HAVERHILL — The trial is over and the sentencing is done, but one key piece of business remains in the Highway Department scandal that rocked the city for two years.
Will James Flaherty be allowed to collect his $65,494-per-year pension from Haverhill, now that he has been convicted of using his highway superintendent's job for personal gain?
That question will be answered by a group of well-known local people, the city's Retirement Board. They are: William Klueber, retired Haverhill city auditor; Donald "Jake" Shea, retired Haverhill deputy police chief; James Cleary, local lawyer; Lewis Poore Jr., Haverhill deputy fire chief; and Charles Benevento, current Haverhill city auditor.
The board is expected to vote to begin formal proceedings to revoke Flaherty's pension at its July 14 meeting, said Michael Sacco of South Hampton, the lawyer representing the board.
Sacco said the board has already requested formal documents from Salem Superior Court detailing Flaherty's conviction and sentence. Once Sacco receives those papers, he said he will mail copies to the rest of the board.
If the board votes to begin revocation proceedings, it will then notify Flaherty and his lawyer. There would be a hearing on the matter, which is likely to take place Aug. 18, Sacco said. The hearing may or may not include testimony. According to law, it will be up to Flaherty whether the hearing is public or private, Sacco said.
"They could question Mr. Flaherty (or his representative), but we don't want to retry the case, just apply the law," he said of the board.
Sacco said he expects to be appointed hearing officer by the board, meaning he will run the proceedings. Following the hearing, he will write a report with a recommendation for the board to consider at its September meeting, he said. That is when the board is expected to vote whether to terminate Flaherty's pension, Sacco said. That vote would happen at a public meeting, he said.
Flaherty must prove losing pension 'excessive'
State law says the board must strip Flaherty of his pension if it finds he was convicted of a criminal offense involving violation of the laws applicable to his office or position, Sacco said.
If Flaherty is to save his pension, he must prove the felony larceny charge he has been convicted of was not related to his city job or that revoking it would amount to an excessive fine in violation of the Eighth Amendment to the U.S. Constitution, Sacco said. The Eighth Amendment requires, essentially, that the punishment must fit the crime.
Flaherty, 67, the city's retired longtime Highway Department superintendent, can be expected to live about 11 more years, based on average life expectancy — a formula commonly used by retirement experts. Losing his pension could cost him around $715,000 total during those years. His lawyer, Scott Gleason of Haverhill, repeatedly argued during Flaherty's trial last month in Salem Superior Court that his client did not deserve to lose his pension, given that he was convicted of stealing what Gleason estimated to be $1,000 worth of paving material.
James Flaherty and his son Kevin Flaherty, 37, a former Highway Department foreman, were sentenced last week to jail terms on felony charges of larceny over $250 by continuous scheme. James is to serve six months of his two-year sentence under house arrest and the remainder on probation. Kevin is to serve four months in Middleton jail and the remainder on probation.
A jury concluded June 2 that the Flahertys stole city paving material from the Highway Department facility and used it for their private jobs. At the sentencing hearing, prosecutors refused to estimate how much paving material they believe the Flahertys stole. They said the theft was part of a scheme that continued for many years, so it was impossible for them to put a number on it.
James Flaherty also pleaded guilty to three tax charges of filing fraudulent state tax returns.
No pension for Kevin Flaherty
Sacco revealed last week that Kevin Flaherty is no longer eligible for a city pension. Shortly after he was fired by Mayor James Fiorentini two years ago, Kevin Flaherty withdrew all the money he had contributed to his retirement account, Sacco said. He said the board could still go after any interest that Kevin Flaherty was paid when he withdrew his contributions, but that doing so would involve the same hearing process that is required to revoke James Flaherty's pension.
"It could be a small amount of money, so the board will have to make that calculation and decide if it's worth it" to go after the interest Kevin Flaherty was paid, Sacco said.
The city Retirement Board tried to begin the process of revoking James Flaherty's pension the day he was found guilty a month ago, Sacco said. But, he said, the court would not provide the legal documents the board needs until Flaherty was sentenced last week.
