Proposed Ballot Initiative Would Threaten Public Pensions
Week of August 3, 2015 
By Shaun Rundle, Government Affairs and Public Safety Specialist 

A campaign for pension reform, led by former San Jose Mayor Chuck Reed, former San Diego Councilman Carl DeMaio, and a group of bipartisan advocates recently filed with the Attorney General’s Office a statewide initiative for the 2016 ballot. The campaign initiative, entitled the “Voter Empowerment Act of 2016,” would amend the state constitution to require voter approval of any new defined public benefit retirement plans and cap employer contributions to retirement benefits provided to government employees at 50%. The ballot proposal contains other reforms that would affect current and future employees, but the legality of the proposal remains in question.

The ‘Voter Empowerment Act’ would not allow public employees hired after January 1, 2019 from having defined benefits unless approved by voters. Some of the other mandates include:

   • Requiring voter approval for government employers to pay more than half of the total cost of retirement benefits 

   • Prohibiting government officials from challenging any voter-approved state or local ballot measures regarding compensation   and retirement benefits 

   • New employees allowed to join a pension system would be responsible for paying the unfunded liability. 

   • Eliminates vested rights for pension/retiree healthcare for current employees. 

Pension reform in California has of course been a long-debate issue, but previous attempts at reform have been thrown out by the courts. Last year the Ventura County Taxpayers Associations attempted to convert a $3.5 billion benefit plan in the county to a plan more in the 401(k) defined-contribution style. Ventura County District Court, however, threw out the case, noting that the initiative process could not undo the current system put in place through statewide legislation. 

This is not Chuck Reed’s first attempt at statewide pension reform. He attempted to get the initiative on the ballot for 2014, but a Sacramento Superior Court decision halted his effort. The decision concluded that his lawsuit, which claimed that Attorney General Harris’s summary of the initiative was inaccurate, was not valid. 

This issue of course affects a large majority our membership, and CPOA has shared our concerns about his measure with Attorney General Kamala Harris.  We believe that proposals such as these challenge constitutional protections for public workers, which include peace officers. Article 1, Section 9 (added in 1974) of the California Constitution states that “A bill of attainder, ex post facto law, or law impairing the obligation of contracts may not be passed.” It is this language that courts generally use to uphold pension protections. The “Voter Empowerment Act of 2016” therefore likely has more legal battles to come. 

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