Santa Clara County’s housing authority could have spent $16 million of federal funds to help more struggling families put a roof over their heads. Instead, it chose to more than double the value of its employees’ retirement benefits.
That may sound unusual, but federal housing officials say it was an allowable expense. Still, the switch from a 401(k)-style retirement plan to a pension allowing workers to retire early — with guaranteed lifetime payments — is raising eyebrows at a time when generous public employee pensions are under fire. . .
Bill Anderson, chairman of the Housing Authority of the County of Santa Clara’s board of commissioners, conceded that the money spent on employee pensions could have been used in other ways, including housing aid for low-income families.
Indeed, the waiting list for federal housing assistance is so long that applicants must now wait four to nine years.
Anderson also acknowledged that with the area’s high unemployment, the housing authority could fill jobs without a more generous retirement plan. But he said he considered the agency’s employees, whose average salary according to CalPERS is $60,730, underpaid compared with other government workers, most of whom have pensions.
“I was very much aware that this was money available for whatever else we do,” said Anderson, a retired assistant county counsel. “I thought it was the right thing to do for the employees.”
Housing authority workers who under the old plan had to wait until they were almost 60 to draw from retirement accounts — which could be shrunk by market losses — can now receive a guaranteed monthly pension check as early as age 50. And they’ll have a guarantee of 2 percent annual increases after they retire . . .
The change in retirement benefits was made possible after the U.S. Department of Housing and Urban Development in 2008 made the housing authority one of 32 Moving to Work demonstration sites. The program allows more spending flexibility to encourage “innovative” approaches that “use federal dollars more efficiently.”