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Reed v. Harris Amicus Brief

Reed v. Harris Amicus Brief

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Published by jon_ortiz
From the National Conference on Public Employee Retirement Systems
From the National Conference on Public Employee Retirement Systems

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Published by: jon_ortiz on Mar 10, 2014
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03/19/2014

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 ____________________________________________________________________________________________________
 AMICUS CURIAE 
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Deborah B. Caplan [SBN 196606] Lance H. Olson [SBN 077634] Richard C. Miadich [SBN 224873] OLSON HAGEL & FISHBURN LLP 555 Capitol Mall, Suite 1425 Sacramento, CA 95814 Telephone: (916) 442-2952 Facsimile: (916) 442-1280 Email: Richard@olsonhagel.com 
 Attorneys for Amicus Curiae
 National Conference of Public Employee Retirement Systems IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SACRAMENTO
 
CHARLES R. “CHUCK” REED; WILLIAM KAMPE; TOM TAIT; PATRICK MORRIS; and STEPHANIE GOMES, in their capacities as individual voters and proponents of the subject statewide ballot measure, Petitioners, v. DEBRA BOWEN, in her capacity as Secretary of State of California, and KAMALA HARRIS, in her capacity as Attorney General of California, and DOES 1 through 10, Respondents.
CASE NO.:
34-2014-80001758
NATIONAL CONFERENCE ON PUBLIC EMPLOYEE RETIREMENT SYSTEMS’ (“NCPERS”)
 AMICUS CURIAE
 BRIEF IN SUPPORT OF RESPONDENTS
DATE: March 14, 2014 TIME: 10:30 a.m. ASSIGNED FOR ALL PURPOSES TO: JUDGE: Hon. Allen H. Sumner DEPT.: 42 PETITION FILED: February 6, 2014
 
 
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INTRODUCTION
Petitioners in this case, who are the proponents of a proposed state constitutional amendment initiative measure entitled the “Pension Reform Act of 2014” (hereafter the “Initiative”), request that the Court take the extraordinary step of “red-penciling” the circulating title and summary that Respondent California Attorney General prepared for the Initiative.
1
 Pursuant to Rule 8.200(c)(1) of the California Rules of Court, the National Conference on Public Employee Retirement Systems (“NCPERS”) submits this
amicus curiae
 brief in support of the Attorney General’s title and summary and in opposition to the Petitioners’ requested relief. Founded in 1941, NCPERS is the largest trade association for public sector pension funds, representing more than 550 funds in the United States and Canada. It is a unique non-profit network of trustees, administrators, public officials, and investment professionals who collectively manage nearly $3 trillion in pension trust assets for active and retired public employees across the nation. NCPERS’ members include virtually all of California’s state and county public employee retirement systems and several major city retirement systems, including the California Public Employee Retirement System, the California State Teachers’ Retirement System, the Los Angeles County Employees Retirement Association, and the Los Angeles City Employees Retirement System. Combined, NCPERS’ California members administer retirement benefits for approximately 2.5 million current and retired public employees in California. As discussed herein, NCPERS believes the circulating title and summary accurately and fairly informs voters that the Initiative would eliminate existing state constitutional protections that the California Supreme Court has long held apply to state and local public employees. Under the Court’s  prior decisions,
current 
 public employees possess a “vested right” to accrue retirement benefits for
 future
 work based on the benefits promised at the time they commenced employment – a right the Court has held is protected from impairment by the Contract Clause of the California Constitution. This is commonly referred to as “the California Rule.” The Initiative proposes two amendments to the California Constitution that would
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 Debra Bowen, in her capacity as Secretary of State of California, is also named as Respondent in this action, but takes no position on the merits of Petitioners’ claims.
 
 
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unquestionably eliminate the constitutional protections that the California Rule affords current public employees. First, it would add new section 12 to Article VII mandating that, henceforth, public employee retirement benefits “shall be earned and vested incrementally, only as the recipient actually  performs work, and only in proportion to work performed.” (Initiative at p. 4 [§4].)
2
 Second, the Initiative would amend existing section 9 of Article I – the State Contract Clause – to explicitly provide that new Section 12 of Article VII “is not deemed to impair the obligation of contracts.” (
 Ibid 
.) The “Purpose and Intent” section of the Initiative states that the intent of these constitutional amendments is “to supersede” the California Supreme Court’s prior decisions “which have been construed as limiting the ability to prospectively modify pension and retiree healthcare benefits for work not yet performed by government employees.”
3
 (Initiative at p. 3 [§3].) After filing the Initiative and requesting that the Attorney General prepare a circulating title and summary, the Petitioners publicly touted that the Initiative is their effort to “eliminate” the existing legal “roadblocks” that prevent state and local governments from reducing (or wiping out altogether) the retirement benefits that current public employees may earn for future work performed.
4
 Given the unmistakable purpose and effect of the Initiative
as even Petitioners previously described it 
, there should have been no surprise when the circulating title and summary issued by the Attorney General contained the following sentence: Eliminates constitutional protections for vested pension and retiree health care benefits for current public employees, including teachers, nurses, and peace officers, for future work performed. Approximately a month after the title and summary issued, however, Petitioners commenced this lawsuit objecting to use of the words/phrases “eliminates constitutional protections,” “vested,” and “teachers, nurses, and peace officers.” The arguments that Petitioners invoke in support of these objections are disingenuous, to say the least. Rather than candidly acknowledging that the California
2
 A copy of the full text of the Initiative is attached as Exhibit A to the Verified Petition for Writ of Mandate, filed February 6, 2014.
3
 The Initiative also proposes constitutional amendments that would require state and local government agencies to create a report if the funding level of the retirement and healthcare plan they provide falls below a specified level. (Initiative at p. 6-7.) However, the most “significant” and “notable” constitutional amendments being proposed are those that would make incremental vesting of pension and retiree health care benefits constitutionally permissible, and thereby allow government agencies to modify – or even eliminate – such benefits “for future years of service.” (See MPA at 1:19-25.)
4
 (Exh. A to O’Brien Decl. in support of Respondents’ Opposition, discussed
infra
at p. 11.)

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