By Lisa Hagen
BU News Service
WASHINGTON — If he is nominated and confirmed as the next secretary of state – as is widely expected — Sen. John Kerry, D-Mass., could leave Capitol Hill with a nice going away present.
With a 28-year tenure on Capitol Hill, Mr. Kerry would be eligible to draw an annual pension of nearly $80,000 once he leaves government service, according to data compiled by the Washington-based National Taxpayers Union, an advocacy group.
Kerry’s departing Republican colleague, Sen. Scott Brown, is not so lucky. A minimum of five years of service in the Senate or U.S. House is required for a retiring legislator to receive a pension, and so Brown, who will have served just under three years before leaving Congress next month, is not eligible.
There is widespread speculation that Brown – defeated last month by Democratic Sen.-elect Elizabeth Warren after winning a 2010 special election – could decide to make a run for Kerry’s seat if becomes vacant. If he were to win a special election for that seat, Brown would then have to be re-elected to a full term in 2014 for pension eligibility to kick in.
Kerry’s pension income could potentially be enhanced by several years of service at the State Department. And, while the Secretary of the Senate’s office declined to confirm the size of Kerry’s congressional pension – saying such information is considered confidential – the senator may also have money in a saving plan in which members of Congress are eligible to participate, Pete Sepp, executive vice president of the National Taxpayers Union, noted.
Assuming Kerry’s participation in the federal thrift savings plan, a 401k style account, Sepp said that, “if invested properly, he could have several hundred thousand dollars socked away.” Sepp noted that, under the plan, legislators can contribute “up to 5 percent of their salary and get a dollar for dollar match from the federal government.”
Not that Kerry really needs the money: Annual financial disclosure reports filed earlier this year show him to be the wealthiest member of the Senate, with a net worth approaching $200 million. Most of this involves assets belonging to his wife, Teresa Heinz Kerry, whose former husband, the late Sen. John Heinz, R-Pa., was an heir to the Heinz Ketchup fortune.
As secretary of state, Kerry would also be eligible to draw an annual salary of $199,700, up from his Senate salary of $174,000.
While Kerry, 69, would be eligible for federal health care benefits as secretary of state, his Senate service would allow him — once he left government — to opt for the federal health insurance plan for the rest of his life, if he is willing to pay the premiums.
Brown, 53, is too young to remain in the federal employee health benefits plan, Sepp said. But, like millions of counterparts in the private sector who have found themselves laid off in recent years, Brown he could continue his health care benefits for 18 months under the provisions of the Consolidated Omnibus Budget Reconciliation Act, better known as COBRA.
Brown would not leave Capitol Hill completely empty-handed: Both he and Mr. Kerry will enjoy some non-financial lifetime benefits as Senate alumni, including being allowed on to the floor of the Senate chamber during sessions.
Other benefits include priority in providing testimony to congressional committees, use of the Senate athletic facility if the applicable fee is paid, and outdoor permit parking on the Senate side of the Capitol, along with borrowing privileges at the Library of Congress.
Departing senators are also offered the option of purchasing the chair that they used in the Senate chamber.
If Brown were to opt not to seek a return to Capitol Hill and instead chose to lobby, both he and his top Senate aides would be restricted from lobbying his former Senate colleagues for two years under federal ethics law.
Short of such direct lobbying, he would be permitted to immediately join a lobbying firm and provide strategic advice to clients on how to lobby, according to Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington. Many former members of Congress opt to become lobbyists, at salaries several times what they were earning on Capitol Hill.
Sepp, noting that the congressional pension system is “more generous” in comparison to most “rank-and-file” employee retirement plans, noted, “This was instituted primarily because it was thought that it might encourage rotation in office and independence of action on the part of lawmakers.”
But he added, “In our opinion, it really hasn’t worked out that way, and there needs to be a serious reform effort, at the very least.”