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City could seek to invalidate landmark pension reform

Posted at 4:59 PM, May 30, 2019
and last updated 2019-05-30 21:49:29-04

SAN DIEGO (KGTV) — The City of San Diego could go to court to invalidate a landmark pension reform measure that voters overwhelmingly supported in 2012.

The City Council is expected to meet in closed session the week June 10 to decide whether to ask a judge to throw out Measure B. The measure switched most new hires from pensions to 401(k) style retirement plans.

More than 65 percent of San Diego voters supported Measure B in 2012. The problem, however, is that the measure got to the ballot via a citizens initiative, but then-Mayor Jerry Sanders campaigned on its behalf.

Labor unions challenged the initiative in court, contending the mayor's involvement meant the city needed to meet and confer with them. The state Supreme Court agreed, and an appellate court ordered the city to make its employees whole, plus pay them 7 percent interest.

The courts, however, did not invalidate Measure B, instead directing the city to work out a compromise with the unions.

On Thursday, City Councilman Scott Sherman and former Councilman Carl DeMaio held a news conference pushing the city to protect Measure B.

"Right now we are being asked to go against what our bosses told us, and I don't think we should do that," Sherman said, adding that the city spends $350 million a year now meeting its minimum pension obligations.

DeMaio said he would work with a coalition to go to court to protect Measure B.

"I'm talking about putting the City of San Diego back on the brink of bankruptcy, let alone telling voters that they don't have a say on where their tax dollars go," he said.

Early estimates indicate the amount needed to make employees whole ranges from negligible to $20 million.

Michael Zucchet, who heads the Municipal Employees Association, said the only rational way to move forward is to invalidate Measure B.

"It is time for the City and its citizens to move forward by ending the Prop B debacle with the least amount of additional litigation and expense, and at the same time help address the City’s severe recruitment and retention challenges brought about because San Diego is the only City in California with no defined benefit pension nor Social Security benefits for newly hired employees," Zucchet said in a statement.

Mayor Kevin Faulconer said in a statement he would oppose any effort to get rid of Measure B.

"Voters demanded pension reform and we should respect that, plain and simple," Faulconer said.

The mayor cannot vote, however, in the decision facing the City Council.