Supervisor Mark Borkowski likes to recall the time he got taken to the woodshed after opposing an item championed by County Executive Tom Ament. “I remember being at a political event the next day,” says Borkowski. “Ament was there and made a beeline to me. He let me have it.” Faced with a withering broadside, […]
Supervisor Mark Borkowski likes to recall the time he got taken to the woodshed after opposing an item championed by County Executive Tom Ament. “I remember being at a political event the next day,” says Borkowski. “Ament was there and made a beeline to me. He let me have it.” Faced with a withering broadside, Borkowski turned to Ament’s bodyguard, a sheriff’s deputy, and asked, “Can I have your gun?”
Even in jest, the idea of grabbing a pistol to protect yourself from Francis Thomas Ament seems a stretch. Voters know him for his mild-mannered, nearly somnolent style, but apparently there is a tiger in Tom’s tank. “He’ll yell. He’ll threaten. Let’s say you’ve got something for your district you want. It’ll get conveniently left out of the budget,” explains Borkowski.
But Ament rarely has to go to such lengths because he has become the undisputed heavyweight of county government. In theory, the County Board and its chairman, Karen Ordinans, provide a counterweight, but that tradition has been obliterated in recent years. “I believe the board has abdicated its power and responsibility to the county executive,” says Supervisor Lee Ann Launstein.
“He’s our benevolent dictator,” says Supervisor Robert Krug. “Ament gets about 95 percent of what he wants.”
What the all-powerful county exec wanted – and got – is a new pension benefit for veteran employees, with an astonishing payoff for F. Thomas himself. If he retires in 2004, he will earn a lump-sum payment of about $1.2 million and still collect a $92,000 annual pension for life. But if Ament wins another term (as is his intention) and serves until 2008, he can claim a lump-sum payment of $2.04 million and still collect a $98,000 annual pension for life. Nice work if you can get it.
“If you had told me Tom Ament got this kind of money, there’s no way I would have voted for this,” says Borkowski.
“We were sold a bill of goods,” Supervisor Roger Quindel complains. “The County Board did not understand what was happening.”
But now that the board has awakened from its slumber, it is too late to undo the deed. Once a pension benefit is given, says county corporation counsel Robert Ott, it cannot be taken away. “That’s the law. That’s so people can plan their retirement, that’s to protect the government from changing the pension the day before you’re to retire.”
How were board members so easily snookered? How can Ament justify this golden parachute for himself and other cronies? How could any government in Wisconsin award such a bonanza to its leaders without encountering more press scrutiny?
Ah, that’s the county for you, that quaint and nearly invisible government, little noted and less understood. The story of the Ament pension package exposes, as never before, just how this government works – or rather doesn’t. The details are very, very droll – unless you’re a Milwaukee County taxpayer.
It’s striking to read legendary Milwaukee Journal reporter Richard Davis’ wry, chapter-length description of Milwaukee for a 1947 book about American cities entitled Our Fair City. Davis describes a pinchpenny town where graft is not tolerated and the city government is squeaky-clean. “The closest approach to the general conception of a boss,” he notes, is in county government, which is run by a “clique” whose “needy friends… can be placed in jobs for convenience all around.”
Davis might have been describing the county government of today. “The county is way more an old club than the city is,” says a lobbyist who works both halls. “The decisionmakers at the county tend to be people who’ve been there a long time.”
A very long time. County government has had only six or so key leaders in the last century. William E. McCarty ran the show as board chair from 1914-1932 and Lawrence Timmerman did the same from 1936-1959. After the position of county executive was created in 1960, John Doyne served until 1976, followed by William F. O’Donnell (1976-1988), who had previously served as a key County Board member for 28 years. Tom Ament, who started as a supervisor in 1968 and became board chair in 1976, rose to executive in 1992 and wants to serve until 2008, which would match O’Donnell’s longevity.
“We have a lot of longtime elected officials here,” says Dorothy Dean, county treasurer. She should know. Dean started as an employee of the County Department of Aging in 1975, won a board seat in 1979, served two decades and then was appointed treasurer by her fellow supervisors. Dean says she will run for at least a couple more terms.
Dean represents the old club’s one adaptation to modernity. Today, says Krug, “the county is both an old boys’ and an old girls’ club.”
“It’s like a family over there,” says Ald. Terrence Herron, who served seven years as a supervisor. “A lot of people are related.”
There are couples like Sheriff Lev Baldwin and parks administrator (and former county supervisor) Sue Baldwin, or siblings like Board Chair Karen Ordinans and her brother, Supervisor John Weishan. There are thousands of employees who are county lifers and build relationships with the elected officials.
