Cost of post-tax settlement jumps to $118K

Amherst workers asked to waive right to sue

By Jason Hawk -

More than $118,000 will be extended to Amherst city workers in an ongoing dispute over pension miscalculations.

Mayor Mark Costilow delivered letters by hand in October offering again to recoup affected workers for income tax over-payments during the past six years. Yet another round of letters was mailed late in the month.

The letters ask workers to waive their right to sue the city in return for a settlement.

The overpayments stem from the way contributions to the Ohio Public Employee Retirement System were calculated. Since 2005, the Amherst auditor’s office had been basing its pension numbers on post-tax figures rather than pre-tax figures.

Letters went out in May to 91 past and present Amherst employees.

They were sent by Ashleigh Kerr, an attorney for O’Toole, McLaughlin, Dooley, and Pecora. Costilow’s office was criticized for retaining the firm, in which Amherst law director Tony Pecora is a partner.

Costilow has since released O’Toole, McLaughlin, Dooley, and Pecora and hired another firm to represent the city in the dispute.

He aims to prevent a mass lawsuit by workers. “We’re willing to pay to get them to waive the right to sue,” Costilow said. “I think it’s a fair offer to settle because the city made a mistake.”

A previous estimate by Costilow put the cost of recouping workers at $70,000. Costilow has since increased that amount.

Affected workers have until Nov. 21 to visit Peck & Peck Accountants to have their contributions reviewed and recalculated — at least for the past six years.

Employees were already asked to amend their income tax filings for the past three years, the maximum allowed by the IRS. The dispute focuses now on the years 2009-2011.

The offer does not extend back 11 years to when the city, on the tail end of then-auditor Diane Eswine’s time in office, started incorrectly making OPERS calculations. Ohio law sets a six-year limitation on such claims.

The bulk of the income tax miscalculations were made during David Kukucka’s tenure as auditor. The post-tax issue was discovered by assistant auditor Gwen Melbar shortly after she was hired to replace her predecessor, Richard Pless, who retired.

“It’s a mistake the city made, I don’t believe purposely, but a mistake we made,” Costilow said.

Jason Hawk can be reached at 440-988-2801 or @EditorHawk on Twitter.

Amherst workers asked to waive right to sue

By Jason Hawk