A recent posting by North Carolina State Senator Andy Wells identified the Alexander County School System for an example of “Pension Spiking” After digging into the matter, it appears the senator’s assertion is incorrect.
“Pension Spiking” is a method by which a person is given a substantial raise before retirement for the purpose of increasing their retirement benefits. Governor McCrory signed into law a measure to curb the practice in 2014.
In July of 2015 the local school system was required to reimburse the state the sum of $65,000. This followed the retirement of then Associate Superintendent of Schools Dr. Jeff Peal. According to School System Finance Director Sharon Mehaffey the money paid to the state was “completely above board and in no way an effort to pad Mr. Peals salary.”
A look at the last four years of Peal’s compensation reveals that the only significant change was his final year of employment after he received compensation for unused sick and vacation time he had accrued over his 29 years of employment.
Mehaffey says the difference was “totally the result of accrued sick and vacation time along with the interest, and annuity factor. His last contract was negotiated in 2013.”
Senator Wells in his posting on his website andywells.org named several other school systems in the state including Johnston County who had to pay over $500,000 and Hickory City Schools who paid back in excess of $169,000.
An effort to reach Senator Wells for comment was unsuccessful.