The Oregon Supreme Court on Thursday upheld a 2002 lower-court ruling that the state's $46 billion Public Employees Retirement System, Salem, distributed too much of its 1999 earnings in benefits and didn't put enough into reserves. The court determined the case was "moot" because the issue was resolved by 2003 legislation as well as a settlement reached between PERS and government employees in 2004. That agreement stipulated that PERS should have credited members' accounts by 11.33% of 1999 earnings, rather than 20%. The 2002 ruling, issued by an Oregon judge, paved the way for pension reforms by the Legislature.
PERS will now calculate the excess benefits and withdraw the money from the accounts of about 45,000 retirees who got earnings crediting for 1999, said PERS spokesman David Crosley. He added that PERS will work out a repayment schedule. PERS also is required to recalculate earnings for 75,000 employees who worked between 1999 and 2002.
