An open-government group is suing the California Public Employees' Retirement System (CalPERS), saying it has failed to disclose records that should be public about benefit recipients.
The Nevada Policy Research Institute, which operates the website Transparent California, filed suit Friday in California Superior Court, accusing the pension system of violating state law by withholding information about the type of benefits retirees receive. Such data, the suit alleges, is necessary to safeguard pension systems from waste, fraud and abuse.
"The problem of disability fraud has plagued California's public pension systems for decades, costing taxpayers untold millions," the group said in a news release. "Yet the fund, which manages over $300 billion in assets and receives nearly $20 billion annually from California taxpayers and public employees, has inexplicably refused to disclose the very information necessary to identify such cases of potential abuse."
Transparent California is the state's largest and most comprehensive public pay and pension database. It collects compensation data under the California Public Records Act and regularly publishes the information for public review. Since its inception, it has published data on more than 2.4 million public employees from at least 2,000 agencies throughout the state.
According to court records, the group requested records in December 2016 that would identify the amount and type of benefits being received by each retiree, as well as other data points.
The pension system provided a report in July 2017 that contained most of the information but repeatedly denied Transparent California's request for records documenting benefit types, such as service, disability and industrial disability. CalPERS said records that show whether a member has retired for disability are confidential and exempt from disclosure, adding that releasing the information would be an unwarranted invasion of privacy, court records show.
Amy Morgan, a CalPERS spokeswoman, said the pension system is declining to comment at this time.
The state's public-records law says access to information about the conduct of government business is a fundamental and necessary right of every person, but not all government information is public. The law offers exemptions for records such as personnel files, police investigative records and medical records. These exceptions should be applied narrowly and be strictly limited, the law states.
The lawsuit argues that CalPERS' argument is moot, since the request seeks the type of retirement benefit, not copies of pensioners' medical records or personnel files. The benefit type also reflects a governmental decision, as opposed to personal details provided by pension members or beneficiaries, and should be disclosed under the state's public records law.
"It's highly unlikely CalPERS actually believes providing the one-word designation of the type of benefit received by its members is equivalent to providing a copy of their medical records," said Transparent California Executive Director Robert Fellner. "Instead, CalPERS is exploiting the lack of any penalties for governments who unlawfully withhold public records, secure in the knowledge that taxpayers will be the ones required to pay all legal fees incurred."
Data show that at least 23 local and state pension systems, including the San Diego County Employees' Retirement Association, the Los Angeles County Pension, the Imperial County Employees Retirement and the California State Teachers' Retirement System, provide benefit type information when requested.
According to the lawsuit, CalPERS already calls on the public to assist in reporting cases of disability fraud. A recent tip to its hotline led to criminal charges, and CalPERS General Counsel Matthew Jacobs touted the incident as a success.
"This case demonstrates the great value of the public's assistance in CalPERS' efforts to protect the state pension system from fraud, waste and abuse," Jacobs said in a November 2016 press release. "Here, a simple voice message to our disability fraud tip line led to a criminal case and the system's eventual recovery of a substantial amount of money. We continue to encourage the public to assist us in this manner."
The Nevada institute behind Transparent California is a nonpartisan think tank that focuses on, among other things, empowering citizens and elected officials with information they need to make informed public policy decisions.
CalPERS is the nation's largest pension fund, serving more than 1.9 million members in the retirement system and 1.4 million members and their families in its health program. Nearly 3,000 employers participate in the retirement program, and its public employees retirement fund pays out an annual $21.4 billion in benefits.
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