The State Worker

5 key things to know about CalPERS pensions

sokada@sacbee.com

The debate over public pensions is the political equivalent of California’s four-year drought: The topic is either in the news or about to become news, depending on the climate. Next year could be a pension politics El Niño year if one of two proposed ballot measures to change state and local retirements goes before voters.

The debate usually centers on whether pensions are adequately funded, whether retirement benefits are too generous or whether set-in-stone pension obligations are siphoning money from core government services. Six-figure pensions, high-profile pension “spiking” cases and local-government bankruptcies dominate the headlines.

But there’s much more to consider. Using raw figures from the California Public Employees’ Retirement System obtained via a Public Records Act request, The Sacramento Bee analyzed 1.7 million lines of data for calendar years 2012 to 2014 to find the following facts you may not have known about pensions:

1. Highest pensions vs. lowest pensions

Nearly 20,000 retirees received six-figure pensions last year, up 34 percent from 2012. But the fund added 12 times as many retirees with pensions of $20,000 or less as it did those who earned $100,000 or more.

School district employees – CalPERS covers non-teachers – make up the majority of lower-end pensioners. Many are part-time workers who earn relatively little money, so their pension benefits grow more slowly than those of their full-time counterparts elsewhere. School retirees’ annual median pension, the point at which half received more and half received less, was just over $12,000 last year.

2. Judges’ pension subsidy

Taxpayers wrote the retirement checks for about 1,800 retired judges last year whose pension fund has virtually no money to pay benefits. Although working judges in the Judges Retirement System I and the courts both kick in 8 percent of salary that CalPERS then invests, the returns aren’t enough to pay even 2 cents of every retirement dollar owed.

CalPERS for years has asked lawmakers to put extra money into the system, but the Legislature has continued to pay the obligations month-to-month from the general fund. Last year, the judges’ pension checks totaled nearly $190 million, nearly all of it money that could have paid for other programs.

Voters approved a second pension program, the Judges Retirement System II, that covers judges elected or appointed on or after Nov. 9, 1994. Its fund receives much higher employer and employee contributions, has far fewer retirees and more than enough money to cover all of its long-term obligations.

3. State managers, cops, firefighters work longer

If the number of years on the job measures dedication, then engineers, managers, cops and firefighters are among the most devoted employees in state service.

While half of all state retirees took their pensions before hitting the 22 1/2 -year mark, according to last year’s figures, high-level administrators with the title “career executive assignment,” and Caltrans senior transportation managers stuck around a decade longer. The extra time is a significant reason that their pensions ranked second- and fifth-highest among retirees with at least 500 members in a job class.

Retired California Highway Patrol officers and correctional lieutenants were all among the 10 groups with the longest state careers, and their retirement benefits reflected that.

4. Gone but not forgotten

Although voters long ago stopped pensions for state legislators, CalPERS still made pension payments last year to former Assembly members and state senators totaling $5.9 million before taxes were taken out.

Proposition 140 eliminated pensions for state lawmakers elected on or after Nov. 6, 1990, but 215 who held office before the law took effect get retirement checks. A few have only recently applied for their pensions. Former Rep. Mel Levine started drawing his Assembly retirement check last year, even though he left the statehouse for Washington, D.C., in 1983.

Former constitutional officers such as the governor, attorney general and secretary of state can receive pensions if they held office before 2013. CalPERS paid nearly $870,000 last year to 15 such retirees or their beneficiaries.

Among them: Former Gov. Ronald Reagan’s widow, Nancy Reagan, who received monthly beneficiary payments totaling nearly $63,500 last year.

5. A key year in pension history

What a difference a year can make. In 1999, 136 sworn CHP officers retired. Their 2014 median monthly pension: $4,065. The following year, nearly three times as many CHP officers retired. Their median pension last year: $5,904. The biggest reason: A Jan. 1, 2000, law that boosted CHP and other public safety pensions by one-third – and applied it back to the first day they joined CalPERS.

State law now prohibits retroactive pension increases.

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