BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 2663 (Furutani) -  California State Teachers' Retirement 
          System

          Amended:  June 20, 2012         Policy Vote:  PE&R 4-0
          Urgency:  No                    Mandate: No
          Hearing Date: August 6, 2012                           
          Consultant: Maureen Ortiz       
          
          This bill does not meet the criteria for referral to the 
          Suspense File.
          
          
          Bill Summary:  AB 2663 makes numerous technical, conforming and 
          compliance changes to the Teachers Retirement Law to enhance 
          effective administration of the California State Teachers' 
          Retirement System.

          Fiscal Impact:  One-time costs of $85,000 potentially offset by 
          future savings (Special)

              CalSTRS indicates one-time IT costs to make changes to the 
              member database, and the "myCalSTRS" Website.
              Savings will result from consolidation of numerous reports 
              and from the reduction in the number of mailings to members. 


          Proposed Law:  AB 2663 does the following:

          1)  Consolidates the following three separately mandated reports 
          into a single financial report:

             a)  The return on investments and actual payroll subject to 
          the system for the prior 
             fiscal year,
             b)  The nature, duration, and cost of investment contract 
          services used,
             c)  The extent to which inflation has eroded the purchasing 
          power of defined         
             benefits and the amount of supplementary increases in 
          retirement allowances
             required to preserve the purchasing power of DB benefits. 









          AB  2663 (Furutani)
          Page 1



          2)  Removes reference to a qualifying condition of a member for 
          survivor benefits under Coverage B that does not currently 
          exist.

          3)  Makes conforming changes relating to disability retirement 
          benefits and workers' compensation benefits.

          4)  Corrects incorrect code references relating to disability 
          benefit annuity provisions of law.

          5)  Allows CalSTRS to withhold mailing certain benefit 
          statements when the member indicates he or she does not want to 
          receive them by mail.

          6)  Clarifies the information that employers must give to 
          reemployed retired members relating to earnings limitations.

          7)  Allows a retiring member to report service credit for unused 
          sick leave from more than one employer, instead of transferring 
          the service credit from one employer to another and then 
          receiving the full service credit.

          8)  Makes several clarifications in regards to the earnings 
          limitations.

          9)  Clarifies that employers such as district superintendent, 
          chancellor of a community college district or other employing 
          agencies that report directly to CalSTRS are subject to penalty 
          payments provisions.

          10)  Clarifies that CalSTRS has existing authority to subpoena 
          witnesses to compel attendance at a board hearing in addition to 
          the authority to subpoena the productions of documents relating 
          to an investigation.

          11)  Makes other technical changes in regards to credit 
          compensation, the 403bCompare website, and fixes incorrect code 
          references to the Teachers' Retirement Law in the Public 
          Resources Code.

          Staff Comments:  AB 2663 is an Assembly Committee on Public 
          Employees, Retirement and Social Security bill that makes 
          necessary conforming and technical changes in order to continue 








          AB  2663 (Furutani)
          Page 2



          effective administration of the California State Teachers' 
          Retirement System.