BILL NUMBER: AB 1064 CHAPTERED 10/12/03 CHAPTER 845 FILED WITH SECRETARY OF STATE OCTOBER 12, 2003 APPROVED BY GOVERNOR OCTOBER 11, 2003 PASSED THE ASSEMBLY AUGUST 28, 2003 PASSED THE SENATE AUGUST 25, 2003 AMENDED IN SENATE JULY 23, 2003 AMENDED IN SENATE JUNE 26, 2003 INTRODUCED BY Assembly Member Laird FEBRUARY 20, 2003 An act to amend Section 125550 of, and to add Sections 99159 and 120523 to, the Public Utilities Code, and to add Section 27512 to the Streets and Highways Code, relating to public transit district pension plans. LEGISLATIVE COUNSEL'S DIGEST AB 1064, Laird. Public transit district pension plans. Existing law authorizes public transit districts and transit development boards to provide a retirement or pension plan for their employees. This bill would require any pension or retirement plan provided by those districts or boards or by the Golden Gate Bridge, Highway and Transportation District for represented employees that meets specified criteria to be maintained pursuant to a collective bargaining agreement and managed and administered by a retirement board with equal representation of labor and management in accordance with existing state and federal law, except as specified. The bill would make related legislative findings. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature finds and declares: (a) In general, public transit systems in California have evolved through the takeover and consolidation of private transit operations by legislatively created public transit agencies. In the process of this evolution, all or a portion of private transit system retirement plans have been replaced by the current public transit retirement systems. (b) In recognition of the private sector origins of these public transit systems and to meet the collective bargaining obligations imposed upon local agencies by federal law, most of the enabling legislation enacted by the Legislature has required transit district labor-management relations and public transit pension plans to be administered by reference to and consistent with the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 141 et seq.). That act requires that pension plans applicable to employees represented by labor organizations operate under strong standards of fiduciary responsibility, including the requirement that those plans be administered and managed by boards of trustees consisting of equal representation of labor and management (29 U.S.C. Sec. 186(c)(5)). (c) In addition, in adopting Proposition 162, which amended Section 17 of Article XVI of the California Constitution, the voters established that the public policy of this state is that a public retirement and pension system shall be administered and its pension assets shall be managed by a retirement board that is independent of the public agency governing board. (d) Therefore, in order to further the objectives of uniform administration of labor-management relations and independence of collectively bargained retirement and pension systems in the public transit industry, the Legislature deems it appropriate that uniform provisions for the administration and management of collectively bargained pension plans, based upon the private-sector model established in the federal Labor Management Relations Act, 1947, be applied to all transit districts or agencies established pursuant to Division 10 (commencing with Section 24501), Division 11 (commencing with Section 120000), and Division 11.5 (commencing with Section 125000) of the Public Utilities Code and Chapter 18 of Part 3 of Division 16 of the Streets and Highways Code. SEC. 2. Section 99159 is added to the Public Utilities Code, to read: 99159. (a) Any retirement system established or maintained pursuant to this division for employees of a transit district who are members of a unit appropriate for collective bargaining shall be maintained pursuant to a collective bargaining agreement and this section. (b) Notwithstanding any other provision of this division, the retirement system and the funds of the system shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)). (c) The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution. (d) This section does not apply to any public transit district that has, pursuant to a collective bargaining agreement, provided membership for the district's represented employees in the Public Employees' Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.) or any transit district where the membership of the governing board of the transit district is directly elected by the voters. SEC. 3. Section 120523 is added to the Public Utilities Code, to read: 120523. (a) Any pension plan maintained by the board pursuant to this division for employees of the board who are members of a unit appropriate for collective bargaining shall be maintained pursuant to a collective bargaining agreement and this section. (b) The pension plan and the funds of the plan shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)). (c) The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution. (d) This section does not apply if the board has, pursuant to a collective bargaining agreement, provided membership for the board's represented employees in the Public Employees' Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.). SEC. 4. Section 125550 of the Public Utilities Code is amended to read: 125550. (a) The adoption, terms, and conditions of a pension plan covering employees of the board in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between that organization and the board and shall be subject to this section. (b) The pension plan and the funds of the plan shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)). (c) The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution. (d) This section does not apply if the board has, pursuant to a collective bargaining agreement, provided membership for the board's represented employees in the Public Employees' Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.). SEC. 5. Section 27512 is added to the Streets and Highways Code, to read: 27512. (a) The adoption, terms, and conditions of a pension plan covering employees of the district in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between that organization and the board and shall be subject to this section. (b) The pension plan and the funds of the plan shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)). (c) The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution. (d) This section does not apply if the district has, pursuant to a collective bargaining agreement, provided membership for the district's represented employees in the Public Employees' Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.) SEC. 6. This act may not become operative in any district in which the provisions of this act would result in a change in the number, term, and method of selection or removal of elected employee members and, pursuant to subdivision (f) of Section 17 of Article XVI of the California Constitution, would require a vote of the electors of the jurisdiction.