Counties losing fight to conceal pension amounts

SANTA ROSA — The Sonoma County retirement board voted last week to release retiree names and their pension amounts, becoming the latest loser in seven separate superior court decisions since 2009 upheld by three different appeals courts.

When asked by a pension reform group, the three big state public pension systems — CalPERS, CalSTRS and UC Retirement — all released the names and pension amounts of retirees receiving $100,000 or more, needing no prodding from the courts.

But as pensions eat up more of state and local government budgets, a number of the 20 independent county retirement systems that operate under a 1937 act have refused to reveal how pension funds are being spent.

In addition to the pension reform group, several newspapers, a taxpayer association and a nonprofit freedom-of-speech group also have sued to force county systems to reveal pension records. They have an unbroken string of victories.

Superior courts have ordered disclosures by retirement systems in Contra Costa, Stanislaus, Orange, Ventura, San Diego, Sacramento and Sonoma counties, upheld by appeals court decisions in San Diego, Sacramento and Sonoma.

Much of the court battle has been over a provision in the 1937 act that says “individual records of members” shall not be disclosed. Part of the rebuttal is that the system’s list of members and pension amounts is not “individual” like a health record.

The county systems also have argued that release of pension records violate privacy and could lead to physical or financial harm of members, possibly even suits against the system by members alleging breach of fiduciary duty.

Taking a different view, several county systems, among them San Mateo and Marin, released pension records without a court order. One of the holdouts is the largest county system, Los Angeles.

After the Sonoma County Employees Retirement Association board decided in closed session not to challenge an appeals court decision, their fiduciary counsel said the new ruling is different from previous appeals court rulings in Sacramento and San Diego.

Neil Baker said the Sonoma ruling gives a narrow analytical model that places the name and gross pension amount in the general context of public compensation, bringing clarity to an area that was not resolved in the simple language of the statute.

“The position that the board took in relation to the statute the court found to be fundamentally reasonable,” Baker told the board. “In the end it just simply disagreed that it extended to the specific information, names and gross amount.”

An underlying issue is that the pension records could aid a drive for pension reform, particularly if the focus is on six-figure pensions of $100,000 a year or more, which might seem excessive to many persons.

The records obtained by a reform group from the three state systems and the counties, either by court order or voluntarily, are for retirees in the “$100,000 pension club.” The state records are posted on the group’s website.

“The main thing is to engage people when you talk about pensions, because it’s boring to people,” said Marcia Fritz, president of the California Foundation for Fiscal Responsibility. “When we put the list up, it was the same reaction as ours — unbelievable.”

Fritz said the lists help taxpayers “connect the dots,” showing where their tax dollars are going as government programs and services are cut to help fund pensions that are now rare in the private sector.

She said the lists also are a reminder that “upper management,” which advised policymakers on pension increases, “lined their pockets” and share in the higher pensions critics say are unaffordable.

The California Public Employees Retirement System says only 2 percent of its retirees have pensions of $100,000 or more a year. The average pension for state workers retiring during the last fiscal year was about $38,000.

After the San Diego county system released pension records early this month, Fritz held a news conference with Councilman Carl DeMaio, who is running for mayor and co-sponsoring a ballot measure to switch new city hires to 401(k)-style plans.

At the Oscar-themed news event Fritz’s group gave the third annual “Hall of Shame” awards to 10 recipients of big pensions, four from the San Diego County system.

“The awards ceremony kicked off with foundation President Marcia Fritz walking across a short red carpet laid out in front of a podium while displaying an Oscar-like statue with a picture of a lemon pasted on the front,” the San Diego Union-Tribune reported.

Fritz said the idea for a “$100,000 pension club” came from DeMaio. He obtained records for a “$100,000 pension club” from the deeply troubled San Diego city pension fund in 2003, an aide said.

Apart from the initial wow factor, what are the county pension records showing?

The biggest pension on the San Diego county list goes to a former superior court chief executive, Stephen Thunberg, 67, who retired in 2002 with pay of $178,500. He now has a pension that has grown to $239,942 a year, the Union-Tribune reported.

In Ventura County records showed that “more than 300 county government retirees are drawing pensions exceeding $100,000 annually, often for tens of thousands more than they earned in base pay,” the Ventura County Star reported in May.

The boosting or “spiking” of pensions by manipulating the final pay on which they are based, along with years of service and age, is a long-standing issue in Ventura County.

A landmark state Supreme Court decision in 1997 in a suit filed by Ventura County deputy sheriffs said nearly all types of pay except overtime must be counted toward 1937 act county pensions, including cashing out unused vacation and sick leave.

