PITTSBURGH (KDKA) – From Wisconsin to Pennsylvania, public employees are under fire as the public they work for is demanding a reduction in their benefits.
In Pittsburgh and Allegheny County, one big issue is the cost of pensions.
At a time when the pension system is underfunded, some employees are padding their pensions.
The practice is called “spiking.”
By working lots of overtime right before they retire, some public employees are able to pump up their pension payments for life.
It’s a big drain on the system, but it’s all legal and it’s going unchecked.
While locally there’s been a lot of talk about the leasing of parking garages and ways to bail out underfunded pensions, there has been precious little discussion about pension reform.
“There’s not a plan that’s been put on the table that deals with the problem,” City Controller Michael Lamb said.
A few years back, KDKA-TV uncovered the problem of runaway pension costs through spiking by County Police at the Pittsburgh International Airport.
Under law, county employee pension benefits are determined not only by their base salary when they retire, but the overtime they average in their last two years.
At the airport, several officers loaded up on overtime before retiring, which significantly increased their pensions.
“We took care of it at the airport and now we’ve looked at this at the jail,” Allegheny County Controller Mark Flaherty said.
The county reigned in spiking by reducing overtime and spreading it around to other officers, but it has gone unchecked at the Allegheny County Jail.
A review of overtime records of corrections officers showed that several piled on the overtime in their last two years before retirement.
One officer, who had been averaging $7,000 a year, made an average of $30,000 in his last two years. Another, who made an average of $13,000 a year in overtime, jumped to an average of $40,000 in his last two years.
A third, who had been averaging $36,000 a year in overtime, made a staggering average of $61,000 in overtime in his last two years. That means taxpayers will pay this guard an extra $40,000 a year in pension benefits.
“The taxpayers and the pensioners are getting shortchanged by this abuse that’s going on,” Flaherty said.
KDKA’s Andy Sheehan tried in vain to contact the president of the Corrections Officers Union. In the past, the union has called on the county to hire more guards to reduce the overtime.
Controller Flaherty said while new hiring would reduce the problem, it will not solve it and the county has called on Harrisburg for help.
“We have an anti-spiking bill up at the legislature. It’s been there for two years,” Flaherty said.
While the elimination of spiking will not be a cure-all, City Controller Lamb said it’s one piece of the big problem.
“We need to look at retirement ages, we need to take a look at defined contributions – at least voluntarily for employees – and, we need to take a look at spiking. And all of these issues that help hold down the cost of pensions so we can continue pay pensions to the people we’ve promised them to,” Lamb said.
The battle over public pensions is just heating up, but reining in costs are likely to be limited.
The courts have ruled that pension benefits promised to employees at the time of their hiring are pretty much set in stone.