4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs

Older City Retiree Woes

— While working 30 years for the City's Water Department, Yvonne Paczulla wrote an in-house column with news of births, marriages, and other domestic matters. She called it Under Water. She didn't realize how prescient she was. A retiree since 1988, she now grumbles, "I am very upset about the pension plan," which she knows is underwater by at least $2 billion. "There has been a lot of monkey business and hanky-panky."

That's obvious to anybody who follows the news. Nonetheless, a surprisingly large number of former city employees who, like Paczulla, retired before mid-1997 and did not receive munificent benefits still have faith in the City or retirement board, or both. They believe they will get their benefits, meager as they are, even if the City goes bankrupt.

"The vast majority [of retired people] are convinced they will get their retirement," says Nancy Acevedo, president of the City of San Diego Retired Employees Association. "They probably believe in [the retirement board]. We've never seen the City in this kind of situation before, so we trust [the board] and also still trust the City," despite pending criminal charges against representatives of both.

To a vocal minority of retirees, such confidence in the pension board and City appears to be a case of "screw me once: shame on you. Screw me twice: roll me over, lay me down, and do it again."

"If the system goes broke and a bankruptcy judge takes over, I'm concerned that a bunch of fancy lawyers representing the policemen and firemen will rush down to court and get as much as they can," while older retirees, who can't afford high-priced lawyers, get taken to the cleaners again, says Dave Wood, who retired in 1994 as a deputy director of the Communications and Electrical Division.

Jim Gleason, who retired in 1982 as director of Environmental Quality and spent 12 years on the pension board, says that older retirees "could get 60 cents on the dollar, and they have low pensions to begin with. Older retirees have not gotten their fair share, and it could happen again."

The older retirees have been fleeced in several ways. First, their monthly payments are far lower than the ones current workers are slated to receive. For example, Wood says, "My retirement is 53 percent of my top salary. If I had retired today, it would be 90 or 100 percent."

Then there are the extras the older retirees didn't get. Beginning in mid-1997, employees were granted juicy retirement benefits such as the double-dipping Deferred Retirement Option Plan (DROP), by which employees declare they will retire in five years and during that period draw their salaries while banking a similar sum with interest, then retire with a monthly stipend as well as a lump sum.

Today's employees can also purchase years of service at a discount -- thus increasing their retirement income. Older retirees couldn't purchase years of service -- with or without a discount -- when they were working.

More than one-fourth of city retirees have benefit levels below the federal poverty line, and more than 40 percent are below the line for a couple, says Gleason. Some older retirees have Social Security income, but others don't. Some have no health-care coverage, and 8.7 percent of city retirees receive less than $500 a month. "A lot of females in clerical positions were notoriously underpaid," says Gleason.

Current employees with their generous payments and fringes plan to retire "with all the money we didn't get," complains June Sandford, who retired from the Street Division in 1981 after 21 years of service. "They are just greedy."

That's the view of city attorney Mike Aguirre, who hopes to rectify the plight of the older retirees. The City's pension system has "not maintained intergenerational equity in the pension plan," says Aguirre. "The current group increased benefits for themselves at the expense of older retirees and future employees." Aguirre says that benefits granted after July 1997 were illegal, representing "property stolen from the taxpayers. The purchase of service credits, DROP," and some other benefits were "created without funding" and should be jettisoned, he says. Not surprisingly, city employee unions scream for Aguirre's head.

Pension-system officials feared the intergenerational inequity even as they approved the underfunding in 2002, according to a report by Navigant Consulting released early this year. In July 2002, after a meeting on the proposal, then-board member David Crow, who voted against it, sent an e-mail to then-administrator Lawrence Grissom. "Several people were voting with their wallets and were not really fulfilling their fiduciary duties," wrote Crow. Some board members were "sitting as a trustee [while] pimping for the city. Seven or eight city employees voted themselves a pay raise and benefit improvements...but none has any concern for the much poorer older retirees."

Amen. But the Navigant report and the pension board offer soothing words that many retirees swallow whole. The pension system "currently has sufficient assets to pay the retirement benefits for all of the current retirees," says the report. But that doesn't take bankruptcy-court haggling or the political pressures of an empty treasury into account. "In bankruptcy, the older retirees will probably get 90 cents on the dollar, but they won't get 100," says attorney Michael Conger, who won one major settlement two years ago and has other suits pending. "But the older ones have extremely modest pensions."

