BILL NUMBER: AB 2472 INTRODUCED
BILL TEXT
INTRODUCED BY Committee on Public Employees, Retirement and Social
Security (Bonta (Chair), Rendon, Ridley-Thomas, and Wieckowski)
FEBRUARY 21, 2014
An act to amend Sections 20533, 21453, 21499, 22775, and 75552 of,
to add Section 75580.5 to, and to repeal Sections 20237 and 22849
of, the Government Code, relating to public employee benefits.
LEGISLATIVE COUNSEL'S DIGEST
AB 2472, as introduced, Committee on Public Employees, Retirement
and Social Security. Public employees: retirement and health
benefits.
(1) The Public Employees' Retirement Law (PERL) creates the Public
Employees' Retirement System (PERS), which provides a defined
benefit to its members based on age at retirement, service credit,
and final compensation. Existing law vests the management and control
of the PERS in the Board of Administration of the PERS. Existing law
requires the board, in addition to any other reports it is required
to make, to annually file a separate report with the Governor and the
Legislature on all matters under its jurisdiction.
This bill would repeal that requirement and make other conforming
changes.
(2) Existing law provides that if a correction of the amount of
compensation received by a member that is reported to the system
requires additional employer contributions to be paid to the system,
the contributions shall be computed using the employer rate in effect
at the time of the adjustment.
This bill would instead provide that the employer contribution
shall be computed using the employer contribution rate in effect at
the time that the compensation requiring adjustment was earned.
(3) Existing law requires that an election, revocation, or change
of retirement benefits be made prior to the making of the first
payment on account of any retirement allowance, or any retirement
allowance following a change in retirement status.
This bill would allow an election, revocation, or change of
election to be made within 30 calendar days after the making of the
first payment.
(4) Existing law requires the Board of Administration of the
Public Employees' Retirement System to administer the Public
Employees' Medical and Hospital Care Act and authorizes the board to
contract for health benefit plans for employees and annuitants.
Existing law defines a family member, for purposes of the act as an
employee's or annuitant's spouse or domestic partner and any child,
including an adopted child, a stepchild, or recognized natural child.
This bill would include a foster child in the definition of family
member.
(5) Existing law requires the board to conduct a study to examine
the feasibility and cost-effectiveness of creating a single statewide
health care pool that would cover all public school employees.
This bill would repeal that requirement.
(6) Existing law establishes the Judges' Retirement System II
which provides retirement benefits to elected judges. Existing law
provides that if a retired judge becomes entitled to any salary for
assignment to a court by the Chairperson of the Judicial Council
after retirement for disability, the retirement allowance otherwise
payable pursuant to the Judges' Retirement System II Law shall,
during the time he or she is entitled to receive that salary or other
compensation, be reduced by the amount of that salary or
compensation.
This bill would specify, except as provided, that if person who is
retired for service or disability under the system is appointed or
elected to serve as a judge, he or she shall reinstate from
retirement and again become a member of the system.
(7) The bill would make other conforming, and technical,
nonsubstantive changes.
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 20237 of the Government Code is repealed.
20237. In addition to any other reports that it may be required
to make by law, the board shall annually file a separate report with
the Governor and each house of the Legislature on all matters under
the jurisdiction of the board.
SEC. 2. Section 20533 of the Government Code is amended to read:
20533. The employer contribution rate adopted under this part
, or because of amendments to the contract or to this
part, apply to all compensation upon the basis of which member's
contributions are deducted after those percentages
employer contribution rates became or become effective
, without regard to the time when the service was rendered
for which the compensation is paid .
If correction of the amount of compensation reported
requires additional employer contributions, the is
required, the employer contributions shall be computed using
the employer contribution rate in effect at the time
of the adjustment. that the compensation
requiring adjustment was earned.
SEC. 3. Section 21453 of the Government Code is amended to read:
21453. An election, revocation, or change of election shall be
made prior to within 30 calendar days after
the making of the first payment on account of any retirement
allowance or, in the event of a change of retirement
status after retirement, prior to within 30
calendar days after the making of the first payment on account
of any retirement allowance following the change in retirement
status. "Change in retirement status" includes, but is not limited
to, change from service to disability retirement, from disability
retirement to service retirement, from nonindustrial disability
retirement to industrial disability retirement, or from industrial to
nonindustrial disability retirement.
For purposes of this section, payment shall be deemed to have been
made on the date a warrant is mailed, or the date funds are
electronically transferred to a bank, savings and loan association,
or credit union account for deposit in the member's account.
