You are on page 1of 8

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO DATE/TIME JUDGE March 14, 2014, 10:30 a.m. HON.

ALLEN SUMNER DEPT. NO CLERK 42 M. GARCIA

CHARLES R. CHUCK REED, et al., Petitioners, v. DEBRA BOWEN, et al., Respondents.

Case No.: 34-2014-80001758

Nature of Proceedings:

PETITION FOR WRIT OF MANDATE

Following is the courts tentative ruling denying the petition for writ of mandate scheduled for March 14, 2014, at 10:30 a.m., in Department 42. This petition challenges ten words in an initiative summary prepared by the Attorney General. Petitioners, five California citizens and registered voters, 1 claim the words are false, partial and argumentative. They seek a writ of mandate compelling the Attorney General to amend the summary. For the reasons explained below, the petition is denied. BACKGROUND Petitioners seek to qualify an initiative, The Pension Reform Act of 2014, which would amend Californias Constitution to address pensions for public employees. The Pension Reform Act is almost ten pages, including over two pages of findings, a page of purpose and intent, and five pages of additions to the Constitution. In order to qualify the initiative for the ballot, Petitioners must first gather a sufficient number of signatures from registered voters. (Elec. Code 9020-9035.) 2 These signatures are gathered on a document known as an initiative petition. Prior to circulating an initiative petition, the text of the proposed initiative must be submitted to the Attorney General, who is charged with preparing a circulating title and summary of the chief purpose and points of the initiative. ( 9001, 9002, 9004.) This title and
1

Although not apparent from the face of the petition, it appears four of the five Petitioners are the Mayors of San Jose, Pacific Grove, Anaheim, and San Bernardino. Unless otherwise noted, all further references are to the Elections Code.

summary may not exceed 100 words. It is included on each page of the petition on which signatures appear, and in each section of the petition preceding the actual text of the initiative. ( 9008.) The title and summary must give a true and impartial statement of the purpose of the measure in such language that the ballot title and summary shall neither be an argument, nor be likely to create prejudice, for or against the proposed measure. ( 9051, subd. (c); see also 9004.) The title and summary prepared by the Attorney General reads as follows: PUBLIC EMPLOYEES. PENSION AND RETIREE HEALTHCARE BENEFITS. INITIATIVE CONSTITUTIONAL AMENDMENT. Eliminates constitutional protections for vested pension and retiree healthcare benefits for current public employees, including teachers, nurses, and peace officers, for future work performed. Permits government employers to reduce employee benefits and increase employee contributions for future work if retirement plans are substantially underfunded or government employer declares fiscal emergency. Requires government employers whose pension or retiree healthcare plans are less than 80 percent funded to prepare a stabilization report specifying nonbinding actions designed to achieve 100 percent funding within 15 years. [Emphasis added.] Petitioners challenge only the first sentence of the summary. They do not challenge the title, or the second and third sentences of the summary. They contend the wording is false, misleading, partial and/or argumentative. (Pet. 20, 24, Opening Br. at 6-14.) Petitioners seek a writ of mandate compelling the Attorney General to amend the summary. Their challenge fails. STANDARD OF REVIEW The purpose of the title and summary requirement is to avoid misleading the public with inaccurate information. (Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization (1978) 22 Cal.3d 208, 243.) To this end, the summary must be true. ( 9051.) It must also be impartial and not argumentative. (Id.) The wording of the summary cannot favor or disparage a particular position, or signal to voters how the Attorney General believes they should vote. (Huntington Beach City Council v. Superior Court (2002) 94 Cal.App.4th 1417, 1433; Martinez v. Superior Court (2006) 142 Cal.App.4th 1245, 1248.) The court may independently review the Attorney Generals summary to determine it if is true and impartial. However, the courts discretion is not wide ranging. (Martinez, supra, 142 Cal.App.4th at p. 1248; Horneff v. City & County of San Francisco (2003) 110 Cal.App.4th814, 821.)

Courts recognize the difficult task of preparing a summary that is brief, accurate, impartial and understandable to the voters. The Attorney General is required to prepare a title and summary in 100 words or less. ( 9002.) As one court has noted, this can be difficult where multiple reasonable interpretations exist of an initiatives purpose and effect. (Zarembergv. Superior Court (2004) 115 Cal. App. 4th 111, 117.) The Attorney General is thus afforded considerable latitude in composing the summary; the court must presume her language is accurate, absent clear and convincing proof otherwise. ( 9092; Gov. Code 88006; Amador Valley, supra, 22 Cal.3d at 243; Yes on 25, Citizens for an On-Time Budget v. Superior Court (2010) 189 Cal.App.4th 1445, 1452.) Our Supreme Court instructs, all legitimate presumptions should be indulged in favor of the propriety of the [Attorney Generals] actions. (Epperson v. Jordan (1938) 12 Cal.2d 61, 66; see also Lungren v. Superior Court (1996) 48 Cal.App.4th 435, 439.) Only in a clear case should a summary be held insufficient. (Brennan v. Board of Supervisors (1981) 125 Cal.App.3d 87, 93.) If reasonable minds may differ as to the sufficiency of the summary, it should be held sufficient. (McDonough v. Superior Court (2012) 204 Cal. App. 4th 1169, 1174; Zaremberg, supra, 115 Cal.App.4th at 117.) ANALYSIS 1. The California Rule and the purpose of the initiative

