An NC retirement story with a happy ending

In October 2019, Charlotte-Mecklenburg Police Department Chief Kerr Putney announced he was going to retire at the end of the year, take two months off and then return as chief during the Republican National Convention. No one at the Department of State Treasurer or the Retirement Systems Division was even aware of this announcement until Taylor Batten, managing editor of the Charlotte Observer, called and asked us whether someone in the pension system could retire then come back to the same job.

Our answer was no. Federal law and conforming state law are clear. Retirement benefits cannot be paid when there is a pre-arrangement to return to employment. It would violate the requirement that there be a “bona fide” separation from employment.

Decades of Internal Revenue Service guidance and tax advice to our office have confirmed this. If we had allowed a retirement to go forward under those circumstances, we could jeopardize the tax status of hundreds of thousands of both current and future retirees. We do not pick and choose which laws to apply or who to apply them to. From custodians to chiefs, we have an obligation to be fair and just to all members of the retirement systems.

The editorial board at the Observer took exception to the decades of guidance and the advice of our pension attorneys citing “[a]n attorney familiar with pension law” that said, “Putney’s plan is probably allowed.” While I understand that the Observer was trying to propagate the notion that there is some widespread difference of legal opinion on this issue, it is largely settled law. The attorneys on our staff were stunned at this interpretation and were at a loss as to how this conclusion could be made.

I said repeatedly, through countless interviews and hours of access given to reporters and editorial staff at the Observer, that it appears as though Chief Putney got bad advice regarding his ability to “retire” and then come back to work at the same job.

Thank goodness Chief Putney did not listen to the lawyer that the Observer contacted. Putney rightfully decided not to retire at the end of the year. He continued working until the end of June, retiring at that time with no intention to return to work.

Nothing publicly would have been said about the Chief’s plans had it not been for the inquiries of the managing editor and reporters at the Observer. Despite this, the editorial stated that I “damaged a good man’s [Putney] reputation” and that I should “apologize.”

At no point did I ever besmirch Chief Putney’s reputation. In fact, because of my respect for him, I visited him in Charlotte to make sure he was getting the right advice. I wanted to make sure that he understood his choices and that they were the best for him so that he could enjoy a well-earned retirement without controversy.

The result? He was able to retire without any problems. Chief Putney then publicly thanked me, saying we had a “good conversation” and noting my support for “everything we’re trying to do here locally, even with retirement … I can’t stop smiling about that. It’s a very good feeling.”

With all of the stress and angst that we are all having these days, it’s good to have a story with a happy ending. Thank you, Chief Putney, for your years of selfless service to the people of Charlotte. Now, I can’t stop smiling.