DeMaio Releases Shocking Pension Report, Unveils National Fix

Press Release

Top City Pension Payout Hits $785,679
Top 100 Payouts Averaged $324,242
Top 1000 Payouts Averaged $133,629
DeMaio Unveils Federal Law to Curb Pension Abuses

San Diego - Carl DeMaio released a report today listing the top government pensions paid out in San Diego and the payouts are downright shocking. To curb abusive payouts like these nationwide, DeMaio unveiled his "Saving Taxpayers from Outrageous Pensions" (STOP) Act which DeMaio plans to introduce in the first month of his congressional term.

"San Diegans are rightfully outraged by these kinds of lavish pension payouts in government," DeMaio said in releasing the report. "While San Diego has already taken action to prevent these outrageous payouts in the future by passing my Pension Reform Initiative, we must take these reforms nation-wide to fix the problem for good," DeMaio noted.

DeMaio also laid blame for the outrageous pension payouts at his opponent in his race for US Congress - Rep. Scott Peters. Peters voted to actually increase the pensions listed in DeMaio's report while simultaneously voting to raid funds to pay for them. Peters even voted to increase his own pension and then opted to enroll in the government pension system early.

"Scott Peters voted to spike government pensions, including his own, even though he knew taxpayers could not afford the cost," DeMaio noted. "Because of Scott Peters' reckless votes to spike these pensions, we see outrageous and indefensible payouts like these," DeMaio concluded.

DeMaio's report used data that was required to be disclosed to the public under DeMaio's 2012 Pension Reform Initiative. The data covers 2013 - the first year the data was required to be available to the public in this format. The payouts provided in the report include regular pension payouts, ongoing and lump-sum payouts from the "Deferred Retirement Option Program (DROP)," and Preservation of Benefit (POB) payments.

Among the shocking findings in the report:

* The top pension payout was a whopping $785,679.
* The top 100 pension payouts averaged an astonishing $324,242
* The top 1000 pension payouts averaged an astonishing $133,629

The City of San Diego has become the poster child of pension abuses over the years, but since the passage of DeMaio's Pension Reform Initiative in 2012 San Diego has been cited as a model for pension reform. The reforms in DeMaio's plan will reduce pension payouts for current employees, while moving new employees to 401(k)-style defined contribution plans.

"Saving Taxpayers from Outrageous Pensions" (STOP) Act

DeMaio is not just pointing out problematic pension payouts with his report, but he is also outlining solutions to reform government pensions nationally.

After successfully authoring and winning passage of the landmark San Diego Pension Reform Initiative in 2012, Carl DeMaio has traveled the country to encourage states and localities to implement the San Diego model. DeMaio is committed to continuing to support these efforts once elected to Congress, and has already announced he will work with Democratic Mayor Chuck Reed of San Jose on an initiative in 2016 to reform California state pensions.

In addition, DeMaio will introduce federal legislation to give states and localities tools to reform pensions.

DeMaio's Saving Taxpayers from Outrageous Pensions (STOP) Act would impose the following reforms:

* Allow for Conversions from Defined Benefit to Defined Contribution Plans Current IRS rulings provide little guidance on whether government employees can voluntarily "opt-out" of defined benefit pension programs and enroll in defined contribution pension programs. DeMaio would amend the Internal Revenue Code to explicitly allow for individuals to "opt-out" of defined benefit pension programs.

* Prohibit Deferred Retirement Option Plans (DROP) Some of the largest payouts seen in DeMaio's report are boosted by DROP lump-sum and ongoing payments. DROP allows government workers to "retire" and continue working in government for five years to "double dip" at taxpayers' expense. DeMaio would amend pension laws prohibiting DROP programs.

* Require Transparency of Pension Payouts Any state or local government entity that receives federal funds to support their programs and operations would be required to publish online the government pension payouts made annually - providing similar data to what DeMaio's Pension Reform Initiative required and what made possible DeMaio's report.

* Tax-Exempt Municipal Bond Penalties DeMaio is proposing to remove tax-exempt bond status from any jurisdiction's municipal bonds if they at any time issue "Pension Obligation Bonds" - which financial experts have called risky borrowing that simply pays one credit card with another.

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