Rider Points Out Govt Employee Racket
By North Pole | 01/26/09 | 07:41 PM EDT | 0 Comments
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<![endif]-->From what I understand government employees got pensions in the old days because they got really low pay. Now they argue they need to be competative with private employers in pay, and still get the pensions. Go figure...
RIDER: Pension plan drives out county assessor
By RICHARD RIDER | Tuesday, December 9, 2008
There's been much speculation in the press about the sudden resignation of San Diego County Assessor Greg Smith. Theories abound.
But there's no mystery why Smith is leaving and taking another job. The county pension plan drove Smith out.
But not the way you'd think. Financially, he'd be a fool to stay. And Assessor Smith is no fool.
Smith is one of the sharpest, most responsive elected officials in the county. I've written about him earlier this year, touting his efforts to ease the process of adjusting down one's property taxes in a recession. I talked with Smith about his retirement, and he was quite open about his story.
Smith started with the county in 1977. He became county assessor in 1983. Under the county's retirement formula, at age 60 he can start receiving a guaranteed pension of 3 percent of his highest salary times the number of years worked for the county ---- not just for the years while functioning as the county assessor. But Smith is retiring early at age 58, so he gets a bit less ---- 2.8 percent per year versus 3 percent at age 60.
Hence Smith will now retire early from county "public service" at age 58 after 32 years with about 89.6 percent of his highest salary. He's earning $182,300, so his initial pension will be about $163,400. Not bad for a "public servant."
Why would he want to work any more for the county when he can get a second, six-figure private sector salary working in San Diego while drawing an 89.6 percent county pension? In essence, at this point, Smith is working at the county for less than $20,000 salary a year.
Logic tells us that there's another reason to retire now. With the economic meltdown of our state and local economy, it's likely that we'll see pay freezes for at least the next two years for county employees ---- and certainly for elected county officials. But once a government employee retires, an automatic, guaranteed annual cost of living pension increase kicks in. While capped at 2 percent a year, Smith's 89.6 percent pension could quickly approach his full frozen salary.
Only one problem with such logic ---- it assumes the county supervisors have a clue as to the magnitude of the economic meltdown they are facing. Clearly, they don't. That's why they've already voted 4.5 percent pay increases for the elected officials this year ---- and another 4.5 percent pay increase for next year. The county is claiming poverty while continuing to give opulent pay increases.
Go figure. Someone has to!
But back to Greg Smith. He is forgoing that last 4.5 percent 2009 pay increase because of an exceptional new job opportunity. Plain and simple, it's a chance to receive two lucrative income streams ---- the county pension and a private salary.
Here we see the final irony of our insanely generous government pension plans. Supposedly, employers pay good pensions to retain good employees. But with governments' generous pension formulas and early retirement age options, we actually drive out our government employees.
When Smith retires, we taxpayers essentially are on the hook to provide two salaries ---- one for Smith, and one for Smith's replacement.
Call me wild and crazy, but I think we just established why state, county and city governments are now in a world of financial hurt.
RIDER: Pension plan drives out county assessor
By RICHARD RIDER | Tuesday, December 9, 2008
There's been much speculation in the press about the sudden resignation of San Diego County Assessor Greg Smith. Theories abound.
But there's no mystery why Smith is leaving and taking another job. The county pension plan drove Smith out.
But not the way you'd think. Financially, he'd be a fool to stay. And Assessor Smith is no fool.
Smith is one of the sharpest, most responsive elected officials in the county. I've written about him earlier this year, touting his efforts to ease the process of adjusting down one's property taxes in a recession. I talked with Smith about his retirement, and he was quite open about his story.
Smith started with the county in 1977. He became county assessor in 1983. Under the county's retirement formula, at age 60 he can start receiving a guaranteed pension of 3 percent of his highest salary times the number of years worked for the county ---- not just for the years while functioning as the county assessor. But Smith is retiring early at age 58, so he gets a bit less ---- 2.8 percent per year versus 3 percent at age 60.
Hence Smith will now retire early from county "public service" at age 58 after 32 years with about 89.6 percent of his highest salary. He's earning $182,300, so his initial pension will be about $163,400. Not bad for a "public servant."
Why would he want to work any more for the county when he can get a second, six-figure private sector salary working in San Diego while drawing an 89.6 percent county pension? In essence, at this point, Smith is working at the county for less than $20,000 salary a year.
Logic tells us that there's another reason to retire now. With the economic meltdown of our state and local economy, it's likely that we'll see pay freezes for at least the next two years for county employees ---- and certainly for elected county officials. But once a government employee retires, an automatic, guaranteed annual cost of living pension increase kicks in. While capped at 2 percent a year, Smith's 89.6 percent pension could quickly approach his full frozen salary.
Only one problem with such logic ---- it assumes the county supervisors have a clue as to the magnitude of the economic meltdown they are facing. Clearly, they don't. That's why they've already voted 4.5 percent pay increases for the elected officials this year ---- and another 4.5 percent pay increase for next year. The county is claiming poverty while continuing to give opulent pay increases.
Go figure. Someone has to!
But back to Greg Smith. He is forgoing that last 4.5 percent 2009 pay increase because of an exceptional new job opportunity. Plain and simple, it's a chance to receive two lucrative income streams ---- the county pension and a private salary.
Here we see the final irony of our insanely generous government pension plans. Supposedly, employers pay good pensions to retain good employees. But with governments' generous pension formulas and early retirement age options, we actually drive out our government employees.
When Smith retires, we taxpayers essentially are on the hook to provide two salaries ---- one for Smith, and one for Smith's replacement.
Call me wild and crazy, but I think we just established why state, county and city governments are now in a world of financial hurt.
TAGS: County Assessor, Gregory Smith, Richard Rider
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