“There are so many people who think their function is to protect their friends because they’ve been here a long time,” says Quindel.
That protection even extended to someone like Dean, whose abrasive style alienated fellow supervisors. “She was not personally liked,” one lobbyist notes with a laugh, “but she was one of theirs, so they appointed her treasurer.”
The biweekly paycheck for county supervisors says “80 hours worked,” and their pay ($52,227) would be considered full time by most people. But many have worked part time in past years. A story I wrote for this magazine in 1989 estimated that 13 of 25 supervisors worked part time. In 1993, an article in Money magazine suggested the job was “hardly taxing.”
Attorney Tom Bailey is a classic example of the part-time supervisor. “Tom Bailey has his law practice and probably spends 20 to 30 percent of his time on county issues,” says Herron.
Today, most observers suggest that three-fourths of supervisors work close to full time for the county, but many wonder what they are actually accomplishing. “What is there to do?” asks a former board member. “You’ve got maybe one board meeting a month to attend, maybe one or two committee meetings a month.”
“A good part of the job is responding to constituent calls,” says Herron. But few calls come in. “At the county, in an average week, I might have gotten five calls. Now [as alderman], I get maybe 50, 60 calls a week.”
“There isn’t that much to do,” says Bailey. Herron says there is so little work to be done that the board could be cut to 15 members: “What is the need for 25 supervisors? I just don’t get it. Twenty-five people at $50,000 a year?”
Quindel agrees, noting that the county has “lost a lot of functions” – from county hospital to welfare to the foster care system. “I don’t think you can justify reducing the number of employees you supervise by a third and still have the same number of supervisors.”
But Quindel doesn’t expect anything to change. “That’s part of the protectionist mentality of the institution,” he says.
That mentality extends to outdated positions like county clerk, county treasurer and register of deeds. The treasurer job has long been known as great place for a man with a hobby. Tom Zablocki worked on his stamp collection, and in the late 1980s was clocked by reporters as spending less than four hours a day on the job. His successor, Paul McCormack, was said to favor crossword puzzles. Tom Meaux, who served in the ’90s, played a lot of golf.
Former Ald. Kevin O’Connor thought the whole thing was so funny that he ran for county treasurer in 1988 as a joke, won election and then quit the job after a month or so. O’Connor estimated that the job took 45 minutes a day, meaning that at a salary of $42,517, he was earning $234 an hour.
Dean says all three of those positions – county clerk, county treasurer and register of deeds – could be combined into one job. “The County Board is on record several times to eliminate them,” says Krug. “I believe they are all archaic positions.”
The board, in fact, has petitioned the state to eliminate these elective positions, and the Legislature, in its wisdom, has seen fit to kill the idea. Yet the board, with a typical protectionist style, has continued to hand out big raises for officers it says are unneeded. Today, the county treasurer, register of deeds and county clerk each earn $72,163; the salary will go up to $78,177 by 2004.
Call it the county contradiction. Borkowski says the three offices should be combined into one, but he’s already making plans to run for the unnecessary position of register of deeds should incumbent Walter Barczak ever retire.
Little of this ever gets analyzed because the county has never gotten the press coverage other governments get. “At the city, if you blink, they want to do a story about it,” says Herron. “It gets a ton more coverage. I probably had 20 stories on me in one year at the city versus 20 in the seven years I was on the County Board.”
“It’s abysmal,” laments supervisor Jim McGuigan. “We have had days where we didn’t have any press covering the budget. The budget! A billion-dollar budget!”
As a result, the public knows little about county government. Krug and McGuigan both refer to the county as “the invisible level of government.”
Supervisor Jim Schmitt reaches for sports metaphors. “We’re like a small high school sport trying to get space on the sports page, which is filled with stories about the Packers and Bucks and Brewers.”
And the quarterback of that unsung team, year after year, is always the same: Tom Ament.
The Indispensable Man
For most of the history of Milwaukee, its county supervisors worked part time. It was a proposal championed by Tom Ament some 20 years ago that bumped the pay to a full-time salary.
But most supervisors were still working part time in the years Ament was board chair (1976-’92), and were the key to his success. “The old style of leadership depended on a lot of part-time people,” says a former board member. “Ament’s friendship was very important, and he would tell you how to vote.”
But beginning in 1992, there was a real sea change, as newcomers to the board devoted themselves full time to the job. Their board chair was a longtime supervisor, Robert Jackson. “Jackson was old-school, part of the old-boy network,” notes Herron.
“Jackson had a lot of people who supported him and were willing to stand up to the county executive,” notes Supervisor T. Anthony Zielinski.
