Former Honolulu Police Cpl. Darius Evangelista worked a high level of overtime throughout his 28-year career. 

The Police Files Project BadgeBut in his final two years on the force, he went into overdrive.

With his wife’s blessing, he volunteered to return to nighttime patrol, making up to three drunken driving arrests per night, he said. Those arrests then required more overtime for court appearances and resulted in Evangelista logging an average of about 1,200 overtime hours in each of his last two years. 

It was no secret that he was putting in the extra effort to boost his pension, he said. 

“Everybody knew what I was doing,” said Evangelista, who retired in lieu of termination amid a disciplinary proceeding in 2019. “And honestly, everybody else in the department is doing the exact same thing.”

At the Honolulu Police Department, where overtime has reached new heights in recent years, some veteran officers’ overtime hours have skyrocketed ahead of their retirements, and they stand to reap extraordinary benefits because of it, according to an analysis of six years of HPD overtime data Civil Beat obtained after suing the city

The overtime not only jacks up their annual income but also sets them up to receive higher pension checks for the rest of their lives. That’s because pension payments for most government workers are based on the average of their highest three years of earnings, including overtime.

The practice, called pension spiking, is legal. It persists despite a change in state law in 2012 aimed at curbing it. That’s because lawmakers only applied the new rule to employees hired after July 2012. Legislators said they were concerned that changing the rules for current employees could be unconstitutional, although other states have successfully implemented spiking limits on existing employees. 

HPD police officers on ATV before the start of teh Aloha Freedom Coalition march from the Honolulu Zoo.
Honolulu police employees are driving up increases in city pension costs. Cory Lum/Civil Beat/2021

As it is, the full impact of Hawaii’s law won’t be seen until after longtime employees retire, which will take decades. 

In the meantime, spiking continues to impact the state pension system and is a fast-growing financial burden for the city, according to the Hawaii Employees’ Retirement System. 

Pensions are supposed to be paid by employee and employer contributions, which the ERS invests. Upon retirement, the ERS then pays the retiree a pension based on a formula that accounts for their years of service and their average income in their final years on the job.

When an employee earns substantially more than the ERS had anticipated, the ERS bills the employer – in this case, Honolulu – for the difference. Overtime is the main driver of spiking, according to the ERS, although pay differentials, bonuses and lump-sum salary supplements also count. 

In the end, county taxpayers are left holding the bag to the tune of tens of millions every year. 

From fiscal year 2017 through 2021, annual costs associated with spiking in Honolulu rose from about $5.3 million to nearly $40 million, ERS data shows, and the police department was responsible for more than any other single department. 

Spiking charges related to HPD alone rose from $2.3 million to $23.8 million in that time period – more than twice the rate of increase for spiking costs among non-police employees.

That comes at a serious cost to the public taxpayer,” said Sandy Ma, executive director of the government accountability nonprofit Common Cause Hawaii. “There have to be some reasonable limits, you would think.” 

But in fact, there are no limits. Officers have been allowed to sign up for as much or as little overtime as they want, former officers said.  

For example, five years before he retired from HPD, Cpl. Thayne Costa didn’t show much interest in overtime. He logged only 24 hours for the entirety of fiscal year 2016.

But in the 2019 fiscal year, he worked 2,335.5 hours of overtime, city data shows, and the following year, he topped that with 2,485.5 hours. Three-quarters of the way through calendar year 2019, he had already boosted his earnings for the year to over $340,000, according to internal HPD records obtained by Civil Beat last year. 

Costa, 49, retired at the end of 2020 after a nearly 30-year career. But taxpayers will continue to pay him at a rate that exceeds the mayor’s annual salary of $186,000 thanks to his fortuitously timed overtime bump. 

Without overtime, his base salary in his last full year of work was only $72,000. 

From fiscal year 2017 through 2021, 171 HPD employees triggered excess pension payments from the city, according to the ERS. That’s about 40% of the HPD employees who retired in that time period, according to retirement data provided by HPD.

HPD Interim Chief Rade Vanic speaks during a Weed and Seed press conference held at Kekaulike Mall.
HPD Interim Chief Rade Vanic said it is "unacceptable" for officers to spike their pensions. Cory Lum/Civil Beat/2021

“A lot of people see the plan as a big social benefit and no one is harmed by them getting additional monies out of it,” ERS Director Thomas Williams said. “But the fact is that everybody pays that cost. The other members, the employers, the taxpayers are responsible … I think it’s unfair.” 

Interim Police Chief Rade Vanic, who many believe is in the running to keep the job permanently, declined to be interviewed for this story. 

In a statement, he said the nature of police work requires some overtime, including to submit incident reports, investigate active leads, testify in court or respond to critical situations. 

In all of these situations, officers are and should be financially compensated,” he said. “Unfortunately, we have had employees who took advantage of overtime work and pay to raise their pensions. This is unacceptable.” 

