The first three parts of this series examined the conflict between Oregon’s legislators, the Ethics Code and the law that allowed legislators to join PERS. That conflict began in 1975 when two major pieces of legislation went into effect. One was the Oregon Ethics Code which was adopted by the people of Oregon, on referral by the Legislative Assembly. The Ethics Code declared that a public office was a public trust and that no public official could use his or her office for personal financial gain. The other law was passed by the legislature and it allowed any person who had ever served in the legislature to retroactively join PERS. Every legislator who voted for this law and then join PERS clearly violated the Ethics Code. It was the first step in a 20 year period during which the Ethics Code was ignored and PERS benefits were substantial increases by the PERS legislators for themselves and all other PERS members. Those actions have led Oregon to the brink of financial collapse.
A simple solution to the PERS conflict of interest problem lies in basic trust law. As public trustees, legislators are required to represent the interests of all of the people of Oregon. Generally, a trustee with a conflict of interest cannot act unless the beneficiaries of the trust consent to the conflict in advance and after full disclosure. Therefore, if the legislators want to join PERS, they simply have to request permission from the people of Oregon to do so. The legislators know how to get approval from the people if they want to. That is what they did with the Ethics Code. The time leading up to that vote would give the legislators who want to join PERS adequate time to explain why their PERS membership would be in the best interest of the over 90% of Oregonians who are not PERS members. Opponents of legislators being in PERS would also have the opportunity to explain why they think that law would be a bad idea. Then, with all of the information before them, the people can decide.
Until the PERS legislators get the people’s approval, however, they are in breach of their trust. That puts the validity of all PERS laws made since 1975 into question. If the people say no to the legislators being in PERS, the PERS law should be reset back to what they were in 1975. Lack of approval by the people also subjects every PERS legislator to disgorgement of all PERS benefits received in violation of their trust. While these may seem like harsh remedies, they are not. They are simply restoring the situation to where it would have been if the legislators had done what they were supposed to do under the very Ethics Code they asked the people to approve.