Armstrong to receive state pension despite federal tax conviction

Former state Rep. Joe Armstrong of Knoxville has been deemed eligible to receive a state pension despite his federal conviction on a felony charge of filing a false income tax return, according to Shelli King, a spokeswoman for the state treasurer’s office.

Jill Bachus, director of the Tennessee Consolidated Retirement System, says in a memo provided by King that a review of relevant state law and the circumstances of his conviction led her to decide that Armstrong should receive his pension.

The law says that a legislator forfeits pension benefits if convicted of a felony “arising out of that person’s official capacity, constituting malfeasance in office.” Apparently, Bachus determined the veteran Democratic lawmaker’s conviction didn’t amount to malfeasance in office – though the memo doesn’t elaborate. (Note: Text of the memo is available by clicking on this link: armstrong-tcrs-memo-1 )

Armstrong’s conviction was based on failure to pay taxes on profits he made by buying state cigarette tax stamps – with a tobacco wholesaler as middleman – prior to a 2007 tax increase. He supported the tax increase, then sold the stamps after it passed. The lawmaker said he was the victim of a lying accountant, who told him the taxes were paid but actually kept the money for himself.

King had said earlier that Armstrong’s application opts for receiving maximum monthly benefits with no survivor benefits upon his death. If approved, she said he will receive $2,395.34 per month based on 27 years, 10 months of service in the General Assembly” – or $28,744.08 per year.

Armstrong is scheduled to face sentencing in U.S. District Court at Knoxville on Nov. 30.

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