Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, July 27, 1994 TAG: 9407270069
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: By MICHAEL STOWE STAFF WRITER
DATELINE: LENGTH: Medium
That was one of the main points stressed to the more than 500 people who turned out Tuesday at Cave Spring High School for a public meeting about the settlement.
"That's a critical date," said Stuart Carter, supervisor of the state's tax research office.
Janie Bowen, a senior executive assistant in tax department, said filing an application by Nov. 1 won't obligate retirees to accept a final settlement offer. But she said those who don't meet the November deadline will lose their right to a refund or to join existing litigation against the state.
The state will mail application forms Aug. 1 to the more than 175,000 known retirees in the state whose pension were overtaxed in the late 1980s.
"On that day, we will also begin an aggressive campaign to reach people who aren't in Virginia," Bowen said.
The state will take out a full-page ad about the settlement offer in USA Today, along with ads in more than 15 national and regional newspapers in such cities as Washington, D.C.; Chicago; San Diego; and Tucson, Ariz.
Anyone who is eligible for a refund but doesn't receive an application can pick one up at their local commissioner of the revenue's office or call (800)730-8730.
The state will mail final settlement offers to federal retirees Dec. 15. The retired government workers then have until Feb. 1 to accept the offer, choose to be bound by the existing litigation or file their own suit against the state.
The first refund checks are scheduled to be mailed March 31.
The federal retiree issue grew out of a state policy that taxed the pensions of former federal workers from 1985-88 while exempting the pensions of state retirees.
The U.S. Supreme Court ruled the policy illegal but left open the question of whether the state must refund the estimated $460 million in taxes that had been collected. Retirees sued after former Attorney General Mary Sue Terry recommended against refunds.
The General Assembly approved the $340 million settlement this month.
Public information meetings about the settlement are being held around the state this week, and those attending Tuesday's session in Roanoke seemed to like what they heard.
"Well, I wasn't really expecting to get anything, so I'm pretty satisfied," said retired postal worker R.B. Moore of Bedford County.
Lewis Peery, a retired postal worker from Roanoke, said he was pleased with the payoff plan, which will begin next year and stretch over five years.
"I think it's a good plan," he said. "I felt all along that we would eventually get the money."
Bowen explained that everyone won't receive a full refund if claims totaling more than $340 million are filed. If that happens, each retiree's payment would be reduced proportionately.
If, for example, claims totaling $373 million are filed, each refund would be cut 6 percent.
Tax Commissioner Danny Payne pointed out that the method works both ways - retirees could benefit if claims totaling less than $340 million are filed.
"If that's the case, then you may get more than 100 percent," he said.
There were only two noticeable crowd reactions during the state's hourlong presentation.
One was a murmur of confusion when Bowen explained that the General Assembly could walk away from the settlement if retirees with claims totaling more than $20 million press ahead with litigation.
The second was an outburst of laughter when Bowen told the group they could chose to accept the offer but let the state keep the money.
Memo: ***CORRECTION***