Bankruptcy Judge Retirement Benefits Legislation

On August 7, 1987, Alabama Senator Howell Heflin introduced a bill that would improve the retirement package for bankruptcy judges. The AO opposed the retirement benefit as being too generous. The AO also did not like the fact that the bankruptcy judges were so politically active and had such good legislative representation in John Podesta of Podesta & Associates, along with sidewalk advice from Akin, Gump. George Paine remembers:

The legislative committee negotiated through an entire session on the amount of pension, penalty for early retirement and the judges’ contribution. Every time we’d hit an objection with a member of Congress we’d say, then give us life tenure since we were losing judges out the wazoo . . . The last sticking point at the end of the session was the contribution. The AO thought the amount should be set at 7-10 percent. We got it down to 5 percent, then 2½ percent. If we didn’t get it put to bed it would have to be reintroduced and go through the same thing the next session. . . . What they didn’t know was we were getting back channel support from Strom Thurman whose nephew had just gone on the bench. He told us he could get it down to zero. It was a weekend and all the members were out of pocket and all the pressure came to bear on Bill Anderson (W.D. Va) who had already gotten it lowered considerably. So he solely made the decision to cut the deal and it was done. That’s why he was such a hero to all of us who had been involved. Plus it was fun going to the Hill with him, since he looked like a senator and everyone always treated us great assuming he was one.

Hill, Parsons, Paine
Anita Hill, Marcia P. Parsons (E.D. Tenn.), and George C. Paine (M.D. Tenn., Ret.)

On November 15, 1988, the Retirement and Survivors’ Annuities for Bankruptcy Judges and Magistrates Act of 1988 was enacted into law as 28 U.S.C. § 377, which established the retirement package for bankruptcy judges in effect today. All bankruptcy judges today owe a huge debt of gratitude to the heroic bankruptcy judges and clerks of court who fought battles in the 1980s to safeguard the position of bankruptcy judge, to create statutory protection of separate clerks of court, to enhance judge salaries, and for the generous retirement package bankruptcy judges enjoy today. Richard Heltzel aptly emphasizes Ralph Kelley’s special contributions: “It is impossible to overstate the role that Judge Ralph Kelley played in supporting and defending the nascent bankruptcy court system. He was a tireless advocate for the courts and everyone involved in the system owes a tremendous debt to him.”

Richard G. Heltzel
Richard G. Heltzel (Clerk of Court, E.D. Cal., Ret.)

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