SANTA FE – A state board plans to investigate whether retired public school employees have been circumventing New Mexico’s return-to-work regulations by drawing both a salary and a pension at the same time.
Critics call the practice double dipping.
Hundreds of people who work at public schools throughout New Mexico could be affected, depending on how the state’s retirement rules are interpreted, one official said.
The investigation involves retirees who work at schools, but as employees of a group called Cooperative Educational Services.
The central question is whether the employees really retired, or if they just continued working in the same jobs, but as CES employees to avoid a requirement that they sit out a year before returning to half- or full-time work
The New Mexico Educational Retirement Board is conducting the investigation.
“If they’re using a third-party entity, or doing something to get around those rules, that’s going to be against the law” or other state rules, said Roderick Ventura, general counsel for the Educational Retirement Board.
The cooperative, in turn, says its employees have taken care to follow the rules. The cooperative even asked ERB ahead of time if retired employees could work for the cooperative and then be re-assigned back to their original schools, said David Chavez, executive director of CES.
And the answer, he said, was that, yes, they could – because the cooperative isn’t part of the ERB system and isn’t covered by its return-to-work restrictions.
The cooperative doesn’t even ask its employees about their retirement status, Chavez said, so he’s not sure how many employees could be affected, but it could potentially reach the hundreds, depending on how ERB interprets the retirement rules.
Jan Goodwin, executive director of the Educational Retirement Board, said that, based on initial conversations with the cooperative, there might be only 15 to 20 people affected.
But “we’re going to do our own independent investigation of this to ascertain how many people are involved,” Goodwin said in an interview.
Ventura said the retirement board never told CES that it was OK for retirees to return to the exact same jobs right after retirement.
The employees could have to repay some of the benefits they’ve received if they violated the law or other state rules.
The cooperative provides staff members for hard-to-fill positions at districts, such as speech-language pathologists, social workers and occupational therapists.
School districts created the cooperative in 1979 to help make purchases. Districts can hire vendors quickly by making purchases through the cooperative, avoiding the need for each school to go through its own lengthy bidding process. The group is funded by a fee paid by the vendors hired through the cooperative.
Under ERB’s return-to-work program, participants receive both a salary and a pension, but must keep paying mandatory contributions into the pension fund.
They also have to meet certain requirements – either by sitting out for at least a year before returning to an ERB employer or by working only a small number of hours each week.
Employees in New Mexico’s main public pension system face more stringent prohibitions.
In 2010, then-Gov. Bill Richardson signed into law a measure that banned double dipping for state workers, after the practice had come under fire for stifling internal promotions and putting a strain on the state’s retirement fund.