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Ex-PSU counsel's pension criticized

| Thursday, March 7, 2013, 12:01 a.m.

Penn State University's former top lawyer retired last year with a $143,337 annual state pension — after pulling out more than $356,000 in personal contributions to the state's ailing pension fund.

In just two years as Penn State vice president and general counsel, Cynthia Baldwin, 68, of McKeesport sweetened her pension by nearly $30,000 from the time she retired in 2008 as a state Supreme Court justice receiving a yearly pension of $113,521.

“The pension that Ms. Baldwin receives is commensurate with the number of positions she held serving the commonwealth for 31 years,” said Baldwin's lawyer, Charles DeMonaco.

Baldwin's benefits reflect formulas in place for state employees who went to work prior to January 2011. Two years ago, lawmakers reduced benefits and outlawed lump sum withdrawals for new hires as the state grappled with unfunded pension obligations that reached $41 billion this year.

Penn State trustee Anthony Lubrano called her retirement package “unbelievable” in light of Baldwin's handling of the Jerry Sandusky scandal.

Baldwin sat in on grand jury testimony given by three Penn State administrators but later said she was not representing them. The administrators have asked a judge to bar Baldwin from testifying against them, claiming they were led to believe she was acting as their lawyer.

DeMonaco has said Baldwin acted properly at all times with regard to her duties at Penn State.

When she went to work at Penn State in 2010, she ceased receiving her pension. When she left in 2012, her pension rose, according to records the Tribune-Review obtained.

Her lump sum withdrawals totaled $356,710.58, equal to her contributions into the state employees' retirement fund — which is $17.9 billion short of what it needs to meet current obligations — plus 4 percent compounded interest.

DeMonaco said she earned her pension in a long and distinguished career that included stints as a public school teacher McKeesport; an instructor at Penn State's McKeesport campus; a lawyer with the attorney general's office; 16 years as a judge in Allegheny County, where she was the first black woman elected to the court; an appointment to the Pennsylvania Supreme Court, which she held for two years before her initial retirement; and later, her Penn State job.

Baldwin joins a small but growing group of state retirees collecting six-figure pensions. A 2012 Tribune-Review investigation found that 658 of the state's 300,000-plus state and school retirees collected pensions of more than $100,000 a year — some in excess of $300,000 a year. Most of those people worked as public school administrators or professors at Penn State or the 14 State System of Higher Education universities.

“We've got to come up with a different system,” said Sen. Mike Folmer, R-Lebanon County, chairman of the Senate Education Committee.

“Taxpayers of Pennsylvania are paying for this. This doesn't come from some private corporation. This has to be looked at. Not her in particular, but this goes to show you why we have got to get away from defined benefits and go to defined contributions,” Folmer said.

A Penn State alumna, Baldwin was on the university's board of trustees from 1995 through 2010 and chaired the board from 2004-07.

Days after she resigned as a trustee, administration officials selected her to become the school's first general counsel at a salary of $321,000, a move former state Auditor General Jack Wagner called symptomatic of a culture of insider influence at Penn State.

Lubrano said the size of Baldwin's benefit and others like it affects the cost of education in Pennsylvania.

“We either made promises we knew we weren't going to be able to afford, or we made promises we knew we couldn't keep. Either way, (pensions) are a problem,” he said.

Public employee unions argue their members contributed to the system while the state consistently failed to meet minimum funding obligations. They say lawmakers, not pension plan beneficiaries, made the funding problem.

Debra Erdley is a staff writer for Trib Total Media. She can be reached at 412-320-7996 or derdley@tribweb.com.

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