Goldwater Institute confronts city of Phoenix on pension spiking - FOX 10 News |

Goldwater Institute confronts city of Phoenix on 'pension spiking'

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Pension spiking. Have you heard of it? It's costing Phoenix taxpayers millions.

Police officers and firefighters use unused sick leave, vacation and other benefits to inflate their salary before retirement -- thus increasing the amount of their pension.

The Goldwater Institute is threatening to sue the city of Phoenix over the practice.

"The way that pensions or retirement benefits are calculated for public safety workers is an average of the last few years of service, used to set a baseline for the salary. So if an individual were to pension spike, they would save up unused vacation leave, sick leave and other fringe benefits and add that to the last few years of salary so their salary is higher and their pension payout is higher," said John Riches of the Goldwater Institute.

Hook: "Some people are going to watch this. They're going to say, look these are police officers who put their lives on the line, should we be grinding them over this stuff? What would you say?"

"Nobody is questioning the vital services police and fire provide to the city. This is about abusing a policy that violates state law at the expense of taxpayers," said Riches. "So the state law is pretty clear, these items shouldn't be counted toward salary for pension purposes."

Hook: "So how is the city of Phoenix doing this and getting away with it if it specifically says in state law they can't do this?"

Riches: "I don't yet know what the answer is but were eagerly anticipating that reply so we can take a look at it."

Hook: "Would this go on in the private sector in your experience?"

Riches: "Couldn't speak to that John, I would say that would be unlikely."

I contacted the mayor's office. Mayor Stanton has called a special executive session with the city council, city manager and city attorney next Wednesday to discuss this issue. And in that meeting, they will determine next steps and when any meetings with Goldwater might occur.

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