June 19 2012 07:27 PM

District court spanks city of San Diego in latest pension-measure legal challenge

2012-06-05 21.38.11
With Prop. B, Jerry Sanders (at the podium) was a “private citizen.”
by Kelly Davis

Roughly halfway through his January 2011 State of the City address, San Diego Mayor Jerry Sanders mentioned his plans to "soon bring to voters" a measure that would switch city workers to a 401(k)-style retirement plan. 

"We are acting in the public interest," he said, the "we" being himself, City Councilmember Kevin Faulconer and City Attorney Jan Goldsmith, "but as private citizens."

That "private citizens" caveat got little notice at the time but is now the focus of legal challenges brought by four city labor unions over Prop. B, which was passed by voters on June 5.

Under state law, any legislative move to change public employees' compensation—Prop. B seeks to freeze base pay, aka "pensionable pay," through June 30, 2018—triggers labor negotiations. The only way to get around negotiations is via a citizen-sponsored ballot measure. Sanders, the unions argue, tried to do an end-run around state labor laws by crafting Prop. B and then recruiting political allies to put it on the ballot.

Sanders has admitted as much; as he told CityBeat in December, he went the citizen-initiative route "so that you get the ballot initiative... that you actually want. Otherwise, we'd have gone through meet-and-confer [negotiations], and you don't know what's gonna go on at that point...."

In January, the Municipal Employees Association (MEA)—the city's white-collar labor union—filed an unfair-labor-practices charge with the Public Employment Relations Board (PERB). PERB, which oversees the state's collective-bargaining laws, agreed that the MEA had a case and issued a complaint against the city. Three other labor unions followed suit.

Earlier this month, hoping to bypass PERB, Goldsmith asked the Fourth District Court of Appeals to issue a ruling on all four complaints. On June 14, the court said no. That ruling came a day after arguments before the same court over whether Superior Court Judge Luis Vargas was correct in halting a scheduled PERB hearing on the MEA complaint in April.

In all, it's an increasingly complex case that seeks to answer a simple question. As the district court's Presiding Justice Judith McConnell put it at last Wednesday's hearing: "Whether [Prop. B] was put on the ballot by citizens or whether citizens were a front or a straw man."

The unions are arguing that Sanders' "front" were the three citizens who ultimately sponsored Prop. B—T.J. Zane, April Boling and Steve Williams, the president, treasurer and chairman, respectively, of The Lincoln Club of San Diego County, a conservative political-action committee. The Lincoln Club also spent $415,361 on the signature-gathering campaign to qualify the measure for the ballot.

In a petition filed with the court, Goldsmith described the trio as "private citizens fed up with the ever rising pension costs."

For Goldsmith, it doesn't matter who authored the initiative and who shepherded the signature-gathering process—all that matters is how Prop. B got on the ballot. And a petition, he argued, doesn't trigger labor talks. "The mayor could have stood in front of Vons 24/7; it doesn't make this a city initiative," he said at the Wednesday hearing.

Goldsmith has also argued that PERB should remove itself from the process entirely because, in February, its board took the rare step of asking a Superior Court judge to pull Prop. B from the ballot. Goldsmith has leveled allegations of bias against PERB, telling a local conservative radio talk-show host that PERB's a "Mickey Mouse Star Chamber" that's "owned and operated by labor unions."

PERB General Counsel M. Suzanne Murphy took issue with Goldsmith's statements. In a Feb. 18 letter to the city attorney, she noted that there's no evidence to support his claims of bias. Of the 19 unfair-labor-practices charges filed with PERB since May 2011 (when Murphy was appointed general counsel), 13 were denied and two were withdrawn. PERB issued a formal complaint in only four cases (one of them being San Diego's).

"While you are, of course, free to exercise your free speech rights," Murphy wrote, "I believe some of your rhetoric... is truly unbecoming of a City Attorney and officer of the court, and inconsistent with the civility rules and policies of the San Diego Superior Court. I hope you will agree with me that civil litigation should, indeed, be conducted ‘civilly.'"

At the June 13 hearing, Justice Alex McDonald also took issue with Goldsmith's claim that PERB's actions so far indicate bias. It's PERB's role to make an initial determination on the merits of an unfair-labor-practices charge, McDonald said.

"They [PERB] have the legal authority under the statute to seek a stay in Superior Court," he told Goldsmith. "You know that as well as I do." 

Goldsmith told CityBeat that PERB is behaving like "an activist group." 

"They want a citizens' initiative to be struck down because the mayor supports it and, therefore, they believe, it's a sham," he said.

On Tuesday, the district court ruled unanimously that PERB should be allowed to proceed with adjudication of the MEA's unfair-labor-practice complaint. The city attorney has the option of appealing the ruling to the state Supreme Court, though, said MEA General Manager Mike Zucchet, that'll only further delay resolving the question of Prop. B's legality.

"We've just gone through at least three months of unnecessary delay caused by the city," Zucchet said. "We had that hearing scheduled for April 2.... The city has done everything it can to make that hearing not happen, and the Fourth District Court of Appeals just said it's going to happen."

Write to kellyd@sdcitybeat.com and editor@sdcitybeat.com.


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