By Nanette Asimov

BERKELEY — University of California President Mark Yudof, who spoke out last year against a threatened lawsuit by 36 executives demanding fatter pensions for UC’s best-paid employees, will ask the regents on Thursday to rescind the 13-year-old policy that began it all.

The legal threat has been dormant for more than a year after an unusual alignment of students, faculty and politicians on the left and right joined Yudof and Regent Russ Gould in denouncing the idea of using public money to pad the wallets of the wealthy.

But it may be stirring to life again. The regents were to meet privately Tuesday to talk about the potential litigation.

Chris Edley, dean of the UC Berkeley Law School, is among the executives who threatened to sue UC.

Asked about the status of their pension demand, Edley paused. “It’s nothing I want to discuss,” he said. “I’m not going to talk about it.”

Edley, who earned $350,000 last year, has defended the demand for higher pensions, saying it is both financially important to his family, and a promise made by the regents in 1999 that UC is obligated to carry out.

(Four executives from UC Davis also were part of the group that threatened to sue: Steven Currall, dean of the Graduate School of Management; William McGowan, chief financial officer of the UCD Health System; Claire Pomeroy, M.D., CEO of the health system, vice chancellor/dean of the School of Medicine; and Ann Madden Rice, CEO of the Medical Center.)

The standoff among Yudof, the regents and the senior employees began in December 2010, when the 36 executives wrote the regents that UC had a “legal, moral and ethical obligation” to spend tens of millions of dollars so that employees earning more than $245,000 could receive higher pensions.

Calling the issue urgent, the executives said UC should calculate their pensions as a percentage of their entire salary instead of the federal limit of $245,000. They said UC hasn’t been subject to the federal limit since 2007, so failure to grant the higher pensions would trigger a lawsuit on behalf of about 200 senior employees earning more than the
limit.

Their letter, obtained by The Chronicle, came just as the regents began wrestling down a $6.3 billion unfunded pension liability. They reduced benefits for future employees and required all employees to pay more into UC’s pension fund. They also raised tuition and used some of it to help close the pension gap.

The executives’ demand alone would cost UC $61 million, according to a recent analysis of the pension fund.

But the executives — including deans, vice chancellors and financial managers — said the regents are legally required to increase their pensions because of the policy they approved in 1999, when the pension fund was flush.

The policy said the higher pensions could go into effect after the Internal Revenue Service granted a waiver from the federal limit, which happened in 2007.

Yudof, however, has said lifting the cap would be too expensive for UC, and that the policy’s implementation requires not only the IRS waiver, but approval from the UC president and the regents. Those have not been given.

On Thursday, Yudof will ask the regents to rescind the 1999 policy supporting the higher pensions, affirm that it was never implemented and declare that no one can benefit from the policy in the future.

Asked why Yudof wants the regents to rescind the policy now, UC spokesman Steve Montiel said only, “We felt it was time to close the loop. It’s time to clarify this.”

— Reach Nanette Asimov at [email protected]

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