BILL NUMBER: AB 1584 CHAPTERED
BILL TEXT
CHAPTER 519
FILED WITH SECRETARY OF STATE SEPTEMBER 25, 2003
APPROVED BY GOVERNOR SEPTEMBER 24, 2003
PASSED THE ASSEMBLY AUGUST 28, 2003
PASSED THE SENATE AUGUST 25, 2003
AMENDED IN SENATE AUGUST 18, 2003
AMENDED IN SENATE JULY 15, 2003
AMENDED IN SENATE JUNE 30, 2003
AMENDED IN SENATE JUNE 3, 2003
INTRODUCED BY Committee on Public Employees, Retirement and Social
Security (Negrete McLeod (Chair), Levine (Vice Chair), Chan, Correa,
Kehoe, and Laird)
FEBRUARY 21, 2003
An act to amend Sections 20057, 20161, 20501, 20585, 20588, 20590,
20610, 20611, 20752, 20816, 20890.2, 20907, 21013, 21220, 21571,
21572, 21661, 21663, 22009.03, 22009.1, 22013.7, 22013.78, 22018,
22156, 22502, 22754, and 22825 of, to add Sections 20672.5, 21220.5,
and 22817.5 to, to repeal Sections 20677.1, 20732, 21253, 21431, and
22216 of, to repeal Chapter 10 (commencing with Section 20860) of
Part 3 of Division 5 of Title 2 of, and to repeal and add Section
21252 of, the Government Code, relating to the Public Employees'
Retirement System, and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
AB 1584, Committee on Public Employees, Retirement and Social
Security. Public Employees' Retirement System.
(1) Existing law authorizes the Board of Administration of the
Public Employees' Retirement System to enter into an agreement with
the governing body of a contracting agency and the governing body of
a city or county or, in certain counties, the board of retirement for
termination of the contracting agency's participation in the Public
Employees' Retirement System and inclusion of the agency's employees
in the retirement system of the city or county. Existing law
requires the agreement to contain provisions the board finds
necessary to protect the interests of the system, as specified.
This bill would authorize the board to include other provisions in
that agreement to address issues related to the transfer, as
specified.
(2) Existing law prescribes employee contribution rates for
members of the Public Employees' Retirement System and provides for
temporary reductions of those rates for state members, as specified.
Under existing law, members of the system may, in certain
circumstances, redeposit previously withdrawn contributions or
purchase service credit upon payment of additional contributions.
This bill would specify that the temporarily reduced contribution
rates do not apply to the redeposit of contributions or to
contributions made to purchase service credit. The bill would also
revise provisions dealing with the collection of an underpayment or
overpayment of member contributions.
(3) Under the Public Employees' Retirement Law, contracting
agencies may request that a portion of the agency's excess employer
assets be transferred to member-accumulated contribution accounts to
satisfy all member contributions.
This bill would authorize that transfer to be made to satisfy all
or a portion of member contributions.
(4) The Public Employees' Retirement Law provides that retirement
is effective on the date designated in the member's application, but
not earlier than specified dates, or the day following the last day
on which salary is payable. However, existing law authorizes the
Board of Administration of the Public Employees' Retirement System to
fix the effective date of the member's retirement as of an earlier
date if the board makes specified findings.
This bill would revise and recast those provisions and would
provide that a member's application for retirement, if submitted
within 9 months after separation from employment, shall be deemed to
have been submitted on the last day for which salary was payable.
The bill would also provide that a retired person who has not
attained the normal retirement age is required to meet specified
requirements of the Internal Revenue Code and corresponding
regulations.
(5) The Public Employees' Retirement Law prescribes 5 levels of
preretirement survivors' benefits. Existing law provides, with
respect to 3 of those levels of benefits, that the assets and
liabilities of all contracting agencies subject to the benefits shall
be pooled into a single account and a single employer rate shall be
established with respect to those benefits, subject to certain
adjustments based on the balance in the agency's account, as
specified.
This bill would also make those provisions relating to the pooling
of assets and the establishment of a single employer rate applicable
to contracting agencies subject to the other 2 levels of benefits.
(6) Existing law requires the Board of Administration of the
Public Employees' Retirement System to contract with carriers
offering long-term care insurance plans and provides that active and
retired members and annuitants of specified counties and public
agencies are eligible to enroll in those plans.
This bill would revise those provisions to provide that active and
retired members, annuitants, and employees of any public agency in
the state are eligible to enroll in those plans. The bill would make
other technical changes to those provisions.
(7) Existing law defines certain public officers as a "policeman"
or "fireman" for purposes of excluding them from coverage under
social security.
This bill would include within that definition for those purposes,
park rangers employed by a contracting agency who have been
classified as local safety members of the Public Employees'
Retirement System, and local prosecutors, local public defenders, and
local public defender investigators employed by a city, county, or
city and county that maintains a retirement system or pension trust
and that provides those employees retirement and pension benefits
accorded to safety members, as specified.
(8) Under the Public Employees' Medical and Hospital Care Act, a
former Member of the Legislature who is a member of a state funded
retirement system and who has at least 8 years of service credit may,
prior to retirement, enroll in a health benefits plan and dental
care plan, as specified, provided that the member pays the total cost
of that coverage, plus an additional 2% for administrative costs.
Upon retirement, if that member elects to enroll in or continue that
coverage, the state assumes payment of employer contributions with
respect thereto. Under existing law, Members of the Legislature who
first took office after November 1, 1990, may not participate in a
state funded retirement system while in office. Employer and
employee contributions for health care benefits and administrative
costs under the Public Employees' Medical and Hospital Care Act are
deposited into one of 2 continuously appropriated special funds.
This bill would authorize a former Member of the Legislature, who
has at least 6 years of service credit, to elect, within a specified
period, to enroll or continue his or her enrollment in a health
benefits plan and dental care plan, as specified, provided that the
member pays the total premiums plus an additional 2% for
administrative costs, as specified. By increasing the contributions
to a continuously appropriated special fund, the bill would make an
appropriation.
(9) The bill would also delete obsolete provisions and make
technical changes to the Public Employees' Retirement Law and the
Public Employees' Medical and Hospital Care Act.
(10) This bill would incorporate additional changes to Section
20057 of the Government Code proposed by AB 1498, to be operative if
AB 1498 and this bill become effective on or before January 1, 2004,
and this bill is enacted last.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 20057 of the Government Code is amended to
read:
20057. "Public agency" also includes the following:
(a) The Commandant, Veterans' Home of California, with respect to
employees of the Veterans' Home Exchange and other post fund
activities whose compensation is paid from the post fund of the
Veterans' Home of California.
(b) Any auxiliary organization operating pursuant to Chapter 7
(commencing with Section 89900) of Part 55 of the Education Code and
in conformity with regulations adopted by the Trustees of the
California State University and any auxiliary organization operating
pursuant to Article 6 (commencing with Section 72670) of Chapter 6 of
Part 45 of the Education Code and in conformity with regulations
adopted by the Board of Governors of the California Community
Colleges.
(c) Any student body or nonprofit organization composed
exclusively of students of the California State University or
community college or of members of the faculty of the California
State University or community college, or both, and established for
the purpose of providing essential activities related to, but not
normally included as a part of, the regular instructional program of
the California State University or community college.
(d) A state organization of governing boards of school districts,
the primary purpose of which is the advancing of public education
through research and investigation.
(e) Any nonprofit corporation whose membership is confined to
public agencies as defined in Section 20056.
(f) A section of the California Interscholastic Federation.
(g) Any credit union incorporated under Division 5 (commencing
with Section 14000) of the Financial Code, or incorporated pursuant
to federal law, with 95 percent of its membership limited to
employees who are members of or retired members of this system or the
State Teachers' Retirement Plan, and their immediate families, and
employees of any credit union. For the purposes of this subdivision,
"immediate family" means those persons related by blood or marriage
who reside in the household of a member of the credit union who is a
member of or retired member of this system or the State Teachers'
Retirement Plan. The credit union shall pay any costs that are in
addition to the normal charges required to enter into a contract with
the board. All the payments made by the credit union that are in
addition to the normal charges required shall be added to the total
amount appropriated by the Budget Act for the administrative expense
of this system. For purposes of this subdivision, a credit union is
not deemed to be a public agency unless it has entered into a
contract with the board pursuant to Chapter 5 (commencing with
Section 20460) prior to January 1, 1988. After January 1, 1988, the
board may not enter into a contract with any credit union as a public
agency.
