Posted in 2012
California’s government borders at the brink of bankruptcy. It refuses to cut spending. But counties put the state to shame.
In 20 counties, there is a practice called pension spiking. Senior bureaucrats arrange their final years to generate so much income that their monthly retirement checks are greater than their salaries were.
The Los Angeles Times reported on the head of one county who was paid $227,000 a year. She cashed in $34,000 in vacation pay, added an $11,000 bonus for having earned a graduate degree, and found more than $24,000 in extra pension benefits.
She will be paid $272,000 a year until she dies.
This is common practice at the top of the heap.
The counties refuse to release data on who is getting what. They claim it is too difficult to assemble this information.
Budgeting, anyone?
The reporter did discover this.
In Ventura County, where the pension system is underfunded by $761 million, 84% of the retirees receiving more than $100,000 a year are receiving more than they did on the job. In Kern County, 77% of retirees with pensions greater than $100,000 a year are getting more now than they did before.
Nice work if you can get it, and if you get it, tell me how.
Most employees do not get in on the deal They retire on $32,500 a year on average for 30 years of service. But at the top, bureaucrats plan ahead. For those who plan ahead, there are numerous ways to spike salaries in the last year of work. In fact, there are 60 categories of payments that Ventura County employees can convert to cash.
A former sheriff added a $30,500 “longevity” bonus (for working more than 30 years), which boosted his pension to $272,000 a year, almost 20% higher than his base salary.
An undersheriff added nearly $92,600 in unused vacation time, resulting in a $257,997-a-year pension, nearly 30% above his working pay. Many county retirees also are entitled to annual cost-of-living adjustments.
County firefighters and sheriff’s deputies can boost their pensions by layering premium pay and end-of-career cash-outs on top of salary. A fire captain increased his final year’s pay by nearly $130,000, resulting in a pension 84% higher than his base compensation. He gets $159,598 a year in retirement pay.
The Times ran an article on this a year ago. Nothing was done. It is not in the self-interest of senior managers to change the system.
This has been going on for decades. I knew a high school teacher who did this in the five years before he retired. That was in 1985. He did not increase his salary by much, but by teaching an extra class a day, he added thousands of dollars a year, as he told me at the time.
For details, click the link.
Continue reading on www.latimes.com.
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Posted on April 27, 2012. The original is here.
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