The California Public Employees’ Retirement System (CalPERS) has announced that it will not pay pensions based on recent compensation set for a number of City of Bell positions, including those of the City’s former Chief Administrative Officer, Assistant Chief Administrative Officer and Chief of Police.
The decision is based on a CalPERS audit released today that concluded the City of Bell did not provide the information necessary to determine retirement benefits, reportable compensation and enrollment in the retirement and health systems for certain employees, including:
- Pay rates reported by the City of Bell failed to qualify as compensation earnable for pension purposes;
- Non-reportable special compensation such as employer payments to a deferred compensation program were incorrectly reported to the pension fund as compensation earnable;
- The City failed to complete and submit membership forms to CalPERS to properly establish membership for certain elected officials’ positions and failed to report earnings and submit retirement contributions on behalf of certain temporary/part-time employees who qualified to become members of CalPERS;
- The City erroneously continued membership of a former City Council member for services performed in an unsubstantiated position; and
- Eligibility verifications for dependents enrolled in CalPERS Health Benefits Program were not provided, and required health enrollment forms were not maintained on file.
In addition, CalPERS says it will be retaining the contributions made by the City of Bell based on the higher compensation rates until the civil complaint filed by the California Attorney General’s office is concluded (see Brown Pushing Twin CA Pension Probes).
CalPERS, which has approximately $220 billion in assets and is the nation’s largest public pension fund, announced the investigation of the Bell pensions, just over three months ago (see CalPERS Places Hold on Pensions of City of Bell Members).
A full copy of the CalPERS City of Bell audit detailing the findings including the City’s response can be found at http://www.calpers.ca.gov/index.jsp?bc=/employer/er-forms-pubs/pubs/compliance-reviews/public-agency.xml.