Bill would shield cities from pension lawsuits

California Lawmaker FBI

Rich Pedroncelli/AP

In this photo taken Thursday, June 6, 2013, Sen. Kevin de Leon, D-Los Angeles, talks with Sen. Carol Liu, D-La Canada Flintridge, at the Capitol in Sacramento, Calif.

Local governments would be shielded from pension lawsuits filed by convicted former officials under proposed legislation in the state Assembly.

Democratic Sen. Kevin de Leon of Los Angeles introduced the legislation Friday in response to a lawsuit in the tiny Los Angeles-area city of Vernon. Former administrator Bruce Malkenhorst sued the city to restore his $500,000 annual pension.

Malkenhorst's pension was the largest in the California retirement system. After he was convicted of misappropriating city funds, state officials slashed his pension to $115,000.

Under De Leon's SB39, convicted officials could appeal benefit changes to a public retirement system but could not take legal action against their former employer.

De Leon says his legislation would prevent officials involved in corruption scandals from defrauding taxpayers a second time.

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