Key Portion of 'SF Smart Reform' Prop. B Struck Down by Judge

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With today's cut, Prop. B just become shorter and easier to read. Will it become easier to evade, too?
A judge today struck down a portion of Proposition B -- "SF Smart Reform" -- that the measure's author, public defender Jeff Adachi, had claimed was critical for actually ensuring the legislation does what it aims to do: save the city hundreds of millions yearly via pension and health care reform.

Judge Harold Kahn disagreed. He claimed "poison pill language," that would have frozen workers' wage and benefit levels for five years if Prop. B passes and any portion of the measure was successfully challenged in court, was "draconian." More than that, it was deemed a violation of city employees' First Amendment rights. Kahn has taken the highly unusual -- and possibly unprecedented -- step of severing a portion of a charter amendment prior to city voters having a chance to weigh in at the ballot box.

"By eliminating five years of bargained compensation increases if any portion of Proposition B is invalidated, the poison pill may discourage potentially meritorious challenges to Proposition B ...," wrote the judge. This posed an "impermissible burden on the constitutional rights of City employees to seek redress from the courts."

Adachi had argued, however, that this language was necessary, in essence, to keep the city honest -- and prevent city politicians dead-set against pension reform from strangling Prop. B in its cradle, regardless of the will of the voters. "Typically, elected officials turn around and give raises," Adachi told the court on Friday. This language "prevents elected officials from going behind voters' backs and not enforcing Prop. B."

Reached today for comment, Adachi acknowledged that city politicos who'd like to undermine his measure have potentially been handed the means to do so. "Certainly, if Prop. B passes, the powers that be could choose to, you know, give everyone raises in response," he says. "But I don't think that's going to sit very well with the electorate."

Perhaps not -- but if there's a San Francisco politician who has ever suffered the wrath of the voters for treating the city's unionized employees too well, his or her name escapes us.

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Joe Eskenazi
Jeff Adachi insisted he was "very pleased with the judge's decision."
Tom Willis, the attorney representing the city unions and union workers suing Adachi, his treasurer, Craig Weber, and the city's Department of Elections, has not yet returned SF Weekly's calls.* While union attorneys have claimed the removal of "Section I" from Prop. B invalidates the city controller's estimate the measure would save San Francisco $121 million in its first year, the controller's office tells SF Weekly that's not the case.

"Having the wages section struck down by the court would not affect our statement," says Peg Stevenson, the department's audit division chief. "The numbers we referenced were the large-scale costs and retirement system costs and/or more near-term costs in terms of health insurance premium rates. Neither of these would be affected." 

While Kahn struck "Section I" of Adachi's measure, he left the rest of it intact: Voters will still decide on whether city employees must contribute nine or 10 percent of their paychecks to their pension plans and 50 percent of their dependents' health care costs (up from 25 percent).

The judge blew off union complaints that Adachi violated procedural regulations by not including "many pages of dense and highly technical legal language" on his signature-gathering petition, or the name of Weber, the measure's treasurer (When readers think "who's Craig Weber?" they're essentially making Kahn's point that omitting his name from election materials was no biggie).

Interestingly, Kahn also disagreed with union claims that a move to alter city workers' contributions to their pension and health plans is "clearly" a violation of their vested rights. While he noted that "this argument has possible, maybe even probable, merit," he declined to take the matter out of the voters' hands while pulling off an expedited ruling meant to beat Wednesday's deadline for submitting the ballot to the printer.

Kahn noted that state law "permits increases in pension contribution rates by employees after they have been hired if there is some 'commensurate' or 'comparable' advantage to the employees and such an 'advantage' can be in the form of preserving or protecting the financial integrity of the pension system."

In other words, California law permits mandating employees to contribute more to their pension plans if not doing so will wreck the system. Adachi applauded Kahn's evocation of this state law and portrayed today's ruling as a great victory.

"What he says in the decision is that the findings that support Prop. B are for the benefit of city employees," says Adachi, who has since become city employees' Public Enemy No. 1 as a result of his championing of pension reform. "I'm very pleased with the judge's decision. Our opponents have tried to argue you can't increase the rate paid by city employees into retirement pensions. What the judge clearly said is you can."

Just how clearly the judge said that -- and whether another judge agrees -- is certain to be the subject of a lawsuit, or lawsuits, should Prop. B pass in November.

Update, 1:47 p.m.: Union lawyer Tom Willis says "We wished he would have tossed the entire thing, because it's unconstitutional, but we understand his ruling."

Regarding Kahn's mention of a state law noting you can, indeed, augment the amount public employees are required to contribute toward their pension costs, Willis claimed "We think that's an inaccurate reading of the case law. We're convinced that if this were to be decided, a court would rule this cannot be applied to current city employees."

Willis is unsure if any more legal challenges to Prop. B will be thrown down prior to the election. Asked if unions will sue to undo the charter amendment should it prevail in November's election, he said "no one's hired me yet." 

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