CSU professors paid to keep CalPERS pension credit

California State University Chico cut a former professor’s pension after determining he rarely worked for 10 years, but failed to cut the pensions of at least five other faculty members who took time off in similar circumstances, according to court records.

Former professor Abdel-Moaty Fayek arrived last week after a long legal fight to try to restore his pension, when the state Supreme Court informed his lawyer that it would not reconsider his case .

Fayek, a computer science professor, sued CSU Chico and CalPERS in 2013 after university officials told him they were cutting 10.5 years of service credit from his CalPERS pension. The decision cost him thousands of dollars a year in expected retirement income.

From 1997 to 2007, Fayek was on leave, operating several IT-related businesses.

Although he rarely taught during this time, Fayek continued to accumulate service credits through a “self-funded buyout” agreement approved by his supervisor. He continued to receive his salary but returned the money to the CSU Chico Research Foundation, now known as Chico State Enterprises.

A court document filed in the case shows that CSU Chico approved the buyouts of at least five other faculty members from 1996 to 2008.

CSU Chico did not answer questions about why the university revoked part of Fayek’s pension but not the others.

CalPERS spokeswoman Amy Morgan said the pension fund looked at the other pensions after they appeared in court documents and found “no integrity issues or anything unusual” in the other five.

Over the 10.5 years, Fayek paid approximately $ 650,000 to the CSU Foundation as part of its arrangement, according to the lawsuit filed in his lawsuit. The money came from his salary and the 5% fees he paid for most years.

The other agreements, detailed in a document that Fayek’s lawyer said was produced by the defendants as part of the lawsuit, reflect lower amounts paid to the foundation for shorter periods than Fayek’s.

Pension plan approved by the Dean of CSU

One of the other agreements lasted five years. Another seemed to be for three semesters. Two were for one year, and one was for a single semester.

Kenneth Derucher, the former dean of the College of Engineering, Computer Science and Technology at Chico, approved the buyout of Fayek and three of the other five deals. Other directors approved the other two.

Most CSU employees accumulate retirement benefits at a base rate of 2% of their salary per year of service, meaning that a person retiring with 35 years of service would expect to earn around 70% of his salary at retirement.

Fayek’s attorney, George Allen, said the records suggest the university targeted Fayek by cutting his pension and not the others.

“From the documents they produced, it appears to be a widespread practice,” Allen said. “And for no reason that was never given to Dr. Fayek, they decided they just weren’t going to honor the deal with him.”

Third District Court of Appeal judge Coleman Blease used strong language to describe Fayek’s arrangement.

“The entire alleged deal appears to be a ploy designed precisely to allow the claimant to circumvent (state law) requirements and accumulate service credits for retirement without rendering the services for which he was paid, ”Blease wrote in his July 9 decision.

“How does that benefit the campus?” “

The lawsuit also revealed a letter from a CSU auditor to the CSU Chico Research Foundation requesting information on three of the faculty member buyout agreements, including Fayek’s.

In the 2001 letter, Auditor Ed Soria said that projects for which faculty members typically take time off often receive funding from outside sources.

“Review of the files referenced above indicates that (faculty members) provided all of the funding for the projects that basically funded the buyout of their own time,” Soria wrote. “How does this benefit the campus … has a formal proposal been submitted for review and approval?” “

In response, Jeff Wright, then director of the research foundation’s sponsored programs office in Chico, said the arrangements gave grantees the opportunity to pursue “professional development activities of various kinds that help them stay active and work out. day in their disciplines “.

“The nature of these personal professional development agreements does not imply proposals but rather agreements made between the individual faculty member and the dean,” Wright wrote. “The dean has the authority to make and approve such arrangements.”

Fayek returned from leave in 2006. In 2007, he became chairman of the computer science department, according to court documents. He retired in 2012.

This story was originally published October 31, 2019 6:00 a.m.

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Wes Venteicher presents the popular cover of The Bee’s State Worker in the newspaper’s Capitol Office. It covers taxes, pensions, labor, state expenses, and the California government. Originally from Montana, he reported on healthcare and politics in Chicago and Pittsburgh before joining The Bee in 2018.