(h) Any county superintendent of schools that was a contracting
agency on July 1, 1983, and any school district or community college
district that was a contracting agency with respect to local
policemen, as defined in Section 20430, on July 1, 1983.
(i) Any school district or community college district that has
established a police department, pursuant to Section 39670 or 72330
of the Education Code, and has entered into a contract with the board
on or after January 1, 1990, for school safety members, as defined
in Section 20444.
(j) A nonprofit corporation formed for the primary purpose of
assisting the development and expansion of the educational, research,
and scientific activities of a district agricultural association
formed pursuant to Part 3 (commencing with Section 3801) of Division
3 of the Food and Agricultural Code, and the nonprofit corporation
described in the California State Exposition and Fair Law (former
Article 3 (commencing with Section 3551) of Chapter 3 of Part 2 of
Division 3 of the Food and Agricultural Code, as added by Chapter 15
of the Statutes of 1967).
(k) (1) A public or private nonprofit corporation that operates a
regional center for the developmentally disabled in accordance with
Chapter 5 (commencing with Section 4620) of Division 4.5 of the
Welfare and Institutions Code.
(2) A public or private nonprofit corporation, exempt from
taxation under Section 501(c)(3) of the Internal Revenue Code, that
operates a rehabilitation facility for the developmentally disabled
and provides services under a contract with either (A) a regional
center for the developmentally disabled, pursuant to paragraph (3) of
subdivision (a) of Section 4648 of the Welfare and Institutions
Code, or (B) the Department of Rehabilitation, pursuant to Chapter
4.5 (commencing with Section 19350) of Part 2 of Division 10 of the
Welfare and Institutions Code, upon obtaining a written advisory
opinion from the United States Department of Labor as described in
Section 20057.1.
(3) A public or private nonprofit corporation described in this
subdivision shall be deemed a "public agency" only for purposes of
this part and only with respect to the employees of the regional
center or the rehabilitation facility described in this subdivision.
Notwithstanding any other provision of this part, the agency may
elect by appropriate provision or amendment of its contract not to
provide credit for service prior to the effective date of its
contract.
(l) Independent data-processing centers formed pursuant to former
Article 2 (commencing with Section 10550) of Chapter 6 of Part 7 of
the Education Code, as it read on December 31, 1990. An agency
included pursuant to this subdivision shall only provide benefits
that are identical to those provided to a school member.
(m) Any local agency formation commission.
(n) A nonprofit corporation organized for the purpose of and
engaged in conducting a citrus fruit fair as defined in Section 4603
of the Food and Agricultural Code.
(o) (1) A public or private nonprofit corporation that operates an
independent living center providing services to severely handicapped
people and established pursuant to federal P.L. 93-112, that
receives the approval of the board, and that provides at least three
of the following services:
(A) Assisting severely handicapped people to obtain personal
attendants who provide in-home supportive services.
(B) Locating and distributing information about housing in the
community usable by severely handicapped people.
(C) Providing information about financial resources available
through federal, state and local government, and private and public
agencies to pay all or part of the cost of the in-home supportive
services and other services needed by severely handicapped people.
(D) Counseling by people with similar disabilities to aid the
adjustment of severely handicapped people to handicaps.
(E) Operation of vans or buses equipped with wheelchair lifts to
provide accessible transportation to otherwise unreachable locations
in the community where services are available to severely handicapped
people.
(2) A public or private nonprofit corporation described in this
subdivision shall be deemed a "public agency" only for purposes of
this part and only with respect to the employees of the independent
living center.
(3) Notwithstanding any other provisions of this part, the public
or private nonprofit corporation may elect by appropriate provision
or amendment of its contract not to provide credit for service prior
to the effective date of its contract.
(p) A hospital that is managed by a city legislative body in
accordance with Article 8 (commencing with Section 37650) of Chapter
5 of Part 2 of Division 3 of Title 4.
(q) The Tahoe Transportation District that is established by
Article IX of Section 66801.
(r) The California Firefighter Joint Apprenticeship Program formed
pursuant to Chapter 4 (commencing with Section 3070) of Division 3
of the Labor Code.
(s) A public health department or district that is managed by the
governing body of a county of the 15th class, as defined by Sections
28020 and 28036, as amended by Chapter 1204 of the Statutes of 1971.
(t) A nonprofit corporation or association conducting an
agricultural fair pursuant to Section 25905 may enter into a contract
with the board for the participation of its employees as members of
this system, upon obtaining a written advisory opinion from the
United States Department of Labor as described in Section 20057.1.
The nonprofit corporation or association shall be deemed a "public
agency" only for this purpose.
(u) An auxiliary organization established pursuant to Article 2.5
(commencing with Section 69522) of Chapter 2 of Part 42 of the
Education Code upon obtaining a written advisory opinion from the
United States Department of Labor as described in Section 20057.1.
The auxiliary organization is a "public agency" only for this
purpose.
(v) The Western Association of Schools and Colleges upon obtaining
a written advisory opinion from the United States Department of
Labor as described in Section 20057.1. The association shall be
deemed a "public agency" only for this purpose.
SEC. 1.5. Section 20057 of the Government Code is amended to read:
20057. "Public agency" also includes the following:
(a) The Commandant, Veterans' Home of California, with respect to
employees of the Veterans' Home Exchange and other post fund
activities whose compensation is paid from the post fund of the
Veterans' Home of California.
(b) Any auxiliary organization operating pursuant to Chapter 7
(commencing with Section 89900) of Part 55 of the Education Code and
in conformity with regulations adopted by the Trustees of the
California State University and any auxiliary organization operating
pursuant to Article 6 (commencing with Section 72670) of Chapter 6 of
Part 45 of the Education Code and in conformity with regulations
adopted by the Board of Governors of the California Community
Colleges.
(c) Any student body or nonprofit organization composed
exclusively of students of the California State University or
community college or of members of the faculty of the California
State University or community college, or both, and established for
the purpose of providing essential activities related to, but not
normally included as a part of, the regular instructional program of
the California State University or community college.
(d) A state organization of governing boards of school districts,
the primary purpose of which is the advancing of public education
through research and investigation.
(e) Any nonprofit corporation whose membership is confined to
public agencies as defined in Section 20056.
(f) A section of the California Interscholastic Federation.
(g) Any credit union incorporated under Division 5 (commencing
with Section 14000) of the Financial Code, or incorporated pursuant
to federal law, with 95 percent of its membership limited to
employees who are members of or retired members of this system or the
State Teachers' Retirement Plan, and their immediate families, and
employees of any credit union. For the purposes of this subdivision,
"immediate family" means those persons related by blood or marriage
who reside in the household of a member of the credit union who is a
member of or retired member of this system or the State Teachers'
Retirement Plan. The credit union shall pay any costs that are in
addition to the normal charges required to enter into a contract with
the board. All the payments made by the credit union that are in
addition to the normal charges required shall be added to the total
amount appropriated by the Budget Act for the administrative expense
of this system. For purposes of this subdivision, a credit union is
not deemed to be a public agency unless it has entered into a
contract with the board pursuant to Chapter 5 (commencing with
Section 20460) prior to January 1, 1988. After January 1, 1988, the
board may not enter into a contract with any credit union as a public
agency.
(h) Any county superintendent of schools that was a contracting
agency on July 1, 1983, and any school district or community college
district that was a contracting agency with respect to local
policemen, as defined in Section 20430, on July 1, 1983.
(i) Any school district or community college district that has
established a police department, pursuant to Section 39670 or 72330
of the Education Code, and has entered into a contract with the board
on or after January 1, 1990, for school safety members, as defined
in Section 20444.
(j) A nonprofit corporation formed for the primary purpose of
assisting the development and expansion of the educational, research,
and scientific activities of a district agricultural association
formed pursuant to Part 3 (commencing with Section 3801) of Division
3 of the Food and Agricultural Code, and the nonprofit corporation
described in the California State Exposition and Fair Law (former
Article 3 (commencing with Section 3551) of Chapter 3 of Part 2 of
Division 3 of the Food and Agricultural Code, as added by Chapter 15
of the Statutes of 1967).
(k) (1) A public or private nonprofit corporation that operates a
regional center for the developmentally disabled in accordance with
Chapter 5 (commencing with Section 4620) of Division 4.5 of the
Welfare and Institutions Code.
