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Obama administration threatens to use outdated law to undermine state pension reform

August 18, 2013

By Daniel Borenstein, staff columnist : Bay Area News Group – excerpt

Siding with transit worker unions, the Obama administration is threatening to derail Gov. Jerry Brown’s attempts to reform California’s public employee retirement systems.

U.S. Labor Secretary Thomas Perez warned in a letter to Brown earlier this month that pension changes state lawmakers approved last year make California transit districts ineligible for federal transportation funds.

Although the changes were designed to strengthen the state’s financially strapped retirement systems, Perez says they violate federal transportation funding requirements by hurting transit workers’ collective bargaining protections.

It’s a mind-boggling misapplication of a law Congress passed in 1964 to ensure public transit agencies didn’t bust unions as they acquired financially troubled private transportation companies.

Now, unless California lawmakers exempt transit workers from the pension changes, the feds could cut off up to $4.3 billion of transportation funding, according to an estimate by the California Transit Association… (more)

UPDATE:
Feds delay move to delay mass transit funding

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