Pension-forfeiture law talk rises again

A judge took bribes to fix cases. A sanitation supervisor got payoffs to permit toxic dumping. A powerful pension trustee received valuable favors from those seeking business with the fund.

All three went to prison -- with fat New York retirement packages intact.

Such stories have spanned decades. Still, proposals to force criminals to forfeit pensions have had a way of coming and going in Albany as the years flow by.

Current advocates of forfeiture will tell you that this time is different. For one thing, the defined-benefit pensions of public employees are drawing special scrutiny and pressure nationwide. For another, cries for state ethics reform are fashionable.

Former comptroller Alan Hevesi was sentenced earlier this month to 1 to 4 years in prison, on charges related to his role as sole pension-fund trustee. He's also in line to receive $105,000 a year in pension payments.

"It's a matter of using the momentum," said one official pushing Gov. Andrew M. Cuomo's pension-forfeiture bid. "If ever there's an opportunity to pass a change like this, it's now. It's not just this legislator or that one. Hevesi was the person in charge of the pension fund, convicted of a felony, and he's still entitled to his pension."

But in case you're laying odds, remember that practical questions abound on how future pension forfeiture might work. Options are limited by the state constitutional bar on diminishing current pension commitments.

Where they exist, the forfeiture laws vary. In New Jersey, the trustees of any state or local retirement system may cancel part or all of a member's benefit due to misconduct. Certain crimes there bring mandatory forfeiture.

In Illinois, pension fund trustees decide if the misconduct meets the standard for automatic forfeiture -- that is, a felony related to the person's public service.

In Nevada, a murder conviction will cost your public pension.

Remember, too, that some corruption experts oppose pension forfeiture. They say the statutes aren't calibrated to the offense, that they discourage public service, and impinge on contractual rights. Stick to imprisonment and fines, argued the authors of one article in the American Criminal Law Review.

Assemb. Charles Lavine (D-Glen Cove) is sponsoring a "taxpayer abuse sanction" for certain grand-larceny or fraud convictions related to the public job. He also sees the political timing as ripe.

"If I heard one thing during the last election, it was the abhorrence that the public has for illegalities committed by public officials," Lavine said. "I was continually amazed at how often the subject came up."

Looking back, though, you might wonder how unique a climate this really is.

Ex-Gov. Mario Cuomo's temporary government-integrity commission called in 1988 for felons to forfeit pensions. Under the proposal, dependents could file hardship requests for part of the money and pension contributions could be returned. The attorney general and comptroller agreed.

Then as now, the news was full of corruption cases. No new law was enacted.

Not that the issues were brand-new even then. In 1954, Congress mandated a narrow pension forfeiture -- for federal employees convicted of treason or other specified crimes. The impetus at that time: The perjury conviction of accused Soviet spy Alger Hiss.