Oregon Legislators, PERS and the Oregon Ethics Code

In 1974, the Oregon legislature referred the Ethic Code to the people of Oregon for approval.  It was  overwhelmingly approved in the 1974 general election, by a vote of 73% in favor to 27% opposed.  The Code declared that a public office was a public trust and that public officials were prohibited from using their office to obtain personal financial gain, other than official salary, honoraria and expense reimbursement.   Legislators are public officials and they are subject to the Ethics Code.

According to the Oregon Government Ethics Commission website, see www.oregon.gov/OGEC/overview.shtml, the Oregon Government Ethics law:

  •  Prohibits use of public office for financial gain; and,
  • Applies to all elected and appointed officials, employees and volunteers at all levels of state and local government in all three branches.

But the legislators must not have understood that, even though they drafted and approved the very Ethics Code that the people adopted.  In 1975, the legislators passed a law that gave themselves and anyone else who had ever served in the Oregon legislature the option to retroactively join PERS.  By passing that law, each legislator who was then a PERS member or who would retroactively join PERS used his or her public office for that legislator’s own personal financial gain in direct violation of the Ethics Code.  The right of legislators to retroactively join PERS eventually expired at the end of 1987 but another law, ORS 237.650 Retirement Plan Election, allows legislators to join PERS based solely on their status as legislators.

While the Ethics Code does not prohibit a public official from using his or her public office in a way that would affect the official’s salary, honorarium or expenses reimbursement, the option to  join PERS does not fit into anyone of those categories.  It is not salary or an expense because the salary of legislators and their expense reimbursement is set by Oregon statute and that statue does not include PERS membership as part of salary or expenses.  See ORS 171.072 Salary of members and presiding officers; per diem allowance; expenses; tax status. And PERS membership is not Honorarium.  ORS 244.020(7) says  “Honorarium” means a payment or something of economic value given to a
public official in exchange for services upon which custom or propriety prevents
the setting of a price.  Services include, but are not limited to, speeches or
other services rendered in connection with an event.

The passage of the 1975 act allowing legislators to retroactively join PERS and the enactment of ORS 237.650 which allows legislators to join PERS based on the fact that they are legislators were unethical.  Both of those laws were passed by the legislators for their own personal financial gain.  That unethical behavior of the legislators, however, was unnecessary.  The legislators could have referred both of those laws to the people of Oregon for passage, just as they did with the Ethics Code.

If the legislators had done had obtained the approval of the people to join PERS,  after full disclosure of the legislators’ conflict of interest, there would have been no ethical violation.  Their failure to do so, however, casts the shadow of illegitimacy over those laws and may someday result in each PERS legislator forfeiting his or her unethically obtained PERS benefits.

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About Dan Re

I am an attorney who has lived in Bend and practiced law since 1981. In educating myself about the Oregon Public Employees Retirement System (PERS), I was shocked at how the PERS laws were changed by the legislature, once legislators were allowed to join PERS in 1971, 26 years after PERS was first created. Those changes personally benefitted the legislators who made them at the direct financial expense of the people they were elected to represent. That is wrong and I intend to change it. In 2009, I started a non-profit 501(c)(4) corporation, In RE The People, Inc., for the purpose of informing concerned citizens of what happened regarding PERS and other issues of social and civic importance. I then created this blog to further that objective.
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