Two Decades of Illegal Benefit Payments Went Unnoticed in Stockton

In violation of the Stockton City Charter, the mayor and two City Council members were enrolled in the state retirement system and were illegally paid retirement benefits for 21 years.

Section 2602 of the city charter specifically states that City Council members cannot receive retirement or death benefits, but that is exactly what has been happening. A combined total of $276,953 was illegally contributed to the retirement funds of three mayors and 14 council members since 1991.

Mayor Ann Johnston is the biggest recipient of the payments, because she also served as a City Council member. She has received $45,405 in illegal payments.

The payments began in 1991, when Stockton's human resources officials started telling newly elected City Council members that they could enroll in the California Public Employees' Retirement System.

City Attorney John Luebberke told the Stockton Record: "I have no explanation whatsoever as to why this benefit was offered. We've been able to find no record of when this action was taken. Or of my office analyzing it. It is simply undocumented."

The bad news for taxpayers is that the money likely will not have to be returned. The city attorney stated when an innocent individual relies on an agency's promise and takes irreversible actions, or actions that are damaging to reverse, courts usually do not allow the agency to take back the money. The good news is that Stockton officials say the payments will be stopped as soon as possible. (Source: Stockton Record, April 25.)

California Tax Foundation   |   1215 K Street, Sacramento, CA 95814   |   916.441.0490   |