A later ruling said the decision was retroactive, resulting in a windfall settlement for some retirees. Anti-spiking legislation for CalPERS was enacted in 1993, but similar legislation for the county systems failed, leaving them notoriously generous.

The Contra Costa Times reported in 2009 that two Contra Costa fire chiefs, ages 50 and 51, retired with pensions well above their final pay (salary $221,000 and pension $284,000 in one case), sparking a round of stalled anti-spiking legislation.

After winning a lawsuit, the Sacramento Bee reported in July that six-figure pensions from the Sacramento County system soared from 44 in December 2005 to 283 last year.

“But instead of retiring, some of those pensioners are choosing to take jobs at a different government agency, while others return to the county to work as contract employees,” said the Bee. It’s often called “double-dipping.”

The Los Angeles Times has asked the Los Angeles County Employees Retirement Association to release pension records. In July the system’s attorney mentioned the pending appeal of the Sonoma ruling, since upheld, as one reason for denying the request.

“If this case were to reach a decision contrary to that in the Sacramento and San Diego cases, the issue would almost certainly have to be finally decided by the California Supreme Court,” Christine Roseland said in a letter to the Times.

Reporter Ed Mendel covered the Capitol in Sacramento for nearly three decades, most recently for the San Diego Union-Tribune. More stories are at https://calpensions.com/ Posted 19 Sep 11

10 Responses to “Counties losing fight to conceal pension amounts”

  1. Rex The Wonder Dog! Says:

    Jig is up.

  2. spension Says:

    This entire story simply argues for a sovereign default of the State of California and all of its counties, cities, and special districts.

    A retirement at age 51 with starting pension $284,000/year (with regular COLA) makes all the Greece debt look parsimonious.

    Of course the typical California pensioner gets way, way less. But what counts is their payout compared to what was saved for them… the $38,000/year may or may not be reasonable, but given the unfunded status of the pension systems, it looks more unreasonable.

    Not that the private system in the US is admirable either… the top layer of US private industry takes government bailouts and turns over those dollar to giant post-employment benefits for their executives. We’ve all forgotten how the private US pension funds were looted starting in the 1980s.

    All makes we want to move to Germany, until I remember their problems 1930-1945.

  3. Captain Says:

    “Counties losing fight to conceal pension amounts”

    That may be true but it hasn’t prevented the public employee unions from denying that a problem exists, lying/fudging/mimimizing the pension payouts and unfunded liabilities, or sticking to their unrealistic assumed rates of return.

    I wouldn’t care is they set set their expected rate of return at 20% if the taxpayers weren’t stuck paying the bill for various scandals, bad management, pension spiking, pensions based on final year compensation, inflated compensation, uniform allowance, SB 400, etc, etc…

    If they want to cover their own unfunded liabilities there wouldn’t even be a 100K pension club website, and I wouldn’t care less about how many people were on the list. That would be an issue between the retired union members receiving bloated pensions and those working union members contributing more of their money to fund the excess.

    I bet the union members CalPERS, and the ACT37 pension plans would be singing a different tune if that were the case.

  4. Rex The Wonder Dog! Says:

    “The county systems also have argued that release of pension records violate privacy and could lead to physical or financial harm of members, ”
    ==
    There has not been ONE documented case of harm from releasing this information.

    “The average pension for state workers retiring during the last fiscal year was about $38,000.”
    ==
    For FULLTIME employees with 30 years the AVERAGE is $68K plus $25K in medical, for the 20 indepentant 1937 act pension it is $83-$85K plus $25K in medical

    “The biggest pension on the San Diego county list goes to a former superior court chief executive, Stephen Thunberg, 67, who retired in 2002 with pay of $178,500. He now has a pension that has grown to $239,942 a year”
    ==
    That’s PEANUTS compared to former San Diego City Attorney Casey Gwinn who RETIRED at AGE 43!!!! With a $100K pension, this guy aboce is 67, he will only collect 13 years, Gwinn will collect 40 years. There is NO job in the real world where you can “retire” at age 43 with $100K pension for life-with COLA’s.

    “But instead of retiring, some of those pensioners are choosing to take jobs at a different government agency, while others return to the county to work as contract employees,” said the Bee. It’s often called “double-dipping.”

    ==
    They are also denying a JOB, a GOOD JOB to an unemployed person in the state-thereby driving UP unemployment. Just another scam that harms the public while lining the pocket of a gov dork who could never make it in the real world.

