BILL NUMBER: AB 837 AMENDED BILL TEXT AMENDED IN SENATE SEPTEMBER 6, 2013 AMENDED IN ASSEMBLY MAY 1, 2013 INTRODUCED BY Assembly MemberCamposWieckowski (Coauthors: Assembly Members Fong and Fox) FEBRUARY 21, 2013 An actto add Section 12096.4.9 to the Government Code, relating to economic development.amend Section 7522.30 of the Government Code, relating to public employees' retirement. LEGISLATIVE COUNSEL'S DIGEST AB 837, as amended,CamposWieckowski .Economic development programs: reporting.Public employees' retirement benefits. The California Public Employees' Pension Reform Act of 2013 (PEPRA), on and after January 1, 2013, requires a public retirement system, as defined, to modify its plan or plans to comply with the act and, among other provisions, establishes new retirement formulas that may not be exceeded by a public employer offering a defined benefit pension plan, setting the maximum benefit allowable for employees first hired on or after January 1, 2013, as a formula commonly known as 2.5% at age 67 for nonsafety members, one of 3 formulas for safety members, 2% at age 57, 2.5% at age 57, or 2.7% at age 57, and 1.25% at age 67 for new state miscellaneous or industrial members who elect to be in Tier 2. On and after January 1, 2013, PEPRA requires new employees of specified public employers, the California State University, and the judicial branch who participate in a defined benefit plan to have an initial contribution rate of at least 50% of the normal cost rate for that defined benefit plan, rounded to the nearest 1/4 of 1%, or the current contribution rate of similarly situated employees, whichever is greater. This bill would make that provision applicable to new members employed by those entities and new members employed by the Legislature. The bill would except from these provisions a judge who was elected to office prior to January 1, 2013, despite not assuming that office and becoming a member of the Judges' Retirement System II for the first time until January 1, 2013, or after that date. The bill would also specify that this contribution rate for new members shall be 50% rounded to the nearest 1/4 of 1%, unless a greater contribution rate has been agreed to through the collective bargaining process. The bill would require that, for purposes of calculating the normal cost rate, the actuarial valuation of retirement benefits includes any elements that impact the actuarial determination of the normal cost, including, but not limited to, the retirement formula, eligibility and vesting criteria, ancillary benefit provisions, and any automatic cost-of-living adjustments.The Economic Revitalization Act establishes the Governor's Office of Business and Economic Development, also known as "GO-Biz," to serve the Governor as the lead entity for economic strategy and the marketing of California on issues relating to business development, private sector investment, and economic growth.This bill would require the State Chair of the California Small Business Development Center Leadership Council, established under a federal program, to report specific information to GO-Biz relating to any year that state funds are appropriated to support an Administrative Lead Center under that federal program, and would, in turn, require the director of GO-Biz to provide that report to the Legislature and post the report on the GO-Biz Internet Web site. This bill would also require the state chair, as a condition of accepting state funds, to allow access to other information about the program under certain conditions. This bill would make legislative findings and declarations in this regard.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. Section 7522.30 of the Government Code is amended to read: 7522.30. (a) This section shall apply to all public employers and to all new members. Equal sharing of normal costs between public employers and public employees shall be the standard. The standard shall be that employees pay at least 50 percent of normal costs and that employers not pay any of the required employee contribution. (b) The "normal cost rate" shall mean the annual actuarially determined normal cost for thedefined benefit plan of an employer expressed as a percentage of payroll.plan of retirement benefits provided to the new member and shall be established based on the actuarial assumptions used to determine the liabilities and costs as part of the annual actuarial valuation. The plan of retirement benefits shall include any elements that would impact the actuarial determination of the normal cost, including, but not limited to, the retirement formula, eligibility and vesting criteria, ancillary benefit provisions, and any automatic cost-of-living adjustments as determined by the public retirement system. (c) (1) Newemployees employed on and after January 1, 2013,members employed by those public employers defined in paragraphs (2) and (3) of subdivision (i) of Section 7522.04, the Legislature, the California State University, and the judicial branch who participate in a defined benefit plan shall have an initial contribution rate of at least 50 percent of the normal cost rate for that defined benefit plan, rounded to the nearest quarter of 1 percent,or the current contribution rate of similarly situated employees, whichever is greater.unless a greater contribution rate has been agreed to pursuant to the requirements in subdivision (e). This contribution shall not be paid by the employer on the employee's behalf. (2) For purposes of this subdivision, "new member" does not include a member who is a judge who was elected to office prior to January 1, 2013, despite assuming the office of judge, and becoming a member of the Judges' Retirement System II, for the first time on or after that date. (d) Notwithstanding subdivision (c), once established, the employee contribution rate described in subdivision (c) shall not be adjusted on account of a change to the normal cost rate unless the normal cost rate increases or decreases by more than 1 percent of payroll above or below the normal cost rate in effect at the time the employee contribution rate is first established or, if later, the normal cost rate in effect at the time of the last adjustment to the employee contribution rate under this section. (e) Notwithstanding subdivision (c), employee contributions may be more than one-half of the normal cost rate if the increase has been agreed to through the collective bargaining