Thursday, October 8, 2015

Robert Fellner: Full-career Los Angeles-area city retirees earn 42% more than residents' average salary - Average Los Angeles-area CalPERS payout highest statewide

Link to original article here.
(Mod: There seems to be some confusion in certain quarters about why utility taxes in Sierra Madre are being pushed all the way to 12% by three members of the City Council. If approved by the voters, a 12% UUT would be the highest ever in California history. The story being put out there is that this tax hike is needed to maintain such services as the Library and the Paramedics. But is this entirely true? As the following post by Robert Fellner clearly indicates, a lot of this would have more to do with salaries, benefits and especially CalPERS than keeping the lights on in city buildings.)

Full-career retirees of Los Angeles County municipalities received an average CalPERS pension worth 42 percent more than the average salary of area workers, according to just-released 2014 pension payout data from Transparent California.com. Full-career police and fire retirees took home an average pension worth nearly twice what area residents earned last year.


Just in case you ever wanted the actual reason for a UUT rate of 12%. For every dollar of pay, the City of Sierra Madre pays 24 cents to CalPERS for miscellaneous and 35 cents for safety employees. These amounts are above the median for LA County.

You can read the entire CalPERS plan for Sierra Madre by clicking here. As stated in the inset above, CalPERS rates are projected to increase substantially over the next few years. Increases that will require a lot more of your utility tax money.

The over 600,000 records — obtained through a series of public records requests to the California Public Employees’ Retirement System (CalPERS) — reveals an average full-career pension of $75,266 for miscellaneous retirees, which includes all non-safety employees, and $100,657 for safety retirees for all Los Angeles County cities enrolled in CalPERS.

By contrast, the average full-time worker in the Los Angeles area earned $53,000 last year, according to the Bureau of Labor and Statistics.

Cities in Los Angeles County had the highest average full-career pensions of any CalPERS agency statewide:

The City of Santa Fe Springs had the highest average for non-safety retirees at $113,040.

The City of El Segundo had the highest average for safety retirees at $124,254.

The cities of El Monte, Santa Fe Springs, Santa Monica and Pasadena each had average safety pensions over $118,000 each, placing them in the top 10 statewide.

The 3 largest CalPERS payouts to retirees from Los Angeles County agencies went to:

Joaquin Fuster, UCLA retiree: $325,278,
Stephen R. Maguin, former chief engineer and GM of the Los Angeles County Sanitation Districts: $304,661, and
James F. Stahl, former chief engineer and GM of the Los Angeles County Sanitation Districts: $291,482.

“Average full-career pensions that significantly exceed the wages of most full-time workers shatters the myth that CalPERS only provides a modest level of retirement income,” said Robert Fellner, research director for Transparent California.

Fellner said such exorbitant benefits are the reason pension contributions are skyrocketing, “Retirement costs are directly related to the generosity of the benefits promised, and unfortunately, taxpayers are now being required to pay an equally exorbitant sum to help fund them.

“The City of El Monte, for example, pays a staggering 57 percent of pay to fund average $120,653 pensions for full-career safety retirees, an amount that is nearly five times greater than the median earnings of City residents.”


Fellner noted that the median contribution rate for all Los Angeles County cities — 20 percent for miscellaneous and 32 percent for safety employees — is significantly higher than the 6.3 percent that private employers pay for their employees’ retirement benefits, according to the Bureau of Labor and Statistics.

Fellner warned that, “As high as the current rates are, CalPERS is projecting significant rate hikes over the next few years, which threatens to break already cash-strapped municipalities. What’s worse, weakening market conditions means rates will rise even further than anticipated.”

Statewide

The 2014 report contained 19,728 recipients with a monthly allowance of $8,333.34 or more — representing an annualized benefit of at least $100,000 — a nearly 35% increase from 2012’s report.

The average pension for full-career miscellaneous and safety CalPERS retirees was $65,148 and $85,724, respectively.

