State Supreme Court: San Diego pension cut illegally placed on ballot

The state Supreme Court ruled Thursday San Diego's pension cuts were illegally placed on a 2012 ballot for approval by voters because city leaders did not negotiate with unions before putting forward the initiative.

The ruling overturned a 4th District Court of Appeal decision that said then-San Diego Mayor Jerry Sanders was not required to meet and confer with labor leaders before advocating the Proposition B pension measure.

The high court, stopping short of invalidating the measure altogether, reinstated a 2015 state Public Employment Relations Board ruling that said the city was required by law to hold negotiations before putting Proposition B on the ballot.

The appellate court will now address the appropriate judicial remedy on remand.

The measure, passed by more than 65 percent of city voters, took away guaranteed pensions for new city hires, except for police officers, and replaced them with a plan similar to 401(k) retirement plans.

Sanders made the argument he only supported the measure as a private citizen and not as mayor.

In its unanimous opinion, the state Supreme Court ruled Sanders' support was as a public servant and therefore he was obligated to confer with unions. The court cited the Meyers-Milias-Brown Act, which stated the governing body of a local public agency must confer over employment.

"The city's assertion that his support was merely that of a private citizen does not withstand objective scrutiny," wrote Justice Carol A. Corrigan.

"Here, Mayor Sanders conceived the idea of a citizens' initiative pension reform measure, developed its terms, and negotiated with other interested parties before any citizen proponents stepped forward. He relied on his position of authority and employed his staff throughout the process," wrote Corrigan.

In a statement, Sanders said the proposition was critical to turning around the city's finances during a time when San Diego was facing massive deficits, budget cuts and a reduced bond rating.

"This was new territory and to meet and confer over a citizens' initiative would have been unprecedented," according to the statement by the San Diego Regional Chamber of Commerce.

"Today's ruling leaves some questions unanswered about the city's duties, but pension reform -- a measure that was approved by 66 percent of San Diegans -- is still valid and in effect. We will continue to defend these reforms and protect the rights of San Diego citizens," Sanders said.

Smith, Steiner, Vanderpool & Wax shareholder Ann M. Smith, who represents the Municipal Employees Association labor union, called the ruling an important victory for collective bargaining.

"This ruling is a complete vindication of what the public sector bargaining is designed to do," said Smith.

She said after seven years, she is confident the appellate court will ultimately invalidate the law.

The case is Boling v. Public Employment Relations Board, 2018 DJDAR 7644.