from: http://www.arizonarepublic.com/news/articles/1130congpensions30.html

Lawmakers retire into lap of luxury
Stump, Helms, Thurmond to top $105,000

By Billy House
Republic Washington Bureau
Nov. 30, 2002

WASHINGTON - When Sens. Strom Thurmond and Jesse Helms and Arizona's Rep. Bob Stump formally retire in January after long careers in the Senate and House, they will be eligible for congressional pensions beginning at more than $105,000-a-year, among Congress' largest ever, a watchdog group says.

Such hefty retirement rewards and the fact that even expelled and imprisoned former Congressman James Traficant, D-Ohio, remains eligible for an annual pension beginning at $37,120 indicate that it's time to scale back congressional pensions, such groups as the National Taxpayers Union say.

Congressional pensions

Estimated initial-year congressional pensions of some notable Senate and House members who won't be returning to office in January:

SENATE

Strom Thurmond, R-S.C. $108,000

Jesse Helms, R-N.C. $107,118

Phil Gramm, R-Texas $78,534

Robert Smith, R-N.H. $42,677

HOUSE

Bob Stump, R-Ariz. $105,463

Dick Armey, R-Texas $44,510

a-JamesTraficant, D-Ohio $37,120

Bob Barr, R-Ga. $33,516

Gary Condit, R-Calif. $19,492

b-J.C.Watts, R-Okla. $17,805

c-Cynthia McKinney, D-Ga. $17,308

a-Has been expelled from House.

b-Pension delayed until 2019, based on age and service.

c-Pension delayed until 2011, based on age and service.

Source: National Taxpayers Union

"Members of Congress have created for themselves the Rolls-Royce, not just the Cadillac, of pension plans," said Peter Sepp, spokesman for an Alexandria, Va.-based taxpayers union. He also said that such payouts continue despite congressional outrage this year over corporate executive abuses.

But others, including David John, a research fellow at the Heritage Foundation, a conservative think tank, said it is not necessarily fair to regard all congressional pensions as excessive.

Pointing to Thurmond, Helms and Stump, John said that all three men are, indeed, among the last of the lawmakers who arrived in Washington when retirement benefits were "excessively generous" because, at that time, lawmakers were not expected to stay on the job long.

But John also asked, "Are these levels really that remarkable given their ages, their years of service, and the fact that their salaries have been (over recent years) in the neighborhood of $140,000?"

Thurmond, R-S.C., 99, arrived in the Senate in 1954, then resigned and was re-elected in 1956; Helms, R-N.C., 81, was first elected to the Senate in 1972; and Republican Stump, 75, was first elected to the House in 1976. All have announced their retirements at the end of the year.

Officials of the Office of Personnel Management would not release individual pension figures, saying they fall under the Privacy Act.

The calculations

But the taxpayers group has made its own calculations, based on information in the public domain, including current age and life expectancy, pension formulas and rules, and cost-of -living adjustments.

The calculating begins with the average of the members' highest three years' salaries. Today, Senate and House members are paid $150,000 a year, up from $145,100 in January 2001. A percentage of that - and these rates have changed over the years as the plans have evolved - is paid out as a pension.

According to the 335,000-member taxpayers group's calculations:

Stump's pension would start immediately at an estimated $105,463. The taxpayers group said that if Stump lives to age 86.7, the congressman could receive a potential lifetime payout of more than $1.5 million.

Helms' pension would start immediately at an estimated $107,118; and he would receive a potential lifetime payout of $981,264.

Thurmond's pension would start at $108,000; while Thurmond already has eclipsed life-expectancy projections, if he (as well as Stump and Helms) took the customary spousal annuity reductions, their wives could collect 50 percent of the benefit when they die.

Generous plans

What Sepp says particularly irks his group is that congressional pension plans tend to be more generous than those in the private sector and even those of other federal workers, by as much as two to three times, turning some former lawmakers into pension millionaires.

Basically, this occurs because the "accrual rate," the amount by which lawmakers build their pension benefit, is higher than other plans. Congressional retirement benefits also are protected from inflation with cost-of-living adjustments, a feature that fewer than one in 10 private plans offer.

For lawmakers like Thurmond, Stump and Helms, who were elected before 1984, the pension formula is the average of three years' salary, multiplied by years of service, multiplied by 2.5 percent. The first year's benefit can't exceed 80 percent of the final salary, but the retirement age can be as young as 50.

For lawmakers elected after 1984, the accrual rate is 1.7 percent. There is no "80 percent rule." However, members must reach age 62 before they see cost-of-living adjustments under this plan. Despite lowering their pension benefits, they added Social Security and tax-deferred savings plans to their benefits.

Small portion

The result is that although new members, such as Rep. Gary Condit, R-Calif., first elected to the U.S. House in 1989, pay an average 1.3 percent of their salaries toward a congressional retirement benefit, this covers only a small portion of the average payout.

The taxpayers group has estimated that Condit, who was defeated in his primary bid for re-election this year, could see a pension starting at $19,492, which could total $721,603 in his lifetime.

Latest estimates put the costs of all congressional pensions at more than $16 million a year, with taxpayers footing most of the bill.

Stump has served as chairman of two House committees overseeing veterans matters and the armed services.

"Bob Stump is absolutely worth it," said Bruce Bartholomew, Stump's district office director. "What he's meant to this country. What he's meant to men and women who serve in uniform, and veterans, absolutely worth it."

Reach the reporter at billy.house@arizonarepublic.com or (202) 906-8136.