(2) A public or private nonprofit corporation, exempt from
taxation under Section 501(c)(3) of the Internal Revenue Code, that
operates a rehabilitation facility for the developmentally disabled
and provides services under a contract with either (A) a regional
center for the developmentally disabled, pursuant to paragraph (3) of
subdivision (a) of Section 4648 of the Welfare and Institutions
Code, or (B) the Department of Rehabilitation, pursuant to Chapter
4.5 (commencing with Section 19350) of Part 2 of Division 10 of the
Welfare and Institutions Code, upon obtaining a written advisory
opinion from the United States Department of Labor as described in
Section 20057.1.
(3) A public or private nonprofit corporation described in this
subdivision shall be deemed a "public agency" only for purposes of
this part and only with respect to the employees of the regional
center or the rehabilitation facility described in this subdivision.
Notwithstanding any other provision of this part, the agency may
elect by appropriate provision or amendment of its contract not to
provide credit for service prior to the effective date of its
contract.
(l) Independent data-processing centers formed pursuant to former
Article 2 (commencing with Section 10550) of Chapter 6 of Part 7 of
the Education Code, as it read on December 31, 1990. An agency
included pursuant to this subdivision shall only provide benefits
that are identical to those provided to a school member.
(m) Any local agency formation commission.
(n) A nonprofit corporation organized for the purpose of and
engaged in conducting a citrus fruit fair as defined in Section 4603
of the Food and Agricultural Code.
(o) (1) A public or private nonprofit corporation that operates an
independent living center providing services to severely handicapped
people and established pursuant to federal P.L. 93-112, that
receives the approval of the board, and that provides at least three
of the following services:
(A) Assisting severely handicapped people to obtain personal
attendants who provide in-home supportive services.
(B) Locating and distributing information about housing in the
community usable by severely handicapped people.
(C) Providing information about financial resources available
through federal, state and local government, and private and public
agencies to pay all or part of the cost of the in-home supportive
services and other services needed by severely handicapped people.
(D) Counseling by people with similar disabilities to aid the
adjustment of severely handicapped people to handicaps.
(E) Operation of vans or buses equipped with wheelchair lifts to
provide accessible transportation to otherwise unreachable locations
in the community where services are available to severely handicapped
people.
(2) A public or private nonprofit corporation described in this
subdivision shall be deemed a "public agency" only for purposes of
this part and only with respect to the employees of the independent
living center.
(3) Notwithstanding any other provisions of this part, the public
or private nonprofit corporation may elect by appropriate provision
or amendment of its contract not to provide credit for service prior
to the effective date of its contract.
(p) A hospital that is managed by a city legislative body in
accordance with Article 8 (commencing with Section 37650) of Chapter
5 of Part 2 of Division 3 of Title 4.
(q) The Tahoe Transportation District that is established by
Article IX of Section 66801.
(r) The California Firefighter Joint Apprenticeship Program
formed pursuant to Chapter 4 (commencing with Section 3070) of
Division 3 of the Labor Code.
(s) A public health department or district that is managed by the
governing body of a county of the 15th class, as defined by Sections
28020 and 28036, as amended by Chapter 1204 of the Statutes of 1971.
(t) A nonprofit corporation or association conducting an
agricultural fair pursuant to Section 25905 may enter into a contract
with the board for the participation of its employees as members of
this system, upon obtaining a written advisory opinion from the
United States Department of Labor as described in Section 20057.1.
The nonprofit corporation or association shall be deemed a "public
agency" only for this purpose.
(u) An auxiliary organization established pursuant to Article 2.5
(commencing with Section 69522) of Chapter 2 of Part 42 of the
Education Code upon obtaining a written advisory opinion from the
United States Department of Labor as described in Section 20057.1.
The auxiliary organization is a "public agency" only for this
purpose.
(v) The Western Association of Schools and Colleges upon
obtaining a written advisory opinion from the United States
Department of Labor as described in Section 20057.1. The association
shall be deemed a "public agency" only for this purpose.
(w) The State Assistance Fund for Enterprise, Business, and
Industrial Development Corporation upon obtaining a written advisory
opinion from the United States Department of Labor as described in
Section 20057.1.
SEC. 2. Section 20161 of the Government Code is amended to read:
20161. Notwithstanding any other provision of this part or of
Section 13943.2 or 16302.1 to the contrary, the following shall
apply:
(a) When there has been a payment of death benefits, a return of
accumulated contributions, a contribution adjustment, or a deposit of
contributions, this system may refrain from collecting an
underpayment of accumulated contributions if the amount to be
collected is two hundred fifty dollars ($250) or less.
(b) When there has been a payment of death benefits, a return of
accumulated contributions, a contribution adjustment, or a deposit of
contributions, and there is a balance of fifty dollars ($50) or less
remaining posted to a member's individual account, or an overpayment
of fifty dollars ($50) or less was received, this system may
dispense with a return of accumulated contributions.
(c) When there is a positive or negative balance of two hundred
fifty dollars ($250) or less remaining posted to a member's
individual account, or the balance exceeds two hundred fifty dollars
($250) but the difference to the monthly allowance unmodified by any
optional settlement is less than five dollars ($5), this system may
dispense with any recalculation of, or other adjustment to, benefit
payments.
(d) The dollar amounts specified in subdivisions (a) and (c) shall
be adjusted in accordance with any changes in the dollar amounts
specified in Section 13943.2.
SEC. 3. Section 20501 of the Government Code is amended to read:
20501. Contracts with school employers may include school
district employees in this system only with respect to service
rendered in a status in which they are not eligible for membership in
the State Teachers' Retirement Plan.
SEC. 4. Section 20585 of the Government Code is amended to read:
20585. (a) Notwithstanding any other provision of this article,
the board may enter into an agreement with the governing body of a
contracting agency whose contract has been in effect for at least
five years and the board of supervisors of a county maintaining a
county retirement system for termination of the contracting agency's
participation in this system and inclusion of its employees in the
county retirement system.
(b) The agreement shall contain provisions the board finds
necessary to protect the interests of this system, including
provisions for determination of the amount, time, and manner of
transfer of cash or securities, or both, to be transferred to the
county system representing the value of the interests in the
retirement fund of the contracting agency and its employees by reason
of accumulated contributions credited to the agency and its
employees. However, the amount transferred may not exceed the amount
of the accumulated contributions. Any amount representing the
difference between the value of the interests in the retirement fund
of the contracting agency and its employees, and the accumulated
contributions credited to the agency and its employees, shall be
credited to the reserve under Section 20174. The agreement may also
contain any other provisions that the board deems necessary to
address issues related to the transfer, including, but not limited
to, benefits subject to an outstanding domestic relations order and
benefits subject to a lien.
(c) All liability of this system with respect to members and
retired persons under the contract shall cease and shall become the
liability of the county system as of the date of termination
specified in the agreement. Liability of the county retirement
system shall be for payment of benefits in accordance with Chapter 3
(commencing with Section 31450) of Part 3 of Division 4 of Title 3
applicable to it except that allowances of persons retired on the
termination date and their beneficiaries and of beneficiaries of
deceased members or retired persons who are receiving allowances on
that date, shall be continued in at least the amount provided under
the agency's contract as it was on that date. The termination may
not affect the contribution rate of any member in any other
employment under this system on the date of termination or any
retirement allowance or other benefit based on service to another
employer being paid on the termination date.
(d) Any member who becomes a member of a county retirement system
upon the contract termination shall be subject to this part and
Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of
Title 3 extending rights to a member or subjecting him or her to
limitations because of membership in another retirement system to the
same extent that he or she would have been had he or she been a
member of the county retirement system during his or her membership
in this system under the terminated contract.
(e) Upon execution of the agreement, a contracting agency that is
an employer under Chapter 9 (commencing with Section 20790) shall
cease to have that status, and the accumulated contributions of the
contracting agency shall be determined and thereafter held as
provided in Section 20834.
SEC. 5. Section 20588 of the Government Code is amended to read:
20588. (a) Notwithstanding any other provision of this article,
the board may, pursuant to this section and Section 31657, enter into
an agreement with the board of retirement of a county maintaining a
county retirement system, for termination of participation of a
public agency whose contract has been in effect for at least five
years in this system or the state with respect to certain safety
members who have ceased to be employed by the public agency or the
state and have been employed by a county, fire authority, or district
as a result of a transfer of firefighting or law enforcement
functions from the public agency or the state to the county, fire
authority, or district and inclusion of the former public agency
employees in that county retirement system.
(b) The agreement shall contain provisions the board finds
necessary to protect the interests of this system, including
provisions for determination of the amount, time, and manner of
transfer of cash or securities, or both, to be transferred to the
county system representing the actuarial value of the interests in
the retirement fund of the public agency or the state and the
transferred employees by reason of accumulated contributions credited
to that public agency or the state and the employees transferred.
