Could Jerry Brown's Pension Limitations Be Undone?

Under former Gov. Jerry Brown, various limits were placed on state public pensions. UC went from a defined-benefit pension to a hybrid with tiers, defined-contribution options, etc. Now the Biden administration, which has just enacted an infrastructure bill, is saying that state transit systems in California are not eligible for those new federal funds because of those legislated limits.

Although the current issue involves just transit workers, it seems likely - if California has to change those limits - that UC's pension system would also be modified. Of course, it is possible that the state will successfully obtain a reversal of policy from the Biden folks.

From the Sacramento Bee:

The U.S. Labor Department recently determined California is ineligible for federal money for public transit, putting in jeopardy about $12 billion in grants including a portion of the infrastructure spending Congress approved last week. The Labor Department’s determination targeted a 2013 state pension law that the department said eroded public transit employees’ rights to negotiate over their pay and benefits. A 1964 federal law says that before state and local agencies may receive federal grants for mass transit, the department must certify the agencies are protecting the interests of any affected employees. California, by restricting pension benefits for any new employees hired after Jan. 1, 2013 with its Public Employees’ Pension Reform Act, ran afoul of those federal protections, according to the Labor Department’s Oct. 28 determination. 

The determination would affect about $9.5 billion Congress earmarked for California public transit agencies in the infrastructure bill the U.S. House of Representatives approved Friday, said Michael Pimentel, executive director of the California Transit Association, a nonprofit representing public transit agencies in the state. In total, the $1.2 trillion bill included about $45 billion for California. Also affected would be about $2.5 billion in American Rescue Plan Act grants for public transit in California, which several agencies have already applied for, Pimentel said.

“This relief funding has served as a lifeline for them, and in the absence of these federal dollars flowing to California transit agencies, we will absolutely see a reduction in service and losses in our workforce, making it more difficult for agencies to rebound,” Pimentel said. Pimentel said the dollar figures are estimates, and that the amount could ultimately be smaller depending on how the Labor Department implements its determination. 

Gov. Gavin Newsom urged Labor Secretary Marty Walsh in a letter Wednesday to reverse the decision, which he said is legally flawed and would harm transit agencies and their riders...

Full story at https://www.sacbee.com/news/politics-government/the-state-worker/article255720896.html.