You're Paying Extra For LA's Millionaire Retiree Pensions

LOS ANGELES, CA — LA'S Millionaire police and fire retirees have pensions so high, they exceed limits set by the Internal Revenue Service, which means Los Angeles taxpayers take a hit.

The city's generous retirement plans for dozens of ranking officers forced the city to create an "Excess Benefit Plan" to pay the additional costs, an investigation by the Los Angeles Times found. The fund has paid more than $14.6 million to 110 retired employees since 2010, The Times' analysis showed. That's money that would otherwise go to fix sidewalks, fight homelessness or hire more officers.

The list of retirees consists of former cops and firefighters who got million-dollar payouts from a separate retirement program that drove their incomes well over the $220,000 annual limit the IRS allows pension funds to pay. The biggest retiree earner from last year was former LAPD Assistant Chief Earl Paysinger, whose $251,000 pension alone would have put him over the limit. But that $251,000 pension was hardly the bulk of his retirement income. He received an additional $1.3 million lump sum payment through the Deferred Retirement Option Plan. That 2016 payment catapulted him way over the top, requiring the city to pay more than half of his pension from the Excess Benefit Plan.

After Paysinger came Assistant Fire Chief Emile Mack. Mack took home a $1.3 million DROP payment in addition to his $247,000 pension, according to city data from 2017, the last year for which complete records are available, according to The Times.

More officers are set to join the list of LA's millionaire retirees in coming years. The Times' reporting on the issues has prompted an effort by city officials to reign in abuses of the program. The DROP program seems especially ripe for abuse, the newspaper found. The program pays officers' salaries and pensions simultaneously for up to the last five years of their careers. According to the Los Angeles Times, nearly half of the cops and firefighters in the program, subsequently took injury leaves, typically for bad backs, sore knees, carpal tunnel syndrome and other conditions that afflict aging bodies regardless of profession. The average absence was about 10 months, but hundreds took more than a year off, at essentially double their usual pay even though they weren't even working.

The Times' investigation prompted Mayor Eric Garcetti and leaders of the police and fire unions to call for reform, requiring that people in DROP show up for about half of their scheduled hours in any given month in order to get the extra pension check. The proposal passed its first reading in the city council 12 to 0; a second vote is expected in January. A city report showed DROP has never been "cost-neutral" as was promised to voters in 2001.

As it stands now, other ranking officers will begin raking in the generous pensions soon. Current LAPD Chief Michel Moore, who got a $1.27 million DROP payment and started collecting his $240,000 pension when he briefly retired earlier this year. He's now collecting an additional $350,000 per year in salary from city taxpayers.

City News Service and Patch Staffer Paige Austin contributed to this report. Photo: Shutterstock