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City Employees Hire Attorney for Pension System Flap

The San Diego Municipal Employees Association has retained San Diego attorney Rob Butterfield to represent it over the latest controversy to involve San Diego’s troubled pension system.

At issue is a memo sent Oct. 29 by Lawrence B. Grissom, administrator of the San Diego City Employees Retirement System, to City Manager Lamont Ewell, which was released Jan. 12 by San Diego-based government-reform watchdog the Performance Institute.

According to the memo, the system’s outside tax counsel advised that it “should not have accepted contributions from any union on behalf of its president, because a union does not meet the tests specified by various federal agencies as a governmental employer.”

The counsel also advised, wrote Grissom, “that we should refund all such contributions to the respective unions.” Not to do so, he said, “would endanger the tax qualified status of the plan.”

In a prepared statement, Butterfield chided “uninformed people and media outlets” for “an incorrect, hysterical view” over Grissom’s memo to Ewell.

The participation of “a small number of non-governmental employees in a government pension plan is an acceptable practice and does not threaten the status of the city plan,” he said. But, Butterfield added, if there are any “newly discovered tax issues” that have cropped up, “those tax issues can and should be addressed in a rational manner and (be) resolved.

“Given the number and complexity of the laws related to public pension systems,” he continued, “these types of issues are not uncommon and there are always solutions.”

, Pat Broderick

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