A 2007 law bars independent contractors working for municipalities or school districts from earning taxpayer-funded pension credits. An investigation by State Comptroller Matt Boxer’s office reveals the overwhelming majority of the 58 local governments he reviewed are failing to comply with the law.

“We decided to investigate just how widespread the problem of improper participation in the state pension system is and what we learned is that the problem is extensive,” explains Boxer. “Despite the requirements of state law and the guidance issued by state agencies, local governments across the state have not done nearly enough to ensure that only eligible employees receive pension benefits.”

Following his examination Boxer has referred 202 pension enrollees to the state Division of Pensions and Benefits for further review and removal of improper pension credits. He estimates that a review of the remaining 515 towns and 597 school districts not included in his survey could uncover hundreds of other inappropriately enrolled people and millions of additional dollars in pension savings each year.

Boxer says some local governments just failed to check to see if employees would be eligible, others thought certain workers were ‘grandfathered’ in, but that’s not allowed under the law and in some cases they opted to keep their attorney enrolled in the pension system based on legal advice from the very attorney whose pension eligibility was in question.

Boxer recommends that the state develop a comprehensive checklist for local governments to use to certify pension eligibility and do more to address questionable pension enrollments.