And a surprising number believe they will get them in full. "We are not going to lose our money," says Donald Craig, who has been retired for 24 years after working 28 years with the Street Division. "I have faith. The City screwed up, not the pension fund."

Even in bankruptcy court, "I have a feeling they would leave us alone," says Joseph Sediway, who retired in 1986 after 18 years in Park and Recreation. However, he believes those in the Deferred Retirement Option Plan should have to forfeit some of that double-dipping loot.

The City of San Diego Retired Employees Association has not hired an attorney to protect the older retirees' status. Some members of the group, including Acevedo, retired after mid-1997 and got the special benefits that Aguirre wants to take away. "Our board of directors voted that we should try to remain neutral so that we are not favoring one group over another. But we should protect older retirees on things like health insurance," she says. Just in case the group needs to hire legal help, "We have increased our dues" from $1 to $2 a month, says Acevedo. There are slightly more than 1000 members.

Frustration with their fellow retirees' optimism caused Gleason and Wood to become plaintiffs in the suit in which Conger negotiated a favorable settlement. "I tried my damnedest" to get the association to hire a lawyer, says Wood. "I was turned down by the association. The leadership seemed to be more aligned with the City than the retirees. It's easy to fleece older people of their money."

Says Gleason, "The loyalty to the City became ingrained in those people. They had their heads in the sand." But in the Gleason/Wood settlement, the City pledged to put assets into the pension fund, and now Conger has two more suits pending -- one for $166 million and another for $600 million. He wants the City to sell real estate and boost its tax revenue. "If a household has five cars, why not sell four of them and pay off bills?" he asks. Such advice may not resonate with younger city employees, but it should make sense to the older retirees.

Here's something you might be interested in.
Submit a free classified
or view all

Previous article

Fernando Tatis, Jr. puts aside “childish things” like World Series rings, signs lucrative 14-year contract with Padres

A Dream Deferred
Next Article

The First Free Methodist Church of Escondido

We’ve been here for over a hundred years

— While working 30 years for the City's Water Department, Yvonne Paczulla wrote an in-house column with news of births, marriages, and other domestic matters. She called it Under Water. She didn't realize how prescient she was. A retiree since 1988, she now grumbles, "I am very upset about the pension plan," which she knows is underwater by at least $2 billion. "There has been a lot of monkey business and hanky-panky."

That's obvious to anybody who follows the news. Nonetheless, a surprisingly large number of former city employees who, like Paczulla, retired before mid-1997 and did not receive munificent benefits still have faith in the City or retirement board, or both. They believe they will get their benefits, meager as they are, even if the City goes bankrupt.

"The vast majority [of retired people] are convinced they will get their retirement," says Nancy Acevedo, president of the City of San Diego Retired Employees Association. "They probably believe in [the retirement board]. We've never seen the City in this kind of situation before, so we trust [the board] and also still trust the City," despite pending criminal charges against representatives of both.

To a vocal minority of retirees, such confidence in the pension board and City appears to be a case of "screw me once: shame on you. Screw me twice: roll me over, lay me down, and do it again."

"If the system goes broke and a bankruptcy judge takes over, I'm concerned that a bunch of fancy lawyers representing the policemen and firemen will rush down to court and get as much as they can," while older retirees, who can't afford high-priced lawyers, get taken to the cleaners again, says Dave Wood, who retired in 1994 as a deputy director of the Communications and Electrical Division.

Jim Gleason, who retired in 1982 as director of Environmental Quality and spent 12 years on the pension board, says that older retirees "could get 60 cents on the dollar, and they have low pensions to begin with. Older retirees have not gotten their fair share, and it could happen again."

The older retirees have been fleeced in several ways. First, their monthly payments are far lower than the ones current workers are slated to receive. For example, Wood says, "My retirement is 53 percent of my top salary. If I had retired today, it would be 90 or 100 percent."

