Lawyers Tell Lower Merion Deferred-Compensation Plan Is OK

After Commissioner Jenny Brown last week for management employees, township lawyers reported to the Board of Commissioners Wednesday night they believe it is legal.  

During public comment, Gladwyne resident David O’Connell asked whether there was a report on deferred compensation. 

Township Solicitor Gil High gave a verbal report to the board in executive session before the full board meeting, Board of Commissioners President Liz Rogan said. Commissioners also received an email report from the township's labor attorneys at the Ballard Spahr firm regarding the legality of the plan, said Commissioner Scott Zelov.

Rogan noted she received the deferred-compensation benefit as a full-time township management employee between 1990 and 2002, and said she does not see that as a conflict that prevents her from contributing to discussion about the plan.

“I had said to this board in executive session that I think understanding management’s compensation plan is really important,” Rogan said, adding the economy is much different now than it was in 1974 when the deferred-compensation plan was introduced. “If we want to change it, we should do it when we understand the whole package, not just the deferred-compensation portion.”

Rogan said the full discussion of compensation for township employees should be an orderly and sequential one. Rogan said accusations about any foul play regarding the deferred compensation plan are “ill-informed and at worst malicious.”

Brown called last week for an independent investigation of the plan, which she was told by Jim McAneny, executive director of the state Public Employee Retirement Commission, is illegal.

Commissioner George Manos said High’s opinion of the plan, based on his research thus far, seems solid. 

“It didn’t arouse enough concern on my part to need a separate investigator,” Manos said. “I don’t know that I would support such an action at this time.”

Zelov also noted the deferred-compensation plan should be discussed in the context of all other employee benefits as well as in the greater context of the township’s budget. He asked that an email memo from the township’s labor attorney about the legality of the plan be made public (see memo documents attached as PDFs to this article).

Brown also noted the budget documents available on the township website, which had been changed recently to specify the 7 percent township contribution to management employees’ deferred-compensation plans, have now been properly dated as of March this year as opposed to being backdated to December.

"I asked [High] to put this opinion in writing and state the documents on which he relied, and I asked the Board to then make that opinion public," Brown wrote in an email early Thursday morning. "We do not yet have that."

The deferred-compensation plan was first brought up in discussion of the forthcoming issue of , which expired in December 2011.