LOS ANGELES (AP) — The office that manages retirement benefits for California public employees is looking into the validity of pension plans for at least 10 police officers, including four chiefs, who received disability pensions and workers’ compensation settlements when they were forced out of their jobs at the city of Bell, according to a newspaper report.
The California Public Employees Retirement System, or CalPERS, is asking Bell officials to determine whether ousted city manager Robert Rizzo approved retirement deals that boosted payments to those officers, the Los Angeles Times reported on its website Wednesday.
Two former police chiefs told the Times that Rizzo proposed retirement deals to minimize taxes for the retiree and lower payments for the city.
State law allows city councils to approve disability retirements when an on-the-job injury prevents an employee from performing their job. Only half of disability pensions are taxed, while workers’ compensation settlements are tax-free.
“If Rizzo wanted to get rid of you, he’d make some way to pay you off and make it beneficial for you financially,” said former Chief Andreas Probst, who was granted a $250,000 workers’ compensation settlement and an annual disability retirement of $158,057.
Probst said his retirement was properly handled because he had suffered on-duty injuries in a crash with a drunk driver. But he said Rizzo bundled severance, vacation and sick pay owed to him into the workers’ compensation settlement — a practice that experts said would violate tax codes.
Rizzo’s attorney, James Spertus, said the chiefs’ claims sound “pretty outlandish.”
Rizzo is charged with masterminding a scam in which he paid himself and other top Bell officials massive salaries. Prosecutors say the scheme nearly bankrupted the working-class Los Angeles suburb.
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