Then there are the extras the older retirees didn't get. Beginning in mid-1997, employees were granted juicy retirement benefits such as the double-dipping Deferred Retirement Option Plan (DROP), by which employees declare they will retire in five years and during that period draw their salaries while banking a similar sum with interest, then retire with a monthly stipend as well as a lump sum.

Today's employees can also purchase years of service at a discount -- thus increasing their retirement income. Older retirees couldn't purchase years of service -- with or without a discount -- when they were working.

More than one-fourth of city retirees have benefit levels below the federal poverty line, and more than 40 percent are below the line for a couple, says Gleason. Some older retirees have Social Security income, but others don't. Some have no health-care coverage, and 8.7 percent of city retirees receive less than $500 a month. "A lot of females in clerical positions were notoriously underpaid," says Gleason.

Current employees with their generous payments and fringes plan to retire "with all the money we didn't get," complains June Sandford, who retired from the Street Division in 1981 after 21 years of service. "They are just greedy."

That's the view of city attorney Mike Aguirre, who hopes to rectify the plight of the older retirees. The City's pension system has "not maintained intergenerational equity in the pension plan," says Aguirre. "The current group increased benefits for themselves at the expense of older retirees and future employees." Aguirre says that benefits granted after July 1997 were illegal, representing "property stolen from the taxpayers. The purchase of service credits, DROP," and some other benefits were "created without funding" and should be jettisoned, he says. Not surprisingly, city employee unions scream for Aguirre's head.

Pension-system officials feared the intergenerational inequity even as they approved the underfunding in 2002, according to a report by Navigant Consulting released early this year. In July 2002, after a meeting on the proposal, then-board member David Crow, who voted against it, sent an e-mail to then-administrator Lawrence Grissom. "Several people were voting with their wallets and were not really fulfilling their fiduciary duties," wrote Crow. Some board members were "sitting as a trustee [while] pimping for the city. Seven or eight city employees voted themselves a pay raise and benefit improvements...but none has any concern for the much poorer older retirees."

Amen. But the Navigant report and the pension board offer soothing words that many retirees swallow whole. The pension system "currently has sufficient assets to pay the retirement benefits for all of the current retirees," says the report. But that doesn't take bankruptcy-court haggling or the political pressures of an empty treasury into account. "In bankruptcy, the older retirees will probably get 90 cents on the dollar, but they won't get 100," says attorney Michael Conger, who won one major settlement two years ago and has other suits pending. "But the older ones have extremely modest pensions."

And a surprising number believe they will get them in full. "We are not going to lose our money," says Donald Craig, who has been retired for 24 years after working 28 years with the Street Division. "I have faith. The City screwed up, not the pension fund."

Even in bankruptcy court, "I have a feeling they would leave us alone," says Joseph Sediway, who retired in 1986 after 18 years in Park and Recreation. However, he believes those in the Deferred Retirement Option Plan should have to forfeit some of that double-dipping loot.

The City of San Diego Retired Employees Association has not hired an attorney to protect the older retirees' status. Some members of the group, including Acevedo, retired after mid-1997 and got the special benefits that Aguirre wants to take away. "Our board of directors voted that we should try to remain neutral so that we are not favoring one group over another. But we should protect older retirees on things like health insurance," she says. Just in case the group needs to hire legal help, "We have increased our dues" from $1 to $2 a month, says Acevedo. There are slightly more than 1000 members.

Frustration with their fellow retirees' optimism caused Gleason and Wood to become plaintiffs in the suit in which Conger negotiated a favorable settlement. "I tried my damnedest" to get the association to hire a lawyer, says Wood. "I was turned down by the association. The leadership seemed to be more aligned with the City than the retirees. It's easy to fleece older people of their money."

Says Gleason, "The loyalty to the City became ingrained in those people. They had their heads in the sand." But in the Gleason/Wood settlement, the City pledged to put assets into the pension fund, and now Conger has two more suits pending -- one for $166 million and another for $600 million. He wants the City to sell real estate and boost its tax revenue. "If a household has five cars, why not sell four of them and pay off bills?" he asks. Such advice may not resonate with younger city employees, but it should make sense to the older retirees.

