THE LEDGER-STAR
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Tuesday, December 13, 1994 TAG: 9412130455
SECTION: LOCAL PAGE: B9 EDITION: FINAL
SOURCE: BY JEAN MCNAIR
ASSOCIATED PRESS
DATELINE: RICHMOND LENGTH: Medium: 54 lines
Leaders of federal retirees appear to be divided over whether to accept Virginia's $351 million tax settlement or pursue more money in court.
The leaders of two retiree groups - the National Association of Retired Federal Employees and the Military Retirees Taxpayers Association - plan to join legislators in flying around the state Thursday to tout the deal.
That's the same day the state will mail settlement offers to 159,000 federal pensioners. They have until Feb. 1 to decide whether to take the money, about 87 cents for each dollar they were illegally taxed. But if retirees who are owed more than $20 million say no thanks, the deal will collapse.
``We're not twisting their arm, but we're promoting the settlement,'' said Rose Musumeci, NARFE's state president.
``It's gone on too long,'' she said Monday. ``A lot of people are tired of waiting. They say if they wait any longer they won't be around to get it.''
Not all of the retirees' leaders are joining the news conferences scheduled for northern Virginia, Norfolk, Richmond and Roanoke.
Some are urging pensioners to think twice about taking the money after the U.S. Supreme Court last week ordered Georgia to pay refunds to federal retirees in a similar case.
``I would hope that people look at it and make some calls and attempt to understand the impact,'' said William Wollenberg of the Retired Officers Association.
``The chances of winning in litigation are better now than they've ever been,'' said Michael Kator, a Washington, D.C., lawyer who helped retirees negotiate the settlement. He contends the Georgia ruling could mean that Virginia retirees are entitled to full refunds with interest.
``I'm getting tons of calls and just about everybody's telling me they're going to go on with the litigation,'' he said.
If the state had to pay full refunds plus interest, the cost could exceed $700 million.
House of Delegates Majority Leader C. Richard Cranwell, a Roanoke County Democrat who brokered the deal, and other legislators will speak at the news conferences.
Attorney General James S. Gilmore III and Gov. George Allen, both Republicans, have been invited to participate but have not committed to attend.
KEYWORDS: TAX REFUND FEDERAL RETIREES MILITARY RETIREES SETTLEMENT
by CNB