The controversial program that pays veteran Los Angeles police officers and firefighters nearly double for the last five years of their careers received a flood of new enrollees in February, records show.
The rush to join the Deferred Retirement Option Plan, or DROP program, coincided with a Times investigation in February that found the program, which was created in 2002 to keep veteran officers and firefighters on the job, allows participants to file workers’ compensation claims and then take extended injury leaves at nearly twice their usual pay.
Almost half of the participants who entered DROP from July 2008 to July 2017 subsequently took such leaves, The Times found. Their average absence was 10 months, while hundreds stayed out more than a year, typically with bad backs, sore knees and other ailments that afflict aging bodies regardless of profession.
None of the new DROP enrollees contacted by the newspaper responded to requests for comment on why they chose to sign up in February, though the surge in participants came amid questions about whether the program might be altered or eliminated.
In response to The Times’ report, L.A. Mayor Eric Garcetti and members of the City Council committee that negotiates contracts with police and firefighters called for an investigation to determine whether the program, which was approved by voters on a promise that it would retain officers without creating additional cost for the city, is achieving that goal.
In February, 129 people signed up for the program, according to data provided by the Los Angeles Fire and Police Pension fund. The average monthly enrollment is 25 new members.
February was the first month in more than six years with more than 100 new enrollees and was the largest one-month class since the program’s inception in May 2002, when 389 people signed up.
LAPD spokesman Josh Rubenstein said he doubted the surge was driven by fear of changes and cited several other possible explanations, including annual February upticks in enrollment for tax reasons, a large recruiting class 30 years ago whose members who are now entering retirement age and Chief Charlie Beck’s announcement in January that he is retiring.
“There may be some people who say if he’s retiring, maybe it’s time for me to go too,” Rubenstein said.
In 2016, the City Administrative Officer recommended eliminating the program because it no longer was necessary as a tool for retention and it had never been cost-effective. But, he added, there would be a “surge” of people into the program once word got out that it was in its final days.
Local government agencies across the country, including San Francisco and San Diego, already had abandoned DROP programs after finding they were too costly.
Garcetti and council members Mitchell Englander, Paul Koretz, Herb Wesson and Paul Krekorian — all of whom receive significant financial support from the city’s police and fire unions — ignored the recommendation in 2016.
In recent months, Garcetti has repeatedly voiced his support for continuing the program with some adjustments. One reform under consideration, he said last month, is the suspension of pension payments to participants in the program while they are on injury leave, an idea borrowed from San Francisco’s now-defunct DROP policy. “That’s one easy quick fix that I certainly would support,” Garcetti said.
To become eligible for DROP, police and firefighters must be 50 years old and have at least 25 years of experience. At that point, they can choose to keep working and receiving their salary, retire with a pension of up to 90% of their salary or get both — working while collecting their salary and pension simultaneously for up to five years.
So far, the program has distributed more than $1.6 billion in early pension payments. On average, participants who left DROP in 2016 walked away with an extra $434,000.
Mayoral spokesman Alex Comisar said the rush of new DROP participants won’t hurt the departments because administrators still have “five years to plan, which is one of the principal benefits of the program.”
Among the cases highlighted in The Times’ investigation were a firefighter who took injury leave for a bad back and knees but kept working his second job as a longshoreman and a married couple, a police captain and detective, who both filed claims for carpal tunnel syndrome and other cumulative injuries and then took two years off, spending some of that time starting a family business and vacationing at their condo in Cabo San Lucas.
The couple collected just shy of $2 million for their time in DROP.
In a televised interview about DROP days after The Times’ story was published, Garcetti touted the LAPD’s unit dedicated to investigating fraud by fellow officers and other city employees. He said there were cases in the works, adding, “You’ll hear, probably in the next month, about some of those prosecutions moving forward.”
Since then, there has been one arrest. Terry Johns, 56, had been retired from the LAPD for two years when police took him into custody March 8 on a felony warrant for workers’ compensation fraud. After 32 years on the force, he retired as a Police Officer II, one of the lowest ranks in the department.
Johns entered DROP in July 2014 and filed a claim for a bad back the next month, public records show. At a news conference announcing the arrest in March, Chief Beck said internal affairs investigators had observed Johns engaged in activity “inconsistent” with his claimed injuries but refused to offer further details.
Department officials offered no new details on the case late last week. Johns could not be reached for comment.
Asked whether any officers besides Johns have been arrested or disciplined in any way for abusing injury leave, LAPD spokesman Rubenstein said, “Since that one, there has been none that I know of.”
“I wouldn’t say that there’s any kind of special initiative,” Rubenstein said of combating workers’ comp fraud in the LAPD ranks. “I think we are always looking at it.”
No DROP participant other than Johns has been prosecuted for workers’ compensation fraud since the program’s inception, court records show.
City administrators offered no timeline last week for when their investigation of the DROP program will be complete.
A letter from the Garcetti administration to the fire and police pension fund to initiate an actuarial study — key to determining whether DROP is truly “cost neutral” as promised to voters — still has not been received, according to Ray Ciranna, general manager of the fund.