Earlier this year, City Council Chair Tommy Waters called for an audit into police overtime policies and procedures, noting that overtime pay factors into veteran officers’ retirements. The audit is not scheduled to be completed until next year, according to the auditor’s office. 

In his statement, Vanic said HPD is working with the auditor “to evaluate the department’s overtime policies and expenditures and to develop ways to flag and identify potential abuse.”

“Currently commanders are provided with periodic reports and limited online access to help monitor the overtime costs in their divisions,” he said. “We look forward to the auditor’s report and ways to provide commanders with more accurate, up-to-date overtime information.” 

When asked about spiking earlier this year, Mayor Rick Blangiardi said he didn’t have a plan to address it. 

In a memo to Civil Beat, Budget and Fiscal Services Director Andy Kawano said it's up to individual department heads to bring spiking costs down.

How Overtime Leads To Pension Bumps

Here’s an example of how pension spiking works: A 55-year-old police officer with 29 years of service would receive an annual pension benefit of $87,000, according to the ERS. 

But every $10,000 bump in their “average final compensation” – the average of their highest-paid three years – results in an additional annual benefit of $7,250.

So a $10,000 bump would result in an annual pension benefit of $94,250. A $20,000 bump would lead to a pension of $101,500, and so on.

For each $10,000 increase to that hypothetical person’s earnings, city taxpayers have to pay $112,839 in excess costs. That's an upfront charge to taxpayers to cover the excesses over the person's expected lifetime

If the person in the above example lived to the age of 85, their total pension payout would be $2.6 million, not taking into account the added amount from spiking.

An example of how a worker's extra earnings from overtime increases their pension and results in additional cost to taxpayers

With enough overtime, some employees are able to increase their annual pay by much more than $10,000 or $20,000, the data obtained by Civil Beat showed. In 2019, several police officers more than doubled their base pay with overtime. 

Exactly how much those officers are making or will make in retirement is not public, according to the Hawaii Office of Information Practices. In 2019, the office ruled that such a disclosure would violate employee privacy. And HPD has refused to share data on actual overtime earnings. 

Pension spiking is one factor that has contributed to the ERS’s unfunded liability, Williams said. That’s why legislators in 2012 changed the law so that overtime would no longer be considered in calculating a person’s pension payments. 

However, that change, opposed by public safety worker unions, only affected new employees. Legislators worried about whether impacting existing employees would be constitutional, according to news reports at that time.  

Ma said they were likely concerned about running afoul of the Hawaii Constitution, which states: “​​Membership in any employees' retirement system of the State or any political subdivision thereof shall be a contractual relationship, the accrued benefits of which shall not be diminished or impaired.” 

So anyone hired before July 2012 can still spike their pension as long as supervisors allow it. And that group currently represents about two-thirds of government workers, Williams said. 

“We’ll probably be dealing with this issue another two decades as people end their careers and retire,” he said. “It’s not going to end any time in the next few years.”

Honolulu City Council member Calvin Say sits masked during city council meeting held at Honolulu Hale.
City Council Budget Chair Calvin Say said there isn't much the city or state can do to reign in costs associated with current employees. Cory Lum/Civil Beat/2021

In the view of City Council Budget Chairman Calvin Say, Hawaii’s government is largely powerless to stop pension spiking among current employees. 

The best the city can do is double down on efforts to recruit and retain police officers so that there is less need for overtime overall, according to Say, who was the longtime speaker of the Hawaii House of Representatives. 

He also recently introduced a resolution asking the city administration to submit quarterly reports to the City Council showing overtime totals for each department and the justification for it. 

Say said he does "not necessarily" endorse the idea that a police retiree could earn more than the mayor every year of retirement. 

“But I can’t stop him from doing it," Say said. "If he is within law, so be it. And I just have to accept it.” 

Meanwhile, other states have enacted anti-spiking measures that impact existing employees.

California, which maintains the largest pension system in the country, removed overtime from pension calculations for all employees in 1996.  

Other states have taken action too, according to a breakdown by the National Association of State Retirement Administrators

Massachusetts instituted an anti-spiking provision in 2011 for both current and future retired members, stating that final average salary may not exceed the average of the two prior years by more than 10%, with some exceptions. 

Nebraska implemented a cap on pension benefits in 2014 for current employees and new hires with a final average compensation of $100,000 or above. For those above that limit, either the pensioners or their employer have to pay the increased liability amount, or the pensioner can accept a reduced benefit. 

Last Police Chief Oversaw Unprecedented Overtime Increases

Overtime began ticking up at HPD when former chief Susan Ballard took the helm in late 2017, city data shows.

