The Corner

Goldwater Institute Scores Victory Against Phoenix Employees’ Pension Padding

A special way of inflating public-sector pensions was dealt a blow in Arizona on Friday when a county judge ruled against the Phoenix city government, pension boards, and local police union attempting to defend a likely illegal method of calculating employee pensions.

The practice, “pension spiking,” usually refers to public employees’ cashing in benefits such as sick leave, vacation time, and bonuses in particular years to inflate the salaries used in calculating their pensions. Arizona state law bans the practice, restricting pension calculations to essentially salaries alone, but the Goldwater Institute filed suit last fall alleging that the City of Phoenix has ignored state laws and let the practice continue, costing taxpayers millions of dollars.

On Friday, a judge in the Maricopa County Superior Court ruled against the defendants’ attempt to dismiss the case, issuing a stay to allow the local pension board (one of the four defendants) time to address its failings. If the board doesn’t do so by February 21, the court will reconvene. Jon Riches, a Goldwater Institute attorney, says that the taxpayers will be off the hook if the defendants resolve the issue, but if the case returns to court, the Institute should prevail.

Required contributions to public-pension funds have skyrocketed in Phoenix in recent years, going from $7.2 million in 2003 to $130 million in 2014, according to the Goldwater Institute.

“The state law is pretty clear that the payments we’re challenging — vacation time, sick leave, fringe benefits — should not be in included in pensionable pay,” Riches tells NRO. The institute points out that the city even apparently includes uniform allowances as part of officers’ salaries that count toward their pensions (public-employee pensions are typically some percentage of the employee’s highest salary). Riches concludes: “Basically the court told the defendant that they need to fix this or else the court is going to have to get involved. The law is obviously against this pension spiking.”

Most Popular

U.S.

The Media Fell for Elizabeth Warren’s Spin

Do you want to know what media bias looks like? Earlier today, Massachusetts senator Elizabeth Warren released DNA test results that confirmed that she misled employers, students, and the public about her Native American heritage for years. Bizarrely, all too many members of the media treated the results as ... Read More
PC Culture

‘White Women’ Becomes a Disparaging Term

Using “white men” as a putdown is no longer extreme enough for the Left. Now it is moving on to doing the same for “white women.” How rapidly this transpired. It was less than two years ago that the approximately 98.7 percent of white women working in media who were openly rooting for Hillary Clinton ... Read More
Politics & Policy

The World Keeps Not Ending

We were not supposed to have made it this far. George Orwell saw night descending on us in 1984. Orwell was, on paper, a radical, but in his heart he was an old-fashioned English liberal. He dreamed of socialism but feared socialists. He feared them because he knew them. I was in the sixth grade in 1984, but I ... Read More
Culture

A Free People Must Be Virtuous

Dear Reader (Even those of you who didn’t seem to notice or care that I failed to file this “news”letter on Friday), So I’m sitting here at Gate C6 at O’Hare waiting for my flight home. I am weary, pressed for time, in desperate need of a shower, and filled with a great sense of dread for the work ... Read More