But Jackson’s less experienced successor, Karen Ordinans, hasn’t been as formidable. “She was on the board a year and a half and then became chair,” says one supervisor. “It was a stretch.”
Some observers suggest that the advent of more full-time supervisors makes it harder to unify them. In the old days of part-timers, they had fewer demands. “Now it’s harder,” says Dean. “Now everybody’s opinion counts.”
Full-time board members with little else to do can get drawn into plots and counterplots. “There are so many shifting coalitions that one day a coalition will support Ordinans and the next day they’ll dislike her,” says one lobbyist.
“There’s not a lot of consistency on the issues [by board members],” says Quindel. “You have difficulty understanding where they’re coming from on a particular issue. It’s been a strange environment.”
“The board is very fractious,” Zielinski says. “That’s one of the reasons Ament has a lot of influence.”
“When you have that kind of divisiveness, it’s easy for Ament to pick off a coalition on various issues,” notes Herron. “I’ve never seen Tom want something and not get it. He’s the guy over there.”
Ament, by all accounts, is a likable and deft politician that board members trust. “The board is so young and Tom is so much more experienced, they generally respect him,” says Supervisor Daniel Diliberti.
Unlike Mayor John Norquist, who meets infrequently with aldermen, “Tom Ament really has an open-door policy,” says County Clerk Mark Ryan. “He regularly meets with county supervisors.”
As a result, Ament all but runs the County Board. “Tom has a lot more influence than Ordinans, a lot more power,” says Schmitt.
“The rest of the board members know they have to work with Ament to get anything done,” says Launstein.
The executive’s omnipotence is such that county administrators now consider him their only boss, Launstein adds. “If you have any department head before the board now, they will say they work for the county executive; they won’t say they work for the County Board and the county exec.” So much for the title of supervisor.
Adding to the unassailable image of Ament is the notion, held by many supervisors until recently, that he could have retired and collected a fine pension years ago. “Tom has dedicated his life to county government and is probably working for nothing now,” says Diliberti. “So people know he’s there because he wants to be.”
Nothing, of course, could be further from the truth.
Coffers of Gold
One of the great county success stories has been its pension fund. The state Legislative Audit Bureau did a study of the state, county and city pension funds, and “we came out with the highest rate of return and the lowest administration cost,” notes Jack Amerell, secretary to the county pension fund.
“The last 20 years, our earnings [on the pension fund] have averaged 12.77 percent per year,” says Ament. In just 10 years, the fund has doubled, rising from $762 million in 1991 to $1.7 billion today.
The county has done so well that it has gradually decreased its annual contribution to the fund – from $19.3 million in 1991 to zero in the current year. As county officials looked at this mother lode, they decided to use it to their advantage.
It was just after Ament’s re-election in 2000 that his director of human resources, Gary Dobbert, began hatching the new pension plan. “The county executive asked me for various options,” says Dobbert. “It was an idea put together by my department working with the director of labor relations [Henry Zielinski].”
Their plan “was part of an overall package which has been designed to recruit and retain employees,” according to a memo Dobbert wrote to the board.
In fact, as Dobbert notes, the number of county employees has plummeted by some 2,500 in the last five years. Other than for a few start-up jobs, there is no need to attract employees because the county is shrinking drastically. As for retaining veterans, no official I talked to could recall anyone who had been wooed away by the private or public sector. Few ever leave the county family.
The real reason for the plan was tactical: The county was swimming in excess pension money that, by law, it could not use for any other purpose. So to keep a lid on property taxes, which pay for employee wages and health insurance, Ament and Dobbert decided to offer big pension increases and ask employee unions to accept a near wage freeze and an increase in their co-payment on insurance.
Thus, all employees hired after 1982 would see their pension build faster: They would get 2 percent of their final average salary for each year worked, compared to the old standard of 1.5 percent. (For example, someone who worked 35 years would get 2 percent for each year or 70 percent of their final average salary as an annual pension, instead of 52.5 percent.)
Since employees hired before 1982 already enjoyed that level of pension benefit, and the unions would want some benefit for everyone, Dobbert threw in a sweetener for old-timers. But he used a truckload of sugar. Veteran employees would get an unprecedented 7.5 percent increase for each year worked after January 2001, up to a maximum of 25 percent by May 2004.
“We were kind of shocked,” says labor negotiator Wayne Krueger. “This is more than we were asking for. We viewed it as a golden parachute for long-term employees. But we weren’t going to look a gift horse in the mouth.”
