Retiree stuck with SS error

The Boston Herald

BEVERLY BECKHAM

It arrived among her Christmas cards, a dunning letter informing Mary Dowd of Somerville that Social Security had made a mistake, and that she, not Social Security, was going to have to pay for this mistake.

"We are writing to give you new information about the retirement benefits which you receive," the letter began, "how we paid you $ 7,874 too much in benefits [and] how you can pay us back. You should refund the overpayment within 30 days."

"If we do not receive your refund within 30 days, we plan to recover the overpayment by withholding your full benefit each month beginning with the payment you would normally receive about March 3, 2000. We will continue to withhold your full benefits until the overpayment had been fully recovered."

"I was in a state of shock," said the 68-year-old Dowd. "I showed the letter to my husband and said, 'How can this be?' He didn't understand either."

Unlike the infamous retired teacher, Joan Phillips, who cashed $ 800,000 worth of clearly inaccurate checks (one for $ 8,394), Dowd had done nothing wrong. Considering retirement, she had done the math, filled out some forms and gone to the Social Security office to see if she could afford to stop working. Her family was pressing her to retire because she'd been having radiation treatments. Her decision depended solely on the numbers.

But the numbers looked good. She was told by Social Security that she'd be getting $ 414 a month. This, plus her government pension of $ 344 plus her husband's pension equaled a green light. So she gave her notice at work.

What Dowd didn't know - what no one told her - is that because she had worked for the U.S. government as a secretary for 13 years and was getting a government pension, she was not eligible for the same Social Security payment she would have received if she'd stayed in private industry.

"But when I went down to Social Security to ask about retiring, they knew I was a government employee and no one said a thing."

In short, Social Security not only made a miscalculation, which three years later equals $ 7,874 and which cuts Dowd's monthly pension by $ 229 a month, Social Security also gave wrong information which led Dowd to premature retirement.

"I know there are people worse off than me," Dowd says. "But in January I received a check for just $ 185. You get used to living on a certain amount of money and this has hit us."

Indeed, according to Kurt Czarnowski, regional public affairs director for Social Security, the agency's formula for calculating benefits for people who are getting "some kind of a social pension" is "admittedly less generous" than for people who are collecting ONLYSocial Security.

Dowd and her husband Jack are not poor. But they're not rich, either. They've lived in the same two-family house for 37 years. They raised four kids in that house. And in August they'll celebrate when they make their last mortgage payment. They're regular people ensnared in a bureaucratic mess that could cost them everything they've worked for.

They have not paid the $ 7,874. They've requested a waiver.

Czarnowski says that waivers are granted if two conditions can be met - that the overpayment is not the fault of the individual and that repaying the money would cause "financial hardship." "But our general predilection is you have to pay the money back."

Even if Dowd's waiver is granted, her Social Security pension will remain at $ 185 a month. "Benefit amounts are set in law," Czarnowski says. "I don't see that there's any provision for us to go back because she's a nice lady or has come to depend on it."

The Dowds aren't poor yet. But stay tuned. They might be.