Milwaukee Police Ass'n v. City of Milwaukee, No. 2015AP2375

• Court: United States State Supreme Court of Wisconsin
• Writing for the Court: PATIENCE DRAKE ROGGENSACK, C.J.
• Citation: 383 Wis.2d 247,2018 WI 86,914 N.W.2d 597
• Parties: MILWAUKEE POLICE ASSOCIATION and Michael Crivello, Plaintiffs-Appellants-Petitioners, Milwaukee Professional Fire Fighters Association, Local 215 and David R. Seager, Jr., Intervenors-Plaintiffs-Co-Appellants-Petitioners, v. CITY OF MILWAUKEE, Defendant-Respondent.
• Decision Date: 06 July 2018
• Docket Number: No. 2015AP2375

383 Wis.2d 247
914 N.W.2d 597
2018 WI 86

MILWAUKEE POLICE ASSOCIATION and Michael Crivello, Plaintiffs-Appellants-Petitioners,

Milwaukee Professional Fire Fighters Association, Local 215 and David R. Seager, Jr., Intervenors-Plaintiffs-Co-Appellants-Petitioners,
v.
CITY OF MILWAUKEE, Defendant-Respondent.

No. 2015AP2375

Supreme Court of Wisconsin.

Oral Argument: November 14, 2017
Opinion Filed: July 6, 2018

For the plaintiffs-appellants-petitioners, there were briefs filed by Jonathan Cermele and Cermele & Matthews, S.C., Milwaukee. There was an oral argument by Jonathan Cermele.

For the intervenors-plaintiffs-co-appellants-petitioners, there were briefs filed by Christopher J. MacGillis, Sean E. Lees, and MacGillis Wiemer, LLC, Wauwatosa. There was an oral argument by Christopher J. MacGillis.

For the defendant-respondent, there was a brief filed by Stuart S. Mukamal, assistant city attorney; Grant F. Langley, city attorney; and Miriam R. Horwitz, deputy city attorney. There was an oral argument by Stuart S. Mukamal.

PATIENCE DRAKE ROGGENSACK, C.J.

¶ 1 When the Employee Retirement System (ERS) was created for the City of Milwaukee (the City) in 1937, the State granted each employee-member of the ERS the right to vote for the election of three employees to serve on the ERS Annuity and Pension Board (the Board) comprised of seven members. In 1947, the State granted all first class cities the opportunity to manage the ERS pursuant to the exercise of home rule powers. However, the State also protected individual rights of those persons who were members of an ERS because the State precluded amendment or alteration that modified "the annuities, benefits or other rights of any persons who are members of the system prior to the effective date of such amendment." § 31(1), ch. 441, Laws of 1947.

¶ 2 In 1967, the City exercised its home rule over the ERS, consistent with the State's protections of individual member rights. However, in 2013, the City amended its charter ordinance and reduced the voting rights of employees. Each employee-member was permitted to vote for only one employee to serve on the Board, rather than three, and employees could no longer vote for the employees of their choice. The City also gave the mayor three appointments, thereby increasing the size of the Board to eleven members.

¶ 3 Milwaukee Police Association (MPA) members and Milwaukee Professional Fire Fighters Association (MPFFA) members challenged the 2013 amendment, saying that it altered the "other rights" of employee-members of the ERS who were members prior to the amendment in violation of State law.

¶ 4 Upon review, we conclude that the City's 2013 amendment to its charter ordinance that reduced each individual employee-member's right to vote for three employees of his or her choice to serve on the Board, while diluting employees' voice on the Board, modified "other rights" and therefore, is contrary to State law. Accordingly, for the reasons stated more fully below, we reverse the decision of the court of appeals and restore the right of employee-members to vote for three employees of their choice to serve as employee-members of the Board. We also return the Board's size to its size prior to 2013.

I. BACKGROUND

¶ 5 In 1937, the State established the ERS and its administrative powers and

914 N.W.2d 600

responsibilities for cities of the first class. Ch. 396, Laws of 1937. The "administration and responsibility for the proper operation of the retirement system" were "vested" in the Board. Id., § 7(1). The 1937 Law established classifications for Board positions and the right of employees to elect three employees to serve as Board members. Relevant to our discussion of MPA's and MPFFA's challenge, the Law provided:

(2) MEMBERSHIP. The membership of the board shall consist of the following:

(a) Three members to be appointed by the chairman of the common council or other governing body (subject to the confirmation by such common council or other governing body), for a term of three years,

(b) The city comptroller ex-officio,

(c) Three employe[e] members who shall be members of the retirement system and who shall be elected by the members of the retirement system for a term of three years according to such rules and regulations as the board shall adopt to govern such election. The initial terms of the first three members so elected shall expire at the end of one, two and three years, respectively. Following the completion of the initial terms, the terms of the office of such members shall be three years.