The agreement may also contain any other provisions that the board
deems necessary to address issues related to the transfer, including,
but not limited to, benefits subject to an outstanding domestic
relations order and benefits subject to a lien. The agreement shall
apply only to employees who are employed by the county or district on
the effective date of the agreement.
(c) All liability of this system with respect to the members
transferred under that agreement shall cease and shall become the
liability of the county retirement system as of the date of transfer
specified in the agreement. Liability of the county retirement
system shall be for payment of benefits to transferred employees in
accordance with Chapter 3 (commencing with Section 31450) of Part 3
of Division 4 of Title 3.
(d) Any member transferred who becomes a member of a county
retirement system upon that transfer date shall be subject to
provisions of this part and of Chapter 3 (commencing with Section
31450) of Part 3 of Division 4 of Title 3 extending rights to a
member or subjecting him or her to limitations because of membership
in another retirement system to the same extent that he or she would
have been had he or she been a member of the county retirement system
during his or her membership in this system.
(e) This section shall apply only in Kern, Los Angeles, and Orange
Counties.
SEC. 6. Section 20590 of the Government Code is amended to read:
20590. (a) Notwithstanding any other provision of this article,
the board may enter into an agreement with the governing body of a
contracting agency, other than a housing authority, and the governing
body of a city with a population in excess of 2,000,000 and
maintaining its own retirement system, for termination of the
contracting agency's
participation in this system and inclusion of the employees in the
city retirement system.
(b) The agreement shall contain provisions the board finds
necessary to protect the interests of this system, including
provisions for determination of the amount, time, and manner of
transfer of cash or securities, or both, to be transferred to the
city system representing the value of the interests in the retirement
fund of the contracting agency and its employees by reason of
contributions and interest credited to the agency and its employees.
The agreement may also contain any other provisions that the board
deems necessary to address issues related to the transfer, including,
but not limited to, benefits subject to an outstanding domestic
relations order and benefits subject to a lien.
(c) All liability of this system with respect to members and
retired persons under the contract shall cease and shall become the
liability of the city system as of the date of termination specified
in the agreement. Liability of the city system shall be for payment
of benefits to persons retired on the termination date and their
beneficiaries and of beneficiaries of deceased members in at least
the amount provided under the agency's contract as it was on that
date. The termination may not affect the contribution rate of any
member in any other employment under this system on the date of
termination or any retirement allowance or other benefit based on
service.
(d) Any member who becomes a member of a city system upon the
contract termination shall be subject to those provisions of this
part extending rights to a member or subjecting the member to
limitations because of membership in another retirement system to the
same extent that the member would have been had he or she been a
member of the city system during his or her membership in this system
under the terminated contract.
SEC. 7. Section 20610 of the Government Code is amended to read:
20610. Every county superintendent of schools shall enter into a
contract with the board for the inclusion in this system of (a) all
of the employees of the office of county superintendent whose
compensation is paid from the county school service fund other than
employees electing pursuant to Section 1313 of the Education Code to
continue in membership in a county system; and (b) all of the
employees of school districts and community college districts
existing on July 1, 1949, or thereafter formed, within his or her
jurisdiction, other than school districts that are contracting
agencies or that maintain a district, joint district, or other local
retirement system, in respect to service rendered in a status in
which they are not eligible for membership in the State Teachers'
Retirement Plan. The effective date of each contract shall be not
later than July 1, 1949. For the purposes of this part those school
district employees shall be considered to be employees of the county
superintendent of schools having jurisdiction over the school
district by which they are employed and service to the district shall
be considered as service to the county superintendent of schools.
SEC. 8. Section 20611 of the Government Code is amended to read:
20611. A regional occupational center established pursuant to
Chapter 9 (commencing with Section 52300) of Division 4 of the
Education Code by two or more school districts by a joint powers
agreement shall be deemed a school district for purposes of this
part. The board and the county superintendent of schools, upon the
request of the governing body of any center in the county, shall
amend the contract entered into under this chapter to include the
employees of the center who are not eligible to membership in the
State Teachers' Retirement Plan. Credit shall not be granted for any
service in that employment prior to the effective date of the
amendment. However, on the request of the governing body of the
center, the amendment may provide that the membership of any person
becoming a member in that employment on the effective date of the
amendment shall be retroactive to the date of that person's entry
into that employment. If the amendment provides for the retroactive
membership, both the member and the center shall contribute to the
retirement fund for the period the amounts they would have
contributed had the amendment been in effect on the date of the entry
into employment.
SEC. 9. Section 20672.5 is added to the Government Code, to read:
20672.5. Whenever a member's contribution rate is temporarily
reduced by statute, a memorandum of understanding, or the Director of
the Department of Personnel Administration, those reductions shall
be limited to the payment of member contributions during the
reduction period and do not apply to the purchase of service credit
or the redeposit of member contributions. The purchase of service
credit and the redeposit of member contributions shall be subject to
the normal rate of contribution for the member in effect immediately
prior to the temporary rate reduction.
SEC. 10. Section 20677.1 of the Government Code is repealed.
SEC. 11. Section 20732 of the Government Code is repealed.
SEC. 12. Section 20752 of the Government Code is amended to read:
20752. (a) A member of the Judges' Retirement System, the Judges'
Retirement System II, the Legislators' Retirement System, the State
Teachers' Retirement Plan, the University of California Retirement
System, or a county retirement system, who has withdrawn accumulated
contributions from this system shall have the right to redeposit
those contributions, subject to the same conditions as imposed for
redeposits of accumulated contributions by Section 20750, including
the rights that he or she would have had under Section 20638 had he
or she not withdrawn his or her contributions.
(b) Provisions of this section extending a right to redeposit
accumulated contributions withdrawn from this system shall also apply
to members of any retirement system established under Chapter 2
(commencing with Section 45300) of Division 5 of Title 4 with respect
to which an ordinance complying with Section 45310.5 has been filed
with, and accepted by, the board or any retirement system established
by, or pursuant to, the charter of a city or city and county or by
any other public agency of this state which system, in the opinion of
the board, provides a similar modification of rights and benefits
because of membership in this system and with respect to which the
governing body of the city, city and county or public agency and the
board have entered into agreement pursuant to Section 20351.
(c) A member who elects to redeposit under this section shall have
the same rights as a member who has elected pursuant to Section
20731 to leave his or her accumulated contributions on deposit in the
fund.
SEC. 13. Section 20816 of the Government Code is amended to read:
20816. (a) Notwithstanding any other provision of this part, all
assets of an employer shall be used in the determination of the
employer contribution rate for the membership comprising the basis of
the computation. Assets held shall be recognized over the same
funding period used to amortize unfunded accrued actuarial
obligations, whether in excess of the accrued actuarial obligation or
not, using the entry age normal funding method.
(b) On and after January 1, 1999, contracting agencies for which
the actuarial value of assets exceeds the present value of benefits
as of the most recently completed valuation, as determined by the
chief actuary, may request that the board transfer employer assets to
member-accumulated contribution accounts to satisfy all or a portion
of the member contributions required by this part. That transfer
shall be over a 12-month period provided the actuarial value of
assets exceeds the present value of benefits. In determining the
present value of benefits and the actuarial value of assets for
purposes of this part, liabilities and assets attributed to the 1959
survivor allowance may not be included. On and after January 1,
2003, a transfer of assets may not be made pursuant to this
subdivision unless all or the same portion of the member
contributions of each member in a membership classification are
satisfied through the transfer. An employer electing a transfer of
assets pursuant to this subdivision shall satisfy the members'
contributions for a period of not less than one month and not more
than one year.
(c) On and after January 1, 2002, any contracting agency for which
the actuarial value of assets exceeds the present value of benefits
as of the most recently completed valuation, as determined by the
chief actuary, may request that the board transfer from the
contracting agency's employer account excess assets, as determined by
the board subject to the requirements and limitations of Section 420
of the Internal Revenue Code (26 U.S.C. Sec. 420), to a retiree
health account established by the board, in its discretion, in the
contracting agency's employer account pursuant to Section 401(h) of
the Internal Revenue Code (26 U.S.C. 401(h)) for the purpose of
providing health benefits to the contracting agency's retirees and
their covered dependents. The board may, in its discretion, transfer
excess assets from the contracting agency's employer account to that
contracting agency's retiree health account within that agency's
employer account, if the transfer meets the conditions of a qualified
transfer pursuant to Section 420 of the Internal Revenue Code (26
U.S.C. Sec. 420). The transferred assets shall be used solely for
the payment of current retiree health liabilities. That qualified
transfer shall be made only once each year. The board may adopt
regulations necessary to implement this subdivision. Notwithstanding
any other provision of law, the regulations may provide for the
nonforfeiture of accrued pension benefits of participants and
beneficiaries of a plan from which excess assets are transferred to
the extent necessary for the transfer to meet the conditions of a
qualified transfer pursuant to Section 420 of the Internal Revenue
Code (26 U.S.C. Sec. 420), and may include any other provision
necessary under Section 420 of the Internal Revenue Code (26 U.S.C.
