Did he mean it?
If Gov. Jerry Brown was serious about
curbing public employee retirement costs, he should step up and defend a
bill he signed to end some of the worst pension spiking.
curbing public employee retirement costs, he should step up and defend a
bill he signed to end some of the worst pension spiking.
Employees in three counties — Contra
Costa, Alameda and Merced — have sued to block implementation of the
new law. If they prevail, they will continue counting unused vacation
time as income when computing pensions.
Costa, Alameda and Merced — have sued to block implementation of the
new law. If they prevail, they will continue counting unused vacation
time as income when computing pensions.
An appellate decision in their favor
could invalidate the law statewide, leaving a new legal loophole that
would allow workers in 17 other counties, including Marin and San Mateo
in the Bay Area, to start boosting pensions, too.
could invalidate the law statewide, leaving a new legal loophole that
would allow workers in 17 other counties, including Marin and San Mateo
in the Bay Area, to start boosting pensions, too.
Pensions are calculated based on years
of service, retirement age and final salary. By increasing final salary,
employees can fatten retirement pay. In Contra Costa, the worst case,
abusive spiking adds as much as 15 percent.
of service, retirement age and final salary. By increasing final salary,
employees can fatten retirement pay. In Contra Costa, the worst case,
abusive spiking adds as much as 15 percent.
Employees sued the retirement systems
that administer pensions in the three counties. But the systems say they
are indifferent and will abide by whatever the courts decide.
that administer pensions in the three counties. But the systems say they
are indifferent and will abide by whatever the courts decide.
The retirement systems don’t ultimately
pay the bill. The cost is passed on to taxpayer-supported local
governments. Yet the three counties’ boards of supervisors have sat on
the sidelines, as has Attorney General Kamala Harris, whose job includes
defending state laws, and Gov. Brown, who vowed to end this sort of
abuse.
pay the bill. The cost is passed on to taxpayer-supported local
governments. Yet the three counties’ boards of supervisors have sat on
the sidelines, as has Attorney General Kamala Harris, whose job includes
defending state laws, and Gov. Brown, who vowed to end this sort of
abuse.
In Contra Costa Superior Court on
Thursday, Judge David Flinn, calling the case there “a very significant
economic matter,” said he found it “troubling” that only one side was
represented. “Where are the real parties in interest?”
Thursday, Judge David Flinn, calling the case there “a very significant
economic matter,” said he found it “troubling” that only one side was
represented. “Where are the real parties in interest?”
Flinn and Alameda County Judge Evelio
Grillo have struggled with whether they can rule on the
constitutionality of the law if no one defends it. Grillo seems ready to
move forward anyway and Flynn may also.
Grillo have struggled with whether they can rule on the
constitutionality of the law if no one defends it. Grillo seems ready to
move forward anyway and Flynn may also.
This pension boosting differs from the
problem I reported two weeks ago. In that situation, the huge California
Public Employees’ Retirement System announced plans to broadly
interpret part of last summer’s main pension bill that affects new
employees. By counting as income nearly 100 different pay premiums, for
everything from marksmanship and longevity to being a notary or working
on a library reference desk, CalPERS will increase future pensions
beyond what the new law seems to permit.
problem I reported two weeks ago. In that situation, the huge California
Public Employees’ Retirement System announced plans to broadly
interpret part of last summer’s main pension bill that affects new
employees. By counting as income nearly 100 different pay premiums, for
everything from marksmanship and longevity to being a notary or working
on a library reference desk, CalPERS will increase future pensions
beyond what the new law seems to permit.
The cases in the three counties also
challenge what should be counted as income when computing pensions. But
the fight affects new and current employees in 20 county-level pension
systems that operate under different rules. The issue is how much
accumulated leave paid off in lump sum at termination can be counted.
challenge what should be counted as income when computing pensions. But
the fight affects new and current employees in 20 county-level pension
systems that operate under different rules. The issue is how much
accumulated leave paid off in lump sum at termination can be counted.
Brown said last summer that he was
trying to end spiking abuses. But I reported in this column the day
before the Aug. 31 Assembly and Senate votes that the main legislation
did just the opposite because of a loophole. It would have not only
permitted the pension spiking to continue in the three counties, it
would have permitted it to begin in the 17 other county-level systems.
trying to end spiking abuses. But I reported in this column the day
before the Aug. 31 Assembly and Senate votes that the main legislation
did just the opposite because of a loophole. It would have not only
permitted the pension spiking to continue in the three counties, it
would have permitted it to begin in the 17 other county-level systems.
In response, the Legislature rushed
through a companion bill to close the loophole. It’s that bill that’s at
issue in the litigation.
through a companion bill to close the loophole. It’s that bill that’s at
issue in the litigation.
Employees claim they had irrevocable
agreements allowing them to spike. But the Contra Costa pension system’s
attorney advised his board more than three years ago that the promises
violated appellate court rulings.
agreements allowing them to spike. But the Contra Costa pension system’s
attorney advised his board more than three years ago that the promises
violated appellate court rulings.
The pending pension cases raise an issue
similar to one involving Proposition 8, the voter-approved gay-marriage
ban: Who can defend a law if the state refuses? One issue before the
U.S. Supreme Court is whether initiative backers can defend it in court.
similar to one involving Proposition 8, the voter-approved gay-marriage
ban: Who can defend a law if the state refuses? One issue before the
U.S. Supreme Court is whether initiative backers can defend it in court.
Brown, then attorney general, originally
refused to defend Proposition 8, which he said was unconstitutional.
But that case involved an initiative, whereas Brown helped draft and
signed the pension law.
refused to defend Proposition 8, which he said was unconstitutional.
But that case involved an initiative, whereas Brown helped draft and
signed the pension law.
He did so at a time when he needed
pension changes to win votes for his tax measure on the November ballot.
Now that his tax passed, does he care about preserving the pension law?
pension changes to win votes for his tax measure on the November ballot.
Now that his tax passed, does he care about preserving the pension law?
Will he or Harris, who aspires to higher
office, buck employee unions to defend it? And, in Contra Costa, will
county supervisors walk their constant talk about pension reform?
office, buck employee unions to defend it? And, in Contra Costa, will
county supervisors walk their constant talk about pension reform?
Right now, their silence speaks volumes.
Dan Borenstein is a columnist and editorial writer for the Bay Area News Group. Contact him at 925-943-8248 or [email protected]. Follow him atTwitter.com/borensteindan.
