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Pensions & driving spike into the public

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POSTED March 21, 2014 12:46 a.m.

Justice and the law are not interchangeable.

Justice is rooted in fair-mindedness while the law consists of rules.

Keep that in mind whenever anyone tries to defend the art of public pension spiking perfected in California by top ranking bureaucrats. It is how some city managers, county executives, district fire chiefs, and school superintendents were able to retire and immediately, in some cases, make as much as $30,000 more a year in pension payments than the highest annual salary they received when they were working. 

How did they do it? They got their governing boards to agree to contracts that allowed them to collapse unused sick leave, unused personal leave, and unused vacation into their final year’s paycheck to substantially balloon the basis for their pensions. In some cases, they even combined things such as vehicle and housing reimbursement into their paycheck.

Most men and women in a position to manipulate the system by taking advantage of an unintended loophole in pension rules prior to retirement did not do so. They grasped the concept of public service and didn’t use their positions to maximize the milking of the system. It’s a quaint old-fashioned concept called ethics.

Close behind pension spiking as an obscene betrayal of public faith are those who justify outlandish public sector salaries.

Their defenders rationalize that they have a $270 million annual budget so therefore being paid $235,000 to oversee an entire government agency such as a county schools office that includes a small army of highly paid managers that essentially do the dirty work. Here’s the problem with that argument: California’s state budget that supplies the money taken from taxpayers that county schools offices run on is $106 billion. Using the rational that the top bureaucrat’s salary should have a proportional tie in with the budget he oversees means Jerry Brown should be making $120 million a year as governor. He doesn’t. His pay is $173,000 a year. That’s less than what the San Joaquin County Superintendent of Schools makes. And unlike the governor that has to deal with a legislature that has a mind of its own, the county schools superintendent doesn’t have a hostile board to deal with. Plus he can also operate under relative obscurity with the public light rarely shining on his day-to-day activities as a public servant. That isn’t the case for the governor.

That’s not to say that $235,000 a year for the county superintendent isn’t a fair and justifiable salary. It’s just pointing out that the size of the budget he oversees should have absolutely nothing to do with his compensation.

Nor is it fair to argue that compensation of the public sector head honcho that’s the equivalent of a private sector chief executive officer should be comparable. Putting aside how CEO compensation during the last 20 years has grown grotesquely out of proportion with actual stock performance and profits as well as the pay of other workers in the same firm, there is no comparison.

A private company has no guarantee of any income unless, of course, you are a utility monopoly such as PG&E that has a government dictate assuring you of a set minimum profit year in and year out regardless of what you do. And unlike private firms, government agencies such as county offices of education have guidelines put in place as to what they can do and what they have to do.

Then there is the question of comparing apples and apples in the public sector. Take city managers as an example. Robb Quincey, pointed out by some as a poster child for pension spiking, made $460,000 a year as city manager of Upland after he had perks and other special compensation rolled into his paycheck to up his retirement in 2010. Upland back then had a population of 76,000. The city manager of San Diego — a city 17 times larger — had an annual salary of $269,740 or $200,000 a year less. Merced with a population almost identical to Upland’s paid their city manager $182,000 in 2010. You may argue that Upland is in a more expensive area than Merced with a higher cost of living and somehow bigger demands on a city manger but no such argument could reasonably be made comparing Upland with San Diego. (For the record, Manteca City Manager Karen McLaughlin’s current salary is $186,600.).

So what drives out-of-whack compensation for high level bureaucrats who also tend to be the same ones that game the system to spike their retirement?

It certainly isn’t a desire to serve the public.

Instead it’s more like every man for himself.

And what makes it even more vulgar is the fact the same people that take advantage of their position through manipulation to line their pockets often have buildings named after them for the great job they did on behalf of the public

 

This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at dwyatt@mantecabulletin.com or 209.249.3519.

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