Sec. 420) or Section 401(h) of the Internal Revenue Code (26 U.S.C.
Sec. 401(h)) to accomplish the purposes of this subdivision.
(d) For the purpose of this section, "employer" means any
contracting agency, the state, or a school employer.
(e) The actuarial report in the annual financial report shall also
express the effect upon employer contribution rates of this section
and of the recognition of net unrealized gains and losses.
SEC. 14. Chapter 10 (commencing with Section 20860) of Part 3 of
Division 5 of Title 2 of the Government Code is repealed.
SEC. 15. Section 20890.2 of the Government Code is amended to
read:
20890.2. (a) Past miscellaneous service performed as an employee
of the Department of the California Highway Patrol while a student at
the department's training school established pursuant to Section
2262 of the Vehicle Code shall be converted to patrol member service
if all of the following apply:
(1) The service was rendered by a current employee of the
Department of the California Highway Patrol.
(2) The service is credited to an employee who has patrol member
service credit for service performed with the Department of the
California Highway Patrol.
(3) The member failed to file a written election to retain the
service as miscellaneous service within 90 days of notification by
the board.
(b) The Department of the California Highway Patrol shall notify
the board, in the manner established by the board, of any employee
who is eligible for conversion of service pursuant to this section.
SEC. 16. Section 20907 of the Government Code is amended to read:
20907. Any funds transferred to this system on account of
liability for additional service credit granted pursuant to Sections
20901, 20902, 20904, or former Section 20822, as added by Chapter 450
of the Statutes of 1992, shall be paid over a time period acceptable
to the employer and the board, but in no case shall that period
exceed five years.
SEC. 17. Section 21013 of the Government Code is amended to read:
21013. "Leave of absence" also means any time, up to one year,
during which a member is granted an approved maternity or paternity
leave and returns to employment at the end of the approved leave for
a period of time at least equal to that leave. Any member electing
to receive service credit for that leave of absence shall make the
contributions as specified in Sections 21050 and 21052. This section
applies to both past and future maternity or paternity leaves of
absences by members of the system.
SEC. 18. Section 21220 of the Government Code is amended to read:
21220. (a) A person who has been retired under this system, for
service or for disability, may not be employed in any capacity
thereafter by the state, the university, a school employer, or a
contracting agency, unless the employment qualifies for service
credit in the University of California Retirement System or the State
Teachers' Retirement Plan, unless he or she has first been
reinstated from retirement pursuant to this chapter, or unless the
employment, without reinstatement, is authorized by this article. A
retired person whose employment without reinstatement is authorized
by this article shall acquire no service credit or retirement rights
under this part with respect to the employment.
(b) Any retired member employed in violation of this article
shall:
(1) Reimburse this system for any retirement allowance received
during the period or periods of employment that are in violation of
law.
(2) Pay to this system an amount of money equal to the employee
contributions that would otherwise have been paid during the period
or periods of unlawful employment, plus interest thereon.
(3) Contribute toward reimbursement of this system for
administrative expenses incurred in responding to this situation, to
the extent the member is determined by the executive officer to be at
fault.
(c) Any public employer that employs a retired member in violation
of this article shall:
(1) Pay to this system an amount of money equal to employer
contributions that would otherwise have been paid for the period or
periods of time that the member is employed in violation of this
article, plus interest thereon.
(2) Contribute toward reimbursement of this system for
administrative expenses incurred in responding to this situation, to
the extent the employer is determined by the executive officer of
this system to be at fault.
SEC. 19. Section 21220.5 is added to the Government Code, to read:
21220.5. A retired person who has not attained the normal
retirement age shall have a bona fide separation in service to the
extent required by the Internal Revenue Code, and the regulations
promulgated thereunder, before working after retirement pursuant to
this article. The board shall establish, by regulation, the criteria
under which a bona fide separation is satisfied.
SEC. 20. Section 21252 of the Government Code is repealed.
SEC. 21. Section 21252 is added to the Government Code, to read:
21252. (a) A member's written application for retirement, if
submitted to the board within nine months after the date the member
discontinued his or her state service, and, in the case of retirement
for disability, if the member was physically or mentally
incapacitated to perform his or her duties from the date the member
discontinued state service to the time the written application for
retirement was submitted to the board, shall be deemed to have been
submitted on the last day for which salary was payable. The
effective date of a written application for retirement submitted to
the board more than nine months after the member's discontinuance of
state service shall be determined in accordance with Section 20160.
(b) An application for retirement may only be submitted by or for
a member who is living on the date the application is actually
received by the system. If the member has been deemed incompetent to
act on his or her own behalf continuously from the last day for
which salary was payable, the effective date of retirement may not be
earlier than one year prior to the month in which an application
submitted by the guardian of the member's estate is received by the
system.
(c) Notwithstanding any other provision of law, a member who
separates from a retirement system that has established reciprocity
with this system with the intention of retiring concurrently under
both systems and who submits his or her application for retirement
for service to the board within nine months after that separation,
may have his or her application received and acted upon by this
system as if the application were submitted pursuant to this section.
SEC. 22. Section 21253 of the Government Code is repealed.
SEC. 23. Section 21431 of the Government Code is repealed.
SEC. 24. Section 21571 of the Government Code is amended to read:
21571. (a) If the death benefit provided by Section 21532 is
payable on account of a member's death that occurs under
circumstances other than those described in subparagraph (F) of
paragraph 1 of subdivision (a) of Section 21530, or if an allowance
under Section 21546 is payable, the payment pursuant to subdivision
(b) shall be made, in the following order of priority:
(1) The surviving wife or surviving husband of the member, who has
the care of unmarried children, including stepchildren, of the
member who are under 22 years of age, or are incapacitated because of
disability that began before and has continued without interruption
after attainment of that age.
(2) The guardian or conservator of surviving unmarried children,
including stepchildren, of the member who are under 22 years of age
or are so incapacitated.
(3) The surviving wife or surviving husband of the member, who
does not qualify under paragraph (1).
(4) Each surviving parent of the member.
(b) Regardless of the benefit provided by Section 21532 and of the
beneficiary designated by the member under that section, or
regardless of the allowance provided under Section 21546, the
following applicable 1959 survivor allowance, under the conditions
stated and from contributions of the state, shall be paid:
(1) A surviving spouse who was either continuously married to the
member for at least one year prior to death, or was married to the
member prior to the occurrence of the injury or onset of the illness
that resulted in death, and has the care of unmarried children,
including stepchildren, of the deceased member who are under 22 years
of age or are so incapacitated, shall be paid three hundred sixty
dollars ($360) if there is one child or four hundred thirty dollars
($430) per month if there are two or more children. If there also
are children who are not in the care of the surviving spouse, the
portion of the allowance payable under this paragraph, assuming that
these children were in the care of the surviving spouse, which is in
excess of one hundred eighty dollars ($180) per month, shall be
divided equally among all those children and payments made to the
spouse and other children, as the case may be.
(2) If there is no surviving spouse, or if the surviving spouse
dies, and if there are unmarried children, including stepchildren, of
the deceased member who are under 22 years of age or are so
incapacitated, or if there are children not in the care of the
spouse, the children shall be paid an allowance as follows:
(A) If there is only one child, the child shall be paid one
hundred eighty dollars ($180) per month.
(B) If there are two children, the children shall be paid three
hundred sixty dollars ($360) per month divided equally between them.
(C) If there are three or more children, the children shall be
paid four hundred thirty dollars ($430) per month divided equally
among them.
