I wanted to walk you through a troubling situation that CalMatters Housing recently reported on, because it involves something every government retiree in California needs to understand. A woman named Linda Samsom spent decades working in local government and retired from Riverside County. After she left, the Yolo County Sheriff's Office asked her to help set up a new department, and she took on part-time consulting work to assist them. She was doing what she thought was legitimate work, earning around eighty thousand dollars over the years she worked there, while also collecting her monthly pension of ten thousand dollars.
Then CalPERS, the massive state pension fund, sent her a letter that basically turned her world upside down. The pension fund claimed she had violated state law and demanded she repay over a million dollars, which represented every penny of her pension payments during the time she worked that consulting job. Alternatively, they offered to cut her pension in half permanently. According to CalMatters, Samsom's story is not isolated. The pension fund's audit office determined that her hourly rate was slightly higher than what a comparable government employee would make, and that violation triggered these enormous financial demands.
What's particularly concerning is that CalPERS has been doing this to other retirees as well. According to the reporting, several government employees who took on part-time work, sometimes with the blessing of their employers, received similar shocking demands for repayment of up to a million dollars or more. CalMatters noted that some of these cases, like one involving a man named David Dowswell who worked through a private consulting company for the city of Dixon, eventually went to settlement after years of legal battles. The common thread is that people believed they were following the law, their employers thought they approved the arrangements, and yet CalPERS came after them years later with enormous bills.
Samsom has now filed a lawsuit against CalPERS, and according to CalMatters, her legal team argues that the pension fund is ignoring a three-year statute of limitations on pension errors and that the penalties are excessive. CalPERS maintains there is no time limit on violations because they believe retirees are intentionally trying to game the system rather than making honest mistakes. The pension fund's office of audit services is tasked with preventing double-dipping, where someone collects a government salary while also drawing a pension, but there's real disagreement about how aggressively this should be enforced.
CalMatters also reported that the Legislature recently passed a bill requiring CalPERS to give better notice of audits to employers and for those employers to notify public employee unions about investigations. One of California's largest unions, the California School Employees Association, pushed for this change because members were getting caught in these audits without warning and facing massive repayment demands. The situation highlights a disconnect between what retirees and employers think is allowed and what CalPERS decides was unlawful years after the fact.
What I am seeing locally in the Bay Area and across the East Bay is that this creates real anxiety for anyone thinking about part-time or consulting work after they retire from government. The stakes are tremendously high, and the rules seem to be applied retroactively in ways that catch people by surprise. For buyers and sellers, this matters because government employees make up a significant portion of our homeowner base, and their retirement security directly impacts their ability to stay in their homes or plan their financial futures. Until there's clarity about statute of limitations and how penalties are calculated, anyone in a government pension plan needs to be extremely careful about any work they consider taking on after they retire.
