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Ventura Pension Reform Defeated in Court. Why It Matters in Orange County

Earlier this year the taxpayers of Ventura County collected enough signatures to place an initiative on the November 2014 ballot that would basically put all new Ventura County hires into a 401(k) style individual investment plan instead of a pension, and freeze current workers for 5 years on pensionable pay.  Ventura County operates under what is known as the “37 Act”.  This act passed in 1937 allows specific counties to create a pension system separate from the California Retirement System.  There are twenty such counties, Orange County being one.  So we were obviously watching Ventura with much interest.

Ventura County Supervisors had to put the initiative on the November ballot, but then a board majority turned around and had their county counsel back a suit to keep the initiative off the ballot.  The lawsuit filed by the public employee union coalition stated that the initiative was unlawful for several reasons including that the 1937 act provided no procedure for a county to disestablish the retirement system once it was set up.

This past Monday a Ventura judge ruled in favor of the public employees and will remove the pension reform from the ballot.  The only way a withdraw from a 37 Act pension system would be allowed is by petitioning the State Legislature.  The Ventura County Taxpayers Association will not appeal the ruling but are shifting their efforts to a statewide initiative.  It is starting to look like the San Diego strategy, a charter amendment, is the one successful way to implement pension reform.

By Carolyn Cavecche, President & CEO of Orange County Taxpayers Association

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