(3) A surviving spouse who has attained or attains the age of 62
years and, with respect to that surviving spouse, who was either
continuously married to the member for at least one year prior to
death, or who was married to the member prior to the occurrence of
the injury or onset of the illness which resulted in death, shall be
paid one hundred eighty dollars ($180) per month. No allowance shall
be paid under this paragraph, while the surviving spouse is
receiving an allowance under paragraph (1), or while an allowance is
being paid under subparagraph (C) of paragraph (2). The allowance
paid under this paragraph shall be seventy dollars ($70) per month
while an allowance is being paid under subparagraph (B) of paragraph
(2).
(4) If there is no surviving spouse or surviving child who
qualifies for a 1959 survivor allowance, or if the surviving spouse
dies and there is no surviving child, or if the surviving spouse dies
and the children die or marry or, if not incapacitated, reach age
22, each of the member's dependent parents who has attained or
attains the age of 62, and who received at least one-half of his or
her support from the member at the time of the member's death, shall
be paid one hundred eighty dollars ($180) per month.
(c) "Stepchildren," for purposes of this section, shall include
only stepchildren of the member living with him or her in a regular
parent-child relationship at the time of his or her death.
(d) The amendments to this section by Chapter 1617 of the Statutes
of 1971 shall apply only to 1959 survivor allowances payable April
1, 1972, and thereafter.
(e) This section does not apply to any member in the employ of an
employer not subject to this section on January 1, 1994.
(f) On and after the date determined by the board, all assets and
liabilities of all contracting agencies subject to this section, and
their employees, on account of benefits provided under this article
shall be pooled into a single account, and a single employer rate
shall be established to provide benefits under this section on
account of members employed by a contracting agency that is subject
to this section.
(g) The rate of contribution of an employer subject to this
section shall be figured using the term insurance valuation method.
If a contracting agency that is subject to this section is projected
to have a surplus in its 1959 survivor benefit account as of the date
the assets and liabilities are first pooled, the surplus shall be
applied to reduce its rate of contribution. If a contracting agency
that is subject to this section is projected to have a deficit in its
1959 survivor benefit account as of the date the assets and
liabilities are first pooled, its rate of contribution shall be
increased until the projected deficit is paid.
SEC. 25. Section 21572 of the Government Code is amended to read:
21572. (a) In lieu of benefits provided in Section 21571, if the
death benefit provided by Section 21532 is payable on account of a
state member's death that occurs under circumstances other than those
described in subparagraph (F) of paragraph (1) of subdivision (a) of
Section 21530, or if an allowance under Section 21546 is payable,
the payment pursuant to subdivision (b) shall be made in the
following order of priority:
(1) The surviving wife or surviving husband of the member, who has
the care of unmarried children, including stepchildren, of the
member who are under 22 years of age, or are incapacitated because of
a disability that began before and has continued without
interruption after attainment of that age.
(2) The guardian of surviving unmarried children, including
stepchildren, of the member who are under 22 years of age or are so
incapacitated.
(3) The surviving wife or surviving husband of the member, who
does not qualify under paragraph (1).
(4) Each surviving parent of the member.
(b) Regardless of the benefit provided by Section 21532 and of the
beneficiary designated by the member under that section, or
regardless of the allowance provided under Section 21546, the
following applicable 1959 survivor allowance, under the conditions
stated and from contributions of the state, shall be paid:
(1) A surviving spouse who was either continuously married to the
member for at least one year prior to death, or was married to the
member prior to the occurrence of the injury or onset of the illness
that resulted in death, and has the care of unmarried children,
including stepchildren, of the deceased member who are under 22 years
of age or are so incapacitated, shall be paid four hundred fifty
dollars ($450) per month if there is one child or five hundred
thirty-eight dollars ($538) per month if there are two or more
children. If there also are children who are not in the care of the
surviving spouse, the portion of the allowance payable under this
paragraph, assuming that these children were in the care of the
surviving spouse, that is in excess of two hundred twenty-five
dollars ($225) per month, shall be divided equally among all those
children and payments made to the spouse and other children, as the
case may be.
(2) If there is no surviving spouse, or if the surviving spouse
dies, and if there are unmarried children, including stepchildren, of
the deceased member who are under 22 years of age or are so
incapacitated, or if there are children not in the care of the
spouse, the children shall be paid an allowance as follows:
(A) If there is only one child, the child shall be paid two
hundred twenty-five dollars ($225) per month.
(B) If there are two children, the children shall be paid four
hundred fifty dollars ($450) per month divided equally between them.
(C) If there are three or more children, the children shall be
paid five hundred thirty-eight dollars ($538) per month divided
equally among them.
(3) A surviving spouse who has attained or attains the age of 62
years and, with respect to that surviving spouse, who was either
continuously married to the member for at least one year prior to
death, or was married to the member prior to the occurrence of the
injury or onset of the illness that resulted in death, shall be paid
two hundred twenty-five dollars ($225) per month. No allowance shall
be paid under this paragraph while the surviving spouse is receiving
an allowance under paragraph (1) or while an allowance is being paid
under subparagraph (C) of paragraph (2). The allowance paid under
this paragraph shall be eighty-eight dollars ($88) per month while an
allowance is being paid under subparagraph
(B) of paragraph (2).
(4) If there is no surviving spouse or surviving child who
qualifies for a 1959 survivor allowance, or if the surviving spouse
dies and there is no surviving child, or if the surviving spouse dies
and the children die or marry or, if not incapacitated, reach 22
years of age, each of the member's dependent parents who has attained
or attains the age of 62 years, and who received at least one-half
of his or her support from the member at the time of the member's
death, shall be paid two hundred twenty-five dollars ($225) per
month.
(c) "Stepchildren," for purposes of this section, shall include
only stepchildren of the member living with him or her in a regular
parent-child relationship at the time of his or her death.
(d) This section shall apply to beneficiaries receiving 1959
survivor allowances on July 1, 1975, as well as to beneficiaries with
respect to the death of a state member occurring on or after July 1,
1975.
(e) This section shall apply, with respect to benefits payable on
and after July 1, 1981, to all members employed by a school employer,
and school safety members employed with a school district or
community college district as defined in subdivision (i) of Section
20057, except that it shall not apply, without contract amendment,
with respect to safety members who became members after July 1, 1981.
All assets and liabilities of all school employers, and their
employees, on account of benefits provided under this article shall
be pooled into a single account, and a single employer rate shall be
established to provide benefits under this section on account of all
miscellaneous members employed by a school employer and all safety
members who are members on July 1, 1981.
(f) This section does not apply to any member in the employ of an
employer not subject to this section on January 1, 1994.
(g) On and after January 1, 2000, and until January 1, 2010, all
state members covered by this section shall be covered by the benefit
provided under Section 21574.7. On and after January 1, 2010, all
state members not covered by Section 21573 or 21574.7 shall be
covered by this section.
(h) On and after the date determined by the board, all assets and
liabilities of all contracting agencies subject to this section, and
their employees, on account of benefits provided under this article
shall be pooled into a single account, and a single employer rate
shall be established to provide benefits under this section on
account of members employed by a contracting agency that is subject
to this section.
(i) The rate of contribution of an employer subject to this
section shall be figured using the term insurance valuation method.
If a contracting agency that is subject to this section is projected
to have a surplus in its 1959 survivor benefit account as of the date
the assets and liabilities are first pooled, the surplus shall be
applied to reduce its rate of contribution. If a contracting agency
that is subject to this section is projected to have a deficit in its
1959 survivor benefit account as of the date the assets and
liabilities are first pooled, its rate of contribution shall be
increased until the projected deficit is paid.
SEC. 26. Section 21661 of the Government Code is amended to read:
21661. (a) The board shall contract with carriers offering
long-term care insurance plans.
The long-term care insurance plans shall be made available
periodically during open enrollment periods determined by the board.
(b) The board shall award contracts to carriers who are qualified
to provide long-term care benefits, and may develop and administer
self-funded long-term care insurance plans. The board may offer one
or more long-term care insurance plans.
(c) The long-term care insurance plans shall include home,
community, and institutional care and shall, to the extent determined
by the board, provide substantially equivalent coverage to that
required under Chapter 2.6 (commencing with Section 10231) of Part 2
of Division 2 of the Insurance Code, if the carrier has been approved
by the Department of Managed Health Care pursuant to Chapter 2.2
(commencing with Section 1340) of Division 2 of the Health and Safety
Code.
(d) The classes of persons who shall be eligible to enroll are:
(1) Active and retired members and annuitants of the Public
Employees' Retirement System, and their spouses, parents, siblings,
and spouses' parents.
(2) Active and retired members and annuitants of the State
Teachers' Retirement Plan, and their spouses, parents, siblings, and
spouses' parents.
