Under Proposed SFPD Budget 55 year old Sergeant with 30 years and in the DROP program would be making over $1,000 daily or $310,000 yearly

Campers,

I ran this by Chat Gpt and we had the following conversation  …

Keep in mind that with the just-passed Prop E that cops will have far less accountability and with drones and cameras be further removed from regular physical contact with the Public.

Me and Chat  …

Hell Chat. Can you tell me about LAPD’s DROP program its history and present status and tie it into the SF proposed program and are there tiers for years of service ?Memory updated

LAPD’s DROP Program:

History and Purpose:

• Deferred Retirement Option Plan (DROP)was introduced by the Los Angeles Police Department (LAPD) in 2002.
• The program was designed to retain experienced officers who were eligible for retirement by allowing them to continue working while their pension benefits are deposited into a separate account.
• Officers could participate in the DROP for up to five years, during which their regular retirement benefits would accrue interest in the DROP account.

How It Works:

• Officers must be eligible for retirement, which typically means having completed 25 years of service and being at least 50 years old.
• Once enrolled, their pension benefits are calculated as if they retired on that day, and those benefits are deposited into an interest-bearing account while they continue to receive their regular salary.
• At the end of the DROP period (up to 5 years), officers retire and receive the accumulated amount in the DROP account in addition to their ongoing pension benefits.

Present Status:

• The program has faced scrutiny and calls for reform due to its financial impact and concerns about officers gaming the system.
• Recent audits and reports have highlighted the high costs associated with the program and instances where officers have taken prolonged medical leave while in the DROP program, raising questions about its effectiveness and sustainability.
• Reforms have been proposed to address these issues, including stricter eligibility criteria and oversight.

San Francisco Proposed Program:

San Francisco has proposed a similar program inspired by the LAPD’s DROP, aiming to:

• Retain experienced officers in the police force by offering financial incentives.
• Address staffing shortages and maintain a higher level of experienced personnel.
• The program is still under consideration, with discussions focusing on its structure, eligibility criteria, and potential financial impact.

Tiers for Years of Service:

Both the LAPD’s DROP program and the proposed San Francisco program generally include tiers based on years of service. The details can vary, but typically:

• Officers with a certain minimum number of years of service (e.g., 20-25 years) are eligible to participate.
• Additional incentives or benefits might be offered for those with longer service periods.
• The structure and specifics of the tiers are designed to balance the retention of experienced officers with the financial sustainability of the program.

These programs aim to address the dual challenges of retaining experienced officers and managing the financial implications for the city’s budget. The success and sustainability of such programs depend on careful planning and ongoing assessment to ensure they meet their goals without creating undue financial strain.

4o

So, Chat does LA still have their DROP program and am I right that an officer (sergeant, say) with 30 years service at 55 years of age making $185k base salary and with a pension of $125k invested at guaranteed rate of 5% until they retire after 5 years would get a payout of about 700k at retirement lump sum then continue making 125k yearly retirement at 60?

Yes, the LAPD still has its DROP program, although it has been under scrutiny and subject to calls for reform.

Regarding your example calculation:

1. Officer Profile:
   • Service years: 30 years
   • Age: 55 years
   • Base salary: $185,000
   • Pension: $125,000 per year
   • DROP participation period: 5 years
   • Interest rate: 5% (compounded annually)
2. Pension Accumulation in DROP:
   • The officer’s pension of $125,000 per year is deposited into a DROP account with a guaranteed interest rate of 5% annually.

Let’s calculate the DROP payout at the end of 5 years:

• Year 1: $125,000
• Year 2: $125,000 + ($125,000 * 5%) = $125,000 + $6,250 = $131,250
• Year 3: $125,000 + ($256,250 * 5%) = $125,000 + $12,812.50 = $137,812.50
• Year 4: $125,000 + ($394,062.50 * 5%) = $125,000 + $19,703.13 = $144,703.13
• Year 5: $125,000 + ($538,765.63 * 5%) = $125,000 + $26,938.28 = $151,938.28

Adding these amounts together gives us the total accumulated in the DROP account over 5 years:

Total DROP Account=125,000+131,250+137,812.50+144,703.13+151,938.28

Let me calculate this sum for you.

The total accumulated amount in the DROP account at the end of 5 years, given the conditions you specified, would be approximately $725,239.

After retiring at age 60, the officer would receive this lump sum in addition to continuing to receive their annual pension of $125,000. 

4o

So, our theoretical sergeant while in the program would be accumulating wealth at a clip of around $310k yearly or around $6k weekly ?

Yes, let’s break that down:

1. Annual Earnings while in DROP:
   • Base salary: $185,000
   • Pension deposited into DROP account: $125,000
   • Total annual earnings: $185,000 + $125,000 = $310,000
2. Weekly Earnings:
   • Total annual earnings: $310,000
   • Weekly earnings: $310,000 / 52 weeks ≈ $5,962

So, the sergeant would indeed be accumulating wealth at a rate of approximately $310,000 annually or around $6,000 weekly while participating in the DROP program.

4o

What if the officer after continuing years of eligibility in DROP decided to keep working how would their salary and retirement be affected please ?

If an officer continues to work beyond the initial 5-year DROP period, the effects on their salary and retirement benefits depend on the specific rules and regulations of the LAPD’s DROP program and any reforms or changes made to it. Here’s a general outline based on typical DROP program structures:

1. Salary:
   • The officer would continue to receive their regular salary. In your example, this would be the base salary of $185,000 (subject to any raises or adjustments over time).
2. Pension Accumulation:
   • Once the officer completes the 5-year DROP period, their pension benefits typically stop being deposited into the DROP account.
   • The pension benefits that have been accumulating in the DROP account during the 5-year period would be paid out as a lump sum.
   • The officer’s regular pension (e.g., $125,000 per year) would resume once they fully retire, but during any additional working years beyond the 5-year DROP period, they would not be accumulating additional pension benefits in a DROP account.
3. Impact on Retirement Benefits:
   • The officer’s pension would have already been calculated based on their service and salary at the time they entered the DROP program. This amount would remain fixed.
   • Any additional working years beyond the DROP period would not increase the pension amount since it was already calculated and frozen at the time of entering DROP.
   • The lump sum from the DROP account is a one-time payment, and any subsequent working years would not contribute additional amounts to this account.
4. Example Scenario:
   • If the officer decides to work for 2 more years after the 5-year DROP period, they would continue to receive their base salary ($185,000) during these 2 years.
   • They would not receive the $125,000 annual pension during these additional working years, as they are still actively employed.
   • Once they finally retire, they would start receiving their annual pension of $125,000 again.

In summary, while the officer continues to work beyond the DROP period, their salary would continue as usual, but they would not receive additional pension contributions to the DROP account. Upon eventual retirement, they would receive their fixed pension amount and any lump sum accumulated during the initial DROP period.