Public Defender Jeff Adachi held a press conference on the steps of City Hall this afternoon, talking about how his pension reform measure is on track to qualify for the November ballot, calling for the Board of Supervisors to strengthen a rival measure so he can drop his, and wielding a series of colorful charts showing how his measure would save the city far more money.
But those involved with crafting the measure that has come out of City Hall – including Mayor Ed Lee and Sup. Sean Elsbernd – tell the Guardian that Adachi is misrepresenting the numbers in a way that amounts to lying, and that he’s employing a legally risky strategy that could either sink pension reform for the year or set a troubling legal precedent that diminishes the vested rights of all public employees.
The conflict – with its complex claims and counter-claims and dizzying array of big numbers derived from speculative actuarial tables and predictions of future economic realities – offers a preview of what is likely to be a bruising yet bewildering battle if both measures make the ballot.
“We have to have real reform,” Adachi told assembled journalists and activists. “If we had real reform coming from this building, City Hall, I wouldn’t be standing here right now.”
But Elsbernd and Lee each told us that the event had more to do with grabbing headlines with sensational yet misleading claims during the final six days of signature-gathering than it did with Adachi’s claim that his measure will save $138 million annually by 2014-15 compared to a $84 million in the city’s plan.
“It is critical people understand the difference in these costs,” Adachi said.
Lee called the event “weak antics in trying to get a headline,” and said, “His claims are false.” Elsbernd said he spoke with Adachi on the phone for an hour yesterday trying to convince him that his fiscal claims were wrong, but to no avail. “Facts don’t seem to matter to him anymore,” Elsbernd said. “He’s not playing straight with the facts.”
Two issues are central to Adachi’s claims of a big cost savings: his plan’s requirement that employees pay more into their pensions without the city’ plan’s promise of lessening that burden during good years – which city officials say is legally dubious because it simply takes away something to which current employees are entitled to under their contracts – and the deal that the city cut last week with public safety unions to give them the 4 percent raise they were scheduled to receive this year but to increase their pension contributions by a similar amount.
“It’ll cost taxpayers even more than the amount of the raise,” Adachi argued, wielding charts and figures to show that the higher pension payouts due to the increased salaries of cops and firefighters will cost the city $45 million over the next 10 years, and as much as $381 million by 2042.
But Elsbernd said that the raises were part of a contract approved back in 2007 and can’t be just unilaterally taken away. “The raises have been incorporated into pension projections,” Elsbernd said, accusing Adachi of essentially double-counting them in his calculations. “He’s saying this action increases the costs, and that’s just wrong. This deal lowers those costs.”
When we asked Adachi about that point during the press conference, he argued that in these dire fiscal times, all public employee contracts should be renegotiated from scratch and therefore his fiscal claims were correct. “Why should we be talking about a 4 percent raise for anyone when we’re cutting basic services?” Adachi asked.
But simply invalidating approved contracts puts Adachi’s measure on shaky legal ground, Elsbernd said. But it’s ground that the wealthy funders of Adachi’s measure are anxious to plow because if the measure survives a legal challenge, it will weaken the ability of current employees to get the benefits they were promised.
“He wants to challenge the issue of vested rights, and in the end, that’s what this is about,” Elsbernd said, noting that if Adachi’s measure gets more votes and is invalidated, as he thinks it will be by the courts, than the city’s pension problem gets worse as the solution gets pushed back a year.
Adachi claimed during the press conference that he has privately been offered support by some union leaders who are attracted to the big cost savings and what it would mean to the city’s future fiscal health, but he wouldn’t name them or indicate whether they will go public at some point. But Lee said Adachi is just desperately looking for allies.
“He’s looking for someone to support his view of this, but we’re very confident that our proposal is better,” Lee told us, noting how important it was to develop the measure with input and help from the unions. “We’ve done it the right way. You do it with people, not to people.”
But Elsbernd also said Adachi’s pushing of pension reform last year and again this year is a big factor in the union givebacks that the city has received: “We would not be in the place we are with labor if not for Jeff Adachi.”
The board is set to consider the city plan next week, while Adachi says he has 60,000 signatures and plans to gather 5,000 more by the deadline of Monday at 5 pm, which should be enough meet the threshold of about 47,000 valid signatures.