Late pay hikes to boost benefits outrageous

Although the practice is legal, implementing it is an affront to taxpayers.

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When city, county, state and federal governments adopt employment policies they sometimes have unintended consequences that cost taxpayers far more than originally intended. While such mistakes are never good and incredibly aggravating, they are understandable.

AP series

Mike Baker's three-part series on state and local government benefits can be read here:

Part 1 — Late pay raises spike pension benefits

Part 2 — Lavish Washington medical plan imperils budgets

Part 3 — Disabilities plague public pension system

Associated Press writer Mike Baker did a two-year investigation looking at all aspects of state and local government benefits. What he found was published in a three-part series in newspapers across the state, including the Union-Bulletin. The series showed how polices enacted years ago have resulted in local and state governments spending enormous amounts of cash today.

Many of the money-hemorrhaging situations are a result of unintended consequences. But some are deliberate efforts to milk the system — and that’s as disappointing as it is outrageous.

This includes a large number of well-paid city employees around the state whose pay was boosted by elected officials or administrators just before retirement resulting in beefed-up pensions. One of the many examples Baker used occurred in Walla Walla.

Last year a retroactive three-month pay raise was given by the City Council to then-Walla Walla Police Chief Chuck Fulton just three days before he was to retire as a way to reward his decades of service. Six of the seven Council members voted Fulton a 9 percent increase, which resulted in boosting his lifetime retirement pension by about $10,000 per year. (Council member Barbara Clark voted no because she felt uncomfortable with the decision. Good call.)

City officials justified the pay hike saying Fulton had done a good job (which, by the way, he did) and the extra pension money would come from state funds.

Wow. A year later and we are still stunned. We said at the time the decision was wrong, regardless of whether it is state or local tax money. It is still public money.

Baker found a pattern of this type of behavior by local officials statewide. As Baker detailed incident after incident, it stirred readers to anger.

Here are a few of Baker’s findings:

• Despite local budget cuts of the past five years, the average first responders retiring into the LEOFF-1 pension system had a pay hike in their final three months of work that was 5.5 percent higher than the same period a year earlier.

• Local officials seeking to cut their budgets approved late pay increases to encourage workers to retire. Those alterations shifted local costs to the state, sticking the state taxpayer-funded pension system with millions of dollars in liabilities.

Retired state Auditor Brian Sonntag called it correctly when he candidly said the local officials and retirees involved in the pre-retirement raises show a clear disregard for what is right.

“They’re thumbing their nose at colleagues — the people who follow the rules — as well as the public,” Sonntag said.

Sadly, these practices won’t stop. But they can — and should — be reduced if local voters hold their elected officials accountable for these egregious decisions.

Previous editorials

The following U-B editorials were published in spring 2012

Council blew it in raising police chief's pay retroactively

Retiring Police Chief Chuck Fulton did an outstanding job, but the Council went too far in raising his pay as a gift.

Chuck Fulton was an outstanding police chief for this city for nearly three decades. Fulton's service and dedication -- 28 years as chief and 42 on the police force -- are worthy of the community's gratitude.

But a majority of the members of the Walla Walla City Council let emotion and their admiration for Fulton cloud their judgment when they granted him a three-month retroactive raise of $2,642 as a parting gift for his service.

The money is not theirs to give away. It's the taxpayers'. Decisions on pay should be based on sound business practices.

The city of Walla Walla, like all local governments in Washington state, has been financially pinched with the downturn of the economy. It's been forced to cut positions and reduce employee hours.

The city's tight budget makes the decision, approved by a 6-1 vote, even more disturbing.

Council member Barbara Clark was the lone voice of reason on this matter. Clark said she believes the Council was overstepping its bounds in establishing the salary rate for the police chief.

"I see this as a management decision rather than a Council decision. I feel uncomfortable for the Council to make a decision, for Council to set salaries," Clark said.

Unfortunately, Clark's solid reasoning was lost in the euphoria of rewarding Fulton.

We certainly understand Council member Jerry Cummins' motivation to grant Fulton a raise. After all, the newly hired police chief started with a higher salary than Fulton's salary. The raise, retroactive to Jan. 1, matched Police Chief Scott Bieber's pay of $123,350 per year.

"I believe the city of Walla Walla has an issue that needs to be resolved this evening," Cummins said as he made his to motion to increase Fulton's salary.

The salary disparity is a legitimate concern. However, that could have -- should have -- been handled by setting the salary for the new chief lower or even at Fulton's then annual salary of $112,788.

Walla Walla has had two police chiefs in the past 60 years -- Fulton and Bert Watts. It's a great job that would have had plenty of excellent applicants for Fulton's salary or less. Chief Bieber might have even taken the job.

The cost to the public will likely be more than the $2,642 for the three months of extra pay. It is likely this raise will boost Fulton's pension.

And while this money does come from a dedicated pension fund, meaning it won't be directly taken from the city's budget, it is nevertheless public money.

The City Council has acted irresponsibly in this case. The blame for this falls to the Council, not Fulton.

The Council's decision should not tarnish Fulton's outstanding legacy of service to this community for 42 years.

Council should have known consequences of chief's pay

Before the City Council granted a retroactive raise to the retiring police chief, it had a responsibility to consider the effect on his pension.

Chuck Fulton served Walla Walla for nearly three decades as the city's police chief. He spent more than four decades as an officer for the Walla Walla Police Department.

When he retired at the end of March, this community was clearly appreciative of his service and all he accomplished. His final act as chief was to oversee the construction of the new police station, which replaced the Police Department's century-old headquarters at City Hall.

Fulton took the lead in pushing for a new station and the respect he has garnered over the years was critical to persuading the community to support the bond election to build the station.

The new headquarters should have been his legacy.

Instead, Fulton has retired in controversy because six of the seven City Council members voted to give him a retroactive pay raise for three months that boosts his pension by $8,661 per year. The three-month raise of $2,642.01 caused Fulton's annual retirement benefit to jump from $92,486 to $101,147.

Ultimately, it's the taxpayers who are on the hook for the extra money, which could easily hit six figures in Fulton's lifetime.

What happened was wrong. The Council's attempt to do something nice for an excellent longtime employee was simply irresponsible.

This has absolutely nothing to do with whether Fulton deserved the extra pay. The fact is he was doing a job -- and doing it well -- for an agreed upon salary. The City Council should not be handing out public money as a parting gift.

What's even more disturbing is that Council members approved this raise without knowing whether it would boost Fulton's retirement benefit. The matter was discussed at the Council meeting, where it was pointed out by City Manager Nabiel Shawa that it was certainly possible this raise could count toward Fulton's pension. The Council members did not demand clarity before they voted.

Instead, the Council members' only concern seemed to be the impact on the city treasury. As long as this raise only cost the city $2,642.01, they (except for Council member Barbara Clark) were good with the plan. They apparently didn't give a hoot that state government was going to shell out tens of thousands of dollars in the future.

But state tax dollars are still our tax dollars. The expectation should be every penny, regardless of the level of government, is spent wisely.

Chief Fulton did nothing wrong. He didn't ask for the pay raise nor did he take action to receive the raise.

The error in judgment was made by the majority of Council.

Let's hope the Council members learn from the mess they created and, in the future, they must make every effort to be certain of the ramifications of every financial decision they make.

Comments

namvet60 1 year ago

Yep - let the greedy flourish and the taxpayers suffer.

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