Amended in Assembly April 8, 2014

California Legislature—2013–14 Regular Session

Assembly BillNo. 2474


Introduced by Committee on Public Employees, Retirement and Social Security (Bonta (Chair), Rendon, Ridley-Thomas, and Wieckowski)

February 21, 2014


An act to amend Sectionsbegin insert 31462.05,end insert 31462.2,begin insert 31563, 31631, 31781,end insert 31781.3, 31781.31, and 31787.6 of the Government Code, relating to county employees’ retirement.

LEGISLATIVE COUNSEL’S DIGEST

AB 2474, as amended, Committee on Public Employees, Retirement and Social Security. begin deleteFinal end deletebegin insertCounty employees retirement: final end insertcompensation:begin insert forfeiture of benefits: employee contributions:end insert death benefits.

The County Employees Retirement Law of 1937 (CERL) authorizes counties to establish retirement systems pursuant to its provisions in order to provide pension benefits to county, city, and district employees and their beneficiaries. The CERL provides for a defined retirement benefit based upon credited service, final compensation, and age at retirement subject to specified formulas relating to membership classification.

The California Public Employees’ Pension Reform Act of 2013 (PEPRA) requires a public retirement system, as defined, including county and district retirement systems created pursuant to CERL, to modify its pension plan or plans to comply with the act and, among other provisions, establishes new limits of pensionable compensation that may not be exceeded whenever pensionable compensation is used in the calculation of a benefit. PEPRA defines pensionable compensation for purposes of its provisions.

This bill would clarify that the definition of final compensation for members whose services is on a tenure that is temporary, seasonal, intermittent, or part time in the CERL, as described, also applies to those members meeting the same service criteria who are subject to PEPRA.

begin insert

The CERL provides that for a member who is subject to PEPRA for all or any portion of his or her membership in the county retirement system, final compensation means the highest average pensionable compensation earned by the member during a period of at least 36 consecutive months, immediately preceding his or her retirement or last separation from service if earlier, or during any other period of 36 consecutive months designated by the member.

end insert
begin insert

This bill would require the computation for any absence to be based on the compensation of the position held by the member at the beginning of the absence.

end insert
begin insert

PEPRA requires a public employee, including one who is elected or appointed to a public office, who is convicted of any state or federal felony for conduct arising out of, or in the performance of, his or her official duties in pursuit of the office or appointment, or in connection with obtaining salary, disability retirement, service retirement, or other benefits, to forfeit retirement benefits earned or accrued from the earliest date of the commission of the felony to the forfeiture date, as specified.

end insert
begin insert

This bill would make a conforming change to the CERL to specify that a person ceases to be a member for any portion of his or her service as an elected public officer or as a public employee that is forfeited under those circumstances.

end insert
begin insert

Under the CERL, except as otherwise specified, a board of supervisors or the governing body of a district may require that members pay all or part of the contributions of a member or employer, or both, for any retirement benefits provided under the CERL, and designates those payments as employee contributions. Existing law requires the contributions to be uniform either (1) with respect to all members of a recognized bargaining unit or (2) within each of the following classifications: local miscellaneous members, local police officers, local firefighters, county peace officers, and all local safety members other than local police officers, local firefighters, and county peace officers and classifications covered pursuant to specified provisions in PEPRA.

end insert
begin insert

This bill would revise that latter provision to require the contributions to be uniform either (1) with respect to all members of a recognized bargaining unit or (2) within both of the following categories: nonsafety and safety members referenced pursuant to specified provisions in PEPRA.

end insert
begin insert

The CERL provides that upon the death before retirement of a member under specified circumstances, the retirement system is liable for a death benefit. The CERL requires the death benefit to consist of the member’s accumulated contributions and an amount calculated using the annual compensation earned by the deceased, as specified.

end insert
begin insert

This bill would instead require that latter amount to be calculated using the pensionable compensation earned by the deceased member, if that member was subject to PEPRA.

end insert

The CERLbegin delete provides thatend deletebegin insert authorizesend insert the surviving spouses of members who die in service after a specified number of years of service or as a result of service-connected injury or diseasebegin delete mayend deletebegin insert toend insert elect a benefit calculated using the annual compensation earned by the deceased in lieu of a death benefit or life annuity.

