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CO: Investigation reveals dozens of police and fire pension ‘double-dippers’

By   /   October 29, 2012  /   4 Comments

Pretty good for government work!

by Todd Shepherd | Colorado Watchdog

Dozens of retired police and firefighters are pulling down five-figure pensions each year while simultaneously going back to work full-time for the state of Colorado and earning a full-time salary, a process commonly known as “double-dipping.”

The vast majority of public employees like teachers and state employees receive their retirement through the state’s public pension, the Public Employment Retirement Association (PERA), but most of the state’s fire and police workers participate in a separate pension plan and plan administrator.

An analysis by Colorado Watchdog cross-referenced a 2011 database of Fire and Police Pension Association of Colorado* (FPPA) recipients against another database listing all workers and salaries for the State of Colorado for the same year. The results lent new meaning to an old expression: “not bad for government work.”

Consider Ronald Sloan, currently the director of the Colorado Bureau of Investigation. In 2011, Sloan earned a salary of $135,000. However, because Sloan was also a vested retiree of a pension managed by the Fire and Police Pension Association of Colorado, he was simultaneously pulling down $67,000 in retirement income. The two income streams together made Sloan’s annual income just over $200,000 per year. By comparison, Gov. John Hickenlooper’s annual salary is about $90,000 per year.

Critics say double-dipping adds extra stress to public pension plans at a time when many around the country already are under pressure. It also could lead to politicizing career decisions such as who is able to keep certain jobs despite being “retired.” Double-dipping has also become a hot issue in other states, such as New Jersey, where recent investigations by NewJersey Watchdog have shown that 17 of the state’s 21 sheriffs are also collecting a pension benefit as well.

According to the FPPA, the unfunded liabilities for the Denver Police State Assisted Plan (managed by the FPPA) were almost $207-million at the beginning of this year.

While legislatures around the country have attempted to restrict or even penalize various double-dip scenarios, the case of Sloan and other Colorado FPPA double-dippers is completely legal.

Of the 36 double-dippers identified by Colorado Watchdog, 13 are retired from the Denver Police Department.

Some say this particular double-dip scenario doesn’t cost the taxpayers because it is “revenue neutral.” Translation: someone like Sloan would pull down his retirement even if he was not employed full-time, and the state would still be paying a salary for a director of the Colorado Bureau of Investigations.

However double-dipping is not revenue neutral to the individual. It helps them collect tens of thousands more, perhaps even hundreds of thousands more in income over a lifetime.

The double-dippers identified by Colorado Watchdog are simultaneously accruing PERA pension benefits as well. This means someone who already has a full pension as promised by a government in Colorado will also soon be enjoying pension checks from PERA, adding more stress to an already overburdened system.

Colorado Watchdog submitted a series of questions to Sloan, including whether he considers it ethical to draw a taxpayer-supported pension while earning a taxpayer-supported salary; and whether retirement benefits should be reserved only for the truly retired.

Sloan did not respond to any of our questions. Officials with FPPA also declined to comment.

If the Colorado Fire and Police Pension Association were a part of the state’s largest public pension, PERA, the worker would have to severely restrict his annual hours of work performed if they were retired, but went to work for another PERA employer (such as the State of Colorado), or their pension payouts would be penalized.  Once a PERA member starts withdrawing benefit checks, they conKatie Kaufmanis, spokeswoman for PERA explained, “The reason for [these restrictions on double-dipping] is that if members know they can retire and return to work for a PERA employer, that situation encourages members to retire earlier than they otherwise might have – potentially requiring PERA to pay benefits longer and increasing PERA’s liabilities.”

Performing a similar double-dipping analysis on PERA would be impossible at this point because PERA does not make its beneficiary list public. In September of 2011, State Treasurer Walker Stapleton, also an ex-officio member of the PERA board, sued PERA for access to a list of recipients, and their corresponding monthly or annual benefits from PERA.

Below is a list of the 36 double-dippers identified by Watchdog, showing their annual income from the state, alongside their annual pension income.  Because this story is more about the “system” of double-dipping rather than the individuals who are doing it, we are declining to publish names at this point.  Mr. Sloan was used simply as a factual illustration.

*The Fire and Police Pension Association of Colorado is not a single, monolithic pension such as PERA.  Instead it acts as an umbrella agency, managing roughly 200 different police and fire pensions from around the state.  Furthermore, after changes to police and fire pensions in the 1980’s, there are two separate pension plans administered by the FPPA, the “old hire” plan, and the “new hire” plan.  The Colorado Watchdog analysis only used beneficiary recipients from the “old plan.”

Contact Reporter Todd Shepherd at shepherd@i2i.org

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  • http://www.facebook.com/people/Chris-Bates/842944161 Chris Bates

    If someone is entitled to their pension and want to continue to have additional income(albeit with the state), then what’s the big deal? If they have served a number of successful years in the government sector…it only makes sense they would continue. If this is really an “issue”, the government/HR/payroll should monitor this situation more closely for any wrong doing instead of it going unchecked for a long period of time.

  • http://www.facebook.com/gerry.santo Gerry Santo

    OK… but is it illegal? Apparently not. So what you have instead is a class-warfare-style argument that these people are getting more than they are “due.”

    I don’t know where you got the idea that FPPA is an “umbrella agency.” Your explanation of “old hire” vs. “new” is somewhat incorrect as well.

    As for the differences between PERA and FPPA: darn right they’re different! PERA is a mismanaged hopeless mess. They’d love to get their hands on the assets accumulated by FPPA, which is nearly 100% funded.

  • Jazzee

    Oh Lordy you can’t be serious?????? I cannot believe how unions have lied and duped the American taxpayer

  • http://www.facebook.com/gerry.santo Gerry Santo

    This has nothing to do with unions.

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