The Associated Press
SALEM - Longtime Oregon public employees who retired last year are, on average, drawing bigger checks from the state pension system than they earned while working.
The average retirement benefit for 423 people retiring in 2001 after 30 years in the Oregon Public Employees Retirement System was nearly 5 percent above the workers' final salary, according to PERS.
The new figures come at a time of heightened criticism of the pension system's cost to taxpayers. One candidate for the Republican nomination for governor, Ron Saxton, has made PERS costs a key campaign issue.
"It does create problems for the system; I won't deny that," PERS Board Chairwoman Dawn Morgan said Monday. "But I don't think there's anything weird at all because there were people in the private sector that had the same results.
The PERS plan covers state employees and most teachers and other local government workers.
State Sen. Roger Beyer, R-Molalla, said the generous pension payouts are a sign the state needs to adopt a 401(k)-style system in which government pays a set amount into worker pensions but doesn't guarantee benefit levels.
"Private industry concluded that 25 years ago," he said.
The PERS benefits aren't as high when all 2001 retirees are included regardless of years of employment.
For the 3,761 people who retired from state and local government jobs in Oregon last year, the average pension check was nearly 75 percent of their final salary.
The PERS traditional formula for pensions was intended to give a retiree 50 percent of final salary after 30 years on the job.
In the stock market boom in the 1990s, though, worker accounts bulged as they put more pension funds in stocks, and the money-match option produced a richer pension than the traditional formula.
Under money-match, government must match the worker's account at retirement if it produces a better pension than the other formula. In 2000 for the first time, longtime employees retired with bigger checks than they earned on the job as pensions averaged 6 percent above final salaries.
Defenders of the system say it's a short-term issue.
"It is an anomaly that will solve itself if the market continues down," said Denny Moore, a PERS retiree who now advises prospective retirees for a financial planning business.
"Sometimes people will leave with more than the system had intended; sometimes they'll leave with less," Moore said.