This bill would instead require that benefit to be calculated using the pensionable compensation earned by the deceased member, if that member was subject to PEPRA.

The CERLbegin delete provides thatend deletebegin insert requiresend insert a surviving spouse of a safety member who is killed in the performance of duty or who dies as the result of an accident or injury caused by external violence or physical force incurred in the performance of his or her dutybegin insert toend insert be paid a one-time lump-sum benefit calculated using the annual compensation earnable by the deceased.

This bill would instead requirebegin delete that benefitend deletebegin insert those benefitsend insert to be calculated using the pensionable compensation earned by the deceased member, if that member was subject to PEPRA.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 31462.05 of the end insertbegin insertGovernment Codeend insertbegin insert is
2amended to read:end insert

3

31462.05.  

begin insert(a)end insertbegin insertend insertFor a member who is subject to the California
4Public Employees’ Pension Reform Act of 2013 for all or any
5portion of his or her membership in the county retirement system,
P4    1“final compensation” as defined in Section 7522.32 shall apply.
2begin delete Ifend delete

3begin insert(b)end insertbegin insertend insertbegin insertIfend insert a member has less than three years of service, that
4member’s final compensation shall be determined by dividing the
5total compensation by the number of months of service credited
6to the member and multiplying by 12.

begin insert

7(c) The computation for any absence shall be based on the
8compensation of the position held by the member at the beginning
9of the absence.

end insert
10

begin deleteSECTION 1.end delete
11begin insertSEC. 2.end insert  

Section 31462.2 of the Government Code is amended
12to read:

13

31462.2.  

(a) “Final compensation” for members whose service
14is on a tenure that is temporary, seasonal, intermittent, or for part
15time only means one-third of the total compensation earned for
16that period of time during which the member rendered the
17equivalent of three years of full-time service.

18(b) The member may elect at or before the time he or she files
19an application for retirement the period of time during which he
20or she has earned three full years of credit upon which final
21compensation shall be calculated. If he or she does not so elect,
22that period of time immediately preceding his or her retirement
23shall be used.

24(c) This section also applies to a member meeting the conditions
25specified in subdivision (a), whose service is described in
26subdivision (a), and who is subject to the California Public
27Employees’ Pension Reform Act of 2013 (Article 4 (commencing
28with Section 7522) of Chapter 21 of Division 7 of Title 1).

29begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 31563 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
30read:end insert

31

31563.  

Notwithstanding any other provision of law, a person
32ceases to be a member for any portion of his or her service as an
33elected public officerbegin insert or as a public employeeend insert that is forfeited
34pursuant tobegin delete Section 1243end deletebegin insert Sections 7522.70, 7522.72, and 7522.74end insert.

35begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 31631 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
36read:end insert

37

31631.  

(a) Notwithstanding any other law, a board of
38supervisors or the governing body of a district may, by resolution,
39ordinance, contract, or contract amendment under this chapter,
40without a change in benefits, require that members pay all or part
P5    1of the contributions of a member or employer, or both, for any
2retirement benefits provided under this chapter. All of those
3payments are hereby designated as employee contributions. For
4members who are represented in a bargaining unit, the payment
5requirement shall be approved in a memorandum of understanding
6executed by the board of supervisors or the governing body of a
7district and the employee collective bargaining representative. The
8contributions shall be uniform either (1) with respect to all
9members of a recognized bargaining unit or (2) withinbegin delete eachend deletebegin insert bothend insert
10 of the following begin delete classifications: local miscellaneous members,
11 local police officers, local firefighters, county peace officers, and
12all local safety members other than local police officers, local
13firefighters, and county peace officers and classifications covered
14pursuant to Sections 7522.20 and 7522.25end delete
begin insert categories: nonsafety
15and safety members subject to Sections 7522.20 and 7522.25end insert
.

