BILL ANALYSIS �
AB 611
Page 1
ASSEMBLY THIRD READING
AB 611 (Bonta)
As Introduced February 20, 2013
Majority vote
PUBLIC EMPLOYEES 7-0 APPROPRIATIONS 17-0
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|Ayes:|Bonta, Allen, Harkey, |Ayes:|Gatto, Harkey, Bigelow, |
| |Jones-Sawyer, Mullin, | |Bocanegra, Bradford, Ian |
| |Rendon, Wieckowski | |Calderon, Campos, |
| | | |Donnelly, Eggman, Gomez, |
| | | |Hall, Ammiano, Linder, |
| | | |Pan, Quirk, Wagner, Weber |
| | | | |
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SUMMARY : Requires, rather than allows, specified employer
contributions to be deposited into the Teachers' Retirement
Program Development Fund.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, Negligible fiscal impact.
COMMENTS : The Teachers' Retirement Program Development Fund was
established to pay any costs related to the development of
programs authorized by statute to enhance the financial security
of members or beneficiaries of the California State Teachers'
Retirement System (CalSTRS). For example, $245,000 of employer
contributions were deposited into this fund during the fiscal
year ended June 30, 2008, for the development of 403(b)Comply.
The total amount to be transferred cannot exceed 0.01% of the
total of the creditable compensation for the fiscal year ending
in the immediately preceding calendar year.
Current law allows, but does not require, the depositing of
contributions into the fund. Although the Teachers' Retirement
Board determines how much can be deposited into the fund, it is
not clear who decides whether the funds are deposited. This
bill addresses this situation by requiring the depositing of the
funds in the amount determined by the board.
The Assembly Public Employees, Retirement and Social Security
Committee is informed that the author intends to use this bill
as a vehicle for addressing the CalSTRS long-term funding needs
AB 611
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once a solution is reached this legislative session.
SCR 105 (Negrete McLeod), Resolution Chapter123, Statutes of
2012, encouraged CalSTRS to develop and submit to the
Legislature by February 15, 2013, at least three options that
would address the long-term funding needs of the Defined Benefit
Program.
CalSTRS submitted its report of possible funding strategies,
"Sustaining Retirement Security for Future Generations: Funding
the California State Teachers' Retirement System," to the
Legislature as requested by the resolution on February 14, 2013.
The report provides an analysis of the issues the Legislature
and Governor need to consider to develop a sustainable funding
strategy that secures the long-term funding needs of the Defined
Benefit Program as directed in the resolution.
The report, developed with input from affected stakeholders,
identifies funding options and illustrates the implications of
gradual, incremental contribution increases necessary to close
the $64 billion funding gap and secure the long-term needs of
the fund. CalSTRS and the affected stakeholders have been
working with the author and the Assembly Public Employees,
Retirement and Social Security Committee to develop a funding
strategy utilizing the information provided in the report.
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957
FN: 0000768