School Pay Hike Scandal SDUT
The San Diego Unified School District was unable to document or justify pay raises awarded to 29 managers before their retirement, a situation that led the State Controller’s Office last week to determine the district is at high risk of pension spiking.
The controller requested documentation from the district as part of a months-long effort to detect and deter pension spiking involving the California State Teachers Retirement System and its 850,000 members.
Among the five education agencies inspected for possible pension fraud, San Diego Unified and San Francisco Unified were singled out as high-risk and recommended for an in-depth pension audit.
“These districts lacked the level of transparency and the necessary controls over management pay increases that a public entity should exercise on behalf of its constituents. As a result, pension spiking may be occurring at these districts,” wrote Jeffrey V. Brownfield, the controller’s audit division chief.
Bernie Rhinerson, chief of staff for San Diego Unified, called the report helpful while disagreeing with the notion that district taxpayers could be suffering from pension fraud.
“This is not any indication of pension spiking. It is an indication that there was documentation lacking,” Rhinerson said. “The superintendent takes the recommendations very, very seriously. He called together his management team (Thursday) and instructed his team to take whatever corrective actions to make sure records like this are up to date and complete... They may not have gotten into the personnel file.”
State officials sought to review 56 management files for San Diego Unified worth $6.4 million in salaries for retirees from July 2006 through June 2011. Proper documentation -- such as board or superintendent approval or complete personnel agreeements -- could not be found for the salaries of 29 managers worth $3.2 million, the controller’s office said.
“In some cases, increased salaries were approved without transparency in an open forum, lacked proper documentation, and were not properly justified,” the Sept. 5 report said. “While we understand that personnel matters often are conducted in closed-session board meetings, we would expect a salary increase to be justified with a performance evaluation, assessment, or other type of written documentation, especially when the increase occurs shortly prior to retirement.”
The state’s pension system for teachers and administrators, also known as CalSTRS, flags retirees for pension review when they earn more than $147,000, when their pension exceeds $100,000 a year, when they receive $15,000 or more in special compensation in a year, or a pay raise of 15 percent or more during their final compensation period. Depending on the years of service, a retiree’s final compensation period used to calculate a pension may be the highest single year of pay or an average of three consecutive years.
Melvin Collins, former executive principal of Lincoln High, was one of the 29 retired managers flagged for review for whom the district could not produce raise documentation. His final salary at retirement in June 2011 was $171,594.
“There was no bonus. There was no pay spike or anything like that,” Collins said, adding that any pay raises he received during his six years at San Diego Unified were always within the pay scale for his position. “All I do know is that San Diego Unified didn’t do anything illegally, nor did I.” ...