Saturday, June 6, 2009

SDPOA set to Prevail against City in DROP Litigation

It was announced this afternoon the judge will issue an order against the City on Monday preventing them from making changes to DROP. Indications are the judge will bar the City from changing the entry age for DROP and from lowering the interest rate earned on DROP accounts. The last item related to this injunction is the elimination of DROP for managers. The judge denied the City from following through on this also. Word from the court is the judge was stern in his comments toward the City and will rule on Monday.

This means the City will be required to ensure DROP accounts earn 7.75% on the money in the accounts not the 3.54% set by SDCERS. The City will have to make up the difference from the 3.54%. This applies to Police and Fire as we have this in our MOU and have had it there since the inception of DROP. This also means those who turn 50 in the coming months can enter DROP and take advantage of the benefit as it was designed and agreed upon. It also means Chiefs and Captains who had DROP removed from their benefit package can take advantage of this benefit.

Long term what does this mean? The case will ultimately be litigated in court, so the City can be told once and for all DROP is a vested and earned benefit that cannot be taken away without a vote of the membership. It means the City will be required to find the money to make up the difference SDCERS is paying DROP accounts and the 7.75%.

We should have more information soon on this issue. This is great news for those not yet in DROP and those who are not leaving in the next few weeks and will continue to participate in DROP. If you want to read more on this issue you can go to Mike Conger's web site where you will find information related to the SDPOA litigation related to DROP.

Retiree Medical is not addressed in today's proceedings. That litigation is still being researched and discussed.

The above was reported by SDPOA President Brian Marvel at Bill Nemec's Retirement Party last night. Read the following story in Voice of San Diego.


Anonymous said...


Anonymous said...

Sparky who made this announcement and where can we find it to read for ourselves? I cannot find anything about this other than your blog.

sparky.sandiego said...

It was announced by Brian Marvel at Bill Nemec's Retirement Party. The SDPOA Board and attorney, Dick Castle were giddy with excitement. A formal announcement will be made Monday after the court hearing to finalize the TRO against the City.

Anonymous said...

Voice of San DIego is reporting thatthe City will not contest the TRO.

Anonymous said...

So has the pending court TRO decision altered your decision to stay or go?

Anonymous said...

The Court issued an order to show cause why a temporary restraining order (TRO) should not be issued on Monday, June 8, 2009, at 11:00 (hearing moved up from 1:45).

This is a very good development.

I expect a formal TRO will be issued on Monday.

The order is even broader and better than we requested.

Here is the wording of the actual order. I have attached an official copy too.

You are ordered to appear in Department 67 of the San Diego Superior Court on Monday, June 8, 2009, at 11:00 am before Judge David B. Oberholtzer to show cause, if any there be, why the court should not issue a temporary restraining order prohibiting the City of San Diego, its boards, commissions and administrators, from compelling any employee (including but not limited to firefighters, police and municipal workers) to make an election of any sort relating or referring to the City's Deferred Retirement Option Plan (whether provided for in memoranda of understanding, contract, City Charter or otherwise) pending further order of this court. Any election by an employee that could have been made or must have been made in the time between this restraining order and further order of this court, shall be deemed to have been made on or before the respective election date, nunc pro tunc. SO ORDERED

Dated: June 5, 2009 ~­
DAVID B. OBERHOLTZER Judge of the Superior Court