Petitioners admit one of the main purposes of their initiative is to overturn what is known as the California Rule. (Opening Br. at 8:20 to 9:12.) The California Rule deals with the scope of the right of public employees to pension benefits. The Rule is complicated. Indeed, Petitioners submitted a 50-page law review article explaining its origins and application. (Amy Monahan, Statutes as Contracts? The California Rule and Its Impact on Public Pension Reform, 97 Iowa Law Review 1029 (2012) [Monahan Article.].) The Monahan Article traces the evolution of the California Rule from its origins in 1917 through 1991. The main thrust of the California Rule is that if the government offers a retirement benefit when an employee is hired, the government may not thereafter change that benefit going forward unless the change is offset by comparable new advantages. (See generally Monahan Article, 97 Iowa Law Review at 1046-69; Legislature v. Eu (1991) 54 Cal.3d 492.) 3

The California Supreme Courts Eu case is discussed in more detail below. The Monahan Article describes the California Rule as follows: [P]ension benefits for current employees cannot be detrimentally changed, even if the changes are purely prospective. (Monahan Article at 1032.) [T]he state cannot decrease the workers rate of pension accrual as long as she is employed. (Monahan Article at 1033.) California courts have not only held that public pensions create a contract but also that the contract is formed on the employees first day of employment. While the courts permit reasonable modifications of the contract prior to retirement, they do not allow any disadvantageous modifications unless the modifications are offset by comparable new advantages. (Monahan Article at 1036.) [I]t was not clear . . . whether a change in future rates of accrual would be considered a detriment that had to be offset by comparable new advantages, since those benefits had not yet been earned. . . . California courts

For example, assume when an employee is hired the government offers a traditional pension plan providing retirement benefits equal to 2 percent of the employees compensation for each year of employment. After ten years of service, the employee has earned an annual retirement benefit equal to 20 percent of his or her salary (i.e., 2 percent times ten years). Petitioners refer to this retirement benefit as one which has vested based on prior years of service, or one which the employee has already earned. (Opening Br. at 1:21, 6:23.) The initiative does not affect this benefit. 4 The question addressed by the initiative is whether government can change the pension plan prospectively. For example, reducing the formula going forward to 1 percent a year. Under the California Rule, the answer is no (unless the employer offsets the change with comparable new advantages). (See generally Monahan Article, 97 Iowa Law Review at 1046-69; Eu, supra, 54 Cal.3d 492.) Petitioners state their initiative takes the California Rule head-on. (Opening Br. at 9:12.) They state their initiative would now allow employers to make reasonable modifications to pension benefits for future services. (Pension Reform Act, 3, subd. (g).) Petitioners challenge the accuracy of the Attorney Generals summary of the initiatives effect on California law. 2. The initiative eliminates constitutional protections and vested benefits

Again, the Attorney Generals summary of the initiative states: Eliminates constitutional protections for vested pension and retiree healthcare benefits for current public employees, including teachings, nurses, and peace officers, for future work performed. Petitioners argue the word eliminates is likely to create prejudice against the initiative, and the words constitutional protections and vested are false and misleading. A. Eliminates

Petitioners argue the word eliminates is problematic because the initiative does not eliminate, repeal or replace any provision of the state Constitution. It merely adds a new provision to make it clear that pension benefits may be negotiated. (Opening Br. at 7:7-9.) Petitioners argue the word eliminates implies the initiative is deleting a provision of the Constitution. In fact, the summary states the initiative eliminates constitutional protections, not that it eliminates Constitutional provisions. There is nothing false or misleading here.

resolved this issue beginning in the 1980s by holding that future accruals are, in fact, protected from detrimental changes. (Monahan Article at 1066.)
4

The proposed amendment to the Constitution provides: Nothing in this subsection shall affect pension . . . benefits earned and accrued for work already performed by employees . . . . (Proposed section 12(a)(2) of art. VII of Cal. Const.)

