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Bell, CA Had $4.5M ‘Secret’ Pension Fund

From the (local) budget hawks at the Los Angeles Times:

Bell seeks $4.5 million in former officials’ pensions to ease city’s budget problems

Grand jury transcripts reveal funds that were placed in secret plan for former Bell City Administrator Robert Rizzo and chief deputy, Angela Spaccia.

By Jeff Gottlieb, Los Angeles Times
April 26, 2011

A special pension fund set up by former Bell City Administrator Robert Rizzo and his top aide to boost the already generous compensation paid to city employees contains $4.5 million, according to grand jury transcripts obtained by The Times, providing a potential lifeline to a city on the brink of insolvency.

According to grand jury testimony, Rizzo established two pension plans designed to provide retirement income — above the level he and other employees would receive from the state pension system. One retirement account covered about 40 employees, giving them benefits that exceeded those allowed by California’s public employee pension rules. A second was just for Rizzo and his deputy, Angela Spaccia, according to the transcripts, allowing them to get around IRS regulations capping government pensions

According to the transcripts, even after Rizzo left office last summer following The Times’ disclosure of his enormous salary, he called Garcia on her cellphone on a Saturday and told her to move money into the Wells Fargo account set up for his and Spaccia’s retirement. Garcia balked, telling him he was on administrative leave.

"I’m still the CAO," Rizzo told her, according to the transcripts.

In other words, even after their outrageous salaries and pension plans had forced him from office, Mr. Rizzo still tried to tap into his secret retirement account.

The revelations come six months after The Times reported that Rizzo had created the supplemental pensions, which allowed employees to circumvent retirement limits set by California. Employees who worked in Bell for 25 years and retired at the age of 55 could get 90% of their salary — far more than most public employees who retire at the age of 60.

Who did these city managers think they were, public sector union employees?

But prosecutors allege that Rizzo and Spaccia secretly schemed to give themselves an even richer supplemental pension. Prosecutors allege that they went to great lengths to hide the value of their pensions

The grand jury last month charged Rizzo and Spaccia with conspiring to illegally boost their pensions, creating fake contracts and secretly increasing their benefits

Email shows that Wells Fargo financial consultant Alan Pennington warned of a backlash if the retirement plan for Bell’s top officials became public… The grand jury transcripts quote an email in which Spaccia tells Pennington that Rizzo "is not concerned w/ media scrutiny and feels the council will accept it since it only makes him whole."

Pennington testified that in his 20 years’ experience, he had never crafted a similar plan for a government entity. Huntsman asked Pennington what went through his mind when he learned of Rizzo’s salary, which reached nearly $800,000 annually.

"People in California make a lot of money," he replied, then admitted that he had never heard of a government official who made that much

So Mr. Pennington just went ahead and did what Mr. Rizzo told him to do.

Officials said they are examining whether some or all of the $4.5 million can be recouped

After all, it was stolen fair and square.

But as we have observed often before, Bell City is certainly not a unique situation. After all, the city managers were doing exactly the same thing just a few miles away in Vernon, California. So it is probably going on, to some degree or another, all across the fruited plain.

This article was posted by Steve on Tuesday, April 26th, 2011. Comments are currently closed.

6 Responses to “Bell, CA Had $4.5M ‘Secret’ Pension Fund”

  1. proreason says:

    Progressivism, in a nutshell.

    These two yahoos are not the exception, they are the rule.

    • tranquil.night says:

      Most definitely. What we think we know and see is just the tip of the iceberg.

      I bet if Rep. Issa was allowed out of the dungeon by leadership to really do his job, there’d be a newsworthy revelation of criminality weekly, if not daily, with regards to the 111th Congress and the regime.

  2. JohnMG says:

    …..”former Bell City Administrator Robert Rizzo and chief deputy, Angela Spaccia”…..

    With names like these two it should come as no surprise that Mr. Pennington rolled over. Evidently he was made an offer he couldn’t refuse.

  3. Gladius et Scutum says:

    When this first came to light, Illinois Govenor Pat Quinn announced that the salaries of elected officials of every county and municipality in Illinois would be available soon on a web site. The web site must be in “the deep web”, near the site that lists the federal stimulus spending dollar by dollar – I sure can’t find it.

    I wrote to the two papers that cover my county, suggesting that publishing the salaries of elected officials would make a good article, and enhance their reputations as public watch dogs. They weren’t printed. I suggested it in the on-line “comments” sections of the papers – and was deleted for violating terms of service both times. I’ve reviewed the published budgets of a few burgs, and find that they are deliberately compilied to avoid revealing salaries of mayors and trustees by lumping “total salaries” in a single line. No private business ever does this. It is always, at least, broken down by department. I suspect that FOIA requests will be met with “Personnel Records Privacy” denials.

    My best guess is that, after making this announcement, Quinn was told he risked losing the three (of Illinois 102) counties that he won (C(r)ook, East St. Louis, Cairo) in the 2010 election if he went ahead with the project. Steve’s right. This sort of thing is going on all over. And there’s worse, but it’s off – topic and complicated so I’ll leave it for another time.

  4. Right of the People says:

    It’s about time coast to coast for the pitchforks and torches to come out if you know what I mean.

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