Since Prop B went into effect in July 2012, it has been embroiled in litigation. The case went all the way to the California Supreme Court, which determined the Mayor Sanders’ support of the initiative and failure to meet and confer with recognized unions over pension changes violated the Meyers-Milias-Brown Act. The Court of Appeal ordered the City to work with the labor unions to agree upon a “make-whole” remedy for City employees who were affected by Prop B. However, the Court of Appeal did not invalidate the law itself – meaning Prop B was still in effect. In June 2019, the City Council voted to join the labor unions in what is called a “quo warranto” action to repeal Prop B through the courts. In September 2019, the unions filed a quo warranto action in San Diego Superior Court requesting that Prop B be overturned. SDCERS is not a party to any litigation connected to Prop B and we won’t know whether or not Prop B will be overturned until all Prop B-related litigation has concluded.
Update as of January 5, 2021: On January 5, 2021, the trial court heard oral arguments from all of the parties involved in the quo warranto action to overturn Prop B. At the hearing, the trial court issued a verbal ruling from the bench, declaring that Prop B is invalid. The court will issue a written statement of its decision, which will direct the City Council to erase Prop B's language from the City's Charter. If the trial court's decision is appealed, any enforcement of the decision may be stalled until the appeal is resolved.
Update as of April 12, 2021: The deadline for proponents of Prop B to appeal the trial court's decision has passed, which means the trial court's order invalidating Prop B is final. Next, the City must take legislative action to remove Prop B from the City Charter and restore all terms and conditions of employment to what they were prior to Prop B's effective date (July 20, 2012). This legislative action will be needed to allow new City employees to be enrolled in the SDCERS defined benefit pension plan at the time of hire. This action will also allow the City and the labor unions to determine how, when, and under what terms to move current active employees into the SDCERS pension plan.
Update as of July 10, 2021: New City employees hired from this date forward will participate in the pension system. The City and relevant labor unions are in continuing negotiations regarding how to implement Prop B's invalidation as it pertains to City employees (non-police officers) hired between July 20, 2012 and July 10, 2021. Once negotiations are finalized and SDCERS receives direction regarding the outcome, employees affected by Proposition B will be contacted with more information.
Update as of January 31, 2022: Please see the information in this article regarding agreements reached between the City and some labor unions. The City is still in negotiations with the remaining labor unions regarding the unwinding of Prop B and will announce more information once agreements are reached.
Update as of September 1, 2022: All active City employees who either chose to retroactively join SDCERS or who joined by default as a result of their labor union's negotiated agreement are officially SDCERS Members. All or a portion of those employees' SPSP-H accounts were transferred to their SDCERS member contribution accounts in order to restore their eligible years of service credit. Please log in to your Member Portal account to monitor your contributions and service credit. Principal is still the administrator of City-sponsored 401(a), 401(k), and SPSP accounts. The City and relevant labor unions are in continuing negotiations regarding all separated City employees who were affected by Prop B.
Update as of September 28, 2023: In early February, 2023, the terms of a Prop B Settlement Agreement with the MEA and Local 127 concluded regarding City employees who were hired during the Prop B time period, but left City employment before July 9, 2022. On February 28, 2023, the San Diego City Council approved these agreements. A copy of the approved agreement and description of the City’s make-whole obligations can be found on this website: https://www.sandiego.gov/riskmanagement/services/propb. The City will be sending letters to affected former City employees in late 2023, which will describe the process of purchasing SDCERS service credit associated with their period of City employment and the associated deadlines.
NOTE: SDCERS is not directly involved with negotiations regarding the invalidation of Prop B. Please direct all relevant questions to your respective labor union representative or to PropB@sandiego.gov.