Petitioners also argue the word eliminates is likely to create prejudice because it fosters a visceral negative response from voters. (Opening Br. at 8, citing Rivers Decl., Ex. A.) Petitioners cite a public opinion poll. This poll is irrelevant. The Attorney General is charged with preparing a summary that is true and impartial; not a summary that polls well. (See, e.g., Martinez, supra, 142 Cal.App.4th at 1248 [test is not whether summary is as accurate, comprehensive, and fair as possible, but whether it is uses words that are neither false, misleading, nor partial].) Petitioners argue the fact voters have a negative response to the word eliminates proves the summary is not impartial. It does not. Voters may have negative responses to many words and phrases, for example raises taxes or sex-offender. The fact voters may have a negative response to these words, standing alone, does not mean they are partial or the Attorney General may not use them to describe measures that do indeed raise taxes or address sex-offenders. B. Constitutional protections

Petitioners argue the phrase constitutional protections is similarly false and misleading. They maintain the California Rule is not constitutionally based, but rather a common law rule created by language in certain appellate court decisions suggesting state statutes governing public pensions create a contract between government agencies and their employees. (Opening Br. at 8:22.) Who are these unnamed appellate courts, with their imprecise language creating misleading suggestions? The California Supreme Court. (See Opening Br. at 8:24-25 [citing only two California Supreme Court cases Legislature v. Eu (1991) 54 Cal.3d 492 and Allen v. City of Long Beach (1955) 45 Cal.2d 128].) Petitioners believe the California Rule is flawed and the California Supreme Court got it wrong. Petitioners are free to disagree with the California Supreme Court. They may ask the voters to change the law. The voters may agree. However, Supreme Court has the last word on what California law is. (See Marbury v. Madison (1803) 5 U.S. 137, 177 [It is emphatically the province and duty of the judicial department to say what the law is.].) If the California Supreme Court says the California Rules protections are constitutionally based, they are. There is nothing false or misleading about the Attorney Generals summary of current California law. Legislature v. Eu (1991) 54 Cal.3d 492 is our Supreme Courts most recent explication of the California Rule. In Eu, the California Legislature challenged Proposition 140 of 1990, which amended the Constitution to eliminate pension and retirement benefits for legislatures. (Id. at 527.) Proposition 140 provided: This Section shall not be construed to abrogate or diminish any vested pension or retirement benefit which may have accrued under an existing law . . . , but upon the adoption of this Act no further entitlement to nor vesting in any existing program shall accrue to any such person. . . . (Id. at 527-28.) The issue in Eu was whether the initiative could take away the right of legislators to earn future pension benefits through continued service, on terms substantially equivalent to those then offered when they first assumed office. (Eu, supra, 54 Cal.3d at 528.) The legislators argued Proposition 140 impermissibly impaired a vested contractual right to continued participation in the pension programs in place when they first became legislators. (Id.) 5

The Supreme Court agreed. It held incumbent legislators had a vested right to earn additional pension benefits through continued service, and that the initiative must be deemed an impairment of that right. (Id. at 530 [emphasis added].) The Court explained that on commencing to serve the state the officer acquires a vested right to earn, through continued service, additional pension benefits in an amount reasonably comparable to those available when he or she first took office. (Id. [italics in original, bold italics added].) And again: Thus, we hold that, under California law, all incumbent legislators acquired a vested right to earn additional pension benefits through continued service, a right that [the initiative] clearly impairs. (Id. at 532 [emphasis added].) In other words, even after passage of Proposition 140, legislators had a right to continue earning pension benefits in the future under a retirement plan comparable to the one in place when they took office. The Supreme Court identified the contracts clause of the federal and state Constitutions as the source of this right. The state and federal constitutions prohibit government from passing any law impairing the obligation of contracts. (Eu, supra, 54 Cal.4th at 528 [citing cases confirming both the federal and state contract clauses protected the vested pension rights of public officers and employees from unreasonable impairment] [emphasis added].) The Supreme Court explicitly considered whether the contract clause of the federal Constitution protects the pension rights of state public officials such as legislators. (Id. at 532.) The Court acknowledged a line of federal authority permitting states to alter public employee compensation. (Id. at 533.) However, the Court concluded, in light of prior California decisions consistently extending federal contract clause protection to state public officers, it is simply too late to retreat from the clear indication of these holdings. (Id. at 533-34.) The bottom line: We conclude that the pension restrictions of [the initiative] are unconstitutional under the federal contract clause as applied to incumbent legislators because they infringe on the vested pension rights of those persons. (Id. at 534 [emphasis added].) Based on the our Supreme Courts clear characterization of the source of the California Rule, there is nothing false or misleading about the Attorney Generals use of the phrase constitutional protections. C. Vested benefits

Petitioners argue the word vested is false and misleading. Petitioners use the word to mean only benefits that have already been earned through past service -- not benefits yet to be earned through future service. Petitioners thus would say an employee with ten years of service has earned ten years of pension benefits, and those benefits may properly described as vested. However, Petitioners would not use the term vested to describe benefits the employee has yet to earn for future service. Petitioners argue the Attorney Generals use of the term vested will mislead voters into believing the initiative would interfere with benefits already earned. The Attorney Generals summary does not. The summary twice informs voters the initiative deals with benefits for future work. This is accurate.

