CHARLESTON, W.Va. -- At least 31 retired state employees used a loophole to get around the state law prohibiting double-dipping, including 17 retirees whose combined pensions and state pay topped $50,000 for the 2010-11 budget year, a legislative audit released Tuesday found.
The 31 all worked for the state as independent contractors, getting around a state law that prohibits retired state employees from earning more than $15,000 a year working for the state, according to the follow-up report to the Legislative Post Audits interim committee.
The analysis covers the 2010-11 budget year, and the list includes retired state Personnel Director Joe Smith, who first drew attention to the loophole by drawing more than $750,000 in pension and contractual pay over a six-year period, while working as an adviser to then-Gov. Joe Manchin.
In fiscal 2011, Smith drew $84,633 in state pay and a $46,123 state pension, according to the audit.
Smith's pay and pension total was second on the list, behind appraiser Gerald Terry, who received $115,260 in contractual pay from the Division of Highways, and a $22,286 pension for the year.
Under state law, retired state employees who earn more than $15,000 are to have their pension payments suspended -- but the law does not prevent the retirees from exceeding the cap by working as independent contractors.
Stacy Snead, director of the Legislative Post Audits Division, said Tuesday the Legislature should clarify the law, either by eliminating the $15,000 cap for all retirees, extending it to also apply to contractual work, or by prohibiting retirees from entering into state contracts.
In a response to the audit, CPRB Executive Director Jeff Fleck advised against eliminating the $15,000 cap.