Update on Affected PSC Contracts of Active Members "Trapped in DROP"

Date: Apr 12, 2011


The City Attorney’s office initially assured SDCERS it would not object to SDCERS’ request of the court for a clarification order exempting from correction affected PSC contracts of those Members in DROP before November 20, 2007.  On Monday, April 11, however, the City Attorney’s office instead filed with the court an opposition to SDCERS’ request (see PDF of Opposition, at the bottom of this page).

On January 25, 2011, City Attorney Jan Goldsmith sent a letter to SDCERS’ CEO Mark Hovey, responding to issues raised by SDCERS and Ann Smith relating to the correction of PSC contracts, as required by the final PSC litigation ruling (see PDF of Jan Goldsmith's letter, at the bottom of this page).

In that letter, the City Attorney addressed the necessity of correcting PSC contracts for Members who entered DROP before the City filed its lawsuit on November 20, 2007, stating: 

“The City’s petition and the judgment did not apply to individuals who were retired as of November 20, 2007.  There were about 280 employees who were already in the DROP program at that time and the terms of DROP precluded them from leaving the program.  What’s more, DROP requires termination of their employment after five years.  As a result, on November 20, 2007, these individuals were “trapped” in DROP and could not correct the service credit problem by leaving the program and resuming normal employment.” 

The City Attorney also stated in the letter that the judgment should be clarified by Judge Nevitt (who rendered the original decision) and that SDCERS should file a motion requesting clarification of the judgment. 

The City Attorney’s office separately advised SDCERS that the City Attorney’s research indicated that the Court retained the power to clarify the judgment to exempt these Members and that the City would not oppose a motion requesting clarification.  Based on these statements from the City Attorney’s office, SDCERS filed the motion requesting clarification of the judgment and asking that the Court allow SDCERS to treat members who entered DROP before November 20, 2007 as if they were retired.

However, in the City’s opposition filed April 11, 2011, they argue that Members who entered DROP before November 20, 2007 should not be excluded from correction and that  the Court has lost power to clarify its judgment to make this finding. 

The hearing on SDCERS’ motion is scheduled for April 22, 2011 at 2:30 p.m. in Department C-64 of the San Diego Superior Court.

Document Under Categories: DROP, Litigation, Purchase of Service (PSC)