Simi may be forced to pay for Bell’s mistakes

2010-07-30 / Front Page

City’s chief of police used to head up SVPD
By Carissa Marsh

The city hall salary scandal that has ignited local and national headlines and sent one town into an outrage may have a negative trickledown effect on Simi Valley and one other Ventura County municipality.

City officials said this week that because former Simi Valley police chief turned chief of police of Bell, Randy Adams, was among those municipal leaders collecting exorbitant wages, taxpayers here will have to pay a price.

That’s because pension checks are based upon a person’s highest year of earnings. And Adams, who headed up the SVPD between ’95 and ’03 before moving on to Glendale PD and then Bell, was getting $457,000 a year while in Bell—more than double that of current SVPD Chief Mike Lewis, who makes $172,000.

It’s estimated that Adams’ retirement plan could cost the city $35,000 to $40,000 more per year because of the spiked salary, Simi Valley City Manager Mike Sedell said.

“It’s something that the council will have to be dealing with in our budgets in the future,” he said.

The Los Angeles Times broke the story earlier this month that top city officials in Bell—a town of 40,000 people southeast of Los Angeles— were making some of the highest municipal wages in the country.

As reported by the Times, Bell’s City Manager Robert Rizzo was being paid $787,637 a year and Assistant City Manager Angela Spaccia was making $376,288. By comparison, Sedell made around $239,000 last year overseeing a city of about 130,000.

In addition, four of the five Bell City Council members were being paid close to $100,000 annually for their part-time jobs. Simi Valley council members make about $14,500 a year in salary.

During a closed door meeting July 22, the three top Bell administrators agreed to resign without severance. Adams will leave at the end of August after completing an evaluation of the police department.

However, that doesn’t solve the pension problem for Simi Valley.

Adams started his career as a Ventura police officer in 1972 and worked his way up the ranks to assistant chief before taking a job as chief of the Simi Valley Police Department in September 1995.

He left Simi at the beginning of 2003 to head up the Glendale Police Department—where he was earning $215,304 a year—but he resigned from that job last summer to become Bell’s chief, a move that doubled his pay.

According to the L.A. Times, if Adams had retired from Glendale a year ago, his retirement pay would have been about $194,000 a year. But the huge salary increase he received from Bell more than doubled his pension, which is estimated to be worth $411,300.

Sedell said the city isn’t certain about the specific impacts Adams’ bloated salary will have on Simi’s coffers—he is waiting to hear the final numbers from the California Public Employees’ Retirement System (CalPERS)—but he knows it could be “significant.”

“It does appear that where someone has an allegedly legitimately spiked pension amount . . . the amount that is paid in a pension is spread back amongst previous employers,” Sedell said.

That includes the cities of Simi Valley, Glendale and Ventura.

“There may be a direct impact on our rates from the PERS system based on that increased pension over and above what it otherwise would have been.”

According to Sedell, cities set aside retirement money for qualified employees based on CalPERS formulas for how much the person is expected to receive in retirement benefits.

The formulas determine how much money will come from CalPERS investments and how much the city is required to contribute throughout the worker’s career.

Though the formulas do account for some variation, when earnings skyrocket at the end of a career, as they did for Adams, the city is left having to make up the difference, paying bigger retirement payouts than it planned on.

Mayor Paul Miller, a former Simi Valley police chief himself, was irritated by the situation.

“Because his pension got spiked we may have to kick in more into the system,” Miller said. “It’s going to penalize the city because of the bad decision Bell made about the high salaries they give employees.”

Miller pointed out that Ventura’s “got a big bite coming” since Adams worked there for 20 years.

At this point it seems there’s not much the cities can do to stop the unforeseen drain on their finances.

“It appears it’s unbelievably legal,” Sedell said.

However, Glendale’s City Manager sent a letter to California Attorney General Jerry Brown on Monday asking him to investigate the matter. Ventura and Simi joined the request.

Sedell said the city is “making sure that all investigations that need to take place are taking place at every level to make sure no more public resources are spent than are absolutely required to be spent.”

Brown and CalPERS already launched a joint investigation on July 22 into the “outrageously high salaries” paid to public officials in Bell.

The probe will examine records to determine whether any illegality, self-dealing or other improper activity occurred in Bell or other cities and counties in the state.

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