US - Millions of New Jersey taxpayer's money has been wasted on "questionable and excessive" pension benefits awarded in the contracts between public school administrators and boards of education, a report by the State Commission of Investigation has found.
The report claimed that lucrative provisions of those privately negotiated deals enabled superintendents and others at the top tier of public school administration to receive compensation and pension benefits often well beyond the reach of any other class of public-service employees.
According to the report, reimbursement for employee contributions to New Jersey’s Teachers’ Pension and Annuity Fund (TPAF) public retirement system were sometimes inappropriately included in base salaries for pension calculation purposes.
New Jersey regulatory guidelines state the compensation of a TPAF member subject to pension and group life insurance contributions are creditable for retirement and death benefits in the system should be limited to base salary, and not include extra compensation. But the report found “discovered manifest inconsistencies” in school district policies and practices with regard to inclusion of extra compensation for pension purposes.
The report also pointed to other “questionable or patently improper” steps taken to provide administrators with inflated and overly generous pensions by padding base salaries with multiple forms of extra compensation. In certain instances, that salary padding occurred in the years immediately preceding retirement.
“This inquiry even revealed exceptional instances in which contracts have been written such that top school administrators reap a kind of “double dip” pension boost in which they purchase credit toward additional pensionable service time, are reimbursed at taxpayer expense for the cost of it, and then have the dollar value of the reimbursement added to their regular pay, thus further inflating their base salaries for pension purposes,” the report stated.
By Damian Clarkson
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