Public picks up $221M government pension tab
SAN JOSE, Calif. (AP) – Nearly 64,000 state and local government workers at public agencies in the San Francisco Bay area had some or all of their pension contributions covered at taxpayer expense last year, according to a newspaper report aimed at calling attention to a costly and little-known perk of public employment.
The workers at 117 agencies big and small had at least part of what was supposed to be their share of their retirement plans picked up with $221 million in public funds, the Bay Area News Group reported in the San Jose Mercury News (http://bit.ly/1c9kY2D ). The practice, known as a “pension pickup,” is legal, but the Mercury News says it is receiving greater scrutiny as a way to cut spending by governments that already are required to pay toward their employees’ pensions.
“It’s gotten out of whack,” said Bay Area Rapid Transit general manager Grace Crunican, who had $17,500 of her pension costs assumed by taxpayers last year but is pressing BARTs unions to eliminate the perk that also benefited 3,372 other BART workers. “It’s called the `employee share’ for a reason.”
Although public employees vested in California’s pension systems are required to have 8 to 10 percent of their gross pay deducted and applied toward their retirement accounts, employees often agree to absorb the costs during union negotiations or while bargaining contracts with managers as a way of boosting workers’ pay.
For some of the 63,713 government employees in the region who had their pension contributions covered, the effect on their paychecks was considerable. The $43,000 that Alameda County residents furnished toward County Administrator Susan Maranishi’s pension meant the money did not have to be deducted from Muranishi’s gross pay of $462,000, the Mercury News said. Another 28 public officials received pickups of more than $20,000 last year, the newspaper said.
“Everyone knows what everyone else is getting, and they want to get it, too,” retired labor lawyer Chris Burdick, the author of a textbook on California pension laws, told the newspaper. “There’s only one good reason to be a public employee, and that’s to get the pension.”
The Mercury News compiled the figures in its report from government compensation data for the Bay Area agencies, which included cities, school districts, water agencies, and smaller entities such as sewer providers and irrigation and mosquito abatement districts. It’s unclear how many employees statewide receive the benefit because the California Public Employees Retirement System doesn’t keep track.
As programs have been cut during the recent economic recession, the tradition has been abolished in some instances as a way to curb personnel costs. Last year, California lawmakers banned agencies that belong to CalPERS from paying pickups for employees hired after Jan. 1, 2013.