The Goldwater Institute has filed a case against the city of Phoenix to end pension spiking and an Ahwatukee Foothills resident is a plaintiff in the case.
Jim Jochim said he took interest in the issue when it was brought up in May of this year. He contacted the Goldwater Institute, offering to help in any way, and was eventually offered to be named as a plaintiff in the case, along with Jennifer Wright and Eric Wnuck.
Goldwater is asking the city to put an immediate stop to the practice of pension spiking, which allows Phoenix police and firefighters to add the cost of accrued vacation time, sick leave and other benefits to their final paychecks, which are then used to calculate their final pension.
The practice is illegal according to Arizona state law, but has been carried out in Phoenix for more than a decade.
“I worked for AT&T for 30 years,” Jochim said. “I understand the corporate pension structure fairly well from my AT&T days. The things going on here are truly overstepping the line. It’s gouging… There’s a loop hole so big people are driving a truck through it.”
Jochim said he has no issue with pensions or even with employees collecting some extra cash for the benefits they didn’t use during their employment, but he believes it should not be added into the calculations used to determine an employee’s pension.
Mayor Greg Stanton has promised to address pension spiking through labor negotiations, which will begin later in 2013. Councilman Sal DiCiccio said that’s not necessary. He sent a memo to Stanton on Monday and asked for an immediate public hearing on the issue and a City Council to vote.
“Not only is pension spiking illegal, but it costs significant city funds and prevents us from restoring critical services such as library hours, after-school programs and seniors’ services,” DiCiccio wrote.
The case could go to court if it is not resolved through council action.
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