Attorneys made their arguments Tuesday in The Bee's lawsuit seeking information about the most lucrative public service pensions in Stanislaus County.
The newspaper filed the lawsuit in August after the Stanislaus County Employees' Retirement Association refused a Public Records Act request to disclose the names of retirees receiving more than $100,000 a year. The California Newspaper Publishers Association joined the lawsuit in Stanislaus County Superior Court.
StanCERA manages a pension system for employees of the county, Ceres, the courts and five special districts.
Judge Hurl Johnson presided over Tuesday's hearing and has 90 days to release a decision.
In recent times, public service pension funds such as the California Public Employees Retirement System, the State Teachers' Retirement System and many county associations have agreed to release information about top pensioners.
Because of investment losses and a wave of retirements, these pension funds are straining the budgets of state and county governments. In addition, disclosures in other jurisdictions have shown that some pensioners are paid more in retirement than when they were working.
Plaintiffs in the Stanislaus County lawsuit contend that StanCERA ignored a 2007 state Supreme Court ruling, which stated that the salaries and benefits of local government employees are public information.
StanCERA has countered that the pension records of its members are confidential under the County Employees' Retirement Law of 1937.
During Tuesday's hearing, Johnson engaged in dialogue with attorney Karl Olson, representing The Bee, and Assistant County Counsel Deirdre McGrath, representing StanCERA. Much of the debate focused on whether the California Supreme Court ruling applies to pensions and what "individual records" are supposed to be confidential under the 1937 law.
"There is a difference between a pension and a salary," Johnson said.
Olson, a specialist in media law and the First Amendment, acknowledged the Supreme Court didn't specifically say pensions were open to public review. But the court did make reference to two state attorney general opinions, in 1955 and 1977, stating that names and pension amounts were public information, Olson stressed. The attorney general's office issues legal opinions when asked by government agencies to interpret state law.
Johnson asked McGrath if any case law defines what "individual records" are protected by the 1937 retirement law. No case law exists, McGrath said, but it was a general phrase used by the Legislature to say member records are confidential.
One reason for seeking disclosure of the records is to expose pension spiking, a practice of cashing out sick leave, vacation time or other benefits to boost an employee's pension.
McGrath said StanCERA is paying pensions to retirees up to 100 years old, based on calculations made decades ago, so there is no public interest in disclosing the pensions of older retirees. She noted that the formulas used to calculate pensions are open to the public, but Olson said more information is needed to expose excessive payments.
"You need to have the list (of names and pensions) to find out whether there has been examples of pension spiking," he said.
In the last fiscal year, StanCERA paid a total of $71.5 million in allowances to almost 2,800 retirees. Stanislaus County was facing a $22.7 million increase in its pension fund contribution for 2009-10 before the retirement board agreed in April to shift nonvested benefit reserves to reduce the obligation.
Thomas Newton, general counsel for the California Newspaper Publishers Association, said StanCERA is one of a handful of county retirement associations to resist disclosing the records.
"I am optimistic based on what I heard," he said after the hearing. "I believe the judge was looking at the governing statutes in a way that favors interpretation that pension information is not exempted by statute from public review."
McGrath said she thought the hearing went well. "I think the court did an excellent job in asking questions of both parties to try to ferret out what the issues are," she said.
Bee staff writer Ken Carlson can be reached at kcarlson@modbee.com or 578-2321.
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