Carter wants SLO council to appeal judge’s decision

March 9, 2014

Former San Luis Obispo Councilman Andrew Carter’s letter to the city council:

Dear council,

What follows is lengthy. I realize that. It covers every nuance I can think of about the decision you face on Monday.

As you are aware, I have been sounding the alarm about this matter since I first heard of it on Tuesday. I make no apologies for that. In fact, AnnMarie Cornejo at The Tribune knew nothing about the issue until I told her Wednesday evening. I was afraid your decision would come and go without anyone having the chance to voice their views.

My thoughts …

The ruling:

As you know, an administrative law judge from the Public Employee Relations Board in Sacramento has invalidated the B-portion (binding arbitration) of the Measure A & B election of August 2011. She let the A-portion stand (pension reform).

Meet and confer:

The administrative law judge made her ruling because she believes city council violated the “meet and confer” process when it put Measure B on the ballot. Oddly, she did not reach that conclusion on Measure A.

What the administrative law judge failed to note was that the “meet and confer” process in San Luis Obispo at that time for public safety employees included the possibility of binding arbitration on all issues involving the employee/employer relationship. We can reasonably assume that public safety would have taken the city to binding arbitration over the issue of putting its repeal on the ballot, so council would have needed an outside arbiter to allow it to put A and B on the ballot.

I remember from council closed sessions at the time that there is legal precedent which says getting rid of binding arbitration cannot be held hostage to binding arbitration. That precedent is one of the reasons council chose to proceed. Also, given the city’s previous experience with binding arbitration, it would have taken two years for the binding arbitration process on the ballot initiatives to unfold.

Impact on the city charter:

The administrative law judge has directed city council to restore binding arbitration to the city charter. What is interesting is that she is telling council to do something council normally does not have the right to do. Council cannot change the city charter, only the people can.

Invalidating the will of the people:

Through her decision, the administrative law judge is invalidating the will of the 7,723 San Luis Obispo citizens who voted in August 2011 to repeal binding arbitration (73 percent of the ballots casts).

We all know that courts do occasionally invalidate elections, but that’s usually when the people make a decision the courts do not believe the people have a right to make under the U.S. Constitution or a state constitution. Think of a vote that unconstitutionally limits the right to free speech, the right to vote, the right to equal protection under the law.

There are other times when an election is invalidated due to a massive flaw in the electoral process. A flaw so massive the court wonders whether a different result would have occurred if the election had been conducted correctly. In those cases, the remedy is to hold the election again. I’m not aware of a court deciding to throw out the results of an election on a matter that voters do have a right to decide because of supposed flaws in the way that matter got to the ballot, with no flaws in the election itself, with the court deciding not to call for a re-vote, and the court pretending the first vote never took place.

Remedy out of proportion to harm done:

There is also legal precedent which says a court has to weigh whether a potential remedy is out of proportion to the supposed harm caused by the defendant. I would hope even those who think that council didn’t adhere to the “meet and confer” process would agree that invalidating an election is out of proportion to the supposed harm caused. The only way to believe otherwise is to believe that strict adherence to “meet and confer” trumps the ballot box and the basic tenets of democracy.

The Public Employee Relations Board (PERB):

The administrative law judge in this case is an employee of a “quasi-judicial administrative agency.” That’s how PERB describes itself on its website. She is not a “real” judge. She does not preside in a “real” court.

I hate to say this, but PERB exists solely for the benefit of public employees, not public employers, and definitely not for the benefit of all citizens. In fact, PERB is dominated by public employee unions. For instance, of the four current members of the PERB board, two served previously as union lawyers and one served previously as a paid union staff member. (This information comes from the PERB website.)

How We Got Here?

The SLO Police Officers Association (POA) brought this matter to PERB. In case you don’t remember, in May 2011, the POA went to San Luis County Superior Court to try to stop the A & B election before the election took place. The POA used the same arguments in superior court they have since used at PERB. Superior Court Judge Charles Crandell ruled against them. The election took place. The POA lost. Then they took their case to PERB, the friendliest venue they could find and potentially the only place they might win.

The decision before you:

On Monday at 9:00 am, you will meet to decide what to do about the administrative law judge decision. You have two alternatives. 1) Accept the decision, restore binding arbitration to the city charter, and ignore the will of the people. 2) Appeal the decision.

