Amended in Senate June 11, 2014

Amended in Senate June 2, 2014

Amended in Assembly April 21, 2014

California Legislature—2013–14 Regular Session

Assembly BillNo. 2582


Introduced by Assembly Member Bonta

(Coauthor: Assembly Member Skinner)

February 21, 2014


An act to add Section 22902 to the Government Code, relating to postemployment health benefits.

LEGISLATIVE COUNSEL’S DIGEST

AB 2582, as amended, Bonta. Public Employees’ Medical and Hospital Care Act: postemployment health benefits: the San Francisco Bay Area Rapid Transit District.

Existing law requires the Board of Administration of the Public Employees’ Retirement System to administer the Public Employees’ Medical and Hospital Care Act. Existing law permits a contracting agency to elect to be subject to the act for its employees and annuitants, provided that the contracting agency and each employee or annuitant contribute a portion of the cost of providing the benefit coverage afforded under the health benefit plan approved or maintained by the board in which the employee or annuitant may be enrolled. Existing law specifies that the employer contribution of a contracting agency begins on the effective date of enrollment and is the amount fixed from time to time by resolution of the governing body of the agency. Existing law provides an optional vesting schedule, for contracting agencies, that links the employer contribution, as specified, to percentages associated with an employee’s credited years of service. Under this formulation, the employer contribution for the contracting agency reaches 100% of a specified amount when the employee attains 20 years of credited service, with certain exceptions. Existing law requires accounts to be maintained in the Public Employees’ Contingency Reserve Fund to consist of administrative costs required to be contributed by contracting agencies and of health plan premiums paid by contracting agencies, which are continuously appropriated for specified purposes.

This bill would authorize the San Francisco Bay Area Rapid Transit District to make employer contributions for postretirement health benefit coverage for the district’s employees who are first hired on or after January 1, 2014. This bill would require the employer contributions to be based on percentages associated with the annuitant’s credited years of service with the district, as provided. Under this formulation, the employer contribution would be 50% for 10 years of credited service, increasing incrementally by 10% each credited year of service, and reaching 100% if the annuitant attained 15 years of credited service, with a specified exception for those employees who retire for disability.begin insert The bill would provide that its provisions apply only to retirements after it becomes effective.end insert

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

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

P2    1

SECTION 1.  

Section 22902 is added to the Government Code,
2to read:

3

22902.  

(a) For the purposes of this section, the term “district”
4shall mean the San Francisco Bay Area Rapid Transit District.

5(b) Notwithstanding any other provision of this part, the district
6may make contributions for postretirement health benefits for its
7unrepresented employees, including members of the district board
8of directors to the extent that they are eligible for contributions
9under existing law, and members of any unit of employees whose
10terms and conditions of employment are determined through
11collective bargaining. Those contributions shall be subject to the
12following:

13(1) Credited years of service that the employee worked with the
14district.

P3    1(2) An agreement with all represented employees regarding
2postretirement health coverage mutually agreed upon through
3collective bargaining.

4(3) Contributions for postretirement health benefits for the
5district’s unrepresented employees, including members of the
6district board of directors to the extent that they are eligible for
7contributions under existing law, may only be made in accordance
8with the eligibility criteria and schedule below.

9(c) An agreement reached pursuant to subdivision (b) shall
10provide that employer contributions for postretirement health
11benefits for employees shall be made in the following percentages
12for the applicable credited years of service:
13

 

Credited Years of Service

Percentage of Employer Contribution

10

50

11

60

12

70

13

80

14

90

15

100

  
P3   22

 

23(d) An agreement reached pursuant to subdivision (b) shall
24authorize full employer contributions for postretirement health
25benefits for those employees who retire for disability with five
26years of credited service with the district.

27(e) (1) This section shall only apply to district employees first
28hired on or after January 1, 2014, and to directors who first serve
29as a director on or after January 1, 2014.

30(2) This section shall apply to employees whose terms and
31conditions of employment are determined through collective
32bargaining only if the agreement is expressly incorporated by
33reference into, or made a part of, a memorandum of understanding.

34(f) This section is not applicable to any employee who retires
35before the effective date of the memorandum of understanding
36referenced in paragraph (2) of subdivision (e). In the event that
37the memorandum of understanding establishes a retroactive
38effective date, this section shall apply only tobegin delete prospective
39retirements.end delete
begin insert retirements occurring on or after the effective date of
40this section.end insert

P4    1(g) The district shall provide, in the manner prescribed by the
2board, a notification of each agreement established pursuant to
3this section or personnel action incorporating or applying this
4section, and any additional information necessary to implement
5this section.



O

    96