Los Angeles Inspector Convicted of Bribery Keeps $72,000 Pension

Why should taking money on the
side deny a public employee a taxpayer-subsidized retirement? It
won’t in Los Angeles, at least for now. Samuel In, a Los Angeles
building inspector, was convicted and sent to prison for two and a
half years for taking bribes. But he will keep his $72,000 annual
pension. As the Los Angeles Times notes, this is because
of
city regulations:

Two years ago, Gov. Jerry Brown signed into law a measure
requiring public employees convicted of a felony to give up
retirement benefits earned during the period when their crimes were
committed.

But the forfeiture requirement doesn’t apply to Los Angeles
because it is governed by the City Council under a voter-approved
charter, and the City Council manages its own pension systems.

I think that state rule regarding convicted public employees is
just about the only part of
Brown’s modest pension reforms that is not being
challenged by unions.

The Times mentions that councilmember Mitchell
Englander would support legislation forcing Los Angeles employees
to give up their pensions if they’re convicted of felony corruption
crimes. In’s attorney countered that his client had “earned” his
pension through his years of service to the city.

That’s another good argument for shifting public employees out
of pensions and into 401(k)-style defined contribution programs. As
it stands, taxpayers are on the hook to make up the difference when
In’s pension doesn’t perform as guaranteed. In a defined
contribution program, the taxpayers’ obligations to In are
frontloaded in the city’s contributions while he is still employed.
Once In (or any other worker) is no longer a city employee, these
obligations end. In a sense, both sides “win.” In gets to keep what
he’s earned, regardless of his crimes, but the taxpayers are not on
the hook for any additional money for his retirement.