Sponsored
Here's something you might be interested in.
Submit a free classified
or view all
Previous article

TikTok rap

The majority of users are from the Generation Y and Z sets
Next Article

Chargers loot city money, QB Stan Humphries gets another concussion, Chargers players 20-30 years later

Is football-hater a pantywaist?, how they got the 1988 Super Bowl here, UCSD sports writer gets yelled at
Comments
0

Be the first to leave a comment.

Sign in to comment

Sign in

Art Reviews — W.S. Di Piero's eye on exhibits Ask a Hipster — Advice you didn't know you needed Best Buys — San Diego shopping Big Screen — Movie commentary Blurt — Music's inside track Booze News — San Diego spirits City Lights — News and politics Classical Music — Immortal beauty Classifieds — Free and easy Cover Stories — Front-page features Excerpts — Literary and spiritual excerpts Famous Former Neighbors — Next-door celebs Feast! — Food & drink reviews Feature Stories — Local news & stories From the Archives — Spotlight on the past Golden Dreams — Talk of the town Here's the Deal — Chad Deal's watering holes Just Announced — The scoop on shows Letters — Our inbox [email protected] — Local movie buffs share favorites Movie Reviews — Our critics' picks and pans Musician Interviews — Up close with local artists Neighborhood News from Stringers — Hyperlocal news News Ticker — News & politics Obermeyer — San Diego politics illustrated Of Note — Concert picks Out & About — What's Happening Overheard in San Diego — Eavesdropping illustrated Poetry — The old and the new Pour Over — Grab a cup Reader Travel — Travel section built by travelers Reading — The hunt for intellectuals Roam-O-Rama — SoCal's best hiking/biking trails San Diego Beer — Inside San Diego suds SD on the QT — Almost factual news Set 'em Up Joe — Bartenders' drink recipes Sheep and Goats — Places of worship Special Issues — The best of Sports — Athletics without gush Street Style — San Diego streets have style Suit Up — Fashion tips for dudes Theater Reviews — Local productions Theater antireviews — Narrow your search Tin Fork — Silver spoon alternative Under the Radar — Matt Potter's undercover work Unforgettable — Long-ago San Diego Unreal Estate — San Diego's priciest pads Waterfront — All things ocean Your Week — Daily event picks
4S Ranch Allied Gardens Alpine Baja Balboa Park Bankers Hill Barrio Logan Bay Ho Bay Park Black Mountain Ranch Blossom Valley Bonita Bonsall Borrego Springs Boulevard Campo Cardiff-by-the-Sea Carlsbad Carmel Mountain Carmel Valley Chollas View Chula Vista City College City Heights Clairemont College Area Coronado CSU San Marcos Cuyamaca College Del Cerro Del Mar Descanso Downtown San Diego Eastlake East Village El Cajon Emerald Hills Encanto Encinitas Escondido Fallbrook Fletcher Hills Golden Hill Grant Hill Grantville Grossmont College Guatay Harbor Island Hillcrest Imperial Beach Imperial Valley Jacumba Jamacha-Lomita Jamul Julian Kearny Mesa Kensington La Jolla Lakeside La Mesa Lemon Grove Leucadia Liberty Station Lincoln Acres Lincoln Park Linda Vista Little Italy Logan Heights Mesa College Midway District MiraCosta College Miramar Miramar College Mira Mesa Mission Beach Mission Hills Mission Valley Mountain View Mount Hope Mount Laguna National City Nestor Normal Heights North Park Oak Park Ocean Beach Oceanside Old Town Otay Mesa Pacific Beach Pala Palomar College Palomar Mountain Paradise Hills Pauma Valley Pine Valley Point Loma Point Loma Nazarene Potrero Poway Rainbow Ramona Rancho Bernardo Rancho Penasquitos Rancho San Diego Rancho Santa Fe Rolando San Carlos San Marcos San Onofre Santa Ysabel Santee San Ysidro Scripps Ranch SDSU Serra Mesa Shelltown Shelter Island Sherman Heights Skyline Solana Beach Sorrento Valley Southcrest South Park Southwestern College Spring Valley Stockton Talmadge Temecula Tierrasanta Tijuana UCSD University City University Heights USD Valencia Park Valley Center Vista Warner Springs
Close