ILLEGAL “CPERS” ACCOUNTS: $344,069 … FED TAXES UNPAID
Saturday, April 15, 2017 ….. 2:12 P.M.
Newly obtained Caddo Commission reports expose both the high cost to taxpayers, and Commissioners’ unpaid federal taxes, in illegal “CPERS” (Caddo Parish Employee Retirement System) accounts.
The new records were obtained in a Public Records Law request by local attorney Erik Vigen, in-house Counsel for The Broyles Group, LLC. (Will Broyles is also owner/operator of news website RealShreveport.com.)
Five (possibly six) former Commissioners have withdrawn all or some CPERS money:
… Former Commissioner Ken Epperson, now in a state government job, withdrew $11,111.11 from his CPERS account in 2016;
… the Louisiana Legislative Auditor’s (LLA) report of November 2015 noted, “… former Commissioners (Clifford) Collins, (Michael) Long, and (Carl) Pierson have withdrawn contributions,” and
… the new records include no accounts / balances for former Commissioners Stephanie Lynch and Michael Thibodeaux.
Lynch left the Commission for a seat on the Shreveport City Council in 2014, and Thibodeaux left in 2015.
Thibodeaux, by email, says his CPERS money “has never been cashed-in.” My requests for clarification from the three top staffers at the Commission have been ignored.
The new data red-flags how the illegal CPERS accounts necessarily mean federal payroll taxes were not paid, i.e., dodged.
For Louisiana part-time elected officials, taxpayer-funded retirement has been statutorily and constitutionally prohibited … explicitly illegal … since January 1, 1997.
So, when Commissioners, on April 1, 2000, voted (unanimously) to take banned CPERS money, their action had been illegal for 3-plus years.
Various commissioners, staff, and at least one outside attorney well knew Commissioners in CPERS was against the law.
Such mattered not.
Now, closing in on two decades later and caught red-handed, Commissioners refuse to return taxpayers’ money to public coffers.
Even if we ignore any federal income tax and early withdrawal penalties, Commissioners both (a) dodged payment of mandated (federal) Social Security payroll tax of 6.2%, and (b) spent far more taxpayer money than if Social Security – as law required – was their retirement.
In his report, the LLA explains:
“… the Parish did not request/receive an IRS Determination Letter to provide it with advance assurance that the terms of CPERS conform to the requirements of IRC section 401(a) and is entitled to favorable tax treatment.
According to our calculations, the Parish paid $136,540.81 more into Commissioner 401(a) retirement accounts than it would have been required to pay the federal government had these Commissioners been participating in the Social Security program.”
Here are salary and Social Security payroll tax details for former Commissioners who have withdrawn CPERS funds:
… Stephanie Lynch was paid $222,262.14 in salary while a Commissioner. Without her illegal CPERS take, she would have paid a Social Security tax of $13,780.27.
Here is like data for other former Commissioners, through December 31, 2014:
… Clifford Collins: $4,648.89 unpaid Social Security tax on $74,982.06 salary
… Michael Long: $5,176.91 unpaid on $83,498.56
… Carl Pierson: $2,987.44 unpaid on $48,184.44
(Michael Thibodeaux disputes any withdrawal, and up-to-date salary/tax information for Ken Epperson is unavailable.)
All else aside, the new documents show these CPERS account totals for Commissioners through 2016, or employment end-date:
Douglas Dominick ….. $36,285.60
John Escude ….. $35,876.48
Rose McCulloch ….. $34,046.07
Jim Smith ….. $31,084.98
Matthew Linn ….. $30,141.83
David Cox ….. $28,782.74
Ken Epperson ….. $19,617.69
Lyndon Johnson ….. $17,697.27
Michael Williams ….. $11,903.45
Jerald Bowman ….. $7,229.19
Stormy Gage-Watts ….. $2,753.76
Lynn Cawthorne ….. $261.34
Clifford Collins ….. $18.40
CPERS funds withdrawn according to Commission:
Michael Long ….. $7,474.25
Carl Pierson ….. $8,462.02
Clifford Collins ….. $8,001.74
Ken Epperson ….. $11,111.11
Stephanie Lynch ….. $31,419.48
Mike Thibodeaux ….. $21,901.11 (disputed)
Total: $ 344,068.51
A final point looms larger and larger.
Former Commissioner Michael Williams is now serving a federal prison sentence for taking $2,400 from Caddo taxpayers.
© 2017 Elliott Stonecipher … ALL RIGHTS RESERVED