BILL NUMBER: SB 481 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Huff
FEBRUARY 21, 2013
An act to amend Section 7522.04 of the Government Code, relating
to public employees' retirement.
LEGISLATIVE COUNSEL'S DIGEST
SB 481, as introduced, Huff. California Public Employees' Pension
Reform Act of 2013.
The California Public Employees' Pension Reform Act of 2013
(PEPRA), on and after January 1, 2013, generally requires a public
retirement system, as defined, to modify its plan or plans to comply
with the act, as specified. Among other things, PEPRA prohibits a
public employer offering a defined benefit pension plan from
exceeding specified retirement formulas for new members and prohibits
an enhancement of a public employee's retirement formula or benefit
adopted after January 1, 2013, from applying to service performed
prior to the operative date of the enhancement. PEPRA prescribes
definitions for the purposes of its provisions.
This bill would make a nonsubstantive change 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:
SECTION 1. Section 7522.04 of the Government Code is amended to
read:
7522.04. For the purposes of this article:
(a) "Defined benefit formula" means a formula used by the
a retirement system to determine a retirement
benefit based on age, years of service, and pensionable compensation
earned by an employee up to the limit defined in Section 7522.10.
(b) "Employee contributions" means the contributions to a public
retirement system required to be paid by a member of the system, as
fixed by law, regulation, administrative action, contract, contract
amendment, or other written agreement recognized by the retirement
system as establishing an employee contribution.
(c) "Federal system" means the old age, survivors, disability, and
health insurance provisions of the federal Social Security Act (42
U.S.C. Sec. 301 et seq.).
(d) "Member" means a public employee who is a member of any type
of a public retirement system or plan.
(e) "New employee" means either of the following:
(1) An employee, including one who is elected or appointed, of a
public employer who is employed for the first time by any public
employer on or after January 1, 2013, and who was not employed by any
other public employer prior to that date.
(2) An employee, including one who is elected or appointed, of a
public employer who is employed for the first time by any public
employer on or after January 1, 2013, and who was employed by another
public employer prior to that date, but who was not subject to
reciprocity under subdivision (c) of Section 7522.02.
(f) "New member" means any of the following:
(1) An individual who becomes a member of any public retirement
system for the first time on or after January 1, 2013, and who was
not a member of any other public retirement system prior to that
date.
(2) An individual who becomes a member of a public retirement
system for the first time on or after January 1, 2013, and who was a
member of another public retirement system prior to that date, but
who was not subject to reciprocity under subdivision (c) of Section
7522.02.
(3) An individual who was an active member in a retirement system
and who, after a break in service of more than six months, returned
to active membership in that system with a new employer. For purposes
of this subdivision, a change in employment between state entities
or from one school employer to another shall not be considered as
service with a new employer.
(g) "Normal cost" means the portion of the present value of
projected benefits under the defined benefit that is attributable to
the current year of service, as determined by the public retirement
system's actuary according to the most recently completed valuation.
(h) "Public employee" means an officer, including one who is
elected or appointed, or an employee of a public employer.
(i) "Public employer" means:
(1) The state and every state entity, including, but not limited
to, the Legislature, the judicial branch, including judicial
officers, and the California State University.
(2) Any political subdivision of the state, or agency or
instrumentality of the state or subdivision of the state, including,
but not limited to, a city, county, city and county, a charter city,
a charter county, school district, community college district, joint
powers authority, joint powers agency, and any public agency,
authority, board, commission, or district.
(3) Any charter school that elects or is required to participate
in a public retirement system.
(j) "Public retirement system" means any pension or retirement
system of a public employer, including, but not limited to, an
independent retirement plan offered by a public employer that the
public employer participates in or offers to its employees for the
purpose of providing retirement benefits, or a system of benefits for
public employees that is governed by Section 401(a) of Title 26 of
the United States Code.