Administration January 2, 2005

San Diego Pension Debacle Heats Up Again

February 1, 2005 (PLANSPONSOR.com) - Once again, the City of San Diego and its pension system is embroiled in turmoil.

Reported by

After literally years of trouble regarding the city’s underfunded pension plan, a new City Council committee on openness in government heard startling revelations that pension trustee was blocked from attending San Diego City Employees Retirement System (SDCERS) meetings and that the system was paying pensions to dead people.

According to the San Diego Daily Transcript, the committee is investigating whether SDCERS violated the Brown Act by blocking trustee Diann Shipione from meetings. The council, upon hearing this, asked the city attorney to look at possible remedies to this situation, including a possible lawsuit against the pension board.

Shipione is believed to have leaked closed meeting information to an individual who had filed a lawsuit against the city, according to the Daily Transcript and General Counsel Loraine Chapin of SDCERS noted in the committee that this was the reason for her being barred from meetings. Shipione claims that she is being barred because of her vocal opposition to a settlement in a lawsuit against former attorney Robert Blum, who advised the pension system.

Also heard at the committee was that the city’s pension system has been paying dead people, according to TheSanDiegoChannel.com. Shipione said that the practice has been going on for years.

“The pension system pays hundreds of checks monthly to people that the Social Security Department claims are deceased,” Shipione said to the news station. She claimed that to check if people died, the pension system would simply look at the obituaries in the newspaper. The pension system claims it checks social security numbers every three months. The news channel claims that they have evidence that one deceased person was paid $126,000 after they died and that the city pension fund did not try to get it back.

These revelations follow months of turbulence with the city’s troubled pension system. The most recent actions include the city’s retirement board suing City Attorney Michael Aguirre to keep him from controlling the pension system’s legal affairs and to get back various legal papers (See San Diego Pension Mess Boils Over – Again ).