Moreover, the Attorney General uses the term the same way as the California Supreme Court. The Eu decision is replete with references to vested rights. 5 The Supreme Court simply does not use the term the way Petitioners do. The Court uses the term to describe benefits that will be earned through future service: a state employee has a vested right to earn, through continued service, additional pension benefits. (Eu, supra, 54 Cal.3d at 530 [emphasis added].) And: an employee has a vested right to earn additional pension benefits through continued service. (Id. [emphasis added].) And: current employees have a vested right to earn additional pension benefits through continued service. (Id. at 532 [emphasis added].) Again, there is nothing false or misleading with the Attorney Generals use of the term vested. Finally, Petitioners argue the phrase eliminates constitutional protections and vested benefits is misleading as a whole, because the Pension Reform Act does not actually eliminate anything. It merely clarifies a complicated area of law, allowing government to make changes going forward while protecting benefits earned in the past. This argument is unpersuasive. As discussed above, a government employer is prohibited from making prospective changes to its pension system for current employees, unless it offers comparable advantages somewhere else. If Petitioners initiative passes, a government employer would then be allowed to make prospective changes to its pension system for current employees. Again the Attorney Generals summary is accurate. Petitioners suggest the following alternative: Amends the Constitution to allow government employers to negotiate with government employees to modify pension and retiree heathcare benefits for future work performed. But the test is not whether Petitioners or the court could come up with a better summary to replace the Attorney Generals. (See Brennan, supra, 125 Cal.App.3d at 96.) The issue is whether the Attorney General met her statutory duty to prepare a summary that is both true and impartial. The Attorney Generals summary need not be the most accurate, most comprehensive, or fairest that a skilled wordsmith might imagine. The [summary] need only contains words that are neither false, misleading, nor partial. (Martinez, supra, 142 Cal.App.4th at 1248.) The court finds the Attorney Generals summary meets this standard. 3. Teachers, nurses, and peace officers

Petitioners challenge the Attorney Generals use of the phrase including teachers, nurses, and peace officers to describe who the initiative will effect. Petitioners object the description is not impartial because it singles out three very popular groups of public employees. The summary states the initiative applies to current public employees. It is certainly true that teachers, nurses and peace officers are public employees. Is it argumentative to cite these professions? The Attorney General responds teachers, nurses and peace officers make up
5

Indeed, the word appears over 25 times in the opinion.

close to half of all public employees. Her summary thus accurately and concisely identifies for the voters the employees affected. Reasonable minds may differ, and political scientists may argue. This is insufficient. Again, the court must presume the Attorney Generals language is accurate. The Attorney General is given considerable latitude in composing her summary. (Yes on 25, supra, 189 Cal.App.4th at 1452.) The court may not interject itself into the process absent clear and convincing proof. (Lungren, supra, 48 Cal.App.4th at 439, 441.) Petitioners challenge does not meet this showing. CONCLUSION For the forgoing reasons, the petition is denied. The tentative ruling shall become the courts final ruling and statement of decision unless a party wishing to be heard so advises the clerk of this department no later than 4:00 p.m. on the court day preceding the hearing, and further advises the clerk that such party has notified the other side of its intention to appear. In the event this tentative ruling becomes the final ruling of the court, counsel for the prevailing party is directed to prepare a formal judgment, incorporating this ruling as an exhibit; submit it to opposing counsel for approval as to form; and thereafter submit it to the court for signature and entry of judgment in accordance with Rule of Court 3.1312. The court prefers that any party intending to participate at the hearing be present in court. Any party who wishes to appear by telephone must contact the court clerk by 4:00 p.m. the court day before the hearing. (See Cal. Rule Court, Rule 3.670; Sac. County Superior Court Local Rule 2.04.) In the event that a hearing is requested, oral argument shall be limited to no more than thirty (30) minutes per side. If a hearing is requested, any party desiring an official record of the proceeding shall make arrangement for reporting services with the clerk of the department not later than 4:30 p.m. on the day before the hearing. The fee is $30.00 for civil proceedings lasting under one hour, and $239.00 per half day of proceedings lasting more than one hour. (Local Rule 1.12 and Govt. Code 68086.) Payment is due at the time of the hearing.

You might also like