Top Republicans remove special retirement benefit from NC budget after N&O story

·4 min read
Dawn Baumgartner Vaughan/

After The News & Observer published a story Thursday morning shining a light on a budget provision that would cost the state $642,000 for giving one person a more lucrative pension, the provision was removed from the budget that afternoon.

The House budget proposal that came out Wednesday evening would have moved the executive director of the Conference of District Attorneys, a position currently held by Kimberly Spahos, into a different state pension plan.

The provision was removed as part of a technical corrections amendment at the end of a several hours-long Appropriations Committee meeting, in a final amendment referred to as a Chairs Amendment. The three House budget chairs are Rep. Donny Lambeth, Rep. Dean Arp and Rep. Jason Saine, all Republicans.

Rep. Marcia Morey, a Durham Democrat and former judge, asked the budget chairs for the change after reading The N&O story. She said the cost of the additional benefits was “shocking.”

“This is what happens when you get the printed copy of the budget an hour before you start committee, and to go through everything and find things is impossible,” Morey told The N&O after the committee meeting. “But, your story alerted us to this outrageous provision targeted to one person to get a substantial change in retirement benefits from the state to judicial. And retroactive, back-dating it, which I think is unprecedented.”

“So it was very appropriate to remove that,” she said. “I don’t know how it got in the budget. But the budget is not for one person and their personal benefit.”

The cost of the pension change

The N&O obtained an actuarial note from the Retirement Systems Division, which is under the Department of the State Treasurer, explaining the cost of moving the director into the Consolidated Judicial Retirement System from the Teachers’ and State Employees’ Retirement System.

The accrual rate for the judicial system is higher than the state employees system.

The proposal had made the change retroactive to August 2021, according to the document. That’s tied to Spahos’ hiring date. If the provision on page 276 of the House budget became law, it would have placed all future district attorneys conference directors in the new, better benefit-paying system as well.

According to the letter, the estimated cost of the move is $642,000 for the judicial retirement system, which would mean an annual cost that amounts to 0.04% of the judicial pension system’s payroll. Other people who are part of that retirement system include judges, district attorneys, clerks of superior court and public defenders.

The Conference of District Attorneys is made up of the state’s elected DAs, who meet twice a year. The director is responsible for developing programs and materials and consensus-building, according to its website.

The size of pension payments to the director of the Conference of District Attorneys depends on how many years the director works before retiring. However, the payments would be 60% higher based on the change in the budget if it becomes law, according to the state retirement system.

Spahos did not respond Wednesday evening or Thursday to an email asking about the budget change. Spahos’ husband, Chuck Spahos, is a liaison who lobbies for the Conference of District Attorneys, according to state lobbying records.

Morey said state employees have a certain retirement that they contribute to, and judicial retirement “is almost twice as much.”

“It’s a very preferred retirement, but it’s for judges. It’s for elected DAs, it’s for the chief appointed public defender and elected clerk support people who have been elected, and who have tremendous responsibilities in courtrooms,” she said.

“This particular position is a conference of DAs, who meets twice a year who oversees or coordinates 40 DAs. So for that type of job to be in judicial retirement is an outlier from all the other positions. So I think that that’s a real concern,” Morey said.

‘Better to take it out’

The change at the end of the daylong Appropriations meeting was not specified in the chairs’ amendment beyond the lines it would delete.

“We just felt it’d be better to take it out at this time,” Arp told The N&O.

Lambeth said that the amendment includes changes that they get feedback about, and that the provision wasn’t on his radar before Morey and others asked him about it on Thursday afternoon.

“A lot of things that come out in (committee amendments) we get feedback on, and that was one that we did get feedback on, that we needed to fix that,” Lambeth said.