Expanding the Baltimore County Council would mean a big pension bump

Next week, Baltimore County residents will learn the fate of a ballot initiative to expand the County Council, a measure aimed at bringing diversity to the all-male and mostly white council. In the meantime, the seven city councilors will find out if they will get a big pay rise and pension bump as a result.

The bylaw amendment on the ballot clarifies that the job as a council member, now part-time, will become full-time. What is not explicitly stated is that placing councilors in a full-time group equates to a big pension bump.

The pension change was not a driving force behind this legislation, council members say. Most council members actually opposed the expansion until Council President Izzy Patoka persuaded enough colleagues to put the proposal on the fall ballot. The measure also stipulated that the county would use new political boundaries drawn by council members to maintain the current balance between Republicans and Democrats. (It’s now 4-3; under the new maps, it’s likely 5-4.) But a convergence of legislation, some passed before Councilmen Mike Ertel and Pat Young were on the council, has set up the council to benefit from the expansion in their retirement year.

What are the relevant laws?

In 2022, introduced Council President Julian Jones, a West Side Democrat Bill 56-22. It would have overturned a provision passed in 2010 that limited the pension benefit to 60% of their salary. Then-Councilman Kevin Kamenetz instituted the cap because it had become apparent that a colleague who served five four-year terms could collect pension benefits equal to a full lifetime salary. (It was former five-term councilman Vince Gardina who would retire from the council and then take a position as director of the Department of Environmental Protection and Stability, effectively making two full salaries.)

Kamenetz ran for county as a reformer, but didn’t want to alienate his fellow council members, so the bill only applied to future council members. Kamenetz died while serving as county executive in May 2018. But Jones said he always felt the cap was unfair.

Many people were against a complete repeal, the council said amended the bill to increase the maximum pension benefit for a councilor who had served for at least 16 years at 70% of their salary. This means that if you earned $100,000 a year in salary, as a retiree you would receive $70,000 a year as a retirement benefit.

With a more generous cap in place, the next task was to address compensation; when wages rise, so do pension benefits.

In 2023, Jones codified executive and board compensation with Bill-8-23. It increased the range of a councilman’s salary from $69,000 to $78,000 for the term beginning in December 2023. If the city council expansion goes through, the chairman, who is now Patoka, could earn up to $115,000, a significant increase from his current salary of $77,000. The county’s personnel and salary advisory recommends official salary, but these are the ranges.

This change will put salaries on a trajectory that has nearly doubled since 2006, when the council passed legislation that increased pay for the 2010-2014 period to $54,000 for members and to $60,000 for the council president.

In 2024, introduced Councilman Wade Kach, a Republican who is not running for re-election Bill 40-24. This bill changed the calculation of pension benefits for council members who retire after January 1, 2025. It allows retired council members to receive a pension increase each time current council members receive a raise. Kach, who is 78, already receives two pensions – one from his work as a teacher and the other from his 40 years as a state delegate. He said this change brings county pension rules in line with those of the General Assembly.

Finally, Bill 47-24 put the question of expansion from seven to nine members on the ballot. Should it pass, council members’ pay would increase to a different, yet to be determined amount for full-time employees. For example, members of the Montgomery County Council have been full-time since voters approved the amendment in 2006. There, council members earn $156,284 a year, and the council president earns $171,912.46 annually.

‘Legislation I just didn’t agree with’

Councilman Mike Ertel, a Towson Democrat, was not in favor of the cap or the compensation bill, but he voted against the pension increase this year. In an interview after the vote, he said he didn’t feel right voting for his own raise.

He wasn’t the only one uncomfortable. County Executive Johnny Olszewski Jr. allowed the measure to become law without his signature, something he said he does occasionally to express his disapproval.

“It was legislation that I just didn’t agree with,” said Olszewski, a Democrat running for Congress. “I certainly respect that the council has the ability to make those changes and those decisions. We felt, given my position, that letting it become law without my signature was the best way forward.”

Olszewski and Ertel have both been vocal in favor of expanding the council. Ertel campaigned on the issue and Olszewski advocated an expansion to 11 members before a commission recommended going to nine members.

Why raise wages?

Some councilors have other jobs; some don’t. But voters expect the same level of service whether their representative has another job or not. Each councilor has several full-time and part-time staff to assist around 122,000 constituents. With the expansion, each district drops to about 95,000 members. Council members will have to leave their other jobs if they want to serve.

All changes must go through personnel and salary advice. However, even under the 70% cap, they can take a significant pension hit when their pay rises.

“Ultimately, if voters approve the ballot question, the PSAB recommends a pay change, and the council passes legislation to approve the change, the amount council members would pay into the pension system could also change,” said David Marks, an Upper Falls Republican. “It will be part of any review by the office of budget and finance and the county’s actuarial consultant of legislation to change councilor pay.”

Members of the council also have the highest required minimum contributions to their retirement system of all county employees, Kach said. This is 13.4% of gross salary. Councilors cannot get raises or promotions.

“Members of the council are subject to election every four years and their salaries remain static until at least the next council or, as history has shown, future councils, agree to increase them,” Kach said.

Give yourself a raise

Kach is correct that the county changes mirror the General Assembly’s pension system in that lawmakers don’t get raises and retired lawmakers get a pension bump when current representatives get raises.

But there are differences. Every four years The General Assembly’s Compensation Commission makes decisions about new salaries and benefits. From 2002 to 2014, lawmakers received no raises; in 2018, they received a raise — from $45,207 in 2015 to $50,330 for delegates and senators, and from $58,718 to $65,371 for the Senate president and house speaker.

The county council meets 52 days a year; the general assembly meets 90 days a year. Both have additional duties outside of these sessions. Instead of maxing out their retirement benefits at 16 years, delegates and senators max out at 22 years and three months. And instead of getting 70% of their salary as a pension, the general assembly members max out at 66.67%. The city council’s pension is more generous.

In 1970 approved a constitutional amendment The General Assembly’s Compensation Commission to set lawmakers’ salaries, save them the trouble of increasing their own compensation, and establish a set of parameters — inflation, cost of living, housing — for making decisions. The General Assembly cannot ask for an increase; it can only cut. The package becomes law if the general meeting does not vote.

Can the county afford the bump?

Kach maintains that a 70% pension level means costs will be minimal because it only affects seven councillors. County Auditor Lauren Smelkinson and Council Attorney Thomas Bostwick did not respond to requests for comment.

The total operating costs per expand from seven to nine members is about $1.4 million, according to county figures. These do not include pension bumps or capital improvements such as office renovations. The county council’s current share of the county’s general fund is $4.9 million — a tiny fraction of one percent.

Despite his reservations about the pension bump and council cards, Olszewski supports city council expansion. And he said he would vote for it.