It’s time that San Francisco rethinks a life time annuity for 5 years of service with ZERO paid in towards that annuity. Who gets it? Elected officials, SEIU public sector union employees and MUNI employees.
Imagine how it transpires: There is a table. On one side sit the elected officials who dish out the money to the other side. On the other side sits the SEIU public sector representatives. And the MUNI representatives. So, SEIU and MUNI say this is what we can give to you elected officials to help your campaign … And how about giving us a life time annuity for which we pay nothing? A DEAL says the elected officials.
Who loses? The taxpayers.
DrCameronJackson@gmail.com .
San Francisco’s pension fund last year paid $3.3 million to former employees who worked as little as five years in city government but nonetheless qualified for a generous pay package upon their 50th birthday.
The program, which city officials say is unmatched anywhere in the country, gives annuities that include city money to people who didn’t work long enough to qualify for an actual pension.
The annuity is calculated by adding the 7.5 percent of the worker’s paychecks they had contributed to the pension fund over the course of their city employment, plus interest, along with a match of that amount from the city. The former employees can begin drawing on it any time after they turn 50.
Making the provision even more unusual, a wide swath of city employees don’t pay anything toward their own pensions, with the city making that 7.5 percent annual employee’s contribution.
That means a number of workers who don’t qualify for a regular pension stand to collect an annuity of 15 percent of their salaries – the 7.5 percent pension contribution made by the city, plus the city’s match of the same amount – even though they never paid a cent toward their pension.
Those groups who now pay nothing toward their pensions include elected officials, Service Employees International Union (SEIU) workers and Muni drivers The first two are set to begin making their own contributions starting July 1. Muni drivers’ contracts are currently being negotiated, and requiring them to pay into their pensions is a major point of contention.
Mayor Ed Lee wants the city-match provision eliminated as part of his pension system overhaul, but unions are fighting to preserve it in some fashion.
To qualify for a pension, a city employee must have worked 20 years and be 50 years old or have worked 10 years and be 60. But to qualify for the annuity, they just have to work for the city for five years.
“There is no other public agency that we know of that does this match,” said Supervisor Sean Elsbernd, who himself will qualify for the annuity but thinks it should be eliminated for new employees. “It’s excessive and needs to be removed.”
Provision ‘out of whack’
He said that while San Francisco’s pension system is in line with comparable city and county governments overall, the city-match provision is “out of whack.”
Take, for example, former Mayor Gavin Newsom. He left city employment in January at age 43 after having worked in the city for 14 years (seven years as a supervisor and seven years as mayor).
As lieutenant governor, his service credit is linked to the time he will accrue under the state’s retirement system, CalPERS. But even if he had left politics for good, in seven years he would qualify for a San Francisco annuity worth 15 percent of his total earnings in city government, which he didn’t pay a dime toward.
Francisco Castillo, a spokesman for Newsom, said, “The lieutenant governor supports Mayor Lee’s commitment to continue the city’s efforts to reform its pension system and agrees that this particular provision should be eliminated.”
Former District Attorney Kamala Harris and Supervisors Chris Daly and Michela Alioto-Pier also left office in January and will qualify for the same free 15 percent of their total salaries. Supervisors Bevan Dufty and Sophie Maxwell, who were termed out of office along with Daly and Alioto-Pier, worked in the city long enough and were old enough to qualify for actual pensions.
The San Francisco Employees’ Retirement System said account balances for individuals are not subject to public disclosure and would not say how much Newsom, Harris, Daly or Alioto-Pier stand to collect when they turn 50.
But given that supervisors make $96,549, the district attorney makes $213,365 and the mayor makes $247,473, the dollar figures will be substantial.
Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/05/08/MNMD1J7U8O.DTL#ixzz1M6oAzz9F
