Audit: Oregon Public Employees Not “Spiking” Pensions

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The Oregon Secretary of State’s office has released the results of an audit that investigated the possibility that Public Employee Retirement System workers were “spiking” their pensions in the years before retiring.

The audit, which was conducted to determine whether “spiking” played a part in the retirement system’s rising costs, found no evidence that such a tactic is practiced.

[The audit can be found here.]

From the Statesman Journal:

PERS costs may have risen, auditors said, but “spiking” wasn’t the reason.

State auditors examined more than 14,000 PERS records for people who retired between 2010 and 2013. They found the records showed no “systemic pension inflation or salary growth issues.”

“We also found that provisions of individual employment contracts may have an effect on pension payouts. However, the inflation of pensions, either intentional or unintentional, appears infrequent,” the auditors wrote.

“The impact on PERS appears to be negligible.”


Most retirees use a formula that is based on an average of their final three years of salary and the number of years they have worked as a member of PERS.

That formula can theoretically be manipulated if an employee suddenly receives abnormally large raises at the end of his or her career or some other type of large, abrupt compensation.

It’s called “spiking” — the act of making a salary and the resulting pension suddenly jump into the stratosphere.

However, in nearly every case state auditors found suspicious (and there were very few), the “spike” in salary was explained by a completely normal employment event, auditors said.

The full audit can be read here.


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