Feb 3 A campaign for a ballot initiative that
would cut California's public pension benefits and could become
a model for other states has stalled as Democrats battle each
other in America's largest state.
Chuck Reed, the Democratic mayor of San Jose, may be forced
to end his campaign to put a sweeping pension reform measure on
a statewide ballot in November after Kamala Harris, California's
attorney general and fellow Democrat, chose what Reed and his
backers say is biased, union-friendly language for the voter
Reed and proponents of the measure, which aims to give
California mayors the freedom to renegotiate pension deals
already awarded to public workers, say they will sue Harris over
the wording her office chose for the ballot initiative.
A lawsuit could come as early as this week, said Dave Low, a
spokesman for Reed.
Harris' office said the title and summary were "accurate,
and we stand by it."
Under California law, the attorney general is tasked with
writing the title and summary for ballot measures, a practice
that in the past has produced wording in some measures that was
biased or too complex for a voter to decipher.
Reed is particularly upset by the ballot summary's first
sentence, which states that his measure "eliminates
constitutional protections for vested pension and retiree
healthcare benefits for current public employees, including
teachers, nurses, and peace officers, for future work
In an interview with Reuters, Reed called the wording chosen
by Harris as "not impartial and not true."
Reed says the use of "nurses, teachers and peace workers" to
describe public employees is loaded and unfair. He also says the
language implies he wants to cut benefits already accrued, which
his measure will not touch.
Reed conceded that the lawsuit will likely make a campaign
for the ballot initiative unlikely for this November's statewide
votes, but he hoped to resurrect the issue for the 2016
Reed's statewide measure, which is backed by four other
Democratic mayors and one Republican mayor in California, would
amend California's state Constitution to allow pension benefits
for current workers to be altered, an effort that has enraged
the state's unions.
Pension spending has become a growing concern in many parts
of the United States as retiree costs are often the biggest part
of city and state budgets. Pension costs are prominent issues in
the municipal bankruptcy cases of Detroit and San Bernardino.
California's courts have interpreted the state Constitution
to mean that a worker's pension benefits, once agreed, can never
CUTTING FUTURE BENEFITS
Reed says he does not want to touch benefits already earned
but does want to give mayors the ability to renegotiate pension
formulas so future benefits to current workers can be cut.
The fight over pensions in California increasingly pits
Democratic mayors, who say they have to balance budgets and
safeguard basic public services, against organized labor, which
is dominated by Democratic membership and which has many elected
allies on city councils.
Reed succeeded in getting 70 percent of voters in San Jose -
California's third-largest city - to pass a pension reform
measure in 2012. That initiative is now being litigated in state
courts after union opposition.
Reed's statewide initiative would allow cities to change
generous deals awarded across California in the 1990s before the
financial crash. Those deals allowed most police, for example,
to retire as early as age 50 on a lifetime pension, based on 90
percent of their final year's salary.
Jeffrey Brown, a professor of finance at the University of
Illinois - a state with severe unfunded pension obligations -
said eight other U.S. states, including Illinois, have similar
provisions making it almost impossible to change pension
formulas for current workers.
"California is a big state," he said. "Many states and
localities across the country are dealing with difficult fiscal
situations. If this measure is successfully pursued in
California, it will create a big public policy precedent that
many other states will likely want to follow."