The Ventura County Taxpayers Association sued to obtain and made public last week the list of more than 300 county government employees who are making more than $100,000 a year in retirement. While many in the private sector will never be able to save that kind of money for retirement, and understanding, decades ago government jobs offered low pay and benefits but job security, the most frustrating part is not just relatively big pensions alone, but big pensions for employees that exceed their last year salaries, especially pensions for various county officials and upper management. Thanks to the inclusion of vacation payouts, cash allowances for uniforms, car and other job-related expenses, raises for earning degrees, some overtime, health care contributions, as well as other benefits, added to an employee’s last year base salary to calculate the final yearly retirement payout is normal practice and is perfectly legal. Abuses of these benefits, known as pension spiking, however, include manipulating overtime, unused vacation and special compensation during a worker’s final three years — safety is their final year — leading to retirement to create an exaggerated benchmark for future benefits. Most employees’ retirement is calculated with their last year’s base salary multiplied at an average of 2 percent to 3 percent for every year worked. Aforementioned benefits are also included in the final calculation.
Among those with the highest pensions includes Undersheriff Craig Husband who retired with a base salary of $198,733 in his last year after 32 years of service but has a pension of $256,233 a year; Probation Director Karen Staples had a base salary of $167,008 after 38 years of service but retired with $238,345 per year; and Deputy Fire Chief David Festerling had a base salary was $148,789 after 35 years of service but retired with $235,282. Recently, former CEO Marty Robinson retired with a base salary of approximately $228,300, after holding the top position for three years and working for the county for a total of 35 years. Former Sheriff Bob Brooks retired at a base salary of $227,600, who was elected sheriff in 1998 and served the county for 37 years. Both are set to receive pensions of around $272,000 per year, according to a report in the Ventura County Star.
These are examples of some of the most generous retirement pensions — most county retirees don’t enjoy such high retirement benefits compared to their base salaries. Additional pension benefits came as a result of negotiations with unions and management. In lieu of raises, the Board of Supervisors approved vacation payouts and cash allowances and so forth. The Supervisors were not prepared for the court’s decision in 1997, known as the Ventura Decision, to allow such benefits as cash allowances and vacation payouts to be added to the base salary when calculating the annual pension payout.
While public unions have negotiated amazing salaries, benefit packages and pensions for their members, perhaps in the past when wages were below market rate, some of these concessions made sense, when government couldn’t recruit or keep good employees. But times have changed. The major issue at hand is that even though county pension obligations are currently 84 percent funded (without calculating in the losses associated with the recent stock market crash), and within just a few years, because of these negotiations, the county’s annual pension obligation will balloon from its current $130 million a year to $200 million in 2014, according to Matt Carroll, assistant county executive. The pendulum has swung too far and the county will be facing a major shortfall.
The solution is complicated — after decades of negotiations to get such benefits will take time to reform. The Ventura County Taxpayers Association, however, has made some recommendations it feels the Board of Supervisors could carry out now. The recommendations include the elimination of vacation payout for management, raises associated with earning higher education degrees and the exclusion of gross-up of retirement bonus from pension calculation. The association also recommends elected officials should have only standard 401(k) with the county match of 3 percent. The association’s ideas sound like a step in the right direction. With budget shortfalls part of the regular rhetoric every year and the need for concessions from employees just to balance the budget and maintain services, it is time for serious pension reform. We must keep our Board of Supervisors accountable for its actions. We must contact our local supervisors, attend meetings and demand our voice be heard, lest we sacrifice services or have our taxes raised in the future to compensate for pensions we cannot afford.