Initiative Update:
San Jose Mayor Files Statewide Pension Reform Initiative

A ballot measure that would make it easier for local governments to curb pension costs has been proposed for the November 2014 ballot. The initiative, filed by San Jose Mayor Chuck Reed, would amend the California Constitution to allow government agencies to propose to voters reductions to pension benefits for current and future local government employees and retirees.

The Pension Reform Act of 2014 was filed October 7 by the Democratic mayor, who was joined by the mayors of Anaheim, Pacific Grove, Santa Ana and San Bernardino. San Bernardino currently is in a fight with government employees over pension obligations after the city declared bankruptcy in August.

Mayor Reed announced his initiative while serving as the keynote speaker at an event at Stanford University. He also discussed the state’s growing unfunded pension liability issue, and told the attendees of the Hoover Institute event that “time is of the essence” to tackle the growing pension burden in California.

The San Jose mayor sponsored a local pension reform measure in 2012, Measure B, which passed with almost 70 percent of voters in support. Measure B required government employees to increase their pension contributions by a percentage based on the amount of existing pension debt, or to reduce their pension compensation. The law immediately faced legal challenges from unions, and now awaits judgment in the Santa Clara County Superior Court.

Opponent Terry Brennand, vice chair of the union-affiliated Californians for Retirement Security, stated during an October 16 radio debate with Mayor Reed that the unions’ strategy to fight the initiative will mirror one they used to battle against Proposition 32, a losing 2012 measure that attempted to reform campaign finance rules for unions and other groups. “Just look back one election cycle to Proposition 32 – the historic unprecedented outreach and contact to more voters in California than any time in history,” Mr. Brennand said. “Look for a repeat of that.”

Once the initiative receives its official title and summary from Attorney General Kamala Harris, sponsors will have 150 days to collect 807,615 signatures to qualify the measure for the ballot. (Sources: The Sacramento Bee, October 16; Southern California Public Radio, October 17.)

October 18, 2013

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