In the wake of Associated Press reporter Mike Baker’s in-depth look at 11th-hour pay raises that helped to significantly boost local firefighters and police officers pensions, the director of the state Department of Retirement Systems is now examining the cases detailed in Baker’s articles.
The AP identified raises in the final days or months of employment that positively impacted the pensions of more than a dozen workers from different parts of the state over the past five years who were enrolled in the generous Law Enforcement Officers’ and Fire Fighters’ Plan 1 retirement system, which was available from 1970 until 1977.
The abuse of the LEOFF-1 plan will add millions of dollars in future liabilities to the pension fund. The plan was replaced in October 1977 with a less costly program.
It’s heartening to know that good journalism can bring about reform.
But it’s disappointing it took a two-year investigation such as the one Baker conducted to alert state officials to the mountain of abuses occurring in the pension and benefit system in local and state government.
Retirement Systems Director Marcie Frost said she was surprised by some of the details reported by Baker and wants to examine how local jurisdictions reported the pay to state officials.
“Some of the things (Baker) brought up may not have been reported to us,” Frost said on Tuesday.
The details of Baker’s investigation into this pervasive problem were certainly eye opening, but it’s hardly a secret in state and local government that firefighters and law enforcement officers in the pension system do very well financially. It’s also been obvious some of the sweet pensions got an extra dose of sugar for some employees.
It is difficult to believe Frost and other officials, including legislators, were totally caught off guard by Baker’s reporting.
When efforts to boost the already generous pensions have been questioned in the past, the state has determined in many of these cases the action was legal. Perhaps the practice is not illegal, but it is morally wrong. Calls for reform should have come earlier.
The system was never intended to allow the final salary of public servants to be inflated as a way to pad pensions.
Rules were put in place designed to prevent “pension spiking” by prohibiting pay linked to retirement from being counted toward the pension benefit. Yet, loopholes in the rules made it possible, as Baker found.
Frost said her agency might eventually conduct an audit looking at the issue more broadly to see if there are other cases to examine.
That’s an excellent idea.
In addition, state officials should more aggressively vet retirement applications by looking beyond the numbers presented to the timing and circumstances of establishing the retiree’s final pay rate.