(3) Active and retired members and annuitants of the Judges'
Retirement System, and their spouses, parents, siblings, and spouses'
parents.
(4) Active and retired members and annuitants of the Judges'
Retirement System II, and their spouses, parents, siblings, and
spouses' parents.
(5) Active and retired members and annuitants of the Legislators'
Retirement System, and their spouses, parents, siblings, and spouses'
parents.
(6) Members of the California Assembly and Senate and their
spouses, parents, siblings, and spouses' parents.
(7) Active and retired members and annuitants, and other classes
of employees of a public agency that is located in this state, and
their spouses, parents, siblings, and spouses' parents.
(e) An individual specified in paragraphs (1) to (7), inclusive,
of subdivision (d) may not be eligible unless he or she resides in
the United States, its territories and possessions, or in a country
in which a provider network can be established comparable in quality
and effectiveness to those established in the United States.
(f) Notwithstanding paragraphs (1) to (7), inclusive, of
subdivision (d), no person may be enrolled unless he or she meets
the eligibility and underwriting criteria established by the board.
(g) Notwithstanding paragraphs (1) to (7), inclusive, of
subdivision (d), enrollment of active employees of the State of
California shall be subject to Section 19867.
(h) The board shall establish eligibility criteria for enrollment,
establish appropriate underwriting criteria for potential enrollees,
define the scope of covered benefits, define the criteria to receive
benefits, and set any other standards as needed. As used in this
section, "sibling" shall mean a sibling who is at least 18 years of
age.
(i) The long-term care insurance plans may not become part of, or
subject to, the retirement or health benefits programs administered
by the system.
(j) For any self-funded long-term care plan developed by the
board, the premiums shall be deposited in the Public Employees'
Long-term Care Fund.
SEC. 27. Section 21663 of the Government Code is amended to read:
21663. (a) The board may enter into contracts with long-term care
insurance carriers, pursuant to Section 21661, and with entities
offering services relating to the administration of long-term care
plans, without compliance with any provisions of law relating to
competitive bidding.
(b) The board may fix the beginning and ending dates of the
contracts in a manner it deems consistent with administration of this
part. The board shall periodically review each contract according
to a reasonable schedule mutually agreed upon by the parties.
Irrespective of any agreed-upon termination date or period for
review, the board may terminate a contract at any time under
conditions determined by the board, and may automatically renew a
contract from term to term, or for any lesser period it deems
appropriate.
(c) The Department of General Services shall review and approve
all contracts entered into pursuant to this section, to ensure that
each written instrument contains the principal necessary provisions
and proper technical terms and phrases, is formally correct, is
arranged in proper and methodical order, and is adapted to the
specific requirements of the agreement between the parties. The
department's review and approval does not supersede the board's
authority to negotiate and reach agreement with long-term care
insurance carriers or with entities offering services relating to the
administration of long-term care plans, with respect to the rates,
terms, and conditions of contracts entered into pursuant to this
section.
SEC. 28. Section 22009.03 of the Government Code is amended to
read:
22009.03. "Public agency" also includes a school district, a
county superintendent of schools, and a regional occupational center
or program established pursuant to Article 1 (commencing with Section
6500) of Chapter 5 of Division 7 of Title 1, with respect to
employees eligible for membership in the State Teachers' Retirement
Plan.
This section shall become inoperative on July 1, 2004, and, as of
January 1, 2005, is repealed, unless a later enacted statute, which
becomes effective on or before January 1, 2005, deletes or extends
the dates on which it becomes inoperative and is repealed.
SEC. 29. Section 22009.1 of the Government Code is amended to
read:
22009.1. "Retirement system" includes:
(a) A pension, annuity, retirement or similar fund or system
established by a public agency and covering only positions of that
agency.
(b) The Public Employees' Retirement System with respect only to
employees of the state and employees of the University of California
in positions covered by that system.
(c) The Public Employees' Retirement System with respect to
employees of all school districts in positions covered under each
contract entered into by a county superintendent of schools and the
system.
(d) The State Teachers' Retirement System with respect to all
employees in positions subject to coverage under the Defined Benefit
Program of the State Teachers' Retirement Plan except employees of a
public agency having any employees in positions covered by that
system who are also in positions covered by a local retirement system
for the retirement of teachers, or for membership in which public
school teachers are eligible, operated by a city, city and county,
county or other public agency or combination of public agencies of
the state.
(e) The Legislators' Retirement System with respect to all
employees in positions covered by that system.
(f) The Judges' Retirement System with respect to all employees in
positions covered by that system.
(g) The University of California Retirement System only with
respect to all employees in positions covered by that system.
(h) The San Francisco City and County Employees' Retirement System
with respect to all employees in positions covered by that system.
(i) Any other retirement system with respect only to employees of
any two or more of the public agencies having employees in positions
covered by that system, as designated by the board and with regard to
which the board authorizes conduct of a referendum.
(j) Any retirement system with respect only to employees of a
hospital that is an integral part of a city incorporated between
January 15, 1898 and July 15, 1898 in positions covered by the
system, as designated by the board on request of the city.
(k) Except as otherwise provided in subdivisions (b) to (j),
inclusive, any retirement system with respect to employees of each of
the public agencies having employees in positions covered by the
system.
(l) Each division or part of a retirement system, as defined in
subdivisions (a), (b), (c), (e), (g), (h), (i), (j), (k), and (m) of
this section, which is divided pursuant to this chapter into two
parts:
(1) The part composed of the positions of members of the system
who desire coverage under the federal system.
(2) The part composed of the positions of members of the system
who do not desire coverage under the federal system.
(m) The State Teachers' Retirement System with respect to all
employees of each public agency, as defined by Section 22009.03, in
positions covered by the State Teachers' Retirement Plan. This
subdivision shall become inoperative on July 1, 2004.
SEC. 30. Section 22013.7 of the Government Code is amended to
read:
22013.7. "Policeman" or "fireman," as used in this part, also
includes persons employed in positions set forth in Sections 20414
and 20423.5 for the purposes of Section 218(d)(5)(A) of the Social
Security Act (42 U.S.C. Sec. 418(d)(5)(A)).
SEC. 31. Section 22013.78 of the Government Code is amended to
read:
22013.78. "Policeman" as used in this part also includes persons
currently employed in classifications listed in Sections 20401.5,
20423.6, 31469.2, 45311, and 53217.6 for purposes of Section 218(d)
(5)(A) of the Social Security Act (42 U.S.C. Sec. 418(d)(5)(A)).
SEC. 32. Section 22018 of the Government Code is amended to read:
22018. (a) It is the intent of the Legislature that, to the
extent possible, members of the State Teachers' Retirement Plan earn
credit towards Medicare coverage.
(b) In accomplishing the goal specified in subdivision (a), the
board shall make available to school districts, community college
districts, and county superintendents of schools information
concerning the procedure for earning credit for social security
coverage for school related service not credited under the Teachers'
Retirement Law.
SEC. 33. Section 22156 of the Government Code is amended to read:
22156. (a) A division of the State Teachers' Retirement Plan is
hereby authorized by the Legislature to provide Medicare coverage for
employees of a public agency as defined in Section 22009.03, upon
the request of the public agency.
(b) The division authorized by subdivision (a) shall be conducted
pursuant to this article.
(c) A member of the State Teachers' Retirement Plan on whose
behalf a request is made pursuant to subdivision (a), may elect to be
covered by Medicare, pursuant to Section 218 of the federal Social
Security Act (42 U.S.C. Sec. 418), and applicable federal regulations
if (1) the member was employed in a position covered by the plan on
March 31, 1986, and (2) the member has not since been mandated into
Medicare coverage due to the enactment of Public Law 99-272, and (3)
the member is in a position covered or the member is eligible to
elect to be covered by the retirement system on the date of the
division.
(d) The public agency shall, immediately after the elections
authorized in subdivision (b) have been made, make application
pursuant to Chapter 2 (commencing with Section 22200) of this part
for Medicare coverage for those members who have elected to receive
Medicare coverage.
(e) The effective date of the coverage may be retroactive a
maximum of five years but not earlier than January 1, 1987.
(f) This section shall become inoperative on July 1, 2004, and, as
of January 1, 2005, is repealed, unless a later enacted statute,
which becomes effective on or before January 1, 2005, deletes or
extends the dates on which it becomes inoperative and is repealed.
SEC. 34. Section 22216 of the Government Code is repealed.
