AB 205, as introduced, Pan. Public employees’ retirement: pension fund management.
The County Employees Retirement Law of 1937 authorizes counties to establish retirement systems, as specified, in order to provide pension benefits to county, city, and district employees. The California Constitution confers upon the retirement boards of public retirement systems plenary authority and fiduciary responsibility for the investment of moneys of those systems. Existing law authorizes the Board of Administration of the Public Employees’ Retirement System and the Teachers’ Retirement Board of the State Teachers’ Retirement System, consistent with their fiduciary duties and the standard for prudent investment, to prioritize investment in an in-state infrastructure project over a comparable out-of-state infrastructure project.
This bill would extend the authorization to prioritize investment in an in-state infrastructure project, as described above, to the board of retirement or the board of investments of a retirement system established pursuant to the County Employees Retirement Law of 1937.
Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 7514.2 of the Government Code is
2amended to read:
(a) As used in this section, the following definitions
4shall apply:
5(1) “Board” means the Board of Administration of the Public
6Employees’ Retirement Systembegin delete andend deletebegin insert,end insert the Teachers’ Retirement
7Boardbegin insert, or the board of retirement or board of investments of a end insert
8begin insertretirement system established pursuant to the County Employees end insert
9begin insertRetirement Law of 1937 (Chapter 3 (commencing with Section end insert
10begin insert31450) of Part 3 of Division 4 of Title 3)end insert.
11(2) “Infrastructure” includes, but is not limited to,
12telecommunications, power, transportation, ports, petrochemical,
13and utilities.
14(b) A board may, subject to and consistent with its fiduciary
15duties and the standard for prudent investment set forth in Section
1620190 of this code, Section 22203 of the Education Code, and
17Section 17 of Article XVI of the California Constitution, prioritize
18investment in an in-state infrastructure project over a comparable
19out-of-state project.
20(c) The Legislature encourages each board to prioritize
21investment in in-state infrastructure projects over alternative
22out-of-state infrastructure projects if the investments in the in-state
23projects are consistent with the board’s fiduciary duties to minimize
24the risk of loss and to maximize the rate of return.
25(d) Nothing in
this section shall require a board to take action
26that is inconsistent with its plenary authority and fiduciary
27responsibilities, as described in Section 17 of Article XVI of the
28California Constitution.
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