State politicians and the public pension cookie jar

Elected officials in dozens of states enjoy similarly generous deals. In Arizona, Florida and Kentucky, for instance, the pensions of legislators are calculated with a more generous “multiplier” than those of regular employees. (The “multiplier” is used in the equation that translates a worker’s years of service into the percentage of his final salary that he will receive as retirement pay—the longer one works, the larger the percentage.)

In Arizona, the multiplier for all current legislators is four, or nearly twice that of ordinary government workers. The Arizona Republic newspaper estimates that a lawmaker retiring after 20 years with a $100,000 salary would receive a pension of $80,000 annually, while a state worker would garner $43,000 for the same years of work. (Legislation last year lowered the multiplier for new lawmakers to three—still a premium over other workers).

Lawmakers in some states also enrich themselves by basing pension calculations on something other than salary. This is particularly common in states with part-time legislatures that pay low salaries. Raising salaries or making legislators full-time isn’t politically popular, so lawmakers instead arrange the pension system to provide greater benefits in retirement.