Unsustainable NYPD QDRO Procedures

Among the recurring headlines in Jack Dean’s pensiontsunami news aggregation emails is this item from 2013:

UNSUSTAINABLE: New York City Has More Retired Cops Collecting Pensions Than Active Cops on the Streets (op-ed – Nicole Gelinas / New York Post)

The New York Post did another story yesterday that suggests some of these retired cops may have too much time (and money) on their hands. But beyond the 40 years of pension payouts and 22 years of non-Medicare health benefits there is a puzzling aspect to this story that some of you may be able to clear up for me.

According to his ex-wife, the former cop, 45, has since moved back to The Bronx, traveled around the world, and ignored an Oct. 24, 2015, court order to pay half his $5,540 monthly NYPD pension and mortgage payments on the house where she and their three children, ages 7, 19, and 20, live.
Despite Lisa’s pleas, the New York City Police Pension Fund says its hands are tied.  Last month, a Florida judge signed an order requiring the pension fund to pay Lisa directly. But a lawyer for the fund, Nicole Giambarrese, said it cannot legally do so because the ex-cop has failed to sign a consent form to have the Florida order recognized in New York. If he doesn’t sign it, his ex-wife must go to court in New York to make the order effective in the Empire State.

New York may be different but, according to New Jersey rules regarding benefits on divorce:

Although your pension is normally exempt from any liens, the New Jersey Division of Pensions and Benefits (NJDPB) will honor court orders for child support, alimony, or equitable distribution. The New Jersey State-administered retirement systems are not regulated by federal ERISA legislation. However, court decisions and opinions rendered by the New Jersey Attorney General have resulted in the retirement systems implementing matrimonial/civil union dissolution court orders granting alimony, support, or equitable distribution against a member’s monthly retirement allowance.

Until about 10 years ago I did a fair amount of lump sum calculations for public employees in New Jersey who were divorcing. Back then you would attach a value to the benefit accrued and the ex-spouse would usually get half of that in a lump sum as authorized by a court-issued Qualified Domestic Relations Order (QDRO). However, as the funding status of the plans deteriorated, one of the unpublicized reforms that the state came up with to preserve assets for actuarial manipulation was the elimination of this lump sum option so the Fact Sheet currently reads:

Matrimonial/civil union dissolution orders regarding your retirement will not take effect until you retire and begin receiving a monthly retirement allowance.

Which brings me to my questions:

  1. How could a retiree’s benefit even commence without spousal consent (or a QDRO resolution if already divorced)?
  2. Does the New York plan not honor court orders from other states?
  3. Why would it be up to the ex-cop to sign a consent order which would sharply reduce his benefit?

These are more legal than actuarial issues and if anyone out there has any insights here, please share.


7 responses to this post.

  1. Posted by Tough Love on June 3, 2018 at 6:51 pm

    In answer to your question, to me it simply looks like ……. protect the Plan participant (the retiree, NOT the divorced spouse) at all Courts ……….. even if that means ignoring generally accepted legal precedent.

    Meaning ……… make the divorced spouse jump through extraordinary hoops to get what he/she is due.


    • Posted by El gaupo on June 3, 2018 at 8:18 pm

      Yea. She is due them. Talk about punishing a spouse. What is even more astounding is when an plan participant losing his pension as a result of a conviction of sexual assault or a similiar charge against his/her spouse and the spouse/victim gets screwed. Police officer assaults wife, gets arrested, loses job, loses pension and benifits. Wife/victim suffers agai because he loses all those things. Encourages a spouse to not report this type of problem. Mandatory arrest situations in domestic violence take the option away from the victim entirely. Overall a good thing.
      I’ve been happily married for 19 years. If my wife and I ever divorce she should get whatever she is entitled to and deserves it all for putting up with me. Lol. I tell her she has to only put up with me 8-10 hours a day between work and sleeping. I gotta put up w me 24 hours a day. Think how I feel. 😐


      • Posted by El gaupo on June 3, 2018 at 8:23 pm

        Jersey is pretty good w ex spouses getting pensions. I know a guy who was married for 25 or so years. Wife was cheating on him behind his back. He retired after 30 years. The very next day she filed for divorce. She waited until she could maximize her payout. She got half of it. Moved in w her new boyfriend and kept getting paid. Poor guy died of cancer year later. There are all kinds. I tell guys in my command that next to deciding to use lethal force on someone, the most important decision you make is who you wind up dating/marrying. It can and does go south real fast.


  2. Posted by SeeSaw Jr on June 4, 2018 at 11:01 am

    1. How could a retiree’s benefit even commence without spousal consent (or a QDRO resolution if already divorced)?
    2. Does the New York plan not honor court orders from other states?
    3. Why would it be up to the ex-cop to sign a consent order which would sharply reduce his benefit?

    1. State law on divorce can be VERY different based on the type of law affecting marriage assets. Here in CA we have the most liberal, and fairest IMO, settlements as a “community property” state. Everything acquired while married is deemed a 50/50 asset including all pensions. They divorce while in FL so I am unsure of the FL rules of prperty.
    2. ALL States MUST honor the legal judgments of other states under the “Full Faih and Credit clause of the Constitution. Don’t know what is gong on in NY, but I am concerned that there are issues with just going down to the NY court and registering her FL judgment/Order with the State of NY. And if that did not work the fastest, easiest and 100% fool proof way to cure the situation would be to ORDER the ex-cop/dirtbag before the FL Court/judge and ask WHY (legal terms = “Order to Show Cause”) he has not signed over or paid his judgment, and if no valid answer comes forth (“good cause” in legal terms), toss the dirtbag in jail for contempt. And keep him there until the $$ are fully paid. From a legal point it seems fairly easy, but I am not from the East Coast.


  3. Posted by geo8rge on June 4, 2018 at 12:06 pm

    “go to court in New York to make the order effective in the Empire State”

    My uneducated non lawyer guess, NY State pensions in no way exist, operate, are licensed, authorized or are domiciled outside NY State so they are not in any way interstate commerce and are free of federal regulation. My non judge reasoning: Amazon and Walmart online have to pay state sales tax. A 100% state of Utah business does not seem to have to pay sales tax outside of Utah. So it is probably true, she has to get a NY court to enforce the order. I personally don’t see a NY State court denying it in part because the outrage would embarrass the court. But who knows.


    • Posted by SeeSaw Jr on June 5, 2018 at 2:30 am

      The sales tax issue is totally different, the rule is simple, if the business has NO physical presence in the state, no building, no store, no offices, they do NOT have to pay a sale tax for any goods sold in the state (shipped in from another state).


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