DeMaio highlights Peters’ role in pension case

The city of San Diego’s pension underfunding debacle is resurfacing in the 52nd Congressional District campaign with Carl DeMaio saying Rep. Scott Peters should cover what could be $7 million in defense fees generated from a resulting court case.

Peters, D-San Diego, faces Republican DeMaio and two other GOP candidates in a swing district election that is expected to be among the closest in California.

DeMaio on Friday said this week’s state Supreme Court decision that puts the city on the hook for defense costs for six officials charged in the pension case is tied directly to Peters. Earlier, the case was thrown out against five of the officials and the district attorney declined to further prosecute the sixth.

Peters was on the City Council in 2002 when he voted along with a unanimous council to indemnify pension board officials for actions arising out of a decision to underfund the pension plan while simultaneously boosting worker benefits. Peters said the city attorney at the time recommend the indemnification vote.

“It is bad enough that Scott Peters and these pension officials hatched a pension scheme that nearly bankrupted San Diego,” DeMaio said. “And now they are demanding that taxpayers pick up the tab for their millions in legal bills.”

DeMaio went on to say Peters is “a multimillionaire who is even taking his taxpayer-funded pension early. I’m calling on him to do the right thing and reimburse the taxpayers the $7 million loss the taxpayers now face.”

The Peters camp scoffed at the suggestion, saying the fees are San Diego’s responsibility. The congressman also said since 2010 he has been donating all his city pension proceeds to city libraries and that he has declined to take a federal pension for his congressional service.

“The city is on the hook today because the district attorney filed and pursued criminal charges against six city employees, which 13 state court judges, including seven Supreme Court Justices, determined were absolutely meritless,” Peters said. “Political witch hunts, in which Carl DeMaio excels, have political and financial consequences. It would be wrong for any employer not to protect employees and volunteers from frivolous legal attacks.

“If the district attorney had not filed these frivolous criminal charge, the city would have no liability today.”

He said the city could have saved about $2 million on the legal bills had it agreed to pay them when it had the opportunity in 2010.

The City Attorney’s Office says the defense costs will be paid out of its risk management budget. It blamed the 2002 council vote for the defense bill and a 2006 council vote that failed to rescind the legal fee coverage. Peters voted against reversing the 2002 decision. Previous to that 2006 vote, an earlier attempt was made to rescind the fee decision but it failed on a 4-1 vote in favor, with five votes needed for approval. Peters and two other council members were absent for that vote. He was on a city business trip to Washington, D.C.

(The above paragraph has been corrected to accurately reflect when Peters voted and when he was absent.)

In his 2012 congressional campaign against long-time GOP Rep. Brian Bilbray, Peters’ was routinely hit for his role in the city’s pension mess. He said then that he “made mistakes” in 2002.