CalPERS

By Jon Ortiz
jortiz@sacbee.com
Published: Thursday, May. 1, 2014 – 12:00 am

Ten years. Enough time for a U.S. Treasury note to mature or a kid to start fifth grade.

And, as The Sacramento Bee reported last weekend, that’s also how long a Southern California public power executive worked full time and drew his government pension before CalPERS discovered the illegal arrangement. Why did it go on for so long?

Officials with the tiny Southern California Public Power Authority said they believed way back in 2000 that contracting with the retiree, Bill Carnahan, was a legitimate way to bring his income closer to what the job market demanded, they said.

CalPERS auditors disagreed when they ran across the deal in 2010. Carnahan, they said, was really an authority employee.

That meant his full-time job – paying up to $271,000 per year in salary and extras – broke state law that limits government retirees to working six months per year for public agencies in the same pension system.

Between wrongly paid retirement benefits and unpaid pension contributions for the government job he had held out of CalPERS’ view for more than a decade, Carnahan and his employer owed a combined $1.2 million.

“I wish, given the way it turned out, that (CalPERS) would have done it sooner,” a morose Carnahan said in a recent interview. “The bill wouldn’t have been so big.”

It also wouldn’t have been so big if the power authority had never made the agreement or had stopped re-upping Carnahan’s annual contracts. Those decisions aren’t CalPERS’ fault.

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