Some have been demonized, but say retirement benefits weren’t their doing

By Danielle Cervantes, UNION-TRIBUNE
Monday, August 23, 2010 at 12:06 a.m.

Download: Details on Top 20 San Diego city pensioners

Sales-tax hike’s roots lie in pension increases: Key votes in 1996 and 2002 boosted top 20 pensions for San Diego city workers by 176 percent


The Watchdog analysis included information about the pensions of 4,153 current service retirees and survivors, provided by the San Diego Employees’ Retirement System (excluding disability pensions). The data consisted of monthly allowances paid in February and was annualized for yearly figures.

The analysis arrived at three key data points:

Current pension: For the current benefit, no extrapolation was necessary. The Watchdog used data for actual payments issued by the retirement system that may include cost-of-living adjustments; payouts from city programs such as the Deferred Retirement Option Plan, or DROP; and credit from a program in which employees purchase credit for years they did not work. Overall figures in the story regarding pension trends and averages are based on this data.

Initial pension benefit: This figure was calculated to show an expected pension benefit with enhanced pension formulas and programs in effect at the time all top 20 pensioners retired. It was calculated using highest salary, years of service, age at retirement and a pension multiplier, all supplied by retirement officials. Because of the way the data was released, the estimates include purchased service credits but not payments from the DROP program, which allows employees to collect pension money in a special account before they retire. Individual circumstances are not captured in the analysis, which was designed to illustrate the scope of the benefit changes.

What that benefit would have been without key city votes: For the estimate of how the initial allowance would have differed without the 1996 and 2002 benefit boosts, the analysis used salary, service years and age at retirement and then applied the lower pension multipliers that were in effect until 1997. Again, individual circumstances and decisions about matters such as beneficiary payments would have changed actual payouts in a way that is not reflected in the data or the analysis.

To calculate pensions with and without the 1996 and 2002 votes, the newspaper was provided the highest one-month salary for the top 20 pensioners, a figure that was annualized to estimate the highest one-year salary. For the top 20 pensioners who were enrolled in DROP, the year of retirement was calculated per retirement system practices as the entry into the program, not the actual year that work stopped.

Each pensioner’s date of birth was not provided, although month of birth was. Therefore, a small number of retirement ages used in the analysis may be off by one year. For the top 20, a date of birth was determined using other public records.

Individual circumstances that may have affected initial payout — and estimated payout without key city votes — include lawsuit settlement groups, beneficiary options, tax law and employee contribution levels.

Finally, to figure the estimated nest egg that a private citizen would need to match the top city pensioner’s income, The Watchdog relied on the expertise of Jon Beyrer of Blankinship & Foster.

Journalism that upholds the public trust, regularly

They are the poster children of San Diego’s broken pension system, 20 people who worked for the city in one capacity or another and now collect more money for not working than most people earn in a year. Or two.

From their point of view — the ones who agreed to interviews — they are retired professionals enjoying their sunset years following a career spent in service of others.

They travel, they hike, they visit with grandchildren. They had nothing to do with the fateful city decisions in 1996 and 2002 to sweeten retirement benefits, they point out.

But for many residents and taxpayers, the idea of writing $12,000 checks to former city workers every month for the rest of their lives is untenable.

They see potholes and sewer-main breaks, closed libraries and rolling brownouts at city fire stations, and they boil inside.

“The amount of these pensions is patently ridiculous,” said Harvey Lenett, a taxpayer who has run his own insurance brokerage in San Diego since 1974. “I don’t know who negotiated it, but whoever did is unrealistic. You don’t see these in the private sector.”

The Watchdog analyzed a database current through the end of February of 4,153 service pension recipients and identified the top 20. Not surprisingly, many were top officials during their time at City Hall.

The Watchdog attempted to contact all 20 and reached 18. Five agreed to discuss their benefits and the precarious city budget.

The list of top pensioners includes a former police chief, a former fire chief, a librarian and career bureaucrats who rose through the ranks to become directors and deputies in key departments.

At least five worked in the City Attorney’s Office. One still does, on a temporary basis. And one volunteers his time at the office.

One — former Deputy City Attorney Sim Von Kalinowski — is now a Superior Court judge in North County. Von Kalinowski, who at $144,099 per year gets the 13th-highest pension in the city, earns $178,800 a year as a judge. Add the two together, and his income is $322,899.

The judge was among those who declined interviews; a spokeswoman said it would be inappropriate because the pensions have been before the court.

Like the judge, several other pensioners in the top 20 have moved on to other public-sector jobs.

Former San Diego Police Chief David Bejarano, for example, is now Chula Vista’s police chief. He earns $191,000 a year in his new job and $139,747 a year from his San Diego retirement, for a total of $330,747.

When he was San Diego chief, Bejarano said, he worked seven days a week and managed a department with a budget of more than $300 million.

“I worked hard, just like a lot of people worked hard,” said Bejarano, who added that he never took advantage of the boutique pension programs that have been controversial in San Diego. “When I was hired as a rookie at age 22, I had no idea what the retirement benefits were. My only interest was to be a police officer.”

He said the current retirement benefits are unsustainable.

“It’s kind of Monday-morning quarterbacking, but the system should have been fully funded from the beginning,” Bejarano said. “If there was not enough funding to pay for additional benefits, they shouldn’t have been granted. It just comes down to fundamental responsibility.”

Thomas Clark, who collects $146,327 annually from his San Diego service, was hired in June as public safety director in Imperial Beach. He earns $110,000 a year in his new job for a total of $256,327.

Clark did not return messages from The Watchdog, but others spoke freely about their benefits.

“I feel very good about the contributions I made to the city of San Diego,” said Eugene Gordon, who worked at the city for 34 years before retiring from the City Attorney’s Office in 2008.

Gordon, who at $187,037 a year is the highest-paid city pensioner, still spends much of his time at City Hall, volunteering dozens of hours a week training lawyers.

“It’s giving back to the community, giving back to the office I worked in for so many years,” said Gordon, 69. “It keeps my mind active and I think there’s a real benefit to it.”

Gordon said he had nothing to do with the level of benefits he receives. Pension levels are set by elected officials, he noted. He also said he saved the city millions of dollars defending police officers from excessive-force complaints and other lawsuits against the city.

Douglas McCalla, 61, served the city for more than 35 years, starting as a park aide earning $1.55 an hour and leaving as the chief investment officer for the pension system. He is second on the list with a benefit of $174,445 per year.

He says he spent the first two years of retirement “getting over the last eight years of stress,” referring to the public outrage over the high pensions.

McCalla said he and other former public servants have been unfairly demonized for pension checks that were fairly earned.

These days, McCalla works part-time as a financial consultant and volunteers on a charity board that serves developmentally disabled people.

“He’s been a very strong voice on how to be financially prudent,” said Debra Turner-Emerson, executive director of the St. Madeleine Sophie’s Center in El Cajon.

Cruz Gonzalez, who turns 61 in November and is No. 17 on the list, collects $140,663 a year. He retired as the city’s transportation director. He said he has no idea how to fix the city budget or pension system.

“I just don’t have the answers,” he said. “I wish I did.”

Former City Attorney Mike Aguirre said the higher pensions are no accident.

Aguirre, who fought what he considers illegal pension boosts, accused city lawyers of feathering their own retirement nests.

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