Judge to consider settlement on San Diego vs. SDCERS case

SAN DIEGO - A hearing is scheduled Friday to consider a proposed settlement of a case designed to clarify a San Diego City Charter section that requires the municipal government and employees to make substantially equal retirement contributions.

The long-running litigation pitted the city of San Diego against the San Diego City Employees Retirement System, which operates the pension plan for municipal workers.

City Attorney Jan Goldsmith filed suit three years ago, contending the clause didn't mean the city had to make up for SDCERS investment losses or actuarial changes. The litigation was designed to save the city tens of millions of dollars through lower annual contributions to the pension system.

However, the City Council decided in October to settle the case. Interim Mayor Todd Gloria said at the time that settling was appropriate, given that the city was implementing a voter-passed pension reform initiative and negotiated a five-year labor deal with employees.

According to Goldsmith, the ballot measure prohibits the city from contributing more than an equal amount to SDCERS unless the City Council does so as part of a good faith settlement of the lawsuit.

Gloria, Councilman Mark Kersey and other city officials submitted declarations to the court that, given the city's gains with the ballot measure and labor contract, they didn't want to increase the burden on city employees.

Judge Joseph Zimmerman will have to decide whether the City Council's decision to settle was motivated by a good faith policy decision or whether there was some ulterior motive, Goldsmith said.

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