Hiring of Counsel in Pension Probe OKd : L.A. County: Supervisors take step after angry Molina fails in her effort to overturn retirement pay rules.

Los Angeles County supervisors on Tuesday balked at repealing controversial pension rules that have cost the cash-strapped county $265 million. Instead, the board voted unanimously to hire independent legal counsel to assist in twin investigations of the unusual retirement program.

The decision to beef up two ongoing studies of the retirement system came after Supervisor Gloria Molina delivered a blistering hourlong condemnation of senior county staff members, who she said unilaterally--and improperly--implemented the lucrative pension rules.

Despite Molina’s attack on Chief Administrative Officer Richard B. Dixon and County Counsel DeWitt Clinton, she lacked board support for her motion to rescind the pension rules. Molina, however, said she intends to push for at least a partial repeal after the investigations are finished.

In an uncharacteristically hostile exchange, county executives at times shouted their defense over Molina’s constant attack. The bureaucrats maintained that the pension changes are legal, proper and were adopted with the full knowledge of the Board of Supervisors.

When Molina called the new rules “a big boo-boo,” Clinton spit back: “I’m dead right.”

“Then it’s the taxpayers that are the big losers,” retorted Molina, who was not on the board when the changes were approved early last year.

Opposition to the pension rules, which would boost retirement pay of some supervisors to more than $125,000 annually, is also building among taxpayer groups.

Jay Curtis, president of Los Angeles Taxpayers Assn., and Joel Fox, president of the Howard Jarvis Taxpayers Assn., said the groups are planning a legal challenge to the pension plan.

“We intend to overturn what they did,” said Curtis.

The pension rules--adopted quietly last year without study of their financial impact--provide that certain fringe benefits such as car and medical insurance allowances be counted with salaries when retirement pay is calculated.

Although some changes eventually will benefit most county employees, the largest gains in retirement income will go to members of the Board of Supervisors and top county managers. Under the rules, retirement benefits of county supervisors and senior county executives are boosted by 19%, giving some officials pensions of more than $125,000 a year.

Calling the pension rules “unconscionable” and “an egregious abuse of the governmental process,” Curtis said the plan “is clearly improper and does not comply with law of California.”

Fox said the two organizations may file a lawsuit challenging the pension rules as early as today.

Last week, a county study concluded that the rule changes have created a liability of $265 million and will cost the county at least $18 million annually for the next 30 years.

And in a slap at Los Angeles County officials, state lawmakers last week voted unanimously to overturn an obscure law used by county officials to adopt the pension changes. The measure, sent to Gov. Pete Wilson by the Senate on a 34-0 vote, was introduced to correct the county’s misinterpretation of an existing state law, according to the bill’s author, Sen. Cecil Green (D-Norwalk).

Earlier this month, the Board of Supervisors ordered two county panels--the Productivity Commission and the Economy and Efficiency Commission--to study the rules, their financial impact and the process under which they were adopted. Commission staff members have said the studies could take months to complete.

But as supervisors Tuesday approved hiring outside lawyers to help with the reviews, they told the commissions to complete their studies in two weeks.