Because the county normally pays the same benefits to nonrepresented employees, veterans like Dobbert would go along for the ride, gaining the 25 percent increase. In fact, Dobbert and Ament presented a plan offering this benefit to nonrepresented employees before they finished negotiations with the unions. The resolution also included elected officials.
Ament says the politicians were included to achieve equity. “The idea was to do pretty much the same across the board.”
But county elected officials have never been treated equitably; they have always been treated better: Veterans like Ament get 2.5 percent of their salary per year in pension, .5 percent higher than other employees hired before 1982. Now Ament and 15 other officials elected prior to 1982 would get an additional 25 percent boost in their pensions. “I don’t know how we justify it,” says Borkowski.
“The high rollers at the county dealt themselves a big increase,” says Cliff Van Beek, union negotiator and president of Local 1656.
For Ament, should he serve until 2008, the 25 percent increase bumps his annual pension up from about $104,500 to $130,609. But the Dobbert/Ament pension plan added a little-understood feature called “backdrop.”
“The dropback is where the money’s really hidden,” says Van Beek. It’s just mind-boggling. It’s going to be a huge windfall for them.”
In essence, backdrop allows veterans like Ament and Dobbert to go back to the date they were first eligible for retirement and take the lower annual pension from that date. In Ament’s case, he was first eligible to retire in 1995. If he takes the lower pension owed him from then (a mere $98,000 a year), the county will have to pay him the 13 years of annual pensions he should have been paid from 1995-2008, along with 8.5 percent interest compounded monthly. That nets Ament a cool $2.04 million in addition to $98,000 a year.
While Ament and his friends were cashing in, they left out the county retirees, notes Van Beek, who also sits on the county pension board. “Here’s this big windfall, and the retirees who were responsible for most of the money got nothing.”
When the city and state increased pension payouts in response to stock market gains, retirees were included. But the resolution presented to the County Board was not for pension enhancement but to “recruit and retain employees,” so retirees could be conveniently left out. “I was always told we would not deal with retirees until all our labor negotiations were taken care of,” recalls Borkowski.
“By the time the contract was settled, there was nothing left for the county retirees,” Van Beek complains. Some 6,500 retirees would get nothing.
Most County Board members say they had scant understanding of the resolution. Launstein claims the information given them was “very technical, not easy to get through,” while Krug says “it was very difficult to get accurate information. A public official shouldn’t have to fight to get information.”
In fact, the guts of the plan were there for anyone to read in the resolution. What was missing was a full explanation of backdrop. “They didn’t cost out the full effect of what they were doing,” says Supervisor Richard Nyklewicz.
Nyklewicz must have smelled a rat, for he was one of the only supervisors to vote against it. As one of 16 politicians getting the bonan-za, Nyklewicz may have feared that voting for this could get him thrown out of office.
Whatever board members did or didn’t understand about the plan, one thing is crystal clear: The proposal presented by Dobbert and Ament was not changed in any significant way. The board swallowed it whole. Ordinans either lacked the power or the inclination to make any changes. Most board members, says Bailey, “would take their guidance from Ament.”
And they had little reason to suspect Ament would benefit so handsomely. When I asked him about this last September, Ament said of the pension benefit: “In my case, it doesn’t result in much. In my case, I’m probably losing money.”
“They didn’t do a test case of Tom Ament to explain backdrop,” says Ordinans. Nor did they run figures on old-timers like District Attorney E. Michael McCann or Register of Deeds Walter Barczak, who will probably collect more than $1 million each from the backdrop, if they gain re-election in 2004.
Even a comparatively low-salaried official like Bailey will do very well. If he is re-elected in 2004 (Bailey has not faced an opponent since being elected in 1979), by 2008, he would earn a backdrop of just under $400,000 and an annual pension for life of about $30,031. For a man who has always worked part time for the county and who earns much more on his law practice, that’s a magnificent reward. (See milwaukeemagazine.com for details on the Ament and Bailey pensions.)
Some 1,400 county employees are also eligible for backdrop. Many are likely to retire in May 2004, as soon as they’ve earned the full 25 percent pension increase.
“I think you will see a landslide in 2004,” says one county administrator. “It’s unbelievable how many people will go. It’s going to be a huge vacuum.” A large part of the county’s institutional memory may disappear in just one month.
Inevitably, as employees claim backdrop, the pension fund will take a hit. Through the first seven months of 2001, just 45 people took it, and $4 million was paid out. The highest lump-sum payment to an individual was $289,000.
Ament says the backdrop provision is “revenue neutral” because those who take the lump-sum payment are also choosing a lower annual pension. They might have gotten more if they elected the higher annual pension without the backdrop. It all depends on how long they live, says Ament.
