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A tentative judgment issued Thursday in the city of San Diego’s main pension case could drastically reshape the stakes of the legal challenge pushed by City Attorney Mike Aguirre for the last year.
Aguirre is trying to roll back $500 million worth of employee pension benefits that he says were created under illegal deals the city and retirement system approved in 1996 and 2002. Wiping the city’s ledger clean of those contested benefit increases would significantly lower its annual payments to the retirement fund in years to come as officials try to whittle away a $1.4 billion deficit.
However, a court settlement that altered employee pension benefits in 2000 – in between the two deals contested by Aguirre – could end up protecting a chunk of those benefits. In a tentative ruling released Thursday, Superior Court Judge Jeffrey Barton affirmed the benefits under the 2000 Corbett settlement in his tentative ruling.
“These benefits cannot now be set aside, as this would invalidate the Corbett judgment,” Barton wrote in his tentative opinion.
The true financial impact of the tentative ruling was disputed Thursday.
Aguirre said the tentative judgment only protects the benefit boost that was granted as part of the Corbett settlement – or about 10 percent of the $500 million he hopes to wipe away. The city attorney said he was confident he could sway the judge during Friday’s scheduled hearing.
Attorney Michael Conger, who is not directly involved in Aguirre’s case but represented the plaintiffs in the Corbett case, said he interprets the tentative ruling to mean that all the benefits granted prior to his client’s settlement are secure as well. That would mean that only the 2002 benefit boosts would be fair game in Aguirre’s legal challenge. If only the 2002 benefits are allowed to be challenged in the trial that is scheduled for October, it could drastically reshape the debate about whether the city wants to allow Aguirre to continue his legal quest. Conger estimated that only $40 million would be on the table in that case.
A final ruling on this motion is expected after Friday’s hearing.
Just how much in benefits Aguirre would be able to roll back has long been a point of contention in the history of the legal challenge.
Council President Scott Peters has agreed with unions, saying that the Corbett settlement was protected. He has publicly questioned the wisdom of garnering expense and ill will for a slice of the savings Aguirre has advertised.
Barton also tentatively denied the retirement system’s request for an expedited hearing, saying that facts are still in dispute and that he could not rule on the law until the facts are ironed out by a jury. He ruled similarly when Aguirre asked to forego a trial, and an appellate court upheld the judgment this week.