A top administration official has weighed in on a federal fight over the public pension law Gov. Jerry Brown signed last year law and whether it puts at risk billions of federal grant dollars.
In a letter last week, Brown's Labor Secretary Marty Morgenstern told the U.S. Department of Labor that the new pension law doesn't diminish mass-transit workers' collective bargaining rights, a prerequisite of the federal money.
"My legal staff and I have reviewed this matter carefully," Morgenstern wrote, concluding the law "merely modifies" the public pension plans that state and local government employers can offer.
The Public Employee Pension Reform Act caps benefits, hikes employee contributions and offers less generous formulas for employees hired Jan. 1 and later. Unions representing roughly 20,000 mass-transit workers in California contend the benefit terms that must be negotiated, not imposed.
That has put mass-transit agencies around the state at an uncomfortable juncture: They must conform to the state law, but doing so might violate a condition of federal mass-transit grants that requires the agencies preserve existing collective bargaining rights.
California receives an estimated $2 billion annually in federal mass-transit grant money, but only after the U.S. Labor Department certifies compliance with the collective bargaining rule. After unions filed federal complaints last fall, the federal government withheld the grants while all sides sort out the issue.
Acting U.S. Labor Secretary Seth Harris had asked for the administration's take, which prompted Morgenstern's letter.
An Assembly bill introduced last month would exempt mass-transit workers from new pension standards, but the administration opposes excluding any employees, Morgenstern said.
PHOTO: Marty Morgenstern speaks during contract talks in 2001 when he headed California's Department of Personnel Administration. He is now Gov. Jerry Brown's labor secretary. Randy Pench / The Sacramento Bee.
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