This section shall not be construed to authorize a member to
change his or her retirement status after the mailing of the
first retirement warrant following the election,
revocation, or change of election provided in this section.
SEC. 4. Section 21499 of the Government Code is amended to read:
21499. (a) Notwithstanding Section 21498, when either an initial
payment of a preretirement or postretirement death allowance or a
preretirement or postretirement lump-sum benefit is payable in an
amount of ten dollars ($10) or more, it shall be authorized to the
Controller within 45 days of receipt by this system of all the
necessary information, including the return of warrants issued or any
overpayment outstanding after the date of the death of the
annuitant.
(b) If any payment is not made within that time limitation, the
payment shall also include interest at the greater of the interest
crediting rate specified in Section 20178 or the net earnings rate
(including capital gains and losses) in effect at the time the
payment is made, for time following the expiration of that time
limitation.
(c) The system shall submit, annually, as part of the report
required by Section 20237, to the Legislature and the Governor a
summary of the experience of the system in making payments pursuant
to subdivision (b).
SEC. 5. Section 22775 of the Government Code is amended to read:
22775. "Family member" means an employee's or annuitant's spouse
or domestic partner and any child, including an adopted child, a
stepchild, an eligible foster child as defined in Section 152(f)
(1)(c) of Title 26 of the United States Code, or recognized
natural child. The board shall, by regulation, prescribe age limits
and other conditions and limitations pertaining to children.
SEC. 6. Section 22849 of the Government Code is repealed.
22849. (a) The board shall conduct a study to examine the
feasibility and cost-effectiveness of creating a single statewide
health care pool that would cover all public school employees working
in school districts, county offices of education, community
colleges, and in entities created or established by those school
employers, including, but not limited to, joint powers agencies,
regional occupational centers, and regional occupational programs.
(b) The health care school pool study shall, at a minimum, include
the following:
(1) A review and analysis of the costs, cost savings, benefits,
and drawbacks of creating a health care pool for all public school
employees in California, including retirees.
(2) An analysis of rates, including both a regional rating
structure and a single statewide rating structure.
(3) An analysis and reporting of any and all cost savings in the
administration of a single health care pool for all school employees
compared to the current process that includes hundreds of different
plans.
(4) An examination of plan design options in the health care
school pool.
(5) An analysis of the feasibility and cost savings of including
all school employees under this part, as the health care pool for all
school employees.
(6) An analysis of the feasibility and cost savings of creating a
pool operated exclusively for school employees.
(7) An analysis and comparison of a mandatory pool versus a
voluntary pool.
(c) The completion of the health care school pool study shall be
contingent upon the ability to secure or budget for funding to cover
the costs of the study. The completed study shall be reported to the
Legislature within one year after funding is secured or budgeted.
(d) The board shall consult with the Teachers' Retirement Board of
the State Teachers' Retirement System in preparing the study.
SEC. 7. Section 75552 of the Government Code is amended to read:
75552. (a) After payment of a portion of the member's
contributions to a nonmember pursuant to subdivision (b) of Section
75551, the member may redeposit the full amount in the fund at any
time before he or she retires or otherwise leaves judicial office.
The redeposit shall include interest at the rate of interest then
being required to be paid by members of the Public Employees'
Retirement System under Section 20654 20750
from the date of payment to the date of redeposit. A partial
redeposit shall not be accepted.
(b) After payment of a portion of the member's monetary credits to
a nonmember pursuant to subdivision (c) of Section 75551, the member
may redeposit the full amount in the fund at any time before he or
she retires or otherwise leaves judicial office. The redeposit shall
include interest at the greater of: (1) the rate of interest then
being required to be paid by members of the Public Employees'
Retirement System under Section 20654 20750
from the date of payment to the date of redeposit; or (2) the
compounded amounts that would have been credited to the member's
monetary account pursuant to subdivision (b) of Section 75520 had the
payment not been made to the nonmember. A partial redeposit shall
not be accepted.
SEC. 8. Section 75580.5 is added to the Government Code, to read:
75580.5. (a) Except as provided in subdivision (b), if a person
who is retired for service or disability under this system is
appointed or elected to serve as a judge, he or she shall reinstate
from retirement and again become a member of the system pursuant to
this chapter.
(b) This section shall not apply to a retired judge who is
assigned to serve in a court pursuant to Section 68543.5, and he or
she shall not earn service credit or be entitled to retirement
benefits under this part for that service.