St. Louis Firefighters Pension Plan Sues City Over “Unconstitutional” Ordinances

As issued by Fireman’s Retirement System of St. Louis:

FRS Seeks Restraining Order and Injunction

St. Louis, MO – June 12, 2012 – The Trustees of the Firemen’s Retirement System of St. Louis (FRS) have filed a six-count lawsuit today in St. Louis City Circuit Court, seeking a temporary restraining order, injunction and declaratory judgment against the City of St. Louis over the Firefighter pension issues. The lawsuit is intended to stop attempts by the City of St. Louis to change the structure of, or take control of, Firemen’s Retirement System and to discontinue the accrual of current benefits to firefighters in the City of St. Louis in violation of Missouri state statutes and the U.S. and Missouri Constitutions. It also seeks to prevent enforcement of a bill to be voted on Friday, where the rights and duties of Trustees to sue the for wrongdoing by the City would be stripped from the trustees.

The City of St. Louis, over the past year, has tried to either change or assume control of FRS. Legislation was introduced in a committee of the Missouri House that would have significantly changed the structure of the FRS in a legally proper manner, and saving the City millions of dollars per year. That effort was actively opposed by the St. Louis Mayor, whose staff testified against the legislation.

The TRO is requested by FRS to prevent the implementation of ordinances and to stop proposed ordinances (in the form of Aldermanic Board Bills) which together are referred to in the lawsuit as a “Scheme” to wrest control of FRS in a manner contrary to state law and to the Missouri and U.S. Constitutions.

The lawsuit further contends that the City of St. Louis, by passing ordinance 69149 and proposed Board Bill 11, violates the St. Louis City Charter, the Missouri Constitution and state statutes in that it attempts to prevent the FRS Trustees from challenging the City’s restructuring of FRS.

“This ordinance and the proposed Board Bills are unconstitutional in that they respectively violate the Contracts Clause and the Due Process Clause of the United States and Missouri constitutions,” said Daniel G. Tobben, the attorney who filed the suit on behalf of FRS. “Perhaps even at a more basic level, the City’s actions and proposed actions ignore and disregard the Missouri Constitution, Missouri statutes and decisions of the Missouri Supreme Court,” Tobben said.

The lawsuit states that the City lacks the authority to repeal or change FRS directly, but must obtain state enabling legislation first if the City wishes to make changes in FRS or to firefighter retirement benefits.

The lawsuit goes on to charge that Board Bills 11 and 12 violate the Missouri Constitution by unlawfully disregarding Article VI, Section 25, which provides that the authority for St. Louis’ pensioning its firefighters must be enacted by the Missouri legislature. This has always been done previously with state legislation being adopted, followed by implementing ordinances adopted by the City, consistent with state statutes.

Tobben noted that the emergency clause of the proposed Board Bill 11 violates the City Charter, which requires that an imminent threat to public safety exist in order to claim an “emergency.”

The lawsuit asks the court to declare the existing and proposed ordinances invalid and to enjoin the City from terminating the existing FRS plan without enabling legislation from the Missouri General Assembly. It also references case law in support of its request.

The second count of the lawsuit directly addresses City Ordinance 69149 and asks the court to declare it unconstitutional because it violates the contract rights of members of FRS, and potentially its beneficiaries, in violation of the Contracts Clause of both the U.S. and Missouri constitutions. The lawsuit emphasizes that firefighters are required to become members of FRS as a contractual condition upon being hired.

The lawsuit also notes that firefighters are not eligible for Social Security benefits when they retire, and must serve as firefighters for twenty years before qualifying for a pension.

The lawsuit’s third of six counts states that Board Bill 11, which contains an emergency clause and is scheduled for vote by the Board of Aldermen on June 15th violates the St. Louis City Charter, the Due Process clauses of the Missouri and U.S. constitutions and the Missouri Uniform Trust Act. The suit also contends that Board Bill 11 violates the open courts provision of the Missouri Constitution.

“Board Bill 11 not only violates the City Charter’s limits on which ordinances may be characterized as emergency measures, but unlawfully restricts the FRS Trustees from exercising their fiduciary duty and authority to contest or challenge illegal or wrongful actions taken by the City of St. Louis,” Tobben said.

“Trustees are both permitted and required to challenge any City action that violates the laws governing FRS,” Tobben continued.

FRS Trustees have challenged City legislation or actions on three occasions, each time winning in the Missouri Supreme Court.

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About FRS: Established on July 26, 1944 in accordance with Ordinance #43009, the Firemen’s Retirement System of St. Louis was created to provide a program of security for the welfare of St. Louis City firefighters and their families. On January 1, 1960, the System was revised through enabling legislation by the Missouri Legislature and then by the Board of Aldermen of the City of St. Louis to further ensures the continued security for all active fire fighters, retirees and their families. The Firemen’s Retirement System of St. Louis provides retirement, disability, death and survivor benefits to nearly 2000 active and retired participants and their beneficiaries. FRS supports its membership by maintaining a pension plan that will attract and retain firefighters. It seeks to maximize investment returns by following a prudent investment policy.

About Danna McKitrick,P.C.: Located in St. Louis, Mo., Danna McKitrick, P.C. delivers legal representation to businesses (emerging to national), insurers, government-related entities, individuals and regarding public pension issues throughout the Midwest. To supplement its local resources, the firm is a member of MSI Global Alliance – an international association of more than 250 independent law and accounting firms in 100 countries.