  5. Rex The Wonder Dog! Says:

    spension Says:

    Of course the typical California pensioner gets way, way less. But what counts is their payout compared to what was saved for them… the $38,000/year may or may not be reasonable, but given the unfunded status of the pension systems, it looks more unreasonable.
    ==
    Except you’re 100% wrong. You have been reading too much CalTURDS comic books.

    Now for the truth, the AVERAGE pension in CalTURDS for a FULL 30 year employee is $68K. And tha is for a person well belwo the SS age pof 67-where the HIGHEST pension is under $30K at age 67.

  6. spension Says:

    Rex, and your point is…. what exactly?

    I think way to little money was saved for the pensions that are being paid out. You say that is `100% wrong’. I disagree with you. If sufficient funds had been saved, as you say, then the pension system would not be in crisis. I can’t imagine why you would think that the pension system would be in crisis, because you think sufficient funds were saved for the current pensions through the years.

    I do believe the statistics that the average pension for all pension outlays is $38,000/year, and no-one ever said that was for the altered conditions that you are now imposing, for a 30-year employees alone. I’m sure 30-year employees get way more than $38,000/year on average, and I’m sure CalxxRS did not save sufficient funds for the payout.

    Social security is an entirely different system, where investment in the higher-return stock market is forbidden. George W. Bush and the Republicans wanted to allow social security to invest in the stock market in a proposal they floated around 2005. I can’t see what your point is in comparing stock market investment of the sort that CalxxRS does with social security, which invests only in special US Treasury bonds. Are you trying to say social security should invest in stock markets?

    Social security has an entirely different payout structure than CalxxRS, in which the low-wage workers get more than they paid in, and the workers near the ss limit of about $110,000 get less. Workers don’t contribute anything on salary above about $110,000. That is an entirely different system than CalxxRS. I don’t see the point of any comparison there, it is like comparing turnips with coconuts.

  7. spension Says:

    Interesting article on military pensions today in the NY Times…

    Can retire at age 38 with 50% of salary if at least 20 years of service… although if you only have 19 years or 19.9 years and multiple combat tours get… 0! That is nuts… I’d recommend something like 2 or 2.5% times service years after 5 years service…. perhaps lower the multiplier from 2.5% to 2% to help fund all the soldiers with 5-20 years of service.

    But note that military retirees do not get the 3%/year of service that California safety employees get. Certainly soldiers in Afghanistan and Iraq put themselves in more danger than California safety employees do.

    US military pensions are woefully underfunded…. only $284 billion in the fund with obligations of $1400 billion, the pensions are 20% funded! What a disaster! Even CalxxRS are better funded. The low funding of US military pensions is a disgrace.

    The consequence of the US military pension fund mismanagement is that the pay-as-you go component for military pensions now exceeds military salaries…$82 billion/year on pensions, $60 billion/year on salaries.

    Health care is also brought up. Any soldier who has done a combat tour should get lifetime health care IMO.

    http://www.nytimes.com/2011/09/19/us/retiree-benefits-for-the-military-could-face-cuts.html

  8. Rex The Wonder Dog! Says:

    Central Falls RI public safety takes 55% PENSION CUT!!!!!!!!!!!!!!!!!!!!! For CURRET pensioners!!!!

    BAM!~

    So much for that bull-dung that pensions cannopt be touched by a BK court-has ALREADY HAPPENED!


    Receiver Robert G. Flanders Jr.’s plan to shrink city government included many items he had already announced, such as consolidating the police and fire departments into a single department of public safety, and cutting the pension benefits for retired city workers by as much as 50 percent.”

    http://newsblog.projo.com/2011/09/receiver-files-central-falls-r.html

  9. Rex The Wonder Dog! Says:

    http://blogs.wpri.com/2011/09/02/c-falls-slashes-dozens-of-pensions-by-55-one-gets-cut-41k/

    C. Falls slashes dozens of pensions by 55%; one gets cut $41K
    September 2nd, 2011 at 2:30 pm by Ted Nesi under Nesi’s Notes
    city retirees hear about the pension cuts July 19

    Central Falls slashed one in three of its retirees’ pension checks by more than half this month, with the majority of the city’s former public-safety workers set to lose tens of thousands of dollars a year.

    Receiver Robert Flanders reduced 48 of the city’s 141 police and fire pensions by 50% or more, with all but three of those cut 55% from their original amount, according to financial records obtained by WPRI.com

  10. spension Says:

    Cutting pensions in the Central Falls bankruptcy is fine…. but not cutting bond paybacks by exactly the same amount is not fine.

    Everyone should take the same haircut, there should be no privileged class of debt holders. If pension holders get cut by 55%, fine, do the same to bondholders too.

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