The top three 2014 CalPERS pension payouts went to:

Michael D Johnson, former Solano County administrator: $375,990,
Joaquin Fuster, UCLA retiree: $325,278, and
Donald Gerth, former Cal State at Sacramento president: $305,002.

The top 10 CalPERS agencies with the highest average pensions reveals retirement income that can more than double the earnings of full-time, working residents:



A full-career for miscellaneous retirees is defined as at least 35 years of service, the minimum required to qualify for Social Security benefits without penalty, while a full-career for safety employees is defined as 30 years or more.

Despite accounting for only 11 percent of service retirees, it is necessary to look at full-career pensions to accurately gauge the system, according to Fellner.

“Just as one assumes a 40-hour work week when comparing salaries, any discussion of pensions implicitly assumes a full-career.

“Furthermore, the disproportionally greater pensions for those who work a full-career reveal an inequity within CalPERS. Part of the generosity of the full-career benefits comes at the expense of partial-career retirees, who receive disproportionally smaller benefits.”

Fellner concluded, “With retirement costs expanding to as much as ten times what private employers are paying, maintaining the status quo is extremely irresponsible. It’s particularly indefensible to force taxpayers to bear the entire cost for the recklessness of union-backed officials who gambled on sky-high investment returns, lost, and now expect taxpayers to bail them out.

(Mod: Which is what a 12% UUT would be in large part designed to do. Help bail out Sierra Madre's portion of CalPERS.)

sierramadretattler.blogspot.com

52 comments:

  1. City of Sierra Madre. Backed by 12% utility tax.

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    Replies
    1. I thought it was amber mines. Oh sorry, I'm getting the crooks mixed up.

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    2. yeah, but what can be done about Calpers?

      the unions got gutted in the private sector and gravitated to the public sector because there aren't any check and balances or opposition

      those selecting the pension plans at taxpayer expense are the ones profiting from it

      what can we do?

      we have the likes of someone like Nancy Walsh who receives a pension of over $ 100 K a year for what? what exactly did she contribute to society to garner that much of a pension, meanwhile we have most retirees in the private sector living on Social Security and a average pension

      Calpers is a fraudulent ponzi scheme - it's what is ruining our cities - it's unfair and obscene

      I know a "retired" 58 year old fireman - owns a beach house, drives a new truck, owns a Porsche and travels freely - he's getting a full pension ride on the taxpayer dime

      Calpers is a rip off to taxpayers

      and what can we do about it?

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    3. Vote down the UUT to start. It will send a nice message.

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  2. What's another ponzi between friends?

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    1. I remember when a public sector job was where you went for service and a career

      now it's 20 and done

      gut the pension system

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  3. No more retirement free rides from local municipalities instead their retirement is based on S.S. and 401K or something similar liken to what the average tax paying resident relies on for their retirements. It is either this method or bankruptcy will be looming in the near future for the weaker municipalities who can not create enough tax revenue to cover the Gold Fleece Retirement packages for their employees.

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    1. I think it's Golden "Flee" Retirement Packages. Get a FAT pension, retire out of state so you don't have to pay the onerous CA taxes needed to pay those FAT pensions.

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  4. What many are led to believe is that the UUT can't go past 12% by state mandate, That is not true. There is no limit to what a city can charge for a UUT tax. It may be 10% this year, and because of need it could be 20% tomorrow.

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    1. So... you mean since I'm 60 and still working in the private sector, I get to pay 12% so SMPD can retire at 50?

      Seems legit.

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    2. They get to retire so early with lifetime pensions. And most of them don't "retire" because even they know they are too young to retire. So they work another job which takes a job away from someone who doesn't have a pension to supplement their income and they end up pulling in alot of money each year. The taxpayers are being fleeced. We all have to work longer and retire later so that we can pay for all this. Why are we so stupid for putting up with this?

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    3. Why do our elected officials refuse to level with us about this? Instead of coming back with the third UUT increase ballot initiative in as many elections?

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    4. Some people earn their retirements, others are grossly over inflated.