process, subject to the following conditions: (1) The employer shall not contribute at a greater rate to the plan for nonrepresented, managerial, or supervisory employees than the employer contributes for other public employees, including represented employees, of the same employer who are in related retirement membership classifications. (2) The employer shall not increase an employee contribution rate in the absence of a memorandum of understanding that has been collectively bargained in accordance with applicable laws. (3) The employer shall not use impasse procedures to increase an employee contribution rate above the rate required by this section. (f) If the terms of a contract, including a memorandum of understanding, between a public employer and its public employees, that is in effect on January 1, 2013, would be impaired by any provision of this section, that provision shall not apply to the public employer and public employees subject to that contract until the expiration of that contract. A renewal, amendment, or any other extension of that contract shall be subject to the requirements of this section.SECTION 1.The Legislature finds and declares all of the following: (a) The California Small Business Development Center Program, a part of the federal Small Business Development Center Program, plays a primary role in providing technical assistance to the state's small businesses and provides verified positive outcomes to the state's economy. (b) Within the state, the California Small Business Development Center Program is administered through six Regional Small Business Development Center Networks, as follows: Northern California, Northeastern California, Central California, Orange County/Inland Empire, Los Angeles, and San Diego. Each regional network is managed by an Administrative Lead Center, designated by the federal Small Business Administration through a cooperative agreement, and affiliated with one public institution of higher education. The centers are responsible for securing required one-to-one matching funds to draw down federal appropriations, according to a population-based formula determined by the United States Census, and the regional networks are held accountable for their productivity and required to submit regular performance reports to the Office of Small Business Development Centers, within the federal Small Business Administration. (c) Throughout the six regional networks there are more than 30 full-time Small Business Development Centers, with multiple additional outreach locations serving small businesses in this state. These centers provide assistance to existing businesses in the areas of financing, government contracting, business planning and management, marketing, international trade, energy efficiency and sustainability, and disaster preparedness. The centers also provide expert advice to technology companies in the areas of business and financial plan preparation, angel and venture capital presentation preparation, funding strategies, product positioning, market launch strategies, applications for federal grants, technology transfers with research universities, intellectual property issues, and strategic partnerships. The centers work in collaboration with various partners to provide these services, including, but not limited to, the federal Small Business Administration, the United States Department of Commerce, the United States Department of Agriculture, the Governor's Office of Business and Economic Development, the California Innovation Hub Program, the California Community Colleges, the California State University, the University of California, local workforce investment boards, economic developers, cities, counties, and chambers of commerce. (d) The California Small Business Development Center Leadership Council is comprised of the directors of the six Administrative Lead Centers that coordinate the regional networks of small business development centers. The council is the statewide entity tasked with negotiating partnerships on behalf of the California Small Business Development Center Program, leveraging operational and technical assistance for best practices across the six regions, and working with the state government to maximize the economic impact of the federal Small Business Development Center Program within the state.SEC. 2.Section 12096.4.9 is added to the Government Code, to read: 12096.4.9. (a) On or before August 30 following any year that state funds are appropriated to an Administrative Lead Center for the support of the California Small Business Development Center Program, the State Chair of the California Small Business Development Center Leadership Council shall provide a written report to the office consistent with the requirements of this section. (b) Each Administrative Lead Center accepts the reporting requirement in this section as a condition of receiving state funds. As a further condition for receiving state funds, the State Chair of the California Small Business Development Center Leadership Council shall arrange to provide the office with access to similar information, in both a similar timeframe and format, that an Administrative Lead Center may provide to the federal Small Business Administration on client services and the economic impact of the California Small Business Development Center Program. Information provided to the office shall meet applicable privacy standards and shall not disclose the name of an individual business. (c) A report prepared pursuant to subdivision (a) shall include, but not be limited to, all of the following data: (1) Number of businesses assisted. (2) Number of employees employed by those businesses at the time those businesses were assisted. (3) Number of jobs created. (4) Number of jobs retained. (5) Estimated amount of state tax dollars generated from those businesses. (6) Industry sectors of the businesses assisted, as reported by the assisted businesses. (7) Increase in sales reported by businesses assisted as a result of the program. (8) The amount of capitol infusion, in both debt and equity, obtained by assisted businesses. (9) Total amount of federal funds allocated to the region during the reporting period. (d) The director shall submit a copy of the report required pursuant to subdivision (a) to the Legislature in compliance with Section 9795 and post the report on the office's Internet Web site no later than 30 days after the office receives the report.