Watchdog group urges appeals court to lift secrecy on disability pensions for government workers

The most famous culprit may be Randy Adams, who secured a promise from the city of Bell to support his future disability retirement even before he became police chief.

The city of San Fernando said police Sgt. William C. Bailey was, indeed, disabled, paving the way for his disability retirement. It wasn’t until years later that an audit by the California Public Employees’ Retirement System discovered that the city actually had terminated Bailey for cause — lying about his educational background — and the disability claim was part of a deal to get him to leave.

Former Irvine police Officer Gregory R. Allen took a disability retirement in May 1996 after a back injury from an on-duty motorcycle crash. He ended up working the exact same job — riding a motorcycle — for the Orange County Sheriff’s Department.

On-duty disability retirements are coveted because they come partially tax-free. But they can spawn such things as “chief’s disease,” a jocular name for the debilitating aches and pains that strike shortly before retirement. While such fraud costs the government millions of dollars a year, CalPERS, the world’s most massive public retirement system, maintains that the public has no right to know which retirees have disability pensions and which do not.

The nonprofit watchdog group Transparent California sued CalPERS for this information in Sacramento County Superior Court. CalPERS argued that revealing who has a disability retirement would violate state confidentiality laws, and prevailed.

Transparent California has asked an appeals court to overturn that decision, arguing that identifying a pension with the words “disability” or “industrial disability” does nothing to compromise an individual’s medical records, helps pinpoint abuse and is required by California’s public records laws.

Ruling: Not public 

In the disputed ruling, Sacramento County Superior Court Judge Laurie M. Earl explained that a disability retirement is “intended to alleviate the harshness that would accompany the termination of an employee who has become medically unable to perform his duties.” To be eligible, members must show, based on competent medical opinion, that they are “incapacitated physically or mentally for the performance of their regular job duties due to a disability that is either permanent or that is expected to last at least 12 consecutive months or to result in death.”

Earl then relied on Government Code Section 20230 to conclude that a retiree’s disability status is confidential and need not be disclosed under the California Public Records Act.

The question, the judge said, is “more difficult than either party acknowledges.” Identifying which retirees get disability retirements is not merely financial information, the judge said. It is tantamount to disclosing information provided by retirees and their physicians. Government code states that such information should remain confidential, and “whether a particular retiree is receiving service or disability retirement benefits … need not be disclosed by CalPERS,” the judge said.

Interestingly, the judge did not find the disclosure to be an unwarranted invasion of privacy, but a violation of the government confidentiality code.

CalPERS believes the judge came to the right conclusion. “Compelling CalPERS to identify retirement payments by type — service or disability — would unlawfully deprive members of their individual right to decide whether to disclose their confidential medical information,” said spokeswoman Amy Morgan by email. “We’re confident Judge Earl got it right and are equally confident the Court of Appeal will agree.”

Data from CalPERS shows that more than 11% of its retirees were on “disability” or “industrial disability” pensions. The “industrial” category refers to on-the-job injuries.

“Our concern about about divulging disability retirements is not meaningful in uncovering fraud and could stigmatize those suffering from mental illness,” said Gary M. Messing, an attorney representing public safety unions who has asked the appellate court to dismiss Transparent California’s action.

“If some police officer has a post-traumatic stress injury and is out playing basketball or mowing the lawn, what are you going to be able to know from that?”

Transparency urged

Transparent California’s request for an appellate intervention argues that the judge got it wrong.

“For decades, virtually every effort to learn more about the public pensions paid to retired public employees has been met with the same refrain from government employee retirement systems and employee unions, i.e., that all information specific to an individual is confidential under California law,” its brief says. “Each time, however, the Court of Appeal ruled in favor of transparency” under the California Public Records Act, and it must do so here.

The judge ignored three “highly relevant” Court of Appeal cases decided in 2011, finding that the privacy of individual records retirees file with the retirement system is wholly different from the public records created by the retirement system itself to categorize and pay benefits, Transparent California argued.

Transparent California simply wants to know the designation that CalPERS already tracks — disability, industrial disability or service — and that data point is, in fact, a public record that’s routinely released by two dozen other California retirement systems, including those in Orange and Los Angeles counties as well as in states like Oregon and New Jersey. After the Orange County Employees Retirement System provided this information to the Orange County Register in 2010 and 2012, the newspaper produced investigations detailing pension fraud by city police officers and firefighters.

“Access to information concerning the conduct of the people’s business is a fundamental and necessary right of every person in this state,” Transparent California argued, invoking the lofty ideals and language of open meetings and records laws.

“California lawmakers long ago determined that, in balancing the interests between an individual’s privacy right and the public’s right to hold its public agencies and public servants accountable, the public’s right is paramount,” it said.

Robert Fellner, executive director of Transparent California, said the judge’s ruling was patently unconstitutional. “The law says that, if there’s ambiguity, you have to favor disclosure,” he said. “She did the exact opposite. And not because the data itself is secret, but because the data it’s based on was drawn from confidential files.

“If this ruling is allowed to stand, that can be used as an excuse to shield almost anything — ‘This report on misconduct is based on information in confidential personnel files.’ It’s a slap in the face to the people of California.”

Source: Orange County Register