Steal taxes, risk pension: Eau Claire County supervisors seek law change

Jan. 10--A pair of Eau Claire County supervisors want Wisconsin law changed so local governments can draw from state-run retirement accounts of public employees who are convicted of stealing taxpayer money.

Supervisors Mark Beckfield and Steve Chilson are drafting a resolution that will ask state legislators for the ability to put a lien on specific pensions run through the Wisconsin Retirement System in situations where public employees have been found guilty of embezzling.

"Right now the law protects that money from us getting it," Beckfield said.

The proposal comes around the two-year anniversary of the conviction of former county Treasurer Larry Lokken and his deputy, Kay Onarheim, who are serving prison sentences for stealing taxpayer money toward the end of their long careers.

"He's locked up but not forgotten in our opinion," Beckfield said of Lokken.

And because Lokken's court case is already closed, Beckfield said his pension from 38 years as treasurer will be waiting for him after prison. But the county supervisor hopes the proposed law change would be a deterrent to others who consider stealing from taxpayers.

A conviction currently has no impact on public employees receiving their pension or other earned benefits under the Wisconsin Retirement System, said Mark Lamkins, communications director for the state Department of Employee Trust Funds.

State law protects Wisconsin Retirement System benefits from the reach of people other than the person who has worked for them, except in certain situations. Those exceptions include some child support orders, delinquent state taxes and when pensions are divided by divorce.

"The purpose behind not being able to take someone's retirement benefit from them in most circumstances is that retirement benefits are meant to protect people from poverty when they are no longer able to work," Lamkins wrote in an email to the Leader-Telegram.

Onarheim voluntarily agreed to pay a portion of her pension to the county to help make amends for her crimes. Lokken did not include that with his no contest pleas, and Beckfield said that still leaves county residents with "a bad taste in their mouths."

Beckfield hopes to have a draft of the proposal to the county's Administration Committee this month with the intent of getting it to the full County Board in February or March.

"I want to close the last chapter on this thing," he said.

Beckfield said he wants to have it acted on before April elections, which will bring a new County Board chairman because Gregg Moore is stepping down from that post.

The two sponsors of the proposal also are facing challengers in the April 3 elections. Lorraine Henning is challenging Chilson in District 7. Beckfield's District 21 seat is contested by Jon Chermack.

Lokken is currently serving a 9 1/2 -year prison sentence in a state prison on multiple counts of theft and misconduct in office. Onarheim is serving eight years in prison for similar offenses.

The two were convicted of multiple counts of theft and misconduct in office for stealing $625,758 between 2011 and 2013. A police investigation uncovered evidence showing the embezzlement went further back and the total taken was $1.39 million.

The county did recoup most of the stolen money but primarily through a $1 million payment from its insurance carrier. But Beckfield said that doesn't make things right because the county will face higher premiums and other local governments may not have the same coverage for their losses if they're victims of embezzlement.

Contact: 715-833-9204, andrew.dowd@ecpc.com, @ADowd_LTon Twitter

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