San Jose

City of San Jose Overpays Pensions, Requests Money Back

About 300 retired police officers and firefighters were overpaid more than $1 million, and some were underpaid

The city of San Jose has made a million-dollar mistake, overpaying pension money to 300 retired firefighters and police officers, and now it's trying to get that money back.

The problem was discovered during an audit in 2009 but it has taken until now to crunch the numbers and notify the retirees of the overpayment.

The retired police officers and firefighters recently received letters indicating the the overpayments, which range from a couple hundred dollars to $30,000.

Tom Saggau of the Association of Retired San Jose Police Officers and Firefighters said it's a frightening scenario for the retirees.

"Some of these people have been retired a very long time and are living paycheck to paycheck," he said. "So to find out they owe $30,000 is very scary."

According to the city, the miscalculation dates back to 1998, but city officials say they can't just ignore the overpayments. IRS guidelines require retirement trust funds to re-collect money paid out in error.

"The goal is to have a process that is fair and equitable and will cause as little discomfort to the retirees, recognizing this is an error on the part of several city departments that happened long ago," city spokesman David Vossbrink said.

And it wasn't just overpayments. The city said some retired cops and firefighters were underpaid and may actually receive a check from the city.

The retirees haven't been given a deadline to pay back the money. The police and fire retirement board is set to meet in early January to figure out how to proceed.

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