Statement From Councilman Sal DiCiccio

Councilman Sal DiCiccio 137 x 175 pixels

Oct. 11, 2013

“By targeting only police and fire’s vacation and sick time for pension spiking but allowing high ranking managers to continue clearly shows the conflict of interest that created the current pension system.  Pension spiking cheats the public and should be stopped for everyone.  This reaffirms the ability of individuals to make more money in retirement than while they were working.”

– Councilman DiCiccio

Sick leave and vacation leave are the two biggest contributors to pension spiking.  The subcommittee recommended allowing current employees to use their accrued sick/vacation time to spike their pensions that taxpayers are still on the hook for. 

Pension spiking allows certain individuals to make more money through their pensions than they did through their salaries.  Employees can accrue unused sick and vacation time and cash those hours in like poker chips at retirement and boost their pensions.  Phoenix is facing a huge problem, here are the facts: 

 • $2.4 billion - City of Phoenix's unfunded pension debt (we don’t have the money to pay for this)…

• $8.5 million - Vacation and sick leave paid to retiring City of Phoenix employees in 2012…

 • 12 million hours - Accrued vacation and sick leave for Phoenix employees still owed (Phoenix allows staff to roll over year after year unused time off)…

 • 40.5 - Number of days off an entry level employee gets their first year at work (it goes up from there).

Phoenix’s Pension Subcommittee released recommendations to the full City Council on Tuesday that fall woefully short of completely eliminating pension spiking.  One of the recommendations allows non-public safety employees to continue to use their massively accrued, unused sick and vacation hours as part of their pension calculation. 

Here is a review of what passed the subcommittee: 

On a 3-1 vote, the council subcommittee voted to continue the spiking of pensions on the following items, including base salary and wages for employees in the City of Phoenix Employees’ Retirement System (COPERS):


  - Premium pay, including, but not limited to shift differentials, and linguistic pay, military differential pay and holiday pay

-  Overtime pay

-  Compensatory time

-  Longevity and performance pay

-  Deferred compensation (401k style plans)

Vacation and sick leave was modified to a "snapshot" staff can still spike on their accrued amount as of July 2014. 

There was no change recommended on the year after year accrual of sick leave and vacation. Staff is given generous sick leave accruing until retirement.  Then they cash in sick leave at their ending salary which is higher than earlier years. 

The committee did recommend taking away car and cell phone allowances as part of peoples pension calculations.  However, when it comes to sick/vacation leave they agreed to allow current non-public safety personnel to continue to spike their pensions while targeting police and fire’s ability to do so.


Contact:

Councilman Sal DiCiccio   602-262-7491