Judge Reverses Part Of S.f. Pension Reform

A state appeals court has overturned part of the pension cutbacks for city employees San Francisco voters approved in November 2011, a reduction of cost-of-living increases for retirees when their pension fund was earning more than previously expected. The reduction was part of Proposition C, sponsored by Mayor Ed Lee, backed by labor unions and approved by more than two-thirds of the voters. The ruling doesn’t affect the measure’s central provision, which required city employees to contribute 7.5 percent of their salaries to the pension fund, a percentage that will rise when the fund is dwindling and drop when it is thriving. Adding to the annual inflation adjustments pensioners were already entitled to receive, the new provisions gave them an additional increase of up to 3.5 percent in years when the city retirement fund’s earnings were higher than anticipated. While the ballot measure argued that it merely clarified the previous voter-approved laws, the First District Court of Appeal said Friday it was actually a cutback that would eliminate the increased payments in some years when the fund had exceeded its projected earnings. David Clisham, a lawyer for employees and retirees who filed the suit, said he disagreed with that part of the ruling but considered it an important victory overall for 23,000 former city workers and for current employees.