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California Supreme Court hears challenge to San Diego's pension changes

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Posted at 1:00 PM, May 29, 2018
and last updated 2018-05-29 16:00:18-04

(KGTV) - The state Supreme Court started hearing oral arguments Tuesday in San Francisco over San Diego’s pension changes that were approved by voters six years ago.

More than 65 percent of San Diegans voted for Proposition B, the "Citizens Pension Reform Initiative" which switched most new city workers to a 401(k) plan instead of a guaranteed pension.

Ever since then the measure has been challenged by labor unions. 

The Public Employment Relations Board (PERB) has been trying to overturn the pension cutbacks in court and now it’s in front of the state Supreme Court.

The court will review the Fourth District Court of Appeal’s 2017 ruling on the issue.

The focus then was on whether former San Diego city leaders illegally put Prop B on the ballot because they did not meet and confer with the labor union first. 

The appellate court ruled in favor of the city then.

Now, political analyst John Dadian says if the Supreme Court rules in favor of the labor union, the city could be upside-down millions of dollars, directly impacting taxpayers.

“Taxpayers should be very scared,” said Dadian.  “They could have to go back and retroactively give the original pension benefits to the new 3,000 employees and that would be horrendous.”

Dadian says there is still hope for the city if the court rules in favor of the union.

“If it rules against the city they have several options, they could craft a new one (prop) to go back on the ballot and it could possibly go to federal court,” said Dadian.

After Tuesday’s hearing, the court has 90 days to make a ruling.