important legislation the way kindergartners rank vegetables among the food groups. They focus on media-friendly social legislation instead of structural reform requiring time and effort to understand and craft. Why, for example, did they pass gay marriage and a law regulating how long a child must face rearward in a car seat but not figure out the budget until the absolute last minute? And why didn't they spend time this year on how to pay the pensions of the 373,000 people in the state retirement system?

When established in 1935, Social Security made its first payments to Americans age 65. These first recipients never contributed and were paid from contributions made by younger Americans. Those Americans and successive generations believed their contributions were investments, and that they would be paid at retirement by the earnings on those investments. In fact, those younger Americans were paid by the contributions of successive generations of "investors," as the federal government spent their money to help finance operating deficits.

Maryland's General Assembly is poised to make the deepest cuts to the state's retirement system in nearly three decades, asking most of the roughly 170,000 teachers and government employees to pay more into a pension plan that is about to become less generous. The nearly 120,000 retirees also will see reduced benefits: They'll pay more each year for prescription medications. The overhaul pains the same people, labor unions and teachers, who helped Democratic Gov. Martin O'Malley to a double-digit re-election victory in the fall.

In a decision that could affect thousands of active and retired Baltimore County employees, a federal judge ruled that the county's pension system discriminates against beneficiaries because older workers were required to pay more toward their retirement than younger workers. U.S. District Judge Benson Everett Legg sided with the U.S. Equal Employment Opportunity Commission, finding that the county system violates the Age Discrimination in Employment Act. It is unclear what the financial impact on the county could be because the court has not determined damages in the case.

Baltimore County Executive Kevin Kamenetz wants to borrow $255 million and repay it over the next 30 years to help fund the county's retirement system, a move that would carry risk but that the administration says could benefit taxpayers in the long run. County Administrative Officer Fred Homan told the County Council at a briefing Tuesday that the administration would introduce legislation next week to allow the county to issue pension obligation bonds....

Baltimore County plans to borrow $25 million from its pension system to upgrade recycling facilities, a move some County Council members and union leaders are questioning. The county retirement system's board of trustees approved the loan last month at the request of County Executive Kevin Kamenetz's administration. In an interview Thursday, Kamenetz called the move prudent, saying it would serve both the retirement system and the county well. The county plans to borrow the money at an interest rate of 7.875 percent and repay it within 15 years.

Declining to follow the footsteps of Baltimore County's pension plan, Maryland's state employee retirement system decided Tuesday to leave unchanged its assumption about how much it will earn on investments. The 14-member pension board voted 11-1 to keep the rate at 7.75 percent, in the middle of the pack for public retirement plans nationwide. By keeping the rate where it has been for almost a decade, Maryland will avoid the roughly $12 million gap that a change might have created in next year's state budget.

Maryland's state retirement system said Thursday that it would once again vote against the election of Wal-Mart Stores' board because it isn't confident in the independence of the directors. The Maryland State Retirement and Pension System, which owns 1.2 million shares of the retail giant, has a policy of voting against all candidates if less than two-thirds of a company's board is independent. Six of Wal-Mart's 16 board members are either company officials or affiliated with the company in another way, according to the system's proxy advisor.

State legislators often prioritize important legislation the way kindergartners rank vegetables among the food groups. They focus on media-friendly social legislation instead of structural reform requiring time and effort to understand and craft. Why, for example, did they pass gay marriage and a law regulating how long a child must face rearward in a car seat but not figure out the budget until the absolute last minute? And why didn't they spend time this year on how to pay the pensions of the 373,000 people in the state retirement system?

In a move to cut fees charged to Baltimore's retirement system, the city's Board of Estimates approved the transfer of nearly $3 billion in accounts this week from Mercantile Safe-Deposit and Trust Co. to Pittsburgh-based Mellon Bank.Under the new contract, Mellon Bank will manage the assets from the Employees' Retirement System, the Fire and Police Retirement System and the Elected Officials' Retirement System.The retirement systems serve about 27,000 active and retired workers.City Comptroller Joan M. Pratt said Mercantile, which had held the management contract for 21 years, was too costly because the Baltimore-based bank had to hire subcontractors for some of its services.

In yesterday's editions, a graphic accompanying an article about state pensions gave the wrong percent for the formula used to compute the annual basic retirement allowance under the old retirement system. The correct number is 1.8 percent.The Sun regrets the error.

As a retired Anne Arundel County teacher and a 40-year resident of Crofton, I listened with great interest to Gov.Martin O'Malley's State of the State message. His proposal to shift pension payments to the counties is of great concern to the teachers he proposes to "thank" for making Maryland schools first in the nation for four years running. The teacher pension contract was and is with the state, not our respective counties. In 1979, we were presented with a choice - to continue in the state retirement system or to opt out. Those of us who remained in the system paid 7 percent of our salaries annually into it with the commitment of a defined benefit and annual cost-of-living adjustments.

I'm a Baltimore Country employee. I have worked for the county for 36 years. I drive a school bus and plan to retire in 2013 at the age of 62 if all goes well. I belong to the retirement system. Of course, I do not make the pay that the Baltimore County Executive Kevin Kamenetz and two former councilmen receive ("A pension windfall," Dec. 18). I work had for my pay and a truck driver hauling beer makes more than I do, only I have a greater responsibility. Hopefully, my retirement check and Social Security check will keep me above water.