LA Times: Some pensions are so huge they exceed IRS limits, costing taxpayers millions extra

Great article in today’s LA Times that highlights how California public pension plans get around IRS limits designed to limit pensions to approximately $210,000 or less:

Dozens of retired Los Angeles employees are collecting such generous retirement pay that they exceed pension fund limits set by the Internal Revenue Service, saddling taxpayers with additional costs, a Times data analysis has found.

Their lavish pensions forced the city to establish an “Excess Benefit Plan” to pay what the pension system cannot legally cover, using money that could otherwise be tapped to fix sidewalks, fight homelessness or hire more cops.

…

The top recipient of excess benefits last year was former LAPD Assistant Chief Earl Paysinger, whose $251,000 pension alone would have put him over the limit.

But an additional $1.3-million lump sum payment Paysinger got through the Deferred Retirement Option Plan when he retired in 2016 catapulted him way over the top, requiring the city to pay more than half of his pension from the Excess Benefit Plan.

Be sure to read the full article at the Los Angeles Times website. 

And to see the pensions mentioned in the article, visit this page of the TransparentCalifornia.com website.