Appellate brief filed in CalPERS public records lawsuit

Today, Transparent California filed its opening appellate brief in its ongoing public records lawsuit against the California Public Employees’ Retirement System (CalPERS).  The government watchdog is asking the 3rd District Court of Appeal to enforce the will of California voters, as expressed in a constitutional amendment designed to protect the public’s right to access government records.

In 2004, more than 83 percent of voters approved a constitutional amendment requiring courts to construe narrowly any statute or legal authority that would limit access to government records — a mandate designed to prevent governments from hiding public records behind an unduly expansive interpretation of one of the confidentiality provisions contained within the state’s public records law.

Unfortunately, this mandate was ignored by Sacramento County Superior Court Judge Laurie Earl last November, when she ruled that CalPERS could withhold records identifying whether a public pension is of either a “service” or “disability” classification.

While no statute or legal authority makes this information confidential, Judge Earl did precisely what the California Constitution forbids and broadly interpreted a confidentiality statute designed to protect medical records to also include the requested one-word pension type identifier.

“State law makes confidential the medical records and other personal documents submitted as part of a disability application, which makes perfect sense,” said Transparent California Executive Director Robert Fellner.

“The determination made by CalPERS regarding the type of pension to be paid, however, is distinct from the member’s medical records, and there is no basis in law for the district court’s erroneous decision to conflate the two.”

Pension type has already been disclosed by two dozen other California public pension funds, as well as by public pension funds in other states, such as Oregon and New Jersey.

Disclosure of such information would assist in detecting disability fraud, which has cost taxpayers untold millions. Ironically, while CalPERS clearly recognizes this fact and even encourages the public to report cases of suspected fraud and abuse to its disability fraud tip line, the agency simultaneously refuses to provide the public with the basic information necessary to assist in those efforts.

Disclosure of this information does not even convey that the recipient is disabled, as evidenced by the case of a former Oakland police officer who is collecting a CalPERS disability pension while working full-time as an FBI special agent.

“We now know that the public is being misled by both state law and agency officials who claim that disability pensions are only awarded to those who are truly disabled,” Fellner said.

“This deception prevents the public from being able to make informed decisions regarding California’s public pension system and the billions of tax dollars it consumes each year,” Fellner said.

Recent abuse highlights transparency need

A recent case of alleged disability fraud highlights the need for more oversight, particularly given the strong incentives for both members and employer agencies to engage in abuse.

In 2014, San Fernando terminated police officer William Bailey for having lied on a promotion application, according to a report from the San Fernando Valley Sun.

After Bailey appealed his firing, the city would ultimately agree to grant him a disability pension in exchange for dropping his appeal.

As CalPERS General Counsel Matthew Jacobs pointed out, awarding a disability claim in these circumstances is often cheaper and easier on the city, making it an attractive, albeit unlawful, solution.

These perverse incentives create a situation ripe for abuse, particularly given the lax oversight measures at CalPERS.

Remarkably, CalPERS approved Bailey’s disability application even though he left blank entire sections of the form, including those which required him to identify the nature of the disability, the approving physician, and other related information.

It was only because Bailey was coded as having been terminated for cause, rather than retiring on disability, that internal auditors would discover their mistake years later, leading to their recent finding of fraud and order demanding repayment.

“The fact that someone terminated for cause can submit a mostly blank application and still receive disability benefits demonstrates the need for more oversight, not less,” Fellner said.

Ruling would gut the Public Records Act

The implication of this case will extend far beyond pension records and could end up gutting California’s Public Records Act entirely, according to Fellner.

“If the Court of Appeal adopts the reasoning put forth by the district court, all of the most important types of government records will be made secret in short order,” Fellner said.

“Government audits, investigations into misconduct and similar records are all created in part by referencing or drawing on legitimately confidential information,” Fellner said, “all of which could similarly be made secret under the legal rationale put forth by the district court.”

“Californians recognized the harm that would come from allowing governments to expand confidentiality provisions far beyond their plain text and intent, which is why voters overwhelmingly approved a constitutional amendment expressly prohibiting such practices,” Fellner said.

“It is imperative that the Court of Appeal uphold this constitutional mandate and reverse the dangerous precedent established by the trial court, so that Californians’ fundamental right to a transparent and open government is fully protected, as voters intended.”

For more information, please contact Transparent California Executive Director Robert Fellner at 559-462-0122 or Robert@TransparentCalifornia.com.