Local Elected Pensions and Inconsistent Practices Draw the Attention of Legislative Committee

While the city of Stockton has been in the media’s spotlight as it tries to avoid bankruptcy, receiving less attention was the revelation that since 1991 the city has illegally enrolled three mayors and 14 council members in the state retirement system for a total cost of $276,953.51. Paying into the system is a violation of Stockton’s charter, but embarrassingly, that detail has escaped the notice of city attorneys and staff. Even worse, there is simply no record of when the action was taken and it is believed to be undocumented, according to City Attorney John Luebberke.

The admission is sure to fan the flames when it comes to heated calls for pension reform, and Ed Mendel over at Cal Pensions writes, “It’s the latest quirk in the hodge-podge of laws and practices, drawing the attention of a legislative committee, that gives some elected officials pensions, prohibits pensions for other elected officials and allows some to choose no pension. Elected official pensions are ‘under consideration’ and ‘may be included’ in the proposal made by a two-house legislative committee on pension reform, a co-chair, Sen. Gloria Negrete-McLeod, D-Chino, said at a hearing in her district this month.”

Mendel also points out that questions remain about whether or not AB 3664, which was passed in 1994, can apply to charter cities in California. The bill states that local legislative bodies cannot receive pension benefits greater than the “most generous” pensions for non-safety employees. The LAO has reported that as far as it knows, the law has never been litigated based on information shared by the Legislative Counsel.

The LAO put together a report for the legislative committee on pension reform to document that local elected officials’ pension benefits vary considerably. You can read the full LAO report here.

There are two bills being considered in the Legislature that would impact current practices. They are as follows: AB 1874 would ban new members from joining the Legislators Retirement System, and AB 2429 bans public pensions for part-time elected and appointed local officials. The Legislators Retirement System is particularly notable because it requires no annual contributions from employers or employees, its benefits are generous, and around a dozen current members of Congress are enrolled.

Read Mendel’s full round-up on elected official pensions here.

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