Monday, April 12, 2010 at 12:04 a.m.

SAN DIEGO — San Diego taxpayers have paid at least $1.75 million in legal fees for the five former city and pension officials who had their federal criminal charges dismissed last week, according to city and pension system records.

The total represents combined fees for federal and state prosecutions as well as a Securities and Exchange Commission civil probe.

The five officials played major roles in pushing through a 2002 deal that significantly boosted retirement benefits for city workers without identifying a way to pay for them. That decision has led to legal battles and budget deficits that recently led to cutbacks in the city’s fire and medical services.

Federal prosecutors alleged that the pension board agreed to accept lower city contributions to the pension fund in return for sweetening benefits. The accused were Cathy Lexin and Teresa Webster, former city employees; Ronald Saathoff, former head of the city firefighters union; and Lawrence Grissom and Loraine Chapin, former pension officials.

The mounting legal fees for more than 45 city and pension officials have led to aggravation over the years, as taxpayers have generally had to pay the bill for both sides of pension-related investigations and lawsuits. But the case against the five officials who were exonerated was among the most visible and costly to the public.

Taxpayer advocate Richard Rider said hindsight shows the federal prosecution may have been ill-advised, but it put public officials on notice that they couldn’t walk away from the 2002 deal without repercussions.

“I certainly don’t like spending money on such fees,” Rider said. “On the other hand, if they can perform on a board with impunity, that costs far more.”

So far, the city’s pension system has paid more than $1.5 million for the five officials, including $923,567 for Grissom, the former pension administrator. Grissom, who is retired, takes home a $117,000 annual pension.

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