|Money to burn?|
San Diego Police Department losing most officers to lucrative retirements, not other departments - Over the past several months, San Diego media outlets have issued a flurry of news reports asserting that San Diego police officers are underpaid and that this is “why the department is losing officers.”
There’s just one problem. The facts don’t support this narrative.
Of the 162 who left, only 17 — or just 10 percent — left the San Diego PD for another police force. 90 percent of those who left did so for retirement, medical retirement or miscellaneous reasons. Last year, San Diego lost less than 1 percent of its officers to other agencies.
The main driver of attrition is found in what is waiting for police officers in retirement – DROP payments that can top $500,000 and ongoing retirement payouts that are often higher than their current base pay.
According to Transparent California, in 2013, the average San Diego police officer retiree who had at least 25 years of service credit prior to retirement received an annual pension benefit of $94,425. This excludes chiefs and assistant chiefs, which would raise the average further. The average years of service for these retirees was only 28.78, suggesting that many police officers take advantage of the ability to retire as young as 50 and still receive their maximum pension benefits.
A further breakdown of this data by job title provides even more insight into why so many police officers are retiring from the SDPD. In the City’s study claiming its police officers are underpaid, it reported the average base pay for a SDPD “Police Officer I or II” to be $62,598. The average pension for retired Police Officer I or II was $76,586 in 2013, or over 20 percent more than the average salary.
Part of the popular narrative is correct: Police officers are leaving the San Diego Police Department for higher pay. It’s just that they’re finding that higher pay in retirement, not in competing departments.
The U-T San Diego reported that half of San Diego police officers will be eligible for retirement by 2017. Should the SDPD find themselves facing a legitimate staffing crisis at that time, it will be because of a system that offers virtually no incentive for an officer to continue working past the age of 50, not the allure of higher paying jobs elsewhere.
Increasing pensionable compensation for current officers — something the city is considering to keep officers from leaving — will only compound the problem.
Mod: You can link to this article and others on Transparent California's brand new blog by clicking here.
Large Chinese developer defaults on loan
Mod: The Chinese real estate bubble has begun to burst, and this year will likely see many stories just like the one we are citing here. This from Bloomberg (link):
Kaisa Group Defaults on $52 Million Loan After Chairman Resigns - Kaisa Group Holdings Ltd. (1638) failed to pay a HK$400 million ($51.6 million) loan, raising questions about the Chinese developer’s ability to pay other debts.
Automatic repayment of the August 2013 term loan facility from HSBC Holdings Plc was triggered by the Dec. 31 resignation of Kaisa’s chairman, Kwok Ying Shing, the company said today in a Hong Kong stock exchange filing. The company is assessing whether its failure to pay the outstanding debt plus interest may trigger cross-defaults and have a material adverse impact on the company, it said.
Kaisa’s stock fell 47 percent in December -- its steepest monthly decline on record -- as authorities in the southern Chinese city of Shenzhen blocked its projects and key personnel departed. Standard & Poor’s Ratings Services said after two executives resigned that Kaisa may face “more challenges” in the days ahead while Moody’s Investors Service cut the company’s credit rating to B3 from B1.
Routine applications for licenses, permits and project approvals haven’t been accepted, while an application for a certificate allowing land acquisitions has been suspended, Kaisa said in a statement on Dec. 21. Approvals for two projects in the city’s Longgang district have been withheld.