Since late 2010, former Honolulu Managing Director Robert Fishman has drawn a regular paycheck from the city while getting a state pension.
Through the first three months of this year, he is scheduled to earn $62.31 an hour, working 30 hours a week, assisting the managing director’s office, according to city documents. That pay rate, if applied over a full year, would top $97,000 — for a part-time job.
"This is more about helping and giving. This is not a lot of money for me," said Fishman, who retired in 2004, has extensive management experience in the public and private sector and agreed a year and a half ago to help Mayor Peter Carlisle with his new administration.
Fishman is among a group of special so-called double dippers in Hawaii. More than 150 employees with the city and state are working part or full time through 89-day employment agreements while continuing to get their full state pensions, which they earned because of their earlier careers.
Many of these double dippers work 89 days, take a short break of as little as one workday, then continue on another 89-day contract — a process that can be repeated indefinitely. The government agency benefits by being able to tap the expertise of retirees while not having to pay health, vacation, retirement and other benefits regular workers receive.
By working in 89-day chunks with breaks in between, the employees avoid a rule that requires public-sector retirees who return to work for at least three months to rejoin the Employees’ Retirement System, suspending their ERS pensions while they work. These 89-day employees fall short of that rule — which applies only if their jobs are half- to full-time — by a day.
The practice, like other forms of double dipping, is allowed under state law but is generating controversy at a time when public pension systems nationally are scrambling to close the growing gap between the projected costs of providing future benefits and the money to pay for them.
Some Hawaii retirees have worked on 89-day contracts for multiple years — even though a major reason for establishing the program was to provide short-term solutions for employment and recruitment gaps.
Yet in some government quarters, it has become a long-term fix.
An investigator with the state Attorney General’s Office, for instance, has worked on repeated short-term contracts for 11 years. One of the highest-paid city employees on the 89-day program has been rehired regularly for the past 10 years and has worked for various agencies.
"I thought I heard of all of the gimmicks, but this is a new one for me," said Edward Zelinsky, a law professor and pension expert at the Cardozo School of Law in New York. "On its face, it’s a rather transparent manipulation of the system to the detriment of both the taxpayers and the state employees and retirees who are playing it straight."
The <$o($)>ERS, the agency that oversees benefit payouts to Hawaii’s 40,000 retirees and beneficiaries, says the 89-day arrangements do not jeopardize its tax-exempt status as long as the pensioners retire for at least six months before working again and as long as the employer does not have a pre-existing agreement to rehire the worker once the six months lapse.
A major incentive for retirees to not become regular employees again is that, as retirees, most have their health insurance entirely paid for by the state. Regular employees pay a major portion of their health insurance premiums.
Government agencies that hire retirees say the workers bring a wealth of knowledge to the job.
"This category of experienced individuals who can ‘hit the ground running’ gives the city flexibility in providing services, especially for positions requiring specialized or highly technical knowledge," city Department of Human Resources Director Noel Ono said in a written statement to the Star-Advertiser. "This flexibility helps departments to continue providing services to the public while they are in the process of filling vacant positions. These employees also provided needed services on a temporary, intermittent and/or part-time basis such as ushers for events at the (Neal Blaisdell Center) and attendants who open and close park facilities."
Ono said the city employs about 95 retirees on 89-day contracts, representing less than 1 percent of its total workforce.
Asked whether the contracts were largely meant to address temporary employment gaps, Ono said that was one reason for the program. But he listed others, including the need to provide special or unique services that are "essential to the public interest and, because of circumstances surrounding its fulfillment, personnel to perform such services cannot be obtained through normal civil service requirement procedures."
One of the highest-paid retirees working for the city on 89-day contracts is Jerry Iwata, a real property acquisition officer for the Honolulu Authority for Rapid Transportation, according to a list of personal services contracts the Carlisle administration files quarterly with the City Council. In the last three months of 2011, Iwata worked 25 hours a week, earning $55 an hour, according to the list. At that rate, Iwata earned $1,375 a week, or $71,500 annually, working just over half time.
Ono said Iwata retired in December 2001 as the city’s chief of land survey and acquisition and started the 89-day jobs the following month. That was before the state law was changed in 2010 to require the six-month wait.
Iwata, whose office said he was out Thursday and Friday, could not be reached for comment last week and didn’t respond to an email from the Star-Advertiser.
Attorney General’s Office spokesman Josh Wisch said the investigator whose contract was renewed 53 times represented the longest stretch of anyone in the office on 89-day appointments.
In written responses to Star-Advertiser questions, Wisch said the investigator, whom he wouldn’t identify because the person does undercover work, started the 89-day contracts in March 2001, although not all went the full duration.
"The justification for keeping someone that long is because they have the specialized skills to handle complex and difficult investigative tasks," Wisch wrote. He said the investigator’s current contract expires this month and won’t be renewed.
Wisch said the 89-day appointments allow his agency to quickly hire workers with relevant experience and proven skills to continue essential operations.
"This is especially critical for positions like the investigators, who would otherwise need years of training before they can handle the demands of these critical positions," he said.
Forty-two of the 46 people holding 89-day appointments in the AG’s office are investigators.
Asked whether the appointments are meant to be short-term, Wisch replied: "Currently, the department is exploring alternatives to best staff these investigatory positions, many of which are temporary, that require specialized skills."
At the Honolulu Police Department, 25 HPD retirees on 89-day contracts staff the processing desks at the island’s nine booking stations, freeing regular officers to be on the road, according to spokeswoman Michelle Yu.
"It’s a win-win for the public," said Tenari Ma’afala, president of the State of Hawaii Organization of Police Officers, the police union.
Public employee unions typically oppose rehiring retirees because of the potential to lessen job and promotion opportunities for their members. But Ma’afala said the union agreed to the practice as long as the retirees were limited to desk work and not given regular active-duty responsibilities.
Fishman, the former city managing director and an executive assistant for the Carlisle administration, said he enjoys the part-time work, which includes training and addressing corporate culture issues. He said he doesn’t consider his double dipping and 89-day contracts to be bad practices, given that he earned his pension and that the city is saving money by not having to pay for benefits.
"I don’t think I’m hurting anybody," Fishman said.