16(b) Nothing in this section shall modify a board of supervisors’
17or the governing body of a district’s authority under law as it
18existed on December 31, 2012, including any restrictions on that
19authority, to change the amount of member contributions.

20begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 31781 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
21read:end insert

22

31781.  

The death benefit shall consist of:

23(a) The member’s accumulated contributions.

24(b) An amount, provided from contributions by the county or
25district, equal to one-twelfth of the annual compensation earnable
26begin insert or pensionable compensation as defined in Section 7522.34,
27whichever is applicable,end insert
by the deceased during the 12 months
28immediately preceding his death, multiplied by the number of
29completed years of service under the system, but not to exceed 50
30percent of such annual compensation.

31

begin deleteSEC. 2.end delete
32begin insertSEC. 6.end insert  

Section 31781.3 of the Government Code is amended
33to read:

34

31781.3.  

The surviving spouse of a member who dies in service
35after five years of service or as a result of service-connected injury
36or disease may elect, in lieu of the death benefit in Section 31781
37or the life annuity provided in Section 31781.1 or 31787, the
38benefit that is the sum of both of the following:

39(a) An amount, provided from contributions by the county or
40district, equal to one-twelfth of the annual compensation earnable
P6    1or pensionable compensation as defined in Section 7522.34,
2whichever is applicable, by the deceased during the 12 months
3immediately preceding his or her death, multiplied by the number
4of completed years of service under the system, but not to exceed
550 percent of that compensation.

6(b) A monthly allowance as provided in Section 31781.1 or
731787 reduced by a monthly amount which is the actuarial
8equivalent of the amount in subdivision (a) as applied to the life
9of the surviving spouse.

10

begin deleteSEC. 3.end delete
11begin insertSEC. 7.end insert  

Section 31781.31 of the Government Code is amended
12to read:

13

31781.31.  

Notwithstanding Sections 31781.1 and 31781.3, the
14surviving spouse of a member subject to Section 31751 who dies
15in service after 10 years of service, or as a result of
16service-connected injury or disease, may elect, in lieu of the life
17annuity provided in Section 31765.11 or the death benefit provided
18in Section 31781.01, the benefit that is the sum of both of the
19following:

20(a) An amount, provided from contributions by the county or
21district, equal to one-twelfth of the annual compensation earnable
22 or pensionable compensation as defined in Section 7522.34,
23whichever is applicable, by the deceased during the 12 months
24immediately preceding his or her death, multiplied by the number
25of completed years of service under the system, but not to exceed
2650 percent of that compensation.

27(b) A monthly allowance as provided in Section 31765.11
28reduced by a monthly amount which is the actuarial equivalent of
29the amount in subdivision (a) as applied to the life of the surviving
30spouse.

31

begin deleteSEC. 4.end delete
32begin insertSEC. 8.end insert  

Section 31787.6 of the Government Code is amended
33to read:

34

31787.6.  

A surviving spouse of a safety member who is killed
35in the performance of duty or who dies as the result of an accident
36or injury caused by external violence or physical force, incurred
37in the performance of his or her duty, shall be paid the following
38amount in addition to all other benefits provided by this chapter:

39A one-time lump-sum benefit equal to an amount, provided from
40contributions by the county or district, equal to the annual
P7    1compensationbegin delete earnable,end deletebegin insert earnableend insert orbegin delete theend delete pensionable compensation
2begin delete for a member who is subject to the California Public Employees’
3Pension Reform Act of 2013 (Article 4 (commencing with Section
47522) of Chapter 21 of Division 7 of Title 1)end delete
begin insert as defined in Section
57522.34, whichever is applicableend insert
, by the deceased at his or her
6monthly rate of compensation at the time of his or her death.

7This section is not applicable to members described in Section
831469.2.



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