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Minnesota's local government pension plan reviewing plans to rein in spiking

The Pioneer Press | by Mary Jo Webster | August 14, 2013

Minnesota's largest public pension system, representing local government workers, has started investigating whether it needs to rein in pension spiking and what options it might have to do so.

The Public Employees Retirement Association (PERA) has started looking into the issue of workers boosting their final average salary -- primarily through massive amounts of overtime -- as a result of a Pioneer Press investigation that revealed this type of spiking among supervisors in the St. Paul Fire Department.

At the time of that story, PERA Executive Director Mary Vanek said the pension system has no way of determining whether workers are boosting their "high five" salaries with overtime because employers report only each workers' total salary, without breaking out how much came from overtime. However, PERA routinely receives complaints from workers about how others are spiking their pensions, she said.

Earlier this year, PERA requested three years' worth of salary data, including the overtime amounts, from local governments, in order to determine whether spiking is more extensive than just a single fire department.

 

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