AB 1163,
as amended, Levine. Public Employees’ Retirement System: Board of Administration:begin delete composition.end deletebegin insert education.end insert
begin deleteThe California Constitution prohibits changing the composition of the retirement board of certain public pension systems, including the number, terms, and method of selection and removal of members, unless the change is ratified by a majority vote of the electors of the jurisdiction in which the participants of the pension system are or were, prior to retirement, employed. end deleteExisting law creates the Board of Administration of the Public Employees’ Retirement System (PERS) for the purpose of governing the system and prescribes the composition of the boardbegin insert and its powers and dutiesend insert.begin delete Existing law requires, among other things, that one member of the board of administration be a member of the State Personnel Board, serving at the pleasure of the State Personnel Board.end delete
This bill wouldbegin delete revise the composition of the Board of Administration of PERS. The bill would eliminate the
position of the member of the State Personnel Board and would replace that position with the Director of Finance. The bill would add to the board 2 persons, appointed by the Governor, who are independent, as defined, and have financial expertise. This provision would not become operative unless ratified by a majority of voters at a statewide election. The bill would require the Secretary of State to submit that provision of the bill to the voters at the next statewide electionend deletebegin insert require the Board of administration of PERS to adopt an education policy, as specified, for its members, and would require all board members to receive a minimum of 24 hours of board member education within the first 2 years of assuming office and for every subsequent 2-year period in which the person serves on the board. The bill would require the board to maintain a record of a board member’s compliance with the policy and to post the policy and
an annual report on board member compliance on the retirement system’s Internet Web siteend insert.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 20090 of the Government Code is
2amended to read:
The Board of Administration of the Public Employees’
4Retirement System is continued in existence. It consists of:
5(a) The Director of Finance.
6(b) The Director of Human Resources.
7(c) The Controller.
8(d) The Treasurer.
9(e) An official of a life insurer and an elected official of a
10contracting agency, appointed by the Governor.
11(f) Two persons representing the public, who are independent
12and have financial expertise, appointed by the Governor. For the
13purpose of this subdivision, “independent” means that neither the
14person nor anyone in the person’s family is a member of the
15system, is receiving or eligible to receive a pension from the
16system, is a member of an organization that represents employees
17with an interest in the system, or has any material interest in any
18entity that contracts with the system.
19(g) One person representing the public, appointed jointly by the
20Speaker of the Assembly and the Senate Committee on Rules.
21(h) Six members elected under the supervision of the board as
22follows:
23(1) Two members elected by the members of this system from
24the membership thereof.
P3 1(2) A member elected by the active state members of this system
2from the state membership
thereof.
3(3) A member elected by and from the active local members of
4this system who are employees of a school district or a county
5superintendent of schools.
6(4) A member elected by and from the active local members of
7this system other than those who are employees of a school district
8or a county superintendent of schools.
9(5) A member elected by and from the retired members of this
10system.
This act would change the composition of the Board
12of Administration of the Public Employees’ Retirement System
13and shall be operative only upon ratification by the voters at a
14statewide election, pursuant to subdivision (f) of Section 17 of
15Article XVI of the California Constitution. The Secretary of State
16shall submit this act to the voters for approval at the next statewide
17election.
begin insertSection 20100 is added to the end insertbegin insertGovernment Codeend insertbegin insert,
19to read:end insert
The board shall adopt a policy for providing education
21to board members. The policy, at a minimum, shall do the
22following:
23(a) Identify appropriate topics for board member education,
24which may include, but are not limited to, the following:
25(1) Fiduciary responsibilities.
26(2) Ethics.
27(3) Pension fund investments and investment program
28management.
29(4) Actuarial matters.
30(5) Pension funding.
31(6) Benefits administration.
32(7) Disability evaluation.
33(8) Fair hearings.
34(9) Pension fund governance.
35(10) New board member orientation.
36(b) Establish a means for determining the programs, training,
37and educational sessions that qualify as board member education.
38Educational seminars sponsored by the state or national public
39pension fund organizations and seminars sponsored by accredited
P4 1academic institutions shall be deemed to meet board member
2education requirements.
3(c) Require that all board members receive a minimum of 24
4hours of board member education within the first two years of
5assuming office and for
every subsequent two-year period the
6board member continues to hold membership on the board.
7(d) Require the board to maintain a record of board member
8compliance with the policy. The policy and an annual report on
9board member compliance shall be placed on the system’s Internet
10Web site.
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