Appeals Court OKs San Diego’s Pension Reform

SAN DIEGO (CN) – California’s Fourth District Court of Appeals Tuesday confirmed a pension reform measure approved by San Diego voters in 2012, a ruling city leaders lauded for “upholding the will of the voters.”

In a 66-page opinion, Appellate Judges Judith McConnell, Richard Huffman and Gilbert Nares found the Public Employment Relations Board was in the wrong when it found the city was obligated to meet and confer with labor representatives for city employees before putting the citizen-sponsored Proposition B on the ballot.

The unions said that because then-Mayor Jerry Sanders sought voter support for the initiative, it converted the citizens’ initiative into a de facto city proposal, which required city leaders to meet with labor representatives to discuss it.

The board found that because the city did not comply with meet-and-confer guidelines, the reform measure should not take effect.

But the appellate court found that the Public Employment Relations Board erred when it found the citizen-sponsored ballot measure was in reality a city-sponsored measure, because it had the support of the mayor, city attorney and prominent council members.

The court also found the city did not engage in unfair labor practices by declining to meet with union reps before the vote on Proposition B.

San Diego voters overwhelmingly approved the Citizens Pension Reform Initiative in 2012, with 66 percent of voters supporting changing pension plans for city employees.

The measure was introduced after the city weathered a pension crisis which blew its budget out of the water and led San Diego to defer maintenance on roads and other repairs and improvements so it could make pension payments for retired city employees.

Before the initiative was introduced city officials said they would eliminate traditional pensions for new hires and replace them 401(k) plans.

Newly hired police officers are the only city employees exempted from the new ordinance and will still receive a traditional pension.

Sanders apparently weighed his options before opting to get a citizens’ initiative on the ballot and hosted a kickoff new conference to announce the measure. He said at his January 2011 State of the City address that he “was acting in the public interest, but as a private citizen.”

Though petition gatherers got more than 145,000 signatures to put the initiative on the summer ballot, union representatives said that calling the ballot measure a citizens’ initiative was a way to “dodge the city’s obligations” to negotiate with the unions under the Meyers-Milias-Brown Act.

Despite the involvement of elected officials, the appellate panel found the officials were acting as private citizens and not under color of authority.

The panel found there was no evidence Sanders acted on behalf of the City Council when he campaigned for the initiative, nor that he believed he had the authority to act on behalf of the council during the campaign.

“The acts alleged here – an individual’s advocacy for a citizen-sponsored initiative affecting employee benefits – is not an inherently wrongful act, nor are we persuaded the MMBA explicitly proscribes such conduct merely because that individual occupies public office,” the panel wrote.

“We are convinced Sanders was entitled to support the CPRI (either as an individual or through capitalizing on his office’s bully pulpit) because he was not supporting the proposal as the ‘governing body,’ which is the only entity constrained by the meet-and-confer obligations under the MMBA.”

At a news conference Tuesday, Proposition B proponent April Boling, the petitioner in the appeal, said the appellate ruling ensures that citizens’ initiatives are properly implemented.

“This decision has statewide implications,” Boling said.

“When citizens decide to take matters into their own hands and put measures on the ballot, we know it can become the law of the land and won’t require negotiation.”

Mayor Kevin Faulconer said the initiative “isn’t about partisanship, it’s about doing the right thing for the city.” He said pension reform was vital to “get the city back on track … to reinvest dollars into neighborhoods where they’re needed.”

Former City Councilman Carl DeMaio, one of the authors of Proposition B, said the ruling “sets case law for the entire state” and paves the way to pursue statewide pension reform in the 2018 election.

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