SEC. 35. Section 22502 of the Government Code is amended to read:
22502. Agreements as defined in Section 22006, and all
applications and agreements and contracts and any amendments thereto
between the board and the Adjutant General, the Teachers' Retirement
Board, the Regents of the University of California, and any public
agency, except the state, executed by the board pursuant to this part
are hereby excepted from the provisions of Section 13370, and of any
other statutory provision that would otherwise require the approval
of any of those agreements and contracts and any amendments thereto
by any other state officer or agency.
SEC. 36. Section 22754 of the Government Code is amended to read:
22754. As used in this part, the following definitions, unless
the context otherwise requires, shall govern the interpretation of
terms:
(a) "Board" means the Board of Administration of the Public
Employees' Retirement System.
(b) "Employee" means:
(1) Any officer or employee of the State of California or of any
agency, department, authority, or instrumentality of the state
including the University of California, or any officer or employee
who is a local or school member of the Public Employees' Retirement
System employed by a contracting agency that has elected to be or
otherwise has become subject to this part, or who is a member or
retirant of the State Teachers' Retirement Plan employed by an
employer who has elected to become subject to this part, or who is an
employee or annuitant of a special district or county subject to the
County Employees Retirement Law of 1937 (Chapter 3 (commencing with
Section 31450) of Part 3 of Division 4 of Title 3) that has elected
to become subject to this part, or who is an employee or annuitant of
a special district, as defined in subdivision (i), that has elected
to become subject to this part, except persons employed on an
intermittent, irregular, or less than half-time basis, or employees
similarly situated, or employees in respect to whom contributions by
the state for any type of plan or program offering prepaid hospital
and medical care are otherwise authorized by law.
(2) Any officer or employee who participates in the retirement
system of a contracting agency as defined in paragraph (2) of
subdivision (g) that has elected to become subject to this part,
except persons employed less than half time or who are otherwise
determined to be ineligible.
(3) Any annuitant of the Public Employees' Retirement System
employed by a contracting agency as defined in subdivision (g) that
has elected to become subject to this part who is a person retired
under Section 21228.
(4) Any officer or employee of a contracting agency as defined in
paragraph (3) of subdivision (g) that has elected to become subject
to this part, except persons who are determined to be ineligible.
(c) "Carrier" means a private insurance company holding a valid
outstanding certificate of authority from the Insurance Commissioner
of the state, a medical society or other medical group, a nonprofit
hospital service plan qualifying under Chapter 11A (commencing with
Section 11491) of Part 2 of Division 2 of the Insurance Code, a
nonprofit membership corporation lawfully operating under Section
9200 or Section 9201 of the Corporations Code, a health care service
plan as defined under subdivision (f) of Section 1345 of the Health
and Safety Code, or a health maintenance organization approved under
Title XIII of the federal Public Health Services Act, that is
lawfully engaged in providing, arranging, paying for, or reimbursing
the cost of personal health services under insurance policies or
contracts, medical and hospital service agreements, membership
contracts, or the like, in consideration of premiums or other
periodic charges payable to it.
(d) "Health benefits plan" means any program or entity that
provides, arranges, pays for, or reimburses the cost of health
benefits.
(e) "Annuitant" means:
(1) Any person who has retired within 120 days of separation from
employment and who receives any retirement allowance under any state
or University of California retirement system to which the state was
a contributing party.
(2) A family member receiving an allowance as the survivor of an
annuitant who has retired as provided in paragraph (1), or as the
survivor of a deceased employee under Section 21541, 21546, or 21547
or similar provisions of any other state retirement system.
(3) Any employee who has retired under the retirement system
provided by a contracting agency as defined in paragraph (2) or (3)
of subdivision (g) and who receives a retirement allowance from that
retirement system, or a surviving family member who receives the
retirement allowance in place of the deceased.
(4) Any person who was a state member for 30 years or more and
who, at the time of retirement, was a local member employed by a
contracting agency.
(f) "Family member" means an employee's or annuitant's spouse and
any unmarried child (including an adopted child, a stepchild, or
recognized natural child who lives with the employee or annuitant in
a regular parent-child relationship). The board shall, by
regulation, prescribe age limits and other conditions and limitations
pertaining to unmarried children.
(g) "Contracting agency" means:
(1) Any contracting agency as defined in Section 20022, any county
or special district subject to the County Employees Retirement Law
of 1937 (Chapter 3 (commencing with Section 31450) of Part 3 of
Division 4 of Title 3), and any special district, school district,
county board of education, personnel commission of a school district
or a county superintendent of schools.
(2) Any public body or agency of, or within California not covered
by the Public Employees' Retirement System or subject to the County
Employees Retirement Law of 1937 (Chapter 3 (commencing with Section
31450) of Part 3 of Division 4 of Title 3), that provides a
retirement system for its employees funded wholly or in part by
public funds and a trial court as defined in the Trial Court
Employment Protections and Governance Act (Chapter 7 (commencing with
Section 71600) of Title 8).
(3) The protection and advocacy agency described in subdivision
(h) of Section 4900 of the Welfare and Institutions Code, if the
agency obtains a written advisory opinion from the United States
Department of Labor stating that the organization is an agency or
instrumentality of the state or a political subdivision thereof
within the meaning of Chapter 18 (commencing with Section 1001) of
Title 29 of the United States Code.
(h) "Employer" means the state, any contracting agency employing
an employee, and any agency that has elected to become subject to
this part pursuant to Section 22856.
(i) "Special district" means a nonprofit, self-governed public
agency, within the State of California and comprised solely of public
employees, performing a governmental rather than proprietary
function.
SEC. 37. Section 22817.5 is added to the Government Code, to read:
22817.5. Notwithstanding any other provision of this part, a
former Member of the Legislature who has served six or more years as
a Member of the Legislature may elect, within 60 days after permanent
separation from state service, to enroll or continue his or her
enrollment in a health benefits plan and dental care plan provided to
annuitants. Upon that election, the former Member shall pay the
total premiums related to that coverage and an additional 2 percent
thereof for the administrative costs incurred by the board and the
Department of Personnel Administration in administering this section.
The health and dental benefits shall be provided without
discrimination as to premium rates or benefits coverage. A person
who subsequently terminates his or her coverage under this section
may not reenroll pursuant to this section.
SEC. 38. Section 22825 of the Government Code is amended to read:
22825. (a) The employer and each employee or annuitant shall
contribute a portion of the cost of providing for each employee and
annuitant the benefit coverage afforded under any health benefit plan
that the board has approved or for which it has executed a contract
pursuant to this part, and in which the employee or annuitant may be
enrolled.
(b) The employer's contribution for each employee or annuitant
shall be the amount necessary to pay the cost of his or her
enrollment, including the enrollment of his or her family members, in
a health benefits plan or plans, or, if less, as follows:
(1) Prior to January 1, 2004, sixteen dollars ($16) per month.
(2) During calendar year 2004, thirty-two dollars and twenty cents
($32.20) per month.
(3) During calendar year 2005, forty-eight dollars and forty cents
($48.40) per month.
(4) During calendar year 2006, sixty-four dollars and sixty cents
($64.60) per month.
(5) During calendar year 2007, eighty dollars and eighty cents
($80.80) per month.
(6) During calendar year 2008, ninety-seven dollars ($97) per
month.
Commencing January 1, 2009, the employer's contribution shall be
adjusted annually by the board to reflect any change in the medical
care component of the Consumer Price Index and shall be rounded to
the nearest dollar. There shall be only one contribution with
respect to all annuitants receiving allowances as survivors of the
same employee or annuitant.
(c) The contribution of each employee and annuitant shall be the
total cost per month of the benefit coverage afforded him or her
under the plan or plans less the portion thereof to be contributed by
the employer.
(d) If the provisions of this section are in conflict with the
provisions of a memorandum of understanding reached pursuant to
Section 3517.5, the memorandum of understanding shall be controlling
without further legislative action, except that if those provisions
of a memorandum of understanding require the expenditure of funds,
the provisions may not become effective unless approved by the
Legislature in the annual Budget Act.
SEC. 39. Section 1.5 of this bill incorporates amendments to
Section 20057 of the Government Code proposed by this bill and AB
1498. It shall only become operative if (1) both bills are enacted
and become effective on or before January 1, 2004, (2) each bill
amends Section 20057 of the Government Code, and (3) this bill is
enacted after AB 1498, in which case Section 20057 of the Government
Code, as amended by AB 1498, shall remain operative only until the
operative date of this bill, at which time Section 1.5 of this bill
shall become operative, and Section 1 of this bill shall not become
operative.