BILL ANALYSIS Ó
AB 2140
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Date of Hearing: April 26, 2012
ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL
SECURITY
Warren T. Furutani, Chair
AB 2140 (Lara) - As Introduced: February 23, 2012
SUBJECT : Public employees' retirement: State Bargaining Unit
5: contribution rates.
SUMMARY : Reduces retirement contribution rates for
miscellaneous and industrial members of State Bargaining Unit
(BU) 5, Highway Patrol, by 3%.
EXISTING LAW requires the following retirement contribution
amounts for state miscellaneous or state industrial members of
BU 5:
1)For those members who do not participate in Social Security,
11% of compensation in excess of $317 per month towards
retirement.
2)For those members who do participate in Social Security, 10%
of compensation in excess of $513 per month.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, AB 2140 corrects a
retirement contribution oversight and ensures current law
accurately reflects the agreement reached between the State and
the California Association of Highway Patrolmen (CAHP) regarding
California Highway Patrol (CHP) cadet pension contributions.
BU 5 cadets are the group of employees who undergo the six-month
CHP training academy. During this training period, cadets are
classified as miscellaneous employees for retirement purposes.
Upon graduation from the CHP Academy, cadets are promoted to the
position of officer and become Patrol members of the California
Public Employees' Retirement System (CalPERS).
The current BU 5 MOU reached between the State and the CAHP,
required Patrol members to increase their pension contribution
by 2%, from 8% of monthly pay to 10% of monthly pay. During
negotiations that culminated in the current BU 5 MOU, the State
and CAHP intended that cadets, while serving their six month
AB 2140
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academy training, would also increase their pension contribution
by 2%, from 5% to 7% of their monthly pay. Once the cadets
graduate and are sworn in, their contribution rate would
increase to 10%.
According to the Department of Personnel Administration who
represents the state in these negotiations, the parties' intent
on the cadets' retirement contribution issue did not translate
onto the current MOU nor into the legislation that ratified the
BU 5 MOU, SB 846 (Correa), Chapter 162, Statutes of 2010. As a
result, CHP cadets are now contributing more than what was
agreed upon between the State and CAHP into CalPERS. Further
evidence of the intent to have CHP cadets contribute 7% rather
than the current 10% can be seen in DPA's fiscal analysis of SB
846 which accurately reflects the intended 7% monthly pension
contribution for cadets.
The author concludes, "In the ongoing process of administering
state employee bargaining agreements, the State Controller's
Office notified DPA of the oversight and that current law
required the cadets to contribute 10% toward their pension.
Consequently, a statutory change to Government Code section
20677.7 is required to accurately reflect the State's and CAHP's
intent that BU 5 cadets pay 7% of monthly pay toward the pension
fund."
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Highway Patrolmen (Sponsor)
Opposition
None on file
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957