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Housing authority taps federal funds to boost employee retirements
Santa Clara County's housing authority could have spent $16 million of federal funds to help more struggling families put a roof over their heads. Instead, it chose to more than double the value of its employees' retirement benefits.

That may sound unusual, but federal housing officials say it was an allowable expense. Still, the switch from a 401(k)-style retirement plan to a pension allowing workers to retire early -- with guaranteed lifetime payments -- is raising eyebrows at a time when generous public employee pensions are under fire.

The housing authority, which bought into the California Public Employees' Retirement System plan in 2009 after stock markets crashed and the nation plunged into a deep recession, already has seen its pension costs inch up. And more hikes may be coming if CalPERS' financial projections don't pan out, as critics predict.

"At the end of the day the government agency is on the hook for the money," said Dan Pellissier, president of California Pension Reform, a group hoping to get a measure aimed at taming public pensions on the ballot.

Bill Anderson, chairman of the Housing Authority of the County of Santa Clara's board of commissioners, conceded that the money spent on employee pensions could have been used in other ways, including housing aid for low-income families.
Indeed, the waiting list for federal housing assistance is so long that applicants must now wait four to nine years....