Friday’s Tribune article gave the impression that there is a third alternative, “negotiate a settlement” with the POA. There is no third alternative, no middle ground, not unless you can somehow buy off the POA and the POA is willing to be bought. By “buy” and “bought,” I mean with wage increases, benefit increases, or some other monetary inducement. The POA knows the value of binding arbitration, so does the Firefighters’ union. They once had binding arbitration. They used it to their advantage. They lost it. They’ve seemingly won it back. It’s extremely unlikely they would voluntarily let it go again.

Economic impact of binding arbitration:

For those who don’t remember, I’ve attached a chart which shows the historical impact of binding arbitration on cost-of-living adjustments (COLA) for city employees.

In 2000, the firefighters’ union (IAFF) and POA won the votes to put binding arbitration into the city charter. Prior to 2000, COLA increases for public safety as well as all other city employees generally tracked inflation as measured by the Consumer Price Index (CPI). Once binding arbitration was in the city charter, public safety used the mere existence of binding arbitration to achieve COLA increases much higher than CPI.

Looking back on that time when binding arbitration existed but hadn’t yet been used, IAFF president Eric Baskin once described binding arbitration to me as “the baseball bat in the corner” during labor negotiations. Even in the corner, it was a very effective bat.

During the time after binding arbitration was passed but before it was used, because of out-sized pay increases for public safety, the city was facing a have vs. have-not situation with respect to its other employee groups. So the city began to give those groups COLA increases higher than CPI.

In 2006, the POA decided to actually use binding arbitration. They rejected the city’s offer of 20 percent in COLA increases over four years. (The IAFF accepted this offer.) The POA went to binding arbitration. Two-and-a-half years later, they won a four-year contract granting 30 percent in COLA increases for sworn officers over time and 35 percent for dispatch. The CPI during those four years totaled 11 percent. In addition, during those four years, many Public Safety employees also received step-in-grade increases of up to 22 percent.

The binding arbitration ruling came down in August 2008. Since it was retroactive to January 1, 2006, the impact on the FY 2008/09 budget was significant — $4.0 million. Council had to immediately make budget cuts. Among other things, those cuts included $1.6 million in street and sidewalk improvements, $600,000 in flood protection projects, $300,000 in open space projects, and $500,000 in public safety projects. This last cut included the elimination of two neighborhood police positions (not yet filled) which had been promised to the voters during the 2006 Measure Y campaign.

The go-forward cost of the binding arbitration award was $2.5 million per year. During that time, Measure Y revenue totaled about $5.5 million per year.

The August 2011 A and B election repealed binding arbitration and initiated pension reform. With 3-to-1 voter support of both measures and binding arbitration gone, city council was able to negotiate new labor contracts with no COLA increases and with all employees starting to pay their 8 percent or 9 percent CalPERS pension contribution. That’s why you see the adjusted COLA’s in my chart suddenly fall. The value of those savings is currently $2.6 million per year.

What I believe:

I’m sure you can tell I strongly believe city council needs to appeal the PERB administrative law judge decision. You need to stand up for the will of the people, the power of the ballot box, and the fundamental tenets of democracy. I believe it is every council member’s obligation to do that whether you originally supported Measure B or not. I believe that obligation flows out of the oath each of you took “to preserve, protect, and defend” the constitution of the United States, the constitution of the State of California, and the charter of the City of San Luis Obispo. With respect to the city charter, I think that means the specific language the voters have decided they want the charter to contain.

I also believe it’s incumbent on each of you to challenge the administrative law judge decision if you also expect to ask our citizens this fall to support the renewal of Measure Y. History shows the return of binding arbitration means Council will once again lose control of the City budget.

I was elected to city council in 2006, the same year that Measure Y was passed. I supported Measure Y then. I continue to support it now. One of the reasons I fought to put Measure A and B on the ballot, fought to get A and B passed, and fought to negotiate the new labor contracts was because of Measure Y. The question I faced then was how could I continue to support Measure Y if I couldn’t guarantee to the voters that Measure Y funds would be used in the manner the voters intended.

With the administrative law judge decision, you are facing that same question today. You have to fight. And let’s be clear, the cost of fighting will be far less than the cost of the return of binding arbitration.

One final word:

I have attached the ballot argument Mayor Jan Marx and I submitted in 2011 in support of Measure B. I have also attached the ballot argument former mayor Dave Romero, former Mayor Ken Schwartz, former Council Member John Ewan, former council member Paul Brown and former council member Christine Mulholland submitted as a rebuttal to the arguments the Measure B opponents submitted in 2011.