Nicholson Removes Conflicted Pension Board Chair

Marcelia Nicholson. Photo from Milwaukee County.

The Chair of the Milwaukee County Pension Board has been replaced, because his serving on the board was barred by local law.

Michael Harper, who was first appointed to the board in 2015 by former Chairmen Theo Lipscomb, has occupied his seat in violation of a Milwaukee County ordinance that prohibits any beneficiaries, or anyone whose family is a beneficiary of Milwaukee County retirement benefits from serving on the board.

Lipscomb knew Harper’s mother was a beneficiary of the retirement system in 2015, before he appointed him, and he later declined to remove him from the position after county officials discovered Harper’s conflict with the rules governing the pension board.

In Harper’s place, Board Chairwoman Marcelia Nicholson has appointed Nicole Best, Chief Financial Officer and Chief Administrative Officer of Heartland Advisors. 

“As a CPA and an investment advisor with extensive non-profit board experience, as well as experience auditing pension plans, Nicole is exceptionally well-qualified to serve on the Milwaukee County Pension Board,” Nicholson said. “In addition to her experience, I was also impressed with Nicole’s values, including her commitment to racially equitable financial literacy and to public service.”

The pension board provides oversight of the county’s retirement system, which has been plagued by scandal for decades. In the early 2000’s the County Board passed a plan with lavish sweeteners, including the notorious backdrop which gives public employees, including some that voted for it, massive payouts in their pension. It was a classic case of self-dealing and conflicts of interests by politicians, which ultimately resulted in the resignation of the county executive and the recall of seven county supervisors. 

Lipscomb knew in 2015, before he appointed Harper to the Pension Board, that Harper’s mother was a beneficiary of the retirement system. And in late 2019, county officials discovered Harper’s conflict. Sources confirm that county officials, including the Office of Corporation Counsel, suggested Harper resign, that he refused and Lipscomb declined to remove him, and instead attempted to amend the ordinance.

That attempted amendment came in a resolution introduced by Lipscomb in February that would have changed the county’s ordinance relating to “necessary qualifications and exclusions for the appointment of Pension Board members.”

Supervisor Theodore Lipscomb, Sr.

In the resolution, Lipscomb wrote that prior to making his appointments to the pension board in 2015, he sought clarification from the Office of Corporation Counsel (OCC) regarding the definition of the word “family member,” and the guidance he received suggested that because Harper’s mother was not a dependent, and he was not a dependent of her, that the appointment was not in conflict with the law. But in 2020, OCC told Lipscomb the previous guidance would not hold up, and that a broader definition of family applies to the Pension Board exclusions.

The resolution stated that “It is clear that OCC lawyers and others can interpret the current ordinances in various ways and the lack of clarity should be rectified.” It also states, “It is inappropriate to sit in judgement of appointees in a manner that directly conflicts with prior OCC guidance, particularly when such action would impugn the integrity and service of said appointee.”

The resolution included an amendment that attempted to redefine “family member” as someone that receives more than one half of their support from an individual that may be appointed to the Pension Board. This change to the ordinance, had it passed, would have covered Harper.

In April, the resolution went before the board, a motion was passed to hold over the resolution to a date in the future, during the June meeting cycle, when Lipscomb would no longer be on the board.

Now, Nicholson has moved to clean up the conflict on the pension board and Lipscomb’s resolution has, it appears, been permanently rejected.