Sandra Emerson, Staff Writer
Created: 08/06/2010 05:52:11 PM PDT

RANCHO CUCAMONGA – The city of Rancho Cucamonga’s pension fund could be on the hook for more than $125,000 when Bell City Manager Robert Rizzo begins drawing his pension.

Rizzo recently resigned from his position after news of his nearly $800,000 salary outraged Bell residents.

Estimates put his annual pension at more than $650,000. Because he worked for Rancho Cucamonga for eight years of his 30-year public career, the city is liable for a percentage of his final retirement pay.

“We called early in the week because we’ve been getting the question of how much were we going to be contributing to his retirement and obviously we don’t determine an individual person’s payout, (the California Public Employee Retirement System) determines that,” said Rancho Cucamonga Assistant City Manager John Gillison.

Rizzo was hired by the city in 1980 as an administrative aide. He held the positions of administrative analyst and assistant to the city manager. He resigned from the city in 1988 as the assistant city manager.

The salary range for the assistant city manager in 1988 was between $56,400 and $68,400 a year, according to the city.

Rizzo worked for Hesperia for four years before moving to Bell. That city will also be responsible for a portion of his retirement.

Rancho Cucamonga contracts with CalPERS to administer its retirement plan. When Rizzo begins collecting his pension checks, a portion will come from the city’s retirement fund.

An estimate for Rancho’s portion can be calculated by the retirement benefit formula that was in place during Rizzo’s years of employment, which was 2 percent at age 55, according to CalPERS officials.

That 2 percent can then be multiplied by his final compensation of $787,000 and his years of service in Rancho Cucamonga. The resulting figure is $125,920.

The equation for determining the amount is accurate, according to a CalPERS official, but he would not comment on the estimate itself.

Gillison said he cannot comment until the city sees the final amount from CalPERS.

CalPERS “doesn’t send supplemental bills for individuals,” he said.

“So how that will affect our rate, it might not even make a change. We don’t know the answer to that question. CalPERS will.”

Marcia Fritz, board member of the California Foundation for Fiscal Responsibility, has estimated Rancho Cucamonga’s potential liability to be more than $185,000.

Her calculations include vacation pay-out, the employer’s 8 percent contribution made on behalf of the employee, an early retirement incentive and the purchase of five years of additional retirement service credit, known as “air time.”

Fritz said she was able to confirm that the city allows for vacation cash-outs as well as the employer’s contribution, but she is speculating on the “air time” credits and early retirement incentive.

“My point in all of this is just to show you all the extra things that are completely legal he can take advantage of,” Fritz said.

Rizzo’s annual pension could range from $710,000 to $884,000, she said.

He could collect more than $30million in retirement pay over the next 30 years.

Rizzo’s resignation was negotiated behind closed doors, making it impossible to know the specifics of the deal.

“That’s the problem with labor negotiations,” Fritz said. “This is exactly what I’m screaming about. We don’t know what’s going on.”

Attorney General Jerry Brown’s office and CalPERS are investigating the salaries. There is a hold on Rizzo’s retirement pay, but he has yet to file for his retirement benefits.

“We’ve joined the attorney general to review the city of Bell and determine whether (Rizzo’s) full salary is eligible for pension purposes,” said Brad Pacheco, CalPERS chief public affairs.

Rancho Cucamonga City Manager Jack Lam on Wednesday sent a letter to CalPERS supporting its investigation.

“We all hope the authorities find something there and the officials should be punished,” Lam said.

Whether Rizzo’s large pension has an impact on Rancho Cucamonga is hard to say, said Edd Fong, CalPERS spokesperson.

“You’re talking eight years out of 30 years of experience,” Fong said. “One quarter of the pension obligation would come from Rancho Cucamonga’s pension plan. It’s probably more than projected. The increase is not going to be to such a degree that it would cause a great deal of grief for the city.”

However, when CalPERS does its annual actuarial review of the city’s pension plan, the city’s employer contribution rate could increase, Fritz said.

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