BILL NUMBER: SB 955	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senators Pavley and Rubio
   (Coauthor: Senator DeSaulnier)
   (Coauthors: Assembly Members Wieckowski and Williams)

                        JANUARY 5, 2012

   An act to add Section 20211 to the Government Code, relating to
public employees' retirement.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 955, as introduced, Pavley. Public Employees' Retirement
System: pension fund management.
   The Public Employees' Retirement Law creates the Public Employees'
Retirement Fund, which is a trust fund created and administered
solely for the benefit of the members and retired members of the
Public Employees' Retirement System and their survivors and
beneficiaries. The Board of Administration of the Public Employees'
Retirement System has the exclusive control of the administration and
investment of moneys in the retirement fund.
   This bill would require the board to prioritize an investment in
an in-state infrastructure project over alternative out-of-state
infrastructure projects if the investment in the in-state project is
consistent with the board's fiduciary duties to minimize the risk of
loss and to maximize the rate of return.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  (a) The Legislature finds and declares all of the
following:
   (1) Due to the current economic recession in which the residents
of the state and the nation as a whole find themselves,
infrastructure investment represents a significant opportunity to
spur job growth while improving California's infrastructure, which is
important to maintain business competitiveness.
   (2) While California may be emerging from the recession, over
2,000,000 Californians remain unemployed.
   (3) Investments in infrastructure can provide much needed
employment opportunities for Californians struggling to find work, as
well as provide a steady rate of return for investment funds that
invest in those projects.
   (4) The California Public Employees' Retirement System (CalPERS)
has announced plans to invest eight hundred million dollars
($800,000,000) in both public and private infrastructure, including,
but not limited to, transportation, energy, natural resources,
utilities, water, communications, and other social support services.
   (5) Because CalPERS investments stem from contributions made by
California's workers, those investments should remain in California
to the maximum extent possible.
   (b) Accordingly, it is the intent of the Legislature in enacting
this act, consistent with the plenary authority and fiduciary
responsibilities of the retirement boards of public pension or
retirement systems under Section 17 of Article XVI of the California
Constitution, that those retirement boards that have specifically
targeted infrastructure investment policies prioritize investments in
projects located in California.
  SEC. 2.  Section 20211 is added to the Government Code, to read:
   20211.  (a) For the purposes of this section, "infrastructure"
includes, but is not limited to, telecommunications, power,
transportation, port, petrochemical, and utilities.
   (b) Except as provided in subdivision (d), the board shall
prioritize an investment in an in-state infrastructure project over
an alternative out-of-state infrastructure project if the investment
in the in-state project is consistent with the board's fiduciary
duties to minimize the risk of loss and to maximize the rate of
return.
   (c) Except as provided in subdivision (d), the board may invest in
out-of-state infrastructure projects only after having considered
existing California infrastructure project proposals and determining
that investment in the in-state projects would not be consistent with
the board's fiduciary duties to its members when compared to
out-of-state infrastructure projects.
   (d) Nothing in this section shall require the board to take action
that is not consistent with its plenary authority and fiduciary
responsibilities as described in Section 17 of Article XVI of the
California Constitution.