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Loophole Benefits Ex-Federal Agents

June 20, 1998

WASHINGTON (AP) _ Thanks to a legal loophole, some retired Secret Service agents have started second federal careers with full salaries while collecting government pensions _ a ``double dip″ out of federal coffers that is strictly forbidden for other government workers.

The two checks can really add up. The pension plan paid out an average of $42,768 per Secret Service retiree last year, and former agents draw annual salaries ranging from $60,000 to $122,000 in their new federal jobs, according to pension data and employee records.

``It’s sending my kids to school,″ said William Wasley, a former agent who earns $110,000 from his job as director of investigations for the U.S. Forest Service. He also receives a $44,600-a-year pension, according to sources familiar with the program, bringing his annual federal income to $154,600 _ more than a Cabinet member’s salary of $151,800.

Wasley is among dozens of ex-agents benefiting from a legal loophole, now closed, that allows agents hired before 1984 and participating in a District of Columbia pension program to retire after 20 years, collect a pension paid by the federal government and take a second government job with full pay.

``It’s a costly program but the government gets seasoned, well-trained investigators,″ said Wasley.

Current rules, designed to control personnel costs, require federal retirees to take a reduction in their new salaries equal to the amount of their pensions. Because of a quirk in the law, the rules do not apply to some pre-1984 Secret Service workers.

Many military people retire and take government jobs. But when they do, they lose a portion of their military pensions.

With a pension and full salary, the Secret Service retirees often earn much more than their colleagues and that can cause friction.

``I think there’s a fair amount of envy,″ said Francis Uteg, who retired from the service in 1987 and is now a manager at the Federal Law Enforcement Training Center. ``All of us down here that are in this position are some of the highest paid people at the center.″

The practice has prompted a grievance at one federal agency alleging other civil servants are losing job opportunities. A half-dozen FDA investigators in Miami who did not get promoted to supervisory jobs filed a grievance last year charging that FDA favors former Secret Service investigators for promotions. The FDA denied the allegation, according to documents obtained by the AP.

The Secret Service says it did not create the system. But a spokesman defended the practice of bringing agents back into government.

``It’s our position that an individual retiring from the Secret Service has a tremendous amount of investigative and protection service to provide,″ Arnette Heinze said.

Secret Service agents, many of whom begin their careers in their 20s and 30s, can retire after 20 years. In their second jobs, they can qualify for federal pensions after working five years and meeting age requirements.

``It raises the question of whether taxpayers should be saddled with paying these people two pensions, even after they paid for the double dip,″ said George Nesterczuk, staff director of a House subcommittee on civil service.

The system stems from the service’s ties to the District of Columbia’s police force.

The service’s uniformed division traces its roots to the White House Police Force, which was comprised of city officers and U.S. Park Police assigned to provide security at the White House. The unit was placed under the supervision of the Secret Service but its pension plan remained with the city. Other city police who joined the Secret Service were allowed to stay in the city plan.

The U.S. government reimburses the district for any federal workers in the plan. The district pensions are not considered a civil service pension, so the service retirees can go back to government work without penalty.

The loophole closed in 1984 with the Federal Employees Retirement System. But Secret Service workers already in the police pension program were allowed to stay.

Last year, 1,777 retired Secret Service employees covered under the police plan received pensions totaling nearly $76 million, according to city officials.

Federal officials say they do not track how many service retirees are re-employed. But interviews and a review of public and government records by The Associated Press turned up at least 165.

Many work as criminal investigators probing wasteful practices and fraud.

When the Food and Drug Administration created a criminal investigations unit in 1992 following a generic drug scandal, it tapped retired special agent Terry Vermillion as director. He earns $122,800 a year.

About 40 of the unit’s 126 agents are retired Secret Service employees, many collecting pensions plus salary, according to government sources.

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