The relationship between state and local governments has always been testy, but more so since voters passed Proposition 13 in 1978, reducing local property taxes.

One Proposition 13 effect was to shift more responsibility for financing schools and local government services to the state, and with that shift, state politicians assumed they could dictate policy to locals.

The Sacramento-knows-best attitude is extremely evident in public education, which derives the vast majority of its funds from the state. It's very evident in 58 county governments, which are agents of state in providing health and welfare services and most recently in incarcerating and supervising felons.

But what about the nearly 500 cities?

The state has a great deal of power over "general law" cities. But about 100 mostly larger cities have their own governing charters, and the amount of control the state exerts over them is the subject of endless conflict.

The state has occasionally raided city coffers to balance its budget, most recently last year, when Gov. Jerry Brown and the Legislature abolished 400-plus local redevelopment agencies and siphoned off their excess assets.

Sacramento politicians have also made attempts to drill more deeply into municipal affairs, such as union-backed legislation to restrict cities' ability to declare bankruptcy.

This year, Brown signed legislation that would cut off state construction funds to any city that adopted a ban on the "project labor agreements" that building trade unions favor.

The legislation was aimed at San Diego, which had such a ban on its June ballot, but it passed anyway, setting up a potential court battle.

San Diego voters also passed a significant overhaul of its city pension program on June 5 and is already being hammered by the state's Public Employment Relations Board for not negotiating changes with unions. San Jose voters passed pension reform on the same day, and there were rumors in the Capitol that a deal on state pensions could include language to overturn the San Diego and San Jose pension measures.

Finally, U-T San Diego, the local newspaper, reported that Brown and Senate leader Darrell Steinberg declared that they had no such intention.

In the midst of all this sniping, the state Supreme Court last week issued a landmark decision, declaring that charter cities were free to ignore the state's prevailing wage law on public works projects – another union-friendly statute – as long as they're spending their own money.

The 5-2 decision bolstered the "home rule" provisions of the state constitution and indicated that there are distinct limits on state politicians' efforts to dictate to local officials and voters – a harbinger, perhaps, of what would happen on a pension showdown.

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