      When someone has spent 30 years dealing with the people you don't want to (drug dealers, burglars, gang members), or putting out fires dealing with hazardous chemical spills and providing critical care to the injured, and made that their career people should be thanking them for making it to 50 years old.

      Before people yell about how much they are supposedly making, find a line level cop or firefighter (not a Chief, not a Commander) and ask them how much they take home each month. Most public safety employees who actually make it to 30 years are the office workers and administrators. Many line level people retire at 50 with 22-25 years on, drawing less than a full retirement because they know it's not safe for them or their community to continue. A majority are not on medical retirements or disability and get other jobs to supplement what they don't receive. Their knees, backs and hips are pretty much destroyed.

      The totals you are being fed are real, but contain numbers which include benefits. If your job gives you benefits do you add that into your total income? It doesn't become part of their retirement either.

      I'm not implying Police Officers and Firefighters should get a pass, but before you pass judgement think about what they (the worker bee employees) do, and what they get in return. It ends up being pretty fair.

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    5. lb, you made a few good points. CA and it's cities and counties should definitely get rid of "Pension Spiking" which allows OT and temp promotions to significantly increase pensions.

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    6. 7:33 The answer to your question is YES.

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    7. Oh, and by the way 7:33, thank you very much.

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    8. Thank you 8:35 - Changes are coming, with many public safety agencies raising the retirement ages and requiring more input from the employee. Spiking legislation is coming at the state level, and I'm sure it will not have any trouble being passed.

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    9. 8:08. You forgot to mention that no one forced these people to take these jobs and they are free to seek other employment. Working at 7-11 can be just as hazardous and those folks don't receive extravagant retirement monies.

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    10. The only problem lb, is the pension spiking law will just push a boatload (cleaned up my language) of retirees out the door to get the big bucks. CA working folks are getting screwed.

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    11. I say pay the PD officers and FD more $ in salary - but the pensions are insane

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    12. jeez 8:08 - take a look at the salaries and overtime we are paying in SM for our PD

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    13. Are your trying to hurt Officer Potato Salad's feelings, 9:43?

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  5. Did the UUT Oversight Committee discuss this? Seems like it should have been item number 1.

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    1. Of course not.

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    2. None of this is in the purview of the UUT Oversight Committee. The Oversight Committee is charged to ensure the UUT Tax coming in is spent on public safety. Since public safety costs far exceed the amount of the tax coming in, there is really nothing to discuss. The UUT Oversight Committee is a sham but we voted it in in all its glory, so there you are.

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    3. Why wasn't it the purview of the UUT Oversight Committee?

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    4. Good question. Anyone know the answer?

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    5. Because the people running the city didn't want them to know?

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    6. Elaine decided it was none of their business.

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  6. Where's Earl Richey? I am willing to walk the streets of Sierra Madre to gather petition signatures . I think we need to put a street walking party together immediately. Does anyone have Earl' email address?

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    Replies
    1. Send an email to The Tattler at sierramadretattler@gmail.com. The Mod can hook you up to the California Tax Limitation Committee (CTLC). CTLC just forced Arcadia (last Tuesday) to put the Arcadia UUT repeal on the April 2016 ballot.

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    2. Whooooaaaa there, 8:27 am. There's laws against street walking in Sierra Madre. That and most of the Tattlers are too old to successfully street walk ... yes, that's what I said.

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    3. Tell that to Arcadia City Council, big boy. April 2016 UUT Repeal dead ahead!!

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    4. I don't think the good people of Arcadia are in the mood to lavish cash on city hall right now.

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  7. Like most Ponzi schemes, the longer it continues, the worse the consequences.
    Only 2 or maybe 3 of our City Council have the integrity to stop this nonsense now.
    They need our unwavering support. Even with our support ,the ultimate solution seems inevitable - BK.
    Bankruptcy is not a surprise. It is a simple-math, foreseeable and preventable failure of leadership & responsibility.

