Sal DiCiccio called 'hypocritical' on Phoenix pension

• For the better part of five years%2C DiCiccio has been trying to stop the soaring costs of the city%27s employee-pension system
• Labor union leaders say DiCiccio is receiving an %248%2C410 annual pension and %2410%2C500 in deferred compensation
• DiCiccio says he tried to suspend his pension payments%2C but state officials told him the law wouldn%27t allow it
• Opponents said DiCiccio should write a check to the city for his pension payments

When it comes to pension reform, critics say Phoenix Councilman Sal DiCiccio seems to be living by the mantra, "Do as I say, not as I do."

For the better part of five years, DiCiccio has been on a mission to stop the excesses and soaring costs of the city's employee-pension system. It's an issue he seized this fall as voters consider Proposition 487, a ballot initiative that would dismantle the pension plan for new hires. He has been the public face of the pro-reform effort.

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But labor union leaders have accused DiCiccio of hypocrisy given that he's receiving an $8,410 pension from a previous term on the council and $10,500 in deferred compensation per year while earning a $61,600 salary for doing the same City Council job.

DiCiccio said he has gone out of his way to return his pension money. Instead of writing a check to the city for his pension amount, he said he pays it back by declining other benefits available to city leaders, including a cellphone and car allowance.

He emphasized that he tried to suspend his pension payments, but state officials told him the law wouldn't allow it.

The pension benefit comes from DiCiccio's council stint from January 1994 to February 2000. Since returning to elected office in 2009, records show he has declined more than $46,000 in city perks and once wrote a $3,000 check to the city.

Still, opponents assert DiCiccio's explanation doesn't square with his message of fiscal responsibility.

They point out he is talking about different pots of money, and the city still has to make payments to a state-pension system for his position. Ultimately, critics contend, he is "double dipping" by pocketing a pension and deferred compensation for a job for which he earns a salary.

"There's a tremendous irony when somebody positions themselves as the tip of the spear when it comes to pension reform and at the same time is receiving a pension for doing a part-time political job," said David Leibowitz, a spokesman for the firefighter union opposing Proposition 487. "I mean, how many times do we have to pay this guy to be a city councilman?"

DiCiccio said the focus on his pension distracts from the real issue Prop. 487 would address: Phoenix's unsustainable pension obligations. The city's costs for the pensions of civilian workers jumped to $129 million this year, up from $27.8 million in fiscal 2002.

"That's a tactic they've used to personally attack and not talk about the initiative," he said. "I've paid back my pension. Period."

Public records from the Arizona Elected Officials' Retirement Plan show DiCiccio applied for early retirement in September 2003, allowing him to start drawing a lifetime pension benefit at age 45. The size of his pension has increased over time with cost-of-living adjustments.

In hindsight, DiCiccio said he "would absolutely never have" taken early retirement had he known of the looming pension crisis.

DiCiccio twice wrote to state pension officials, asking to have his payments suspended while he is in office. They rejected his requests. He said he also made multiple phone calls to the state, advocating for a suspension.

When that didn't work, DiCiccio started declining other city benefits.

But opponents said that if DiCiccio were to truly practice what he advocates, he would write a check to the city for his pension payment, decline deferred compensation and not accept a cellphone or car allowance.

Rather than simply writing a check to the city for his pension amount, DiCiccio said he declined certain allowances for tax reasons. He elaborated: Writing a check would make him pay taxes twice: once for the income tax on his pension, and again for taxes on the car and cellphone allowances he would otherwise collect from the city.

Cathy Gleason, the city's retired budget director and a co-chair of the No on 487 campaign, said DiCiccio is being especially hypocritical on deferred compensation, which is similar to 401(k)-type retirement plans in the private sector. DiCiccio receives the benefit despite labeling it a "second retirement" plan and advocating its removal for all city workers with pensions.

"He hasn't really given it back," she said. "He's still getting more compensation than the average city employee, and they have to show up for 40 hours a week."

Records from the elected-officials pension plan show DiCiccio has received more than $77,000 in payments since retiring in 2003. He said he has paid back the portion of those payments that he has received since returning to the council.

However, DiCiccio has previously claimed he asked the city to stop all of his deferred-compensation payments. Public records show he stopped accepting the second retirement benefit for a few years, but had the $761 monthly payments reinstated in December 2012.

DiCiccio later said he declined deferred compensation only for a time to repay his pension payments since returning to office.

When asked about the deferred compensation payments, DiCiccio said he's taking the money instead of accruing more pension benefits. He added, "At some point, you're allowed to have some benefits."

Election information

Early ballots for the Nov. 4 election hit Phoenix mailboxes this month. Voters will decide races for federal, state and local offices, as well as the fate of several ballot measures.

There is only one city issue on the ballot this year: Proposition 487, also known as the Phoenix Pension Reform Act. Because Maricopa County elections officials are conducting this election, there will be no separate city ballot or polling places, as has been the case in other city elections.

The vast majority of Phoenix voters participate in elections via mail and will receive their county ballots in the next several days. Ballots must be returned to the County Elections Department or city clerk by 7 p.m. on Election Day to be counted. In-person early voting starts Oct. 9 at Phoenix City Hall, 200 W. Washington St.

Voters who decide to cast a ballot in person on Election Day will need to visit the specific polling place designated for the precinct where they live. For help finding your polling place, call 602-506-1511 or visit recorder.maricopa.gov/pollingplace/pollingplace.aspx. Polls will be open from 6 a.m. to 7 p.m. on Nov. 4.

Prop. 487 would end Phoenix's pension system for general city workers and replace it with a plan similar to a private-sector 401(k). The switch to a new retirement plan would only impact new hires or employees who choose to leave the pension plan, the Phoenix Employees' Retirement System. Current civilian employees could remain in the pension system and have a guaranteed income at retirement.

Among Prop. 487's other provisions:

• Make permanent and expand reforms the city has made to combat the practice of "pension spiking," generally seen as the artificial inflation of a city employee's income to boost retirement benefits. It would exclude from the pension calculation any compensation beyond base pay and expand the number of years used to determine an employee's final average salary, a key part of the benefit formula.

• Prohibit the city from contributing to more than one retirement account for each city worker, including current employees. Currently, the city contributes to a second retirement plan, known as deferred compensation, on top of most employees' pensions.