We agree with a state legislative audit that calls for a ban on double-dipping by Utah public employees, where an employee is collecting a taxpayer-funded work check as well as a paycheck via the state's defined-benefit retirement system.
So long as these former public employees return quickly to work at the expense of taxpayers' wallets, they must not draw from the state retirement system until they are really retired.
This change must be made as soon as possible by the Legislature. To public workers we say: it's fair that you wait until you are fully retired before you collect on your state pension.
Any contributions these fast-returning public workers make to retirement should not go to a 401(k). Because these workers have not received retirement benefits yet, they should continue to go into the state retirement fund. This helps to bolster the public retirement fund and also benefits the state employee.
This current practice of double-dipping, while unfair, is also costing the state -- and by extension taxpayers -- lots of money. The legislative audit found that Utah is losing hundreds of millions of dollars in benefits from the double-dipping.
One reason why is that when a double-dipper takes another public job in Utah, the state must still contribute to a private 401(k) retirement plan at the same rate it did for the defined benefit plan. That is causing Utah's retirement system to lose a lot of money.
Look, this is a no-brainer change to make and any Utah legislator who opposes it deserves to lose re-election. Utah is the only state in the Western United States that lets retirees come back to work with a salary, pension and a 401(k). The result is Utah has lost $400 million over the past eight years and will lose $900 million over the next 10 years. We just can't afford to bleed money like that, particularly during this tough recession.
We have no objection to a public worker retiring, drawing benefits and then moving into the private sector. That is not costing the state money. But public-sector double-dipping is, and it needs to stop.