Indiana Law Blog Debunks "Transparency" of Legislative Pay Raise

The Indiana Law Blog's Marcia Oddi has been doing all that she can to inform the public about the true nature of legislative pay and benefits for state lawmakers and the legislature's past practice of using slight-of-hands to feather their own nests. It was Oddi, not the mainstream media for example, who blew the lid off the lifetime health insurance benefits lawmakers awarded themselves, their spouses and families. Lawmakers agreed to revoke those benefits after public outrage led to the defeat of long-time Senate President Pro Tempore Robert Garton (R-Columbus).

A new pay raise has been making its way through the legislature this year, and the legislature is up to its same old tricks, but Oddi won't let them get by with it. She astutely observes the new pay raise legislation is both non-transparent and convoluted. Lawmakers would have us believe, for example, they are making a big sacrifice by giving up the generous lifetime health insurance benefits and retirement benefits as a trade off for a $9,000 raise in their annual salary from $11,700 to $20,700. But it isn't all that meets the eye as Oddi explains.

If the pay raise is adopted as proposed, lawmakers will never have to vote for a pay raise again. That's because lawmakers have tied their salary to 18% of a judge's salary, which is adjusted at the same rate as other state employees pay annually. And thanks to the way the legislation is crafted, lawmakers will receive their entire salary in two lump sum payments in January and February. As a consequence, a legislator could resign from the legislature after February 16 and pocket the entire $20,700 for a whole year. Not bad, ah?

The legislation will scrap the generous 4-1 match the state is currently providing to legislators retirement plans and replace it with the same 1-1 retirement contribution plan the state offers to state employees under PERF. Or is it the same? The legislation expands the definition of salary to include per diem and leadership allowances, which amount to an additional $30,000-$40,000 a year for legislators. Yes, lawmakers will still collect a generous per diem allowance, which allows even legislators who live less than 50 miles from the State House to collect per diem allowances 7 days a week while the legislature is in session and on a daily basis the balance of the year whenever they claim to be performing legislative work. And because the per diem pay will be included in the calculation for retirement benefit purposes, their pensions will be dramatically boosted.

So how much will the generous retirement package cost? Who knows. The legislation provides for a continuing appropriation for whatever is necessary to pay for legislative pensions, unlike other public retirement plans. And about that generous health insurance plan which was supposedly ended last year. The legislation provides it will now end on July 1 of this year.

These guys just don't get it. They've always got a trick card up their sleeve to play whenever they want to bamboozle the public about their pay and benefits plan. Thankfully, Marcia Oddi is around to set the record straight for the public's benefit.