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  8. Get the word out on this UUT 12% nonsense early and often. The "we are going to loose our 'safe little town and its LIBRARY' if we don't vote for this next UUT extension" are into the full spin.

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    1. I would suggest that the library annex into the Pasadena system and we fund a "branch" not an entire library infrastructure.

      Look at the salary, benefits and pension of the top few library staff - it'll surprise you

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  9. Thanks Tattler for bringing the elephant out into the open. I'd hate to tell you what it was buried under.

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  10. I have heard that the Richey petition was denied because they were told there were invalid signatures. They then checked that out, verified the signatures and sent it back. It was returned for lacking 1 signature. I guess they had to restart the process so they sent the affidavit and were told by the city attorney that it was done incorrectly so they had to resubmit it. That's all I have heard. They were going to resubmit. I heard that the form submitted was exactly the same as the original that was accepted.

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    1. Both the County and City Hall keep throwing up roadblocks. They do not want to come out and say no because of the legal ramifications, but it seems there is no way they are going to let this go through. Arcadia, on the other hand, looks like it is putting a similar UUT repeal on the ballot.

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    2. Comparing Arcadia financially with Sierra Madre is folly. Arcadia has the mall, race track, car dealerships, commercial downtown, and a large residential section for property taxes,etc. to bring in revenue. Sierra Madre has a meager two blocks of shops and property taxes.

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    3. Then maybe Sierra Madre is too small and therefore shouldn't try to carry it's own PD and Library and have the County do it instead. It's not my job to pay the highest UUT in the state so Platinum Pensions can be paid.

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    4. Revenue from property taxes in SM have been increasing a LOT. It's not the taxpayers' problem that the City insists on spending money faster than it's coming in. We're working folks, not Mr. GotBucks.

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    5. Yeah, the whole petition process requires scrupulous attention.
      One effort we did cost us ten thousand dollars to prepare all the forms, with attorneys. Then the hard part starts, gathering signatures that you know are good.

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  11. Shocking! I guess if ol' Willie Sutton were alive today he'd be in city govt or a cop instead of robbing banks 'cuz dats where the money is.

    Regarding retirement benefits for cops, firemen and other highly deserving professions. A generous plan makes sense, but it seems there is room for adjustment based on this data. Most federal employees have a FERS plan which is a defined-contribution plan similar to corporate 401k plans. Active military is different and can't be compared.

    The top-heavy figures for city administrative functions just don't make sense. It's shocking.

    Most corporations have switched to defined-contribution plans instead of defined-benefit plans. As 7:21 said, it's time for city government to do the same. Add to this an enhancement for cops, fire fighters and other who take unusual risk compared to other white collar jobs and I'll propose the ballot language myself.

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    1. The Feds got rid of the fat pensions for anyone who started after 1/1/1983 because the old system (CSRS) wasn't going to be sustainable. CA govt. was passing out the $$ to the unions so they never changed the plan.

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    2. Sacramento is pretty much owned by government employee unions. This is basically a one party state. But that does not mean Sierra Madre has to go along with that.

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    3. Oh please, there is no reason that the police and fire have such inflated salaries. It only shows how their unions scare, then fleece, the public.

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    4. LA Times:
      California taxpayers have never paid more for public worker pensions, but it's still not enough to cover the rising number of retirement checks written by the state's largest pension plan.

      Even before the stock market's recent fall, staffers at the California Public Employees' Retirement System were worried about what they call "negative cash flows."

      The shortfalls — which totaled $5 billion last year — are created when contributions from taxpayers and public employees who are still working aren't enough to cover monthly checks sent to retirees.

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    5. Hahahahahahahaha!

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  12. Really missing having people like Chris Koerber when this issue keeps getting discussed but nothing much happens.

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  13. I'm voting NO on the UUT and will every time

    dump Calpers - adjust pensions being paid right now - those able to go to work go back to work

    wouldn't you love to see Nancy Walsh having to interview for a job cause her pension got cut in half?

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