"We believe this is a common sense proposal to make sure pension dollars are not gained as a case of fraud," said Gov. Peter Shumlin, D-Vermont.
The governor, unions and lawmakers say it's time for pension reform. They all support a bill to seize the retirement of any state employee involved in embezzlement or fraud.
"The taxpayers should have recourse and that is what this bill provides," said Beth Pearce, D-Vt. Treasurer.
The crackdown comes after a stunning charge this summer that a former Vt. State Police sergeant padded his time sheet and even fabricated hundreds of traffic tickets and emergency calls to make overtime cash, more than doubling his salary to $140,000. Jim Deeghan denies the charges. But even if he's found guilty, under current law he can collect his full pension, and it's calculated based on his inflated salary that investigators say came from fraud.
"When a state employee who we entrust with taxpayer dollars rips off the public we want to make sure they don't gain pension dollars as a result of their crime," Shumlin said.
Under the new proposal, a judge could seize the pension of an employee convicted of any crime that rips off taxpayers. It also applies to municipal workers and teachers.
"I think this sends a really clear message to state employees who have a tremendous responsibility because they are dealing with the public trust and taxpayer dollars that are not theirs to ensure their actions are always honest and forthright," the governor said.
Reporter Kristin Carlson: Someone at home might look at this and say this just makes sense, why wasn't this happening before?
Gov. Peter Shumlin: Good question. There are states have done better than us on this one. It didn't come to my attention as governor until we had a problem.
Two state police audits of time sheets did not find any problems with other troopers. But the department has made changes to prevent future issues. Any overtime over 20 hours gets red flagged and reviewed, and a lieutenant is now always on duty to OK the need for extra hours.
"It was my suspicion this was an isolated incident of fraud and so far our investigation has backed that up," Shumlin said.
This proposal would not be retroactive and would not apply to Deeghan if he's found guilty. His case is still making its way through the courts.
The governor says he is convinced this is an isolated incident. But the state also paid $100,000 to hire an independent forensic auditor to review state records and time sheets. That report is due out in a month or two.
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