Retirement Benefits Issue to be Determined

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Thursday August 18, 2011

Although it was never clearly stated by the City Council, it appears that a number of benefits awarded to former city manager, Chuck Hafter, by a previous City Council may be under dispute. According to the current Council Chair Sandy Dooley, the Council and current City management have been reviewing Mr. Hafter’s previously negotiated retirement benefits. The Council met on Monday August 15th to determine the form that a due process meeting would take to discuss these benefits. The terms and obligations under Mr. Hafter’s interest-free home loan agreement with the City are also to be included in this discussion scheduled for September 6th.

A determination of where and when this discussion takes place was ultimately the goal of Monday’s meeting on the subject. When Chair Dooley stated that she would entertain a motion to move to executive session to discuss Mr. Hafter’s benefits with his attorney present, not a sound was uttered. Having heard no motion to move to executive session then, the City’s attorney on the matter, Joe McNeil recommended that no further discussion take place, and that the topic become an agenda item for a later public meeting of the City Council. 

Nevertheless, public questions prompted discussion of some specific details regarding Mr. Hafter’s pension, health, and long term care benefits. In response to these specific questions, the Council announced that although Mr. Hafter’s $40K loan has technically been repaid, $25K was forgiven by a previous Council at some unknown point in the last seven years. Chair Dooley stated that the form of forgiveness was assumed to be a part of Mr. Hafter’s total compensation during his tenure as City Manager. 

The Council and City Manager Sandy Miller also specified the home equity repayment terms, which call for payment to the City of 32.65% of the increased home value at the time of Mr. Hafter’s retirement or resignation from his position as City Manager. According to Mr. Miller’s statement, that percentage is currently estimated at a dollar value of $53,570.

Regarding long term care benefits, Mr. McNeil stated that there is a question about who is responsible for the premium payments.  According to Mr. McNeil, Mr. Hafter is the listed owner but the City has been paying the premiums. Mr. McNeil advised that the Council first needs to deliberate on whether there was actually past agreement on these terms. The answer to this first question will determine how the Council decides to move forward on who owns payments of the premiums moving forward. To date, the City has paid $61,417.50 since 2004 to cover Mr. Hafter’s premiums.

Mr. McNeil also provided a  statement that there is some question as to whether or not Mr. Hafter is entitled to be enrolled in the City’s retirement plan along with his enrollment in the City Managers Association plan, at which point he re-emphasized the point that further discussion is not advised until the topic is next scheduled for public hearing.

In response to a request from The Other Paper for a statement on the matters at hand regarding Mr. Hafter’s benefits, Mr. Hafter’s attorney Mr. Pietro Lynn provided the following on behalf of his client:

I understand that the City Council intends to decide soon whether Mr. Hafter is entitled to certain benefits.  Mr. Hafter negotiated with the City Council for those benefits and they were made part of his employment contract.  It is disappointing that anyone would even suggest there is an issue to be decided. 

Mr. Hafter served the City for over twenty years and was an outstanding City Manager.  There have been attempts since his retirement to impugn his performance.  However, the record is clear. Mr. Hafter always acted professionally, ethically and appropriately.

We hope that the City will honor its financial commitments to Mr. Hafter.  If it does not, he will be forced to file suit.  The last thing Mr. Hafter wants is to litigate against the community he served for so long.

Public discussion of retirement benefits for City staff does have recent precedent. The current Council recently approved payment of approximately $90K over a 5-year period for retired bookkeeper Gloria Yandow. In Ms. Yandow’s case, an agreement was made in the ’80s and honored by the current Council that allowed her to accrue 10 times the amount that her pre-existing labor agreement allowed in comp time. A simultaneous decision was made to pay Ms. Yandow 4 times what her labor agreement with the City allowed her to accrue in unused vacation time.  See The Other Paper May 5th, 2011, archived edition at www.otherpapervt.com

SOURCE: Michelle Boyer, Correspondent