HUNTINGTON BEACH : City Tops the List in Retirement ‘Spiking’

A study ordered by the City Council has found that among nine comparable cities in Southern California, Huntington Beach allows its employees the most generous retirement benefits because of “salary spiking.”

“Spiking” is a term for allowing additional sources of income, such as car allowances or other expenses, to be added to an employee’s final-year salary. Retirement income is based on pay in the last year of employment.

Salary spiking became a heated issue here in January after state Controller Gray Davis’ office charged that 16 recent Huntington Beach city retirees had artificially inflated their final-year salaries. The controller’s office said that although spiking is not illegal, such practices drain the state’s retirement system.

After the spiking controversy erupted, Councilwoman Linda Moulton-Patterson asked for a city staff survey of comparable cities’ practices. The study was made public this week.

Deputy City Administrator Robert Franz said the nine cities chosen for comparison are similar in population and budgets. They are Anaheim, Costa Mesa, Fullerton, Glendale, Newport Beach, Santa Ana, Torrance, Garden Grove and Pasadena.

The study found that unlike Huntington Beach, none of those cities allows an auto allowance to be tacked on as “salary” during a public employee’s final year. The study also found that Costa Mesa was the only comparison city to allow unused vacation time to be added on as salary during the final year.

David Sullivan, president of the citizens group Huntington Beach Tomorrow, on Thursday reiterated the organization’s opposition to salary spiking.

“While we recognize that this is not illegal, we believe that spiking is a violation of public trust,” Sullivan said. “This is one issue that people are really outraged about. And the question we ask is, ‘Why is Huntington Beach doing it?’ We think Huntington Beach should be in line with the practices of other cities.”

Franz said Thursday that the city cannot consider a change in how it grants retirement-pay credit until current contracts with city employees expire in 1993. Franz noted, however, that earlier action might have to be taken if the state requires any changes.

A bill before the state Legislature would make salary spiking illegal. It was unanimously passed by an Assembly committee in February.