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Tuesday, February 06, 2007 | Should the city’s beleaguered retirement system be allowed to have its own legal representation, or should it be advised by the elected city attorney like every other municipal department?
The judge presiding over that debate did not issue his final answer to that question after hearing City Attorney Mike Aguirre and lawyers representing the San Diego City Employees’ Retirement System argue their sides in court Wednesday, a day after he tentatively sided with the retirement system’s request for separate legal counsel. It is unknown when Superior Court Judge Jeffrey Barton will enter
Aguirre has argued for over a year that he revoked former City Attorney Casey Gwinn’s legal opinion that SDCERS could have its own legal advisor just days after taking office in December 2004.
“I should have been permitted, as of Dec. 15, to begin protecting the interests of the pensioners and, in a subordinate way, the interests of the taxpayers,” Aguirre said.
The court’s preliminary decision stated that only the City Council has the power to rescind the statement after it was codified.
The retirement system sued Aguirre last year to keep him from becoming its general counsel, arguing that the creditor-debtor relationship between SDCERS and the city means they are separate legal entities. Aguirre filed a cross-complaint to the civil lawsuit, using it as a forum to challenge the pension benefits he believes were illegally granted between 1996 and 2002, when the city was paying less than what it owed the fund.
Michael Leone, an attorney at Seltzer Caplan who represents SDCERS, said that the interests of the city’s taxpayers and the retirement system are fundamentally different, which was enough reason for the plan to have its own legal department.
“The only way by which these conflicts can be resolved is if each entity is represented in court by their own attorneys,” Leone said.
Attorneys representing SDCERS referred to an amendment to the state constitution voters approved in 1992 when they passed Proposition 162.
Judge Barton referred to Proposition 162 in the tentative ruling he issued Tuesday.
The state constitution, Barton said, gives the board overseeing SDCERS “the power to use its assets to retain counsel of its choosing to assure a prompt delivery of benefits and related services to the participants.”
Aguirre pointed to the cities of Los Angeles and San Francisco as examples where the city attorney represents the retirement systems in those municipalities, but the judge noted that the city charters governing those jurisdictions explicitly call for the city attorney to represent the pension plans.
The city attorney argued that San Diego’s charter says he’s the legal counsel for every city department except the Ethics Commission, which is explicitly excluded in the City Charter. He also argued that he had enough evidence to show that retirement system was a department like every other one within the city.
The voters would have to change the charter — the same way it changed the makeup of the retirement board’s membership in 2004 — to allow the retirement system its own legal department, not the other way around, Aguirre said.
Aguirre believes that allowing the board to supervise an in-house attorney will mean that counsel will only be accountable to retirement officials while his office is directly accountable to the city’s voters.
“It’s not because voters are self-interested, but because the way to provide true independence is through a system of democracy,” Aguirre said.
After former pension attorney Lori Chapin was indicted along with four other retirement officials last month, her second-in-command Roxanne Story Parks was named the interim replacement.
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