Mallozzi Seeks Clarification of Process Behind Pension Fund [Updated]

[Editor's Note: The title and introduction of this article has been changed in order to better represent the situation.]

The New Canaan (BOS) voted Tuesday morning to begin a search for a third party firm that will launch an inquiry into the the process involved in the latest amendment to the town's Retirement Plan.

During its July 10 meeting the Board of Finance, followed by the Town Council on July 18, voted in an amendment to the Retirement Plan, which would effectively change the period of vestment from five to four years, but would apply only to those elected into office before January 1, 2011.

This amendment essentially applied to Sally Hines and Jeb Walker; Walker had already started receiving $944 per month pension after four years of service.

“Changing the rules going backwards to benefit one or two employees is the wrong way to govern,” said Town Council member Roger Williams at the July 18 meeting, which resulted in six votes for the amendment and four votes against it.

Tom O’Dea weighed in on the issue at the Town Council’s July 18 meeting as well, stating, “I’m torn and upset about it, but based on the fact that the Board of Finance was unanimous and based on the fact that Mr. Walker was told that he’d be vested after a year, I’m going to vote in favor of it.”

The inquiry, which will be spearheaded by as of August 8, aims to clear up the many questions surrounding the Town Council’s decision.

“Any modification of a pension plan requires a two-thirds vote, which didn’t happen, so was this even effective?” asked Williams. “Was this an ordinance, which still would have required seven votes? If this did pass by the requisite number of votes, then is Mr. Walker going to to be a retiree as defined by town pension plan, which he has been participating in?”

As for why Walker started accepting monthly pension before his five-year vestment period and before the amendment in question was proposed, Williams has more questions yet.

“When Jeb Walker left office, Gary Conrad, CFO and Walker’s subordinate, directed his benefits to be calculated as if he was fully vested under the plan and, since that time, he’s been receiving benefits on a monthly basis of $944. [Walker] knew he wasn’t entitled to pension, he knew he didn’t qualify,” said Williams.

“We’re looking to review the process, legal and fiscal aspects of this decision,” said Mallozzi at the BOS meeting Tuesday. “There’s a lot of confusion and we should have an independent review that is clinical and dispassionate. We don’t want this to be partisan or political.”

“I don’t think this has to be anyone’s fault,” said Selectwoman Beth Jones. “Knowing all persons involved, I think everyone is doing their best. We’re not all experts here, we’re volunteers. There was confusion and mistakes were made.”

Mallozzi said he is treating this as an opportunity for clarification rather than a legal audit, sharing in his own confusion on the matter.

"[Walker] had to have received one of these,” said Mallozzi opening up a print copy stating his own pension status, “and it would say clearly right here that he wasn’t vested yet,” pointing at a tickered box next to the word ‘No.’

Williams agreed that the issue must now be put into the hands of an independent, competent authority for review.

“We must look into this to see how this could have occurred,” said Williams. “Were laws violated here? The plan stated that you have to be vested and vestment took five years, so it doesn’t matter who said what to whom and at what time. It’s going to be extremely difficult to undo this.”

Mallozzi stressed that the purpose of seeking out a third party is to conduct a review of the policies, procedures and processes surrounding the administration of the Town of New Canaan’s Defined Benefit Retirement Plan.

Mark DeWaele, Stephen Karl, Tucker Murphy, Tom O’Dea, Kenneth Campbell and Penny Young voted in favor while Kit Devereaux, John Emert, Joe Paladino and Roger Williams voted in opposition.

Click here to watch the archived July 18 Town Council meeting on Vimeo.