City of San Jose v. Howard Jarvis Taxpayers Assn.

Summary

The court held that San José may issue pension obligation bonds without voter approval under the constitutional local debt limitation because the City's obligation to maintain actuarially sound retirement plans is imposed by law. The exception applies even though the City has discretion to choose among methods of addressing its unfunded actuarial liability, including issuing bonds, amortizing the liability, or using current revenues. The court affirmed the judgment validating the proposed bonds.