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Ruling On San Diego’s Pension Reform Initiative Not End Of Debate

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The state Public Employment Relations Board ruled last week that the city of San Diego violated state law by not negotiating with employee unions over a 2012 ballot measure that eliminated guaranteed pension benefits for most city employees, but that won't be the end of the issue.

The city attorney has said he intends to ask the City Council to appeal the ruling over Proposition B, which upheld a previous decision by an administrative law judge.

The dispute is over whether city officials were required to negotiate with the San Diego Municipal Employees Association and three other unions before changing the pension system, because the citizens initiative was pushed by city political leaders, including then-Mayor Jerry Sanders. The municipal employees union is the city's largest, with about 4,000 members. Police officers were exempt from the initiative.

"It was literally campaign central in the mayor's office," Michael Zucchet, the union's general manager, told KPBS Midday Edition on Monday. He said Sanders' staff was involved with drafting the initiative and raising funds to support it.

"None of that was disputed (in previous hearings)," Zucchet said. "The city's argument was basically, 'Who cares? At the end of the day the citizens are going to vote on it.'"

City Councilman Chris Cate wrote the fiscal impact analysis of Proposition B when he worked for the San Diego Taxpayers Association. He said on KPBS Midday Edition that the initiative was driven by the citizens.

"The only action (the council) had to take was because 160,000 San Diegans forced them to put it on the ballot," Cate said. The council supported the initiative because it would stabilize ballooning pension payments, which at the time added up to more than $260 million annually, he said.

"I would argue that the will of the voters — nearly two-thirds approved it — should see this implemented all the way through," Cate said.

Zucchet said that no matter which side an appeals court takes, taxpayers will continue to see savings from a five-year freeze on pensionable pay. While the freeze came at the same time as Proposition B, it was negotiated with the union and not part of the ballot measure.

Proposition B changed the city's pension system for most of its employees from a defined benefit plan, which the city pays into on the employee's behalf, to a 401(k)-style plan that the employee pays into.

No matter what happens with this ruling, that pay freeze stays.

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