Since the Albuquerque Police Officers Association agreed to the large pay raise that Mayor Keller offered last month, I have had several retired officers ask me if it’s worth it for them to suspend their pension and go back to APD. With input from the good people at PERA and Shaun Willoughby, of the APOA, I have tried to crunch some numbers, dispel some rumors and provide some hard facts.
This new labor agreement is open to everyone: new cadets, current officers who wish to lateral to APD, and retired police officers. This column only discusses the financial impact of suspending their pensions to go work at APD, for retired New Mexico police officers.
The way the new contract with APD was written, APD can extend this new pay rate and longevity to any retired officer. An officer who is already New Mexico state certified is more attractive to APD (as they can bring them on board quickly). All retired officers qualify for these benefits.
The APD website shows that retired / lateral officers will be hired back at $29 hour for their first year (probation). Immediately upon being hired they will receive longevity based upon the number of years they have served as a police officer anywhere. Longevity is not based upon APD time, but upon all the years served with any department as a sworn police officer. In 2019 the longevity for a 20-year veteran officer becomes a whopping $15,600 per year.
For PERA purposes, officers get their pensions calculated on their hourly rate, longevity and specialty pay. For this column I am only going to concern myself with hour rate and longevity pay. Retired officers returning to APD in 2018 will start at $29 hour plus $500 bi-weekly in longevity. They will go to $31.50 hour and start receiving the $15,600 in longevity after they serve their one-year probation.
If a retired police officer who is receiving a pension from PERA decides to suspend his pension and join APD they will do so under Tier 1 rules. The most important of these rules is that PERA will calculate a new pension on the highest three years.
Retired officers who come back, build a new pension calculation and then retire again will have to wait seven years before they will start receiving their COLA. This is waived when the retired officer turns 65 years old. In that case the COLA begins the year after the officer turns 65.
I am basing calculations on an officer who retired after 20 years, making an hourly wage of $28 and a yearly longevity of $2,400. The reason I am using these figures is the APOA stated this is what APD officers were earning, the last few years, when Albuquerque had hundreds of officers retire.
Here are the comparisons. A current officer who retired at the $28 rate plus $2,400 in longevity, at 70% would get a pension of approximately $42,448 per year. If that retired officer started receiving COLA’s in 2018 their pension would increase to $45,947 in 2022 and $52,778 in 2029 and $57,129 in 2033.
Compare this with a retired officer who suspends his pension to join APD in 2018. I won’t count 2018 because that is the probation year and the officer will make $29 per hour. The officer will not have the $31,50 and $15,600 calculation for three years until 2022. This is 83% and the officer could retire at $67,329. Seven years later when the officer will start receiving the first COLA the difference between the officer who didn’t suspend the pension and the one who did and recalculated at 83% is approximately $14,551! The officer who suspended would increase his pension by $1,212 per month!
If the officer stayed for the maximum retirement of 90%, with no further pay raises, the pension would recalculate at $73,008. In the year 2033, when the 90% officer would start receiving a COLA, the difference would be almost $15,879! A monthly increase of $1,323!
Let me strongly point out though that this new pay level is open to ALL police officers who retired while working for a New Mexico agency. This is important because, for example, an officer retired after 20 years (70%) based upon $20 per hour, they could suspend their pension, get hired by APD and in just a few years greatly increase their pension. They would get a new pension calculation based upon 83% at $31.50 per hour plus $15,600 in longevity. This would be a huge increase.
There are a lot of issues a retired officer will need to consider before suspending retirement to build a new pension calculation. I have only looked at the financial incentive. Retired officers and their families will need to consider if physically, mentally and emotionally they are ready to come back into police work in a large metro area. We aren’t as young as we used to be, money isn’t everything.
What about the current double dippers at APD? There are about 70 APD officers that fall into this category. Suspending their pensions would mean building a new calculation. They would stay in the positions they currently hold, but would it be smart to stop double dipping to recalculate their pension? That will depend upon their current financial outlook. If they have bills based upon double dipping, then they might not be able to stop their pension check. Talking to a financial planner would be the appropriate course of action for them.
The worse thing they can do is to get advice from other officers, as many times the information is wrong and not based upon all the facts of their unique situation. Get your advice from a financial professional before you make this decision.
Hopefully, Chief Geier has directed APD Recruiting to send letters to ALL officers throughout New Mexico who have retired in the last couple years. A retired officer certification stays current for two years after retirement. Tapping into retired NMSP, BCSO, Santa Fe PD, Las Cruces PD, etc could quickly increase the number of veteran officers at APD, while continuing to hire new officers.
APD has a real opportunity to grow the department with good, seasoned police officers. APD must take advantage of this with a recruiting campaign to reach out to the hundreds of officers, statewide, who have retired in the last couple years. That campaign needs to start NOW!
If APD grows the force over 900 by the end of 2018, Geier and Keller deserve all the praise. If APD continues to languish below 900 officers, well, somebody probably needs to be fired. If I were Chief Geier I would be getting my best people on this recruiting campaign immediately. Don’t wait for these officers to come you, go out and get them! Put an ad in the PERA La Voz newsletter. Get a list of retired officers! The opportunity is now, don’t waste it.
Would I come back? The answer is no. I retired in 2003 and even though I think I am still in good shape, my eyes and ears tell me I am not as sharp as I once was. I have substantial hearing loss and I don’t think younger officers would appreciate me always asking, “What did they say?”
Officers who suspend their pensions to come to APD will start with high pay, but low seniority. That means graveyard shift and like sleeping at night. As I get older, I need all the beauty sleep I can get.
I hope this helps retired officers in their decision making. If you have other questions contact APD Recruiting (505 343 5040 or at www.apdonline.com)