Thumbs down: Court leaves big question unanswered
The state Supreme Court had a chance to help solve one of California’s biggest fiscal problems: runaway pension costs. But the justices punted. Thumbs down. Monday’s ruling wasn’t a complete loss for taxpayers. Rejecting a firefighter union challenge, the court said the state was within its rights to stop allowing public employees to boost their retirement benefits by buying credit for time they didn’t work — a practice known as “air time.” The pension sweetener, created in the early 1990s and eliminated in 2013, was supposed to be cost-neutral. Like the big retroactive benefit increases of the late 1990s and early 2000s, it wasn’t.
Unfortunately, the justices declined requests to take up a more substantive issue: the so-called “California rule,” a disputed legal interpretation that forbids public employers from rolling back future retirement benefits. The inflexibility is a major factor in the multi-billion-dollar pension liabilities threatening to swamp state and local budgets. Several challenges to the state’s 2012 pension reform law are working their way through the courts, so the justices may get another chance to address the California rule. Let’s hope they don’t duck again.
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