Honolulu Police Chief Susan Ballard speaks to media about yesterday’s shooting where the suspect died after being shot by officers. April 15, 2021
Honolulu Police Chief Susan Ballard wanted boots on the ground. It came at a cost. Cory Lum/Civil Beat/2021

Her priority was to add staff to the island’s police beats, according to numerous police officers – a worthy goal, they said, but one that came with a cost because the department is perpetually understaffed. 

In fiscal year 2016, before Ballard became chief, officers logged a total of just under 96,000 overtime hours. Overtime that year cost $21.6 million, according to the city. That was on par with levels throughout the previous decade. 

But by the 2019 fiscal year, it had more than doubled to over 230,000 hours, and cost a record-breaking $38.3 million. 

Then Covid-19 happened. 

In the 2020 fiscal year, the first of the pandemic, overtime peaked at nearly 300,000 hours, the data shows, amounting to almost $40 million. The following year, it came down a bit but remained high, with about 212,600 hours.

In mid-2020, the coronavirus was spreading and then-mayor Kirk Caldwell and Ballard ordered a mass law enforcement action in response. An unprecedented ticketing spree commenced, fueled by millions in federal CARES Act money

“They were really pushing the Covid Enforcement Teams,” said Denny Santiago, a retired HPD corporal. 

In the end, almost all the tickets were dismissed, but officers who were nearing retirement may continue to see the fruits of that overtime for years to come. Even though the overtime was funded by federal dollars, it factors into pension payments just like any other overtime, Williams said. 

Santiago said his late-career overtime increase – from 491 hours in fiscal year 2016 to 1,070 in fiscal year 2020 – was a matter of opportunities presenting themselves. 

“The overtime was made available to me, and I worked,” he said. “The command provided it, the command approved it, and yes, I worked it to better my retirement and for the extra pay so I could pay my bills, especially during Covid. My wife didn’t go back to work. It was just my income.” 

The problem is that pension spikers end up with more than their fair share, Williams said.

“We have conversations with the employers and suggest to them that it's their responsibility to constrain this, if at all possible, because it's a big drain on their revenue and they actually have to pay us for these added benefits,” he said. 

Every year, the Employees' Retirement System demands more and more money from Honolulu to cover the cost of pension spiking. Nanea Kalani/Civil Beat

Despite that guidance, HPD leadership hasn’t made any significant moves to stop spiking, officers said. Other than an overtime limit that was supposedly imposed during the pandemic – which was ultimately ignored – officers said there was never any limit on overtime work. 

Ballard said she was concerned about the costs of overtime and pension spiking during her tenure, which ended earlier this year. She said she asked city administrations about having overtime shifts pay a flat rate, such as $60 per hour, rather than time-and-a-half, to control costs.

But administration officials said it couldn't be done, perhaps for technological reasons, she said. Ballard said she didn't believe her idea would have violated officers' union contract.

"They couldn't do it," she said. "And I said, why not? Why can't you work on something like this? If this is an important issue for you, then work on it. But nobody ever got back to me, so I figured that it wasn't that important for them."

She noted that overtime is voluntary. And fortune favors those who sign up.  

"There are just some people that just don't want to work overtime," she said.

The data shows the department has allowed officers to work extraordinarily long hours. 

Costa was likely working upwards of 90 hours a week, on average, during his final days on the force, the data shows. He declined to comment for this story. 

Cpl. Patrick Fo retired at the end of 2019 after 25 years on the job. In the preceding six months, he logged 1,072 hours of overtime – an average of 41 hours per week on top of his regular work hours. 

“I would be worried about public safety for officers like that, if their reflexes are dulled if they’re driving a car or interacting with the public,” Ma said. 

Three-quarters of the way through 2019, Fo had already brought in more than $275,000, according to documents obtained by Civil Beat last year – more than the annual salaries of the mayor and police chief. Civil Beat was unable to reach Fo for comment. 

HPD could curb overtime if it wanted to, according to Evangelista. For instance, the leadership could move high earners who work nights to daytime shifts that don’t lead to court-related overtime, he said. But that’s not to say the union and its members wouldn’t put up a fight. 

“The union could file a complaint,” he said. “But (HPD) could make a legitimate claim that 'We're doing it for staffing purposes.' There are ways. But if you do that, you're going to have a ton of disgruntled employees, and it's not good for morale and command itself.” 

In the end, Evangelista said he doesn’t feel bad about his earnings. 

“All of that work was legitimate,” he said. “Anybody who ever worked with me would acknowledge that I came to work, and I did my job. I admit it, it was done to make a better High 3 for me and my family. I'm not going to apologize for that. And in my opinion, I did it the right way. I earned it.” 

Williams sees it differently. 

“We greatly respect the sacrifices made and services provided by our public servants, whether they are police, fire, teachers or others,” Williams said. 

“That said, no one earns the right to game the system. The added costs are shifted to those who remain in the system and to those who are hired in the future. And, that’s neither fair nor equitable.”

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