📋
Extracted from Consolidated Report
This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.
⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.
⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.
Recommendations 17
-
R1Page 18Roger Lowenstein, While America Aged, The Penguin Press, New York, 2008
-
R2Page 18Philip LaVelle, “New board for pension has tough task ahead”, San Diego Union Tribune, April 14, 2005
-
R5Page 19See Figure 10 for the historical and projected increase in CCSF Employer Contribution Rates.
-
R6Page 19Task force created against pension fund abuse (Global Pensions May 5th 2009). Thirty-six attorney general's offices are set to create a multi-state task force to explore pension fund abuse across the country, New York State attorney general Andrew Cuomo has said, “The task force is intended to enable states to share vital information to prosecute wrongdoing and facilitate nationwide reform. The task force will allow us to have a unified, efficient method for gathering information as we fight to combat corruption and restore transparency and integrity to public pension funds.”
-
R8Page 19Present value calculation for SFFD was $107 million and SFPD was $24 million. See
-
R9Page 19A Lieutenant was temporarily assigned to a rank of Battalion Chief during the course of the last year of before his retirement. This action was authorized by the Fire Chief and sanctioned under the Memorandum of Understanding (MOU) between the City and the San Francisco Firefighters Union (Local 798) dated July 1, 2007 to June 30, 2011. As a result of being assigned to Battalion Chief, the Lieutenant contributed a onetime amount of $1,915 into the pension fund during his last year of employment. This payment increased his pension amount by $25,542 per year. The effect of the “spike” was to increase his pension by 22% a year over the pension amount that he would have received at the rank of Lieutenant. The value of a $25,542 increase over his actuarial lifetime (29.6 years) was calculated to be $296,000. If one deducts his original contribution and the contribution the City made to the fund, the liability incurred by the City and the active members of the SFERS was $293,000. The above example was based on the actual retirement record of a 52 year old Fire Lieutenant, who started his career in 1981 and worked for 26.5 years for the Fire department.
-
R10Page 19The practice permitted an officer making $88,000/year in his final year of service to retire at an initial pension of $110,000/year, due to an assignment that allowed him to earn a rate of $111,000/year for the last 3 months prior to retirement. Cost of living and other increases in his pension benefits have boosted his current retirement pay to $113,000. This pension benefit is 121% higher that it would have been if he retired without any change in rank.
-
R11Page 19Email received from SFERS Deputy Director. Final Compensation is defined in Charter citations A8.595-1 and A8.559-1 for “Old Plan” members and A8.596-1 and A8.585-1 for “New Plan” members. There are specific Safety Pay Types that are included/excluded in PENSIONS, BEYOND OUR ABILITY TO PAY, A REPORT BY THE 2008-2009 SAN FRANCISCO CIVIL GRAND JURY Final Compensation as outlined in a final judgment to a lawsuit won by SFERS in the Superior Court. We found the Pay Type of “WDO” – Work Day Off was not indicated as a pay type to be included in Final Compensation. We contacted the Executive Director and the Deputy Director of SFERS for an explanation of why the WDO pay type was included in the determination of this employee’s Final Compensation and the resulting increase in his retirement benefit. The Executive Director and the Deputy Director have not responded to our specific inquiry.
-
R12Page 20Email dated June 19, 2009 from SFERS Deputy Director SFERS.
-
R14Page 20State of California, Funding Pensions & Retiree Health Care for Public Employees- A Report of the Post-Employment Benefits Commission, 2008.
-
R15Page 20SFERS Annual Reports – 2003 to 2008.
-
R16Page 20Dave Umhoefer, “Pension Twist Costs County Millions”, Journal Sentinel Watchdog Report, Milwaukee County, July 29, 2007.
-
R17Page 20Email From Deputy Director SFERS, July 24, 2009 o “The policies regarding the DROP program have been developed and implemented (see DROP booklet previously provided). The systems for calculation and accounting for DROP are approximately 80 to 85% complete.
-
R18Page 20SFCGJ Internal Analysis 55 DROP members deferred compensation provided by SFERS.
-
R19Page 20People’s Advocate Research Report, “30 Ways to Spike your Pension.”
-
R20Page 20Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions (Issued 6/04)
-
R21Page 20SFERS administers a 2 tier benefit system. Employees who became plan members before 11/2/1976 are said to be Old Plan members while Employees who became members after 11/2/1976 are said to be New Plan member. Each of the plans have had subsequent voter approved Charter Amendments. PENSIONS, BEYOND OUR ABILITY TO PAY, A REPORT BY THE 2008-2009 SAN FRANCISCO CIVIL GRAND JURY