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State workers boost salary in final years to inflate pensions; Post-retirement pay can eclipse salary

Cashing in unused sick time and vacation days at the end of his career pumped up former Niagara Falls School Superintendent Carmen A. Granto Jr.'s annual pension beyond what he had made in his annual paycheck.

Granto is getting a $147,109 annual state pension in retirement.

He was making $129,000 a year when he retired in 2009.

How'd he do it?

The same way others before him did.

Granto cashed in 45 unused vacation days and 747 accumulated sick days during the final years of his career, boosting his salary to over $200,000 in the two years he worked before retiring.

Under the terms of his contract, as well as state regulations for retirees hired before 1971, the inflated salary was used to calculate a five-year average salary that was the basis of Granto's pension. Granto therefore received a pension based on a $182,000 salary.

As a result, the former school superintendent has the third highest state pension in Western New York, according to a Buffalo News analysis of 2009 state pension data recently released by the Empire Center for New York State Policy on its SeeThroughNY Web site.

The only local state pensioners collecting more, the analysis found, are a Roswell Park research scientist/administrator who receives a combined state pension and paycheck exceeding $400,000, and another retired school superintendent, John H. George, who left the North Tonawanda School District in 2006 with a $205,809 pension -- some $22,000 more than his $184,417 annual salary. George's pension -- which was the subject of previous articles in The News' series "Public Pensions: Cashing In" -- was also pumped up with accumulated sick and vacation time.

>Educators' pensions

Granto makes no apologies for his pension. "I put in my 42 years, and they were the rules," Granto said. "You follow the rules. For the last three years, I cashed in those days. Obviously, that raises your average salary."

George had similar comments when discussing his pension in the past.

"I wouldn't apologize for it," George has told The News. "It was some unusual circumstances I happened to be in that resulted in that. I certainly paid my dues."

Recent analyses by the Empire Center for New York State Policy, a conservative think tank associated with New York's Manhattan Institute, of 2009 pension data found almost 2,400 retirees in the state retirement system -- covering municipal and state workers, as well as educators -- with pensions that top $100,000.

One exceeds $300,000 a year. Sixteen others are over $200,000.

All but three of these 17 pensions topping $200,000 go to retired educators, most from downstate.

Locally, The News identified 40 Western New York retirees with pensions exceeding $100,000.

Two of the local pensioners are among those receiving over $200,000.

They are George, the retired North Tonawanda school superintendent; and Youcef Rustum, an internationally known cancer research scientist who retired from Roswell Park Cancer Institute in 2008, at age 68, with a $203,102 pension, according to payroll and pension records. His 2008 salary was $340,182, Roswell Park officials confirmed.

Following his retirement, Rustum was asked by hospital officials to return to Roswell Park to head up the center's Cancer Biology Department and to serve as an international representative for the hospital. He earned $207,918 from Roswell Park in 2009, Roswell officials confirmed. Rustum's combined 2009 pay and pension exceeded $411,000, records show.

State law permits such "double dipping" -- collecting a paycheck and pension from a state employer -- without any financial penalties if the employee is at least age 62.

"His unique combination of administrative skills, research renown and international recognition made him an excellent choice to fill the difficult-to-recruit position while also assisting RPCI in enhancing its international reputation as a cancer care and research center of excellence," Roswell Park administrators said in a statement when asked about Rustum remaining on the Roswell Park payroll while also collecting a pension.

Of the 40 local retirees receiving pensions of more than $100,000, 21 are educators. Most, like Granto, were superintendents; a couple were school principals.

Fourteen of the 40 pensioners are in the medical community, primarily at Roswell Park.

One is a Buffalo firefighter. Two others are Buffalo police officers.

>Police and fire pensions

The rising number of police and firefighters with pensions exceeding $100,000 is among the more notable recent trends in the pension data statewide, the Empire Center found.

The percentage of newly retired police and firefighters with six-figure pensions rose from less than 2 percent of those who retired in 2000 to 13 percent of 2009 retirees, the center found. The increase in police and fire pensions reflects rising salaries, especially in downstate suburbs, the center found.

In Buffalo, the six-figure police and fire pensions generally reflect massive amounts of overtime some police and firefighters work in their final years on the job, often as a way to pump up their pensions.

In "Public Pensions: Cashing In," published in 2008 and 2009, The News found police and firefighters pumping up their salaries by as much as $100,000 in their final years on the job, resulting in pensions that sometimes exceeded their base pay.

For example, retired fire Battalion Chief Ronald J. Morganti, who is collecting a $125,930 pension, had a base pay of $71,524 when he retired from the Fire Department in 2008. However, Morganti had pumped his salary up with more than $100,000 in overtime in a 12-month period before his retirement, resulting in his higher pension.

Similarly, that's also how Police Officer Jerry R. Stover ended up with a $108,987 pension, and how Police Officer Patrick J. McDonald ended up with a $105,361 pension.

With a base pay of $60,000, each used overtime to boost their annual salaries beyond $150,000 in their final years with the force, with that inflated number being used to calculate their pensions.

>Highest state pensions

The News also documented, as part of that series, inflated educator pensions, particularly among educators like George and Granto, who were hired before 1971. For educators hired after that, the state no longer permits lump-sum payments for unused sick and vacation time to be included in pension calculations.

Statewide, the largest educator pension goes to James H. Hunderford, who retired as superintendent of a Long Island school district in 2008, with a $316,245 annual pension. After retiring, Hunderford resumed working as superintendent of a different Long Island school district, making $225,000 a year while continuing to collect his pension.

Locally, the educator with the highest pension, North Tonawanda's George, has said he was not returning to the work force upon retirement.

Granto, with the area's second-highest educator pension, has no plans to return to public employment, but he is working full-time for the consulting firm that he worked with on a part-time basis prior to retiring, Border River Management.

The educators are covered under the New York State Teachers Retirement System pension program.

Most other local and state government employees, including those working for the Teachers Retirement System office itself, are covered by the state Employees Retirement System. Others are with the state Police & Fire Retirement System.

The retiree from those systems with the biggest pension is George M. Philip, the former head of the New York State Teachers Retirement System. He retired in 2007 with a $261,037 pension. Following his retirement, Philip was named president of the State University at Albany, making $280,000. His combined pension and SUNY salary top $540,000.