No More Double Dipping

Katy Grimes: State employees that plan to retire and enjoy the benefits of a state retirement, but then get another full time state job in order to “double dip,” will no longer be allowed to game the system — at least for six months after retirement.

Specifically, SB 1425 prohibits a retiree from returning to work while collecting state retirement, or as a contract employee, for six months after retirement, and imposes new pension spiking controls on both the California Public Employees Retirement System and the California State Teachers Retirement System.

The bill would require the boards of each public retirement system to establish accountability provisions that would include an ongoing audit process to ensure that a change in a members salary, compensation, or remuneration is not made principally for the purpose increasing retirement benefits.

Sen. Joe Simitian, D-Palo Alto, author of SB 1425 said, “This bill institutes uniform laws for all public retirement systems that will help to curtail an individual from taking extraordinary steps to enhance their retirement benefits (i.e., ‘spiking’). In addition, the bill requires that employees have a bona fide separation in service of six months before taking another position in public service to prevent ‘double dipping.’  The provision will eliminate ‘revolving door’ practices in which some public employees retire on a Friday and return to the same job on Monday as a retired worker.”

The bill passed unanimously out of the Assembly Public Employees Retirement and Social Security committee today.

No comments

Write a comment
  1. DavidfromLosGatos
    DavidfromLosGatos 23 June, 2010, 13:23

    IMO, this language will do nothing to stop pension spiking:

    “The bill would require the boards of each public retirement system to establish accountability provisions that would include an ongoing audit process to ensure that a change in a members salary, compensation, or remuneration is not made principally for the purpose increasing retirement benefits.”

    Among other needed adjustments, such as raising the minimum age, the pension formula needs to be based on base salary amount, e.g., averaged over final three to five years, exclusive of any OT or accrued sick pay or whatnot.

    There is no way to stop some forms of spiking, such as sweet heart promotions for the last year or two of employment. As with the tax code, when they make new rules, people figure out new ways around them.

    Also IMO, a six month prohibition against full time public employment after retirement is pointless. They can still double dip “part time” (which I believe in CA means less than 32 hours a week) for the first six months (or maybe enjoy a vacation or whatever), then resume with the full time double dipping for several years.

    The only remedy with any real teeth would be to require that any money paid by the state would be deducted dollar for dollar from any pensions paid during the same time period. You want to “retire”? Fine. Retire.

    Keep up the good work with this blog.

    Reply this comment
  2. CalWatchdog
    CalWatchdog Author 23 June, 2010, 19:19

    You are right David – this is toothless prevention. But at least it’s something…. which I can’t believe I just said.
    -Katy

    Reply this comment
  3. Jamie
    Jamie 30 June, 2010, 16:24

    Dear Katy —

    Is it too late to draft a letter of support/opposition? I’m never all that sure of what exactly the “status” of a bill means when you look at its history (say on leginfo). Like it will say “Do-pass” and “re-referred to such-and-such committee,” be “read” so many times and continue to be read and amended, and give voting summary several times before it even goes to be chaptered.

    Basically I have no idea what that all means, and when the appropriate time to draft a letter is.

    Thanks!

    Reply this comment

Write a Comment

Leave a Reply


Related Articles

Farcical TSA needs Miss Manners lesson

July 20, 2012 Katy Grimes: I’ve just returned home a trip across the country. And once again, I vowed to

Rocky Chavez: Can a Latino colonel beat Kamala Harris?

The decision of moderate-conservative Assemblyman Rocky Chavez, R-Oceanside, to explore a run for U.S. Senate in 2016 surprised quite a

CA “community solar” fight looms on subsidy issue

Hawaii’s boom in residential solar power is inspiring advocates of the alternative energy resource to push hard in states across