Prosecutors recommended that James Flaherty be ordered to pay $25,000 worth of fines for the larceny and tax evasion crimes, and that Kevin Flaherty pay $17,000 in fines for his two convictions. But the judge did not require the Flahertys to pay any fines. Gleason successfully argued the now 29-month-old case has financially ruined the Flahertys, and that if James loses his pension, that would be a much greater financial hit than any fines that could be imposed under sentencing guidelines.
Gleason has said he will fight to keep James Flaherty's pension. In fact, prosecutors a year ago offered the Flahertys a deal that included no jail time for Kevin Flaherty in exchange for both men agreeing to plead guilty to the charges. The Flahertys rejected the offer, however, because James Flaherty wanted to try to save his pension, Gleason said.
High-profile public pension cases
Recently, the state Retirement Board took the unprecedented step of suspending House Speaker Sal DiMasi's public pension after he was indicted on federal charges. DiMasi is charged with conspiring to help a software company win $20 million in state contracts and then concealing money he received from the company.
Sacco said the state board used its discretion to suspend DiMasi's pension, but that there is nothing in the law that calls for such an action.
If the city's Retirement Board revokes James Flaherty's pension, he may appeal to a court of law that his Eighth Amendment rights were violated.
Sacco knows something about that. He represented a former city of Quincy plumbing and gas inspector whose public pension was revoked by the Quincy Retirement Board after the former inspector pleaded guilty to breaking and entering Quincy City Hall in 2001. The inspector, Ralph Maher, stole documents criticizing his performance from his personnel file in an attempt to be re-appointed to his job for another two years by an incoming mayor. Maher was sentenced to six months' probation and ordered to pay $393 in restitution and a $500 fine.
Sacco appealed to a court, alleging the loss of his client's pension worth an estimated $576,000, violated the Eighth Amendment. The state Supreme Judicial Court ultimately ruled revoking Maher's pension was not excessive. That decision was based on the fact that the two-year appointment Maher sought to win was worth $125,000 in salary and because "we view the potential harm to the public trust caused by Maher's actions as equally important to our analysis as any potential harm his actions might have caused to the public treasury," according to the decision.
"Comparing the total amount of the forfeiture ... to the gravity of the underlying offenses to which he pleaded guilty, we cannot say that the forfeiture is grossly disproportional," the state's high court wrote.
Another well-known case in which a pubic pension was revoked involves John Bulger, the former clerk-magistrate of the Boston Juvenile Court and brother of notorious South Boston gang leader James "Whitey" Bulger and former House Speaker William Bulger. The state Board of Retirement revoked John Bulger's pension after his conviction for perjury and obstruction of justice charges related to statements John Bulger made under oath about whether he knew the whereabouts of Whitey Bulger, one of the FBI's top 10 most wanted fugitives.
The state's high court upheld the revocation of John Bulger's pension in 2006. The court's decision says Bulger's crime violated the laws applicable to his office, and thus, mandated the forfeiture of his retirement allowance.
In 2007, former House Speaker Thomas Finneran forfeited his $30,000-a-year public pension after he was convicted on obstruction of justice charges. The charges were related to Finneran lying in court about his role in the creation of a legislative redistricting plan that siphoned voting strength from Boston's blacks and Hispanics.
Well-known cases in which public pensions were revoked or suspended after felony convictions or indictments
Sal DiMasi, former House speaker whose pension was suspended after he was indicted last month on federal charges.
Thomas Finneran, the former House speaker and now radio talk show host.
John Bulger, the former clerk-magistrate of Boston Juvenile Court and brother of notorious South Boston gang leader James "Whitey" Bulger and the former House Speaker William Bulger.
Haverhill Retirement Board
William Klueber, retired Haverhill city auditor
Donald Shea, retired Haverhill deputy police chief
James Cleary, local lawyer
Lewis Poore Jr., Haverhill deputy fire chief
Charles Benevento, current Haverhill city auditor
*The board is expected to vote July 14 whether to begin proceedings to revoke James Flaherty's $65,494-a-year public pension. A hearing with Flaherty is expected on the matter Aug. 18
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