By Matthew K. Roy
The agency overseeing the state's 106 retirement systems has launched an investigation of the Essex Regional Retirement Board, focusing on a $500,000 retirement perk for its executive director, Timothy Bassett, and on violations of the Open Meeting Law.
The Public Employee Retirement Commission's inquiry will be done in conjunction with an "accelerated" audit of the Essex board, said Joseph Connarton, PERAC's executive director. The board's triennial audit, originally scheduled for October, began yesterday.
State Sen. Bruce Tarr of Gloucester has been working with state Rep. Brad Hill, whose district includes Manchester, and the leadership of Middleton, Ipswich, Boxford, Manchester and North Andover on a possible legislative remedy to the board's problems. He supports PERAC's investigation.
"There are some very serious allegations that have been raised here," Tarr said. "We all need to get to the bottom of the situation, find out what's wrong, correct it and clear up the clouds that are hanging."
The Retirement Board handles employee pensions for 48 governmental bodies, including towns, regional school districts and housing authorities, in Essex County. Locally, pensions for employees in Essex, Manchester and Rockport have been enrolled with the board.
A number of towns have since voted to move their pensions into the state fund after the ERRB came under harsh scrutiny for posting the worst investment losses of any retirement system in the state — 33 percent — for 2008.
At the same time, it gave 5.8 percent pay raises to the staff and angered member communities by trying to lower the retirement age for public safety dispatchers and then charged communities extra for it, even though they hadn't approved it.
Amid the turmoil, Bassett, 62, of Marblehead disclosed the details of a 2004 retirement deal he negotiated with the board that set aside $83,400 a year — for six years — into an investment account he would be able to access when he reached 65.
PERAC's seven commissioners voted in favor of an investigation on July 28. The agency will review all documentation connected to Bassett's retirement deal, Connarton said.
Under the agreement, Basset would have been eligible to purchase an annuity that would pay him $40,000 a year for the life of the account.
"I have not heard of this in the retirement community until Mr. Bassett's situation," Connarton said.
Bassett earns $137,250 a year from the Retirement Board, and — thanks to special legislation enacted for him — is still able to collect his $41,000-a-year retirement pension from his previous positions as a Lynn state representative, Government Land Bank director and county treasurer. He also earned $14,400 last year moonlighting as a lobbyist.
In June, as local town representatives were threatening to pull their funds from the system, Bassett made the annuity deal public and said he had asked the board to rescind the benefit, citing market conditions and the "economic realities" facing cities and towns.
Limited powers
PERAC does not have subpoena power and it is counting on the board to comply with its requests for information.
"I have been assured by Mr. Bassett that we will get full cooperation," Connarton said. Bassett was on vacation yesterday and could not be reached.
"If, in fact, we were to find something untoward (during the investigation), we would refer it to the attorney general's office," Connarton said. Any evidence of Opening Meeting Law violations would be given to the district attorney, he said.
Staff writer Mike Stucka contributed to this story compiled by Matthew K. Roy. Roy may be contacted at mroy@gloucestertimes.com.
