03/28/04 — Ineligible or eligible? Goldsboro pays into retirement of city attorney

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Ineligible or eligible? Goldsboro pays into retirement of city attorney

By Barbara Arntsen
Published in News on March 28, 2004 8:31 AM

Goldsboro has paid thousands of dollars toward state retirement benefits for City Attorney Harrell Everett over the past three decades, even though state officials have said he is not entitled to those benefits.

Michael Williamson, director of the state retirement system, says that only full-time employees of local governments are eligible to participate in the local government retirement plan, which is administered by the state.

After the city's payments for Everett were called to his attention, Williamson said, he reviewed the file and "it is clear we notified the city in 1989 that those contributions were not appropriate."

City Manager Richard Slozak said he remembered the issue of Everett's eligibility for the retirement plan coming up, but said he thought it had been resolved.

"If the state has sent something, I have never seen it," he said. "He's entitled to the retirement. It's been in the budget for years."

The city's personnel director was not available Friday to comment on Everett's employment status, and a clerk in the office said only the director or Slozak could talk about it.

Everett says that he has "an arrangement with the city where they pay me a salary."

Slozak says that salary means Everett is a full-time city employee. Asked why Everett didn't get sick leave and vacations like other full-time employees, Slozak said he didn't want it.

Mayor Al King and Mayor Pro Tem Chuck Allen said that Everett is not a full-time city employee but works on retainer.

The city's budget shows that Everett receives a basic $60,000 fee annually, plus an additional $90,000 for legal services. Another line item in the budget shows the city paying around $2,500 annually towards Everett's retirement.

Everett wouldn't discuss the matter in detail, saying it was a personnel issue, and he took the paper to task for asking about it.

"All I'll say is that I never received anything from the state," he said.

The News-Argus obtained copies of the 1989 correspondence between the state and Everett.

In a letter to the director of the retirement system dated Sept. 7, 1989, written on city stationery, Everett makes a case for state retirement benefits, saying he spends at least 25 hours a week on city business.

"In my opinion," Everett wrote, "this matter can be handled by your office and would not necessitate any type of appeal to the Office of Administrative Hearings."

The state wrote Everett back on Oct. 20, 1989, concluding for the second time that he wasn't eligible for the state retirement plan.

Both Slozak and Everett deny ever seeing a letter about this from state retirement officials.

Mayor Al King, who was the city's personnel director 15 years ago, remembers the issue because one of his employees raised the question of Everett's eligibility.

"Darlene Cruthirds was the records and benefits specialist for the city, and she came to me, asking about Everett's eligibility," King said.

King then wrote a letter to the state, in May 1989, asking for clarification on the matter. The state replied to King the next month saying that Everett was ineligible.

Both King and Ms. Cruthirds say they recall Everett's letter protesting that decision.

They also both remember that the city received a copy of the state's letter back to Everett, but neither one knew if the situation had been appealed further.

Ms. Cruthirds, who now lives in Mississippi, worked for the city from 1979 through 1994. She said in an interview that part of the duty of the records and benefits specialist was to initiate any personnel changes involving employees.

At that time, she said, all changes she initiated were sent to the Finance Department to be processed.

"When we received the second letter from the state saying Mr. Everett wasn't eligible, I went to Mr. King and asked him what I should do," she said. "Mr. King told me to initiate the change, taking Mr. Everett off the retirement system."

Ms. Cruthirds submitted the changes to the Finance Department, but she said the paperwork was ignored and the changes were left undone.

"I would initiate the changes, based on policy and procedure," she said. "All I could do was submit the paperwork. I didn't have the final authority to make the changes."

State officials now are looking into the matter of Everett's eligibility.

"We have 1,200 employers submitting information on a monthly basis. We rely on them to give us correct information," said Williamson. "We will be sending a letter to the city to clarify Everett's employment situation to see if his employment status has changed since the letter was issued in 1989."

If the state determines that Everett isn't eligible for the retirement money, he will be refunded the contributions that he has made on his own behalf over the years. But state law prohibits the city from being refunded for its money, except for the current year.

A spokesman for the retirement system said that it would not be possible to determine how much the city has paid in for Everett since it began making the contributions in 1974.