Bloomberg News

San Bernardino Unions Seek Delay of Bid to End Contracts

March 22, 2013

San Bernardino, the insolvent California city, shouldn’t be allowed to cancel contracts with its three biggest unions until a judge decides whether the city’s bankruptcy is legal, labor officials said.

The city’s main police and fire unions asked U.S. Bankruptcy Court Judge Meredith Jury to delay an April 4 court hearing on whether San Bernardino officials can throw out the three contracts, according to court papers filed yesterday in Riverside, California.

The unions are fighting the city’s effort to cancel their contracts and force workers to accept pension changes imposed by elected officials in January. Those changes will save the city about $26 million by requiring workers to pay for 50 percent of their monthly pension premium.

The city prematurely ended mediation with its labor unions and then imposed the changes at an emergency council meeting, Ron M. Oliner, an attorney for the police union, said in court papers.

“On the pretense of its self-constructed emergency, the City Council then passed a resolution that imposed draconian cuts,” Oliner said.

San Bernardino was the third California city to file for bankruptcy last year. The city of about 209,000 people lies about 60 miles (97 kilometers) east of Los Angeles. A fiscal emergency, brought on by a $46 million budget shortfall, forced it to stop paying some creditors and seek court protection, the city said.

Before the city can adopt a plan to adjust its debts, it must first prove to Jury that it’s eligible for bankruptcy.

The case is In re San Bernardino, 12-28006, U.S. Bankruptcy Court, Central District of California (Riverside).

To contact the reporter on this story: Steven Church in Wilmington, Delaware at schurch3@bloomberg.net

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net


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