§ 7(2), ch. 396, Laws of 1937.

¶ 6 If a vacancy occurred "in the office of a board member," the 1937 Law provided that "the vacancy shall be filled for the unexpired term in the same manner as the office was previously filled." Id., § 7(3). Each Board member had one vote. "Four votes shall be necessary for a decision by the members of the board at any meeting of the board." Id., § 7(5).

¶ 7 The 1937 Law also provided that it is the Board's responsibility to "establish rules and regulations for the administration of the funds created by this act and for the transaction of its business." Id., § 7(6). The Board members were "trustees of the several funds of the system," and given the "full power [and] sole discretion to invest and re-invest." Id., § 9(1).

¶ 8 In 1947, in order to give all first class cities such as Milwaukee "the largest measure of self-government with respect to pension annuity and retirement systems," the State amended its 1937 ERS enactment and granted the City the opportunity to assume responsibility for the ERS, whereby the City could "amend or alter the provisions" of the ERS "in the manner prescribed by section 66.01 of the statutes." § 31(1), ch. 441, Laws of 1947. However, in so doing, the legislation did not give the City carte blanche to amend the ERS as it pleased. Rather, the law explicitly limited the City's power, providing that "no such amendment or alteration [to the ERS] shall modify the annuities, benefits or other rights of any persons who are members of the system prior to the effective date of such amendment or alteration." Id.

¶ 9 In 1967, the City, by charter ordinance, exercised home rule over the ERS. The City adopted the language from § 31(1) of the 1947 Law nearly verbatim. The City's home rule as it appears in its charter ordinance states:

For the purpose of giving to cities of the first class the largest measure of self-government with respect to pension, annuity and retirement systems compatible with the constitution and general law, it is hereby declared to be the legislative policy that all future amendments and alterations to this act are matters of local affair and government and shall not be construed as an enactment of statewide concern. Cities of the first class are hereby empowered to

914 N.W.2d 601

amend or alter the provisions of this act in the manner prescribed by s. 66.0101, Wis. Stats., provided that no such amendment or alteration shall modify the annuities, benefits or other rights of any persons who are members of the system prior to the effective date of such amendment or alteration.

Milw., Wis., Charter Ord. § 36-14 (emphasis added). Following the City exercising its home rule power, the voting rights of ERS members who were employees remained the same as that provided by statute when the ERS was created. That is, employees continued to have the right to vote for three employees to serve as members to the Board. Milw., Wis., Charter Ord. § 36-18-2.

¶ 10 In 1972, the City amended its charter ordinance, changing the composition of the Board. The amendment added a retired employee as a member of the Board, elected by other retired employees. Milw., Wis., Charter Ord. § 36-15-2(d). This change did not limit the voting rights of employee-members, who continued to have the right to elect three employees of their choice to serve as members of the Board. Id.

¶ 11 In 2013, the City again amended its charter ordinance. The 2013 amendment significantly reduced the voting rights of employees to select employees as members of the Board. MPA members were limited to electing only one Board member, and that person had to be a police officer. Milw., Wis., Charter Ord. § 36-15-(2)(c). MPFFA employees voting rights were similarly reduced so that they too could elect only one Board member and they could select only a firefighter. Id. And finally, the City limited the voting rights of all other employee-members of the ERS such that they could vote for only one Board member who could be neither a police officer nor a firefighter. Id.

¶ 12 The 2013 amendment also increased the size of the Board to eleven members. While the chairman of the common council continued to appoint three Board members, pursuant to the amendment, the mayor was given power to appoint three additional Board members. Id., § 36-15-(2)(a-3).

¶ 13 MPA challenged the 2013 changes to the ERS in circuit court, seeking declaratory judgment and a permanent injunction. In so doing, MPA alleged that the 2013 amendment infringed on the rights of police officers to vote for three employees to serve as ERS Board members, and to participate in a Board of similar size to that provided in the State's 1947 delegation to the City. The circuit court allowed MPFFA, who sought the same relief, to...