The latest chapter in the efforts to dismantle California’s public-sector retirement system was officially opened Tuesday when San Jose Mayor Chuck Reed submitted paperwork that begins the process of qualifying his latest pension initiative for next year’s statewide ballot.
The filing brings to a climax weeks of speculation about the timing of the proposed law after Frying Pan News first confirmed rumors of its existence when Gary Cohn published a leaked draft version last month and when we reported Reed’s remarks, delivered before a Hoover Institution conference on pensions, that indicated he was uncertain whether he would file for the 2014 or 2016 ballot. Now Reed is certain: It’s 2014 or never.
Called the Pension Reform Act of 2014, the measure seeks to rewrite California’s constitution in order to bypass its current guarantees of public pension rights. If passed by voters, the amendment would effectively allow the state and local governments to cut back retirement benefits for current employees for the years of work they perform after the changes go into effect.
Reaction to the filing was swift. In a prepared statement, Dave Low, Chairman of Californians for Retirement Security (CRS), called the measure “extreme” and noted that it proposed nothing less than breaking “the promise of a secure retirement made to millions of Californians.”
CRS spokesperson Steven Maviglio went further, labeling it “a direct assault on current employees” for “political purposes.” Maviglio predicted lengthy and costly court battles if the measure should both qualify for the ballot and be passed by voters.
After Reed’s first pension-cutting initiative, Measure B, was passed by San Jose voters last year, the nominally Democratic Mayor became the default figurehead for a statewide, corporate-backed ballot effort that had all but stalled.
Reed’s status effectively became formalized in August when a routine filing revealed that he had taken $200,000 in organizing money from Action Now Initiative, a non-profit controlled by Texas billionaire and former Enron hedge fund manager John Arnold.
Reed and Arnold’s next hurdle will be a February 28, 2014 deadline to submit qualifying signatures when they file the ballot petition with county elections officials.