But Ament would have to live as long as Methuselah for that to be true. Rather than taking the $2 million backdrop and annual pension of $98,000 in 2008, he could elect to take the higher annual pension of $130,600. That means he would earn $32,600 more per year and would need 63 years to gain the $2 million. By then, Ament would be 134 years old. I’m betting he doesn’t make it.
The truth is that Ament and other county veterans are getting a massive handout that taxpayers will ultimately help subsidize. In the years to come, the county will be forced to use property taxes to make contributions to the pension fund that wouldn’t have been needed had more moderate benefits been handed to Ament and his cronies.
But Ordinans says it couldn’t have been done any other way, given how county government works. “We talked about the issue [of excluding elected officials]. But it’s very difficult to exclude any group in Milwaukee County. We’re the Milwaukee County family.”
Do the Math: The Two Toms’ Terrific Pension Payouts
If Ament elects backdrop, he goes back in time to when he was first eligible to retire. Under the Rule of 75, Ament could have retired in 1995, the first year the rule went into effect, when he was 58 and had 26 years of service. His last three years (or technically, his last 78 biweekly checks) are figured from his last four years of salary prior to eligibility, which were $101,762 (1995), $97,329 (1994), $95,901 (1993) and $93,127 (1992). I came up with an annual average of $96,000, which could vary slightly depending upon what month the salaries kick in and which month he retires.
With 26 years of service for Ament multiplied by 2.5 (the elevated percentage of the salary elected officials get for their pension), Ament gets 65 percent of his average salary for an annual pension, or $62,400. But under the new pension settlement, this is multiplied by 25 percent, giving him $78,000.
The backdrop also gives employees a 2 percent annual cost of living increase in their pension amount. In Ament’s case, that’s $1,560, which is added to each year’s pension amount. Thus, he would be owed $79,560 in pension for each year beginning with 1995. Each successive year would add that amount, but all of the money is actually being totaled on a monthly basis with the addition of 8.5 percent compounded interest.
Plugging this into an Internet tool that allows for computation of monthly compounded interest, Ament would earn $1,196,150 by 2004 and would still collect his annual pension of $92,040 (which is computed by taking the original pension of $78,000 and adding the $1,560 cost of living adjustment for each year served). If he serves until 2008, he earns a lump-sum payment of $2,041,500 plus an annual pension of $98,200 (which is higher because of four more years of COLA payments; this annual payment will rise each succeeding year by $1,560).
If Ament decided to bypass backdrop, he would get a pension based on his higher average salaries for 2002-’04, giving him an annual pension of $111,277. If he served another term, his higher salary average for 2006-’08 would bring his annual pension to $130,609. But that would mean passing up the $2 million lump-sum payment. My guess is his accountant would advise against this.
Since Bailey intends to run for re-election in 2004 and has never faced an opponent, I simply went right to 2008 (when Bailey would be 65 years old) to figure his pension. By then, county supervisors, whose pay rises to $60,557 in 2004, are likely to be up around a $64,000 annual salary and Bailey’s final average salary would be about $62,000. With 29 years service time (Bailey was first elected in 1979) multiplied by his 2.5 percent per-year pension credit, he would have collected 72.5 percent of that. But the county’s new pension benefit hands him another 25 percent increase above that, netting him an annual pension of about $56,187. Not a bad payout for someone who’s always worked part time as a supervisor.
If Bailey elects backdrop, he was first eligible to retire by at least January 1999, when he was approaching age 56 and had more than 19 years of service on the County Board. His last 78 biweekly paychecks are figured from his salary for the period 1996 (he earned $42,388), 1997 ($42,388), 1998 ($43,659) and 1999 ($44,969). We used an annual average of $43,000, which could vary slightly depending upon what month the salaries kick in and which month and day Bailey (under the Rule of 75) was eligible for retirement.
With 19 years service for Bailey multiplied by 2.5 (the elevated percentage of the salary elected officials get for their pension), Bailey gets 47.5 percent of his average salary for an annual pension, or $20,425. But under the new pension settlement, this is then multiplied by 25 percent, giving him $25,531.
The 2 percent annual cost of living increase in the pension amount gives Bailey an additional $511, meaning he gets $26,042 each year, which is totaled up on a monthly basis, with 8.5 percent compounded interest.
Using our Internet tool that allows for computation of monthly compounded interest, Bailey would earn a lump-sum payment of $391,500 by 2008 and would still collect his annual pension of $30,031 (which is computed by taking the original pension of $25,531 and adding the $511 COLA for each year served). This annual pension would continue to rise by $511 each year.
Bruce Murphy is a regular contributor to Milwaukee Magazine .