Long-ago union payoff now haunts CA pension reform

Long-ago union payoff now haunts CA pension reform

In his Tuesday Sac Bee story about the federal government preparing to withhold funds for state construction projects because the 2012 state pension reform violated a “federal mass transit grant rule,” Jon Ortiz got it wrong. It’s not a grant rule. It’s a plainly written 1964 federal law that could haunt pension reform efforts in California and around the U.S. I have the details in a U-T San Diego editorial:

“In 1963, President John F. Kennedy and many in Congress were keen on using federal funds to improve decaying mass-transit systems in urban areas. But transit unions, worried about the sharp decline in transit jobs after World War II, were strongly opposed. According to an analysis commissioned by the Federal Transit Association, the workers feared that automated, driverless cars and buses could wipe out scores of jobs, and that the federal effort might lead to government takeovers of private transit firms and an abrogation of their workers’ collectively bargained contracts.


“To win union support, Kennedy, Congress and Lyndon B. Johnson, Kennedy’s successor, agreed to include protections for transit workers in what became the Urban Mass Transportation Act of 1964. The most significant: Federal transit funds shall not go to governments that have not preserved the ‘rights, privileges and benefits under existing collective bargaining agreements’ of all transit workers in the area where the funds are to be spent.”

A hangover — 49 years later

Talk about prescient — the unions feared driverless cars long before Google started making them. But talk about a hangover — this old concession now hangs over any effort to fix local and state pensions. More from the editorial:

“[In] an Aug. 1 letter, U.S. Labor Secretary Thomas E. Perez told state officials that he had concluded the modest but constructive pension reform adopted by the Legislature last year circumvents the collective-bargaining rights of the state’s 20,000 transit workers.

“The reform requires the use of a less-generous retirement formula for public employees hired starting Jan. 1 of this year. It also requires all governments to steadily adjust pension-funding formulas until the employer and employee share the cost burden equally.

“In his letter, Perez expressed sympathy for the fiscal bind that led California to seek pension reform. But he said he has concluded that he has no choice but to withhold funds — starting Friday — unless state transit workers are exempted from the 2012 pension reform. The labor secretary notes that a bill before the Legislature, AB 160, would do just that.

“This is preposterous. A 1964 legal provision addressing concerns that may have been valid then but are now moot has morphed into a powerful protection for the pensions of all mass-transit workers — even those not yet hired.”

A 1964 legal provision that was a concession to unions!

For more on this ancient power play, here’s a 1995 study commissioned by federal transit authorities.


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  1. Ted Steele, Prosecutor
    Ted Steele, Prosecutor 15 August, 2013, 08:02

    WHAT??? You mean we will have to live up to the obligations we made to the workers in exchange for the work they did?????????

    Reply this comment
  2. admin
    admin 15 August, 2013, 09:40

    Ted: Who is this “we”? Not me. I never signed anything.

    And in any case, my “we” obligation will be canceled the happy day when I drive out of this state for good.

    — John Seiler

    Reply this comment
  3. El Kabong
    El Kabong 15 August, 2013, 16:40

    I always like to see the law get in the way of the lynch mob.

    Reply this comment
  4. Ted Steele, Prosecutor
    Ted Steele, Prosecutor 15 August, 2013, 17:17

    …be sorry to see ya go John– I can sense your frustration.

    The “we” comes from a representative democracy John. Wherever you intend to go I bet they have one of those pesky things there too!

    Reply this comment
    • admin
      admin 16 August, 2013, 12:06

      Funny. Special interests buying the regime, which then imposes tyranny and robs me, is wrong no matter who does it, including a “democracy.” But even the “will of the people” cannot defy economic laws, such as that if you spend and borrow too much, you go bankrupt. Soon.

      — John Seiler

      Reply this comment
  5. SeeSaw
    SeeSaw 16 August, 2013, 12:02

    A writer can earn a living anywhere. What are you waiting for? You have a right to the pursuit of happiness, and you can drive to any state you want. That is just one thing that is so great about this country!

    Reply this comment
    • admin
      admin 16 August, 2013, 12:09

      A writer writing on California has to live here. And I have personal interests to stay, for now.

      In today’s America, “the pursuit of happiness” has been outlawed. But when personal happiness is outlawed, only outlaws will have personal happiness.

      — John Seiler

      Reply this comment

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