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San Jose Mayor Chuck Reed

The finances of cities, counties and states are under siege. Chuck Reed, an old military man who is now mayor of San Jose, has decided to go nuclear.

While leaders of other struggling jurisdictions negotiate with public employee unions for relief, or flirt with bankruptcy filings, or propose laws to limit employees’ collective-bargaining rights, Reed has declared a state of fiscal emergency in his sprawling city of nearly 1 million people. The City Council is expected to make the declaration official at a meeting on Tuesday, imposing sort of the government-finance version of martial law.

In theory, at least, a state of emergency will enable Reed, a popular Democrat, to amend contracts and benefits packages of the city’s employees and retirees. Most significantly, in what may become a test-case with national implications, Reed is asserting that public employees have no “vested rights” to the specific terms of their pension plans and benefits going forward. (Already-accrued benefits would not be affected.)

The city’s unions are certain to fight him in court. And there’s a good deal of case law on their side. “No jurisdiction in California has ever, ever succeeded” in stripping away a public employee’s vested rights using a fiscal emergency as justification, said Robert Bezemek, an Oakland labor lawyer.

But Reed, a Stanford-trained lawyer himself, is confident that any judge hearing a union challenge will be persuaded that the direness of San Jose’s financial situation justifies his actions. And Amy B. Monahan, a law professor at the University of Minnesota who is an authority on pension law, said any decision in his favor would be closely watched around the country. “It’s highly relevant to what a lot of other cities and states are grappling with right now,” Professor Monahan explained.

Reed, 62, is an unlikely revolutionary: he is a former Air Force officer, Princeton man, father of a much-decorated fighter-pilot daughter and has been married for more than 40 years. Elected to a second and final term last June with 77 percent of the vote, Reed said he had no further political ambitions and would return to his private law practice. He knows he is proposing a drastic assault on what has been contractually promised to public employees.