Lake County Record-Bee

Biden helps unions attack California pension reform

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Jerry Brown signed thousands of legislativ­e bills during his two eight-year stints as California’s governor but two stand out as fundamenta­l and potentiall­y long-lasting alteration­s in the status quo.

One is the Local Control Funding Formula (LCFF), which changed how California public schools are financed to provide more money for improving the educations of poor and English-learner students.

The second is the California Public Employees’ Pension Reform Act (PEPRA), which reduced pension benefits for new state and local government employees in an effort to keep the California Public Employees Retirement System from sliding into insolvency.

Both were enacted nearly a decade ago in the first years of Brown’s second governorsh­ip but whether either will deliver the promised benefits is still uncertain.

Although 60% of California’s nearly 6 million K-12 students are deemed to be “at-risk” and needing the extra attention LCFF promised, the program has been criticized for its lack of oversight and the “achievemen­t gap” it was supposed to narrow remains unacceptab­ly wide.

With PEPRA, as public employees retire and are replaced by new hires with redefined benefits, the gap between what the pension system has in assets and what it needs to pay out in future decades will narrow.

However, public employee unions have opposed Brown’s reform plan from the onset, have tried to undo parts of it through litigation and are enlisting the federal government’s help in challengin­g the plan’s legality.

Shortly after Brown signed the pension reform legislatio­n, unions representi­ng workers in public transit systems persuaded the federal Department of Labor, then part of former President Barack Obama’s administra­tion, to declare that it violated a federal law.

The 1964 law prohibits agencies from receiving federal grants for mass transit unless the department certifies that the agencies are protecting the interests of affected employees. The Labor Department declared that PEPRA, by making pension changes without bargaining them with unions, violated the law and thus blocked federal aid to California transit systems.

Brown disputed the finding and the issue wound up in federal court, where a judge ruled that the Department of Labor’s “failure to consider the realities of the process of public sector bargaining renders its decision arbitrary and capricious.”

That decision, specifical­ly affecting two local transit systems, kept federal funds flowing to California and former President Donald Trump’s administra­tion rebuffed union efforts to have PEPRA overturned.

However, Democrats are back in power with the election of President Joe Biden and once again the Department of Labor is threatenin­g to cut off federal transit funds to all but the two systems affected by the previous federal court ruling. It potentiall­y affects billions of dollars from the recently enacted infrastruc­ture improvemen­t program.

The transit agencies are raising the alarm and Gov. Gavin Newsom is emulating predecesso­r Jerry Brown in opposing the Biden administra­tion’s attack on

PEPRA. Newsom, in a letter to Labor Secretary Marty Walsh, asks for a reversal of its declaratio­n, saying it’s legally flawed and would harm transit agencies and their passengers.

“Public transit agencies rely more than ever on these federal grants just to keep trains and buses running and their workforces employed,” Newsom said in the letter. “The grants being withheld also help provide vital mobility to low-income seniors, individual­s with disabiliti­es, and other transit-dependent riders.”

Were California’s transit workers to be exempted from PEPRA, it would put Newsom and the Legislatur­e in a bind. Politicall­y, they are joined at the hip with public employee unions, which would then demand that millions of other workers should also be exempted, thereby gutting pension reform.

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