Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Public Pensions topic
No spam. Unsubscribe anytime.
Committee advances bill to criminalize misappropriation of public employee retirement contributions
Summary
Senators voted 10–1 to give a favorable report to SB244, which sponsors say would close a gap that allowed public employers to spend employee retirement withholdings without criminal penalty.
A Senate committee gave a favorable report, 10–1, to SB244, a bill intended to make it a crime to misappropriate public employee retirement contributions that were deducted from payroll.
Senator Nelson, who explained the bill, said audits by the Office of Public Examiners uncovered instances in which retirement withholdings were not remitted to the retirement system and there was no criminal remedy. "They were taking from people's paychecks and spending it on whatever else," Nelson said, arguing the bill closes that loophole.
Committee debate focused on scope and mens rea. A city chief financial officer who spoke during the hearing warned that line staff who follow supervisors' instructions could be exposed to prosecution. "I'm the CFO for City of X, and the mayor says, this is how we're gonna do this, and the city council votes unanimously. ... You're telling me I'm supposed to have the cuffs put on me?" the CFO said (name not specified in the transcript).
Supporters said the bill targets intentional misuse. Senator Albritton read the bill language and said it applies to those who "embezzle, steal, or unlawfully and willfully abstract or convert" retirement funds rather than to losses from investment or inadvertent errors. Senator Bell added the wording shows the offense is limited to intentional acts.
Senator Singleton described a case in her district and urged passage so retirees are not left without the dollars they expected to receive. Senator Nelson and others acknowledged the need to craft language that preserves protections for innocent employees while holding administrators accountable.
The committee requested that legislative staff consider clarifying intent requirements to avoid ensnaring data-entry employees or other low-level staff who lack intent to commit theft. The bill received a favorable committee report by roll call, 10 yes to 1 no; Senator Gavan recorded the lone dissent.
The committee's action advances the bill to the next stage of the legislative process; sponsors said they will work on statutory language addressing intent and chain-of-custody concerns.
