BILL ANALYSIS                                                                                                                                                                                                    

                           CONSTITUTIONAL AMENDMENTS
                          Senator Loni Hancock, Chair

          BILL NO:   SB 1271                            HEARING DATE:  
          AUTHOR:    ROMERO                             ANALYSIS BY:   
             Darren Chesin
          AMENDED:   4/5/10
          FISCAL:    YES
          Political Reform Act: conflict of interest codes

           Existing law  , pursuant to the Political Reform Act,  
          requires each state and local government agency to adopt  
          and promulgate a conflict of interest code.  A conflict of  
          interest code must establish conflict of interest standards  
          for designated employees of the agency and requires those  
          employees to file periodic statements of economic interest  
          (SEIs) disclosing specified personal financial information.  

           Existing law  further requires specified public officials,  
          including officials who manage public investments, to also  
          file SEIs, but does not require those officials to be  
          specifically enumerated in the agency's conflict of  
          interest code.  

          This bill  would require a public retirement board,  
          commission, or agency to attach to its conflict of interest  
          code an appendix that lists each position for which an  
          individual occupying that position is required to file a  
          SEI as a public official who manages public investments.  
          The bill would further require the board, commission, or  
          agency to post the appendix on its Internet Web site.  

           This bill  provides that for this purpose "public official  
          who manages public investments" includes a salaried or  
          unsalaried member of a committee, board, commission, or  
          other entity that exists as, or within, a governmental  
          agency and that possesses decision making authority.  


           This bill  provides that a committee, board, commission, or  
          other entity possesses decision making authority if any of  
          the following apply:
           The entity may make a final governmental decision.
           The entity may compel a governmental decision or prevent  
            a governmental decision, either by virtue of possessing  
            exclusive power to initiate the decision or by having  
            veto authority that may not be overridden.
           The entity makes substantive recommendations that are,  
            and over an extended period of time have been, regularly  
            approved, without significant amendment or modification,  
            by another public official or governmental agency.

          However, this bill provides that a committee, board,  
          commission, or other entity does not possess decision  
          making authority if it is formed for the sole purpose of  
          researching a subject and preparing a report or  
          recommendation for submission to another governmental  
          entity that has final decision making authority. 

           More than just PERS and STRS  ?  The following public  
          retirement agencies, among others, would fall under the  
          purview of this bill:

          Alameda-Contra Costa Transit District Retirement Plan
          Alameda County Employees' Retirement Association
          Bart Investment Plans Committee
          City Of Concord Retirement System
          Contra Costa Employees' Retirement Association
          East Bay Municipal Utility District Retirement System
          Fresno City Employees' Retirement System
          Fresno City Fire & Police Retirement System
          Fresno County Employees' Retirement Association
          Imperial County Employees' Retirement System
          Kern County Employees' Retirement Association
          Los Angeles City Employees' Retirement System
          Los Angeles County Employees' Retirement Association
          Los Angeles County MTA Retirement Plan 
          Los Angeles Fire & Police Pension System
          Los Angeles Water and Power Employees' Retirement Plan
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          Marin County Employees' Retirement Association
          Mendocino County Employees' Retirement Association
          Merced County Employees' Retirement Association
          Oakland Municipal Employees' Retirement System
          Oakland Police & Fire Retirement System
          Orange County Employees' Retirement System
          Pasadena Fire & Police Retirement System
          Public Employees' Retirement System (CalPERS)
          Sacramento County Employees' Retirement System
          Sacramento Regional Transit District Retirement Plan
          San Bernardino County Employees' Retirement Association
          San Diego City Employees' Retirement System
          San Diego County Employees' Retirement Association
          San Francisco City & County Employees' Retirement System
          San Joaquin County Employees' Retirement Association
          San Jose Federated City Employees' Retirement System
          San Jose Police & Fire Department Retirement Plan
          San Luis Obispo County Pension Trust
          San Mateo County Employees' Retirement Association
          Santa Barbara County Employees' Retirement System
          Santa Clara Valley Transportation Authority/Amalgamated  
          Transit Union        

            Pension Plan
          Sonoma County Employees' Retirement Association
          Stanislaus County Employees' Retirement Association
          State of California Savings Plus Program
          State Teachers' Retirement System (CalSTRS)
          Tulare County Employees' Retirement Association
          University Of California Retirement System
          Ventura County Employees' Retirement Association

           1.According to the author  , California's public retirement  
            systems (PRS) each have a governing body whose  
            responsibility is to administer the pension in a manner  
            that protects the interests of the pension members for  
            whom they have a fiduciary responsibility.  The Political  
            Reform Act requires state and local government agencies  
            to adopt and promulgate a Conflict of Interest Code.  The  
            purpose of this Conflict of Interest Code, with respect  
            to public employee retirement systems is to facilitate  
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            the disclosure of the economic interests of public  
            officials serving Public Retirement Systems (PRS) that  
            may be materially affected by PRS's actions in which they  

          However, the Conflict of Interest code promulgated by some  
            PRS are extremely lax and/or do not encompass all those  
            persons who may be materially affected by the PRS actions  
            in which they actively participate in the decision-making  
            process, but do not vote.  Since these persons do not  
            file SEIs there is no way to determine if they have been  
            materially affected.  

          This bill would encompass those persons who participate in  
            the decision making process, but do not vote, requiring  
            them to file SEIs.

          Sponsor: American Federation of State, County and Municipal  

           Support: None received

           Oppose:  None received

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