BILL ANALYSIS Ó
SB 673
Page 1
SENATE THIRD READING
SB 673 (DeSaulnier)
As Amended January 23, 2014
Majority vote
SENATE VOTE :34-0
PUBLIC EMPLOYEES 7-0
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|Ayes:|Bonta, Allen, Harkey, | | |
| |Jones-Sawyer, Rendon, | | |
| |Ridley-Thomas, Wieckowski | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Makes the Contra Costa County retirement system
(System) an independent, public employer district within the
Contra Costa County Employees Retirement Association (CCCERA)
and the statutory employer for System employees. Specifically,
this bill :
1)Establishes that the System is an independent public agency
"district" under County Employees Retirement Law of 1937 (CERL
or '37 Act) rather than a division of Contra Costa County and
clarifies that the CCCERA Board of Retirement (the Board) may
appoint necessary personnel as specified. System employees
will no longer be Contra Costa County employees but rather
employees of the retirement system subject to terms and
conditions of employment established by the Board and set
forth in a memorandum of understanding (MOU) with recognized
employee representatives.
2)Clarifies that System employees and other county employees who
have prior service with Contra Costa County and who are
appointed to the System after it becomes an independent
district retain their membership in CCCERA without
interruption in service or loss of credit.
3)Provides that new System employees without prior eligible
CCCERA service become CCCERA members on the first day of the
calendar month following their entrance into service (i.e.,
hire date).
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4)Provides that county civil service rules do not apply to
System employees, but that collective bargaining rules under
Myers-Milias-Brown Act (MMBA) do apply. As determined by the
Board, the CCCERA retirement fund will bear expenses related
to System employees' compensation as specified.
5)Requires the System to retain existing non-probationary
employees who were covered by a MOU with Contra Costa County
and worked at the retirement system for a 90-day transition
period unless just cause or legitimate grounds exist to
terminate or layoff the employees. If the System determines
layoffs are necessary during the 90-day transition period, the
System will retain employees based on seniority within job
classifications.
6)Provides that retained employees are subject to the terms and
conditions established by the applicable MOUs between Contra
Costa County and the employees' recognized employee
organization prior to the System's establishment as a
district.
7)Requires the System to recognize the employee organizations
that represented the retained employees in negotiations with
the county and provides that initial terms and conditions for
those employees are those previously established by the
applicable MOU with the county.
EXISTING LAW :
1)Establishes CERL, which governs 20 independent county
retirement associations, including CCCERA.
2)Defines specified districts formed under the law of the state,
located wholly or partially within a county and states that
these districts are public employers whose employees are
eligible to participate in their respective '37 Act county
retirement associations.
3)Provides both Orange County and San Bernardino County
retirement systems authority to be independent districts
within their respective retirement associations and the
statutory employer for purposes of determining their
employees' compensation and benefits.
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4)Provides that CCCERA retirement system employees are county
employees subject to the county civil service or merit system
rules adopted by the board of supervisors for the compensation
of county officers and employees.
5)Pursuant to constitutional provisions and applicable case law,
provides that retirement boards have plenary authority to
administer their respective retirement systems and authorizes
the Board to establish conditions of employment for county
employees working at the System.
6)Provides, under the MMBA, for the administration and
resolution of labor relations between employees of local
public agencies and their respective public employers.
FISCAL EFFECT : Unknown. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS : Most '37 Act county retirement systems are county
agencies and their employees are county employees. However,
independent retirement boards have constitutional rights and
duties to oversee the systems' administration. Some counties
and retirement boards, by mutual agreement, have made their
retirement systems independent districts within their applicable
retirement association. Currently, the Orange County and San
Bernardino County retirement systems both have statutory
authority to be independent districts within their respective
retirement associations.
This bill effectuates a settlement agreement to resolve a
lawsuit over the role and conflicting responsibilities among the
Contra Costa County Auditor-Controller, the Contra Costa Board
of Supervisors, and the Board. Under existing law, the Board
has authority to establish compensation for retirement system
employees, the Board of Supervisors has responsibility to
establish civil service rules and enter MOUs for all county
employees, and the Auditor-Controller provides payroll and
oversight services. The Auditor-Controller would not issue pay
warrants to CCCERA employees that did not reflect reductions
from furloughs for county employees as required by the Contra
Costa Board of Supervisors despite receiving direction from the
Board to do so since the Board had not authorized reductions for
retirement system employees. Additionally, the
Auditor-Controller indicated that issuing full pay warrants to
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the CCCERA employees would cause Contra Costa County to violate
MOUs that prohibited disparate treatment among employees in the
same class.
According to the author, "administrative issues continued to
arise concerning terms and conditions of employment for the
staff serving at CCCERA" resulting in a lawsuit filed by CCCERA
against Contra Costa County and the Auditor-Controller.
The Contra Costa County Board of Supervisors states that "this
case was resolved in 2013 through a court-approved settlement
providing that the (retirement system) staff would be employed
by the CCCERA directly instead of employed by the county and
that the parties would jointly seek the legislation necessary to
implement this transition."
AFSCME states, "This bill will resolve a legal dispute between
CCCERA and Contra Costa County. CCCERA, the County's Board of
Supervisors, and AFSCME Local 2700, which represents public
employees in Contra Costa County, all support the bill because
it will resolve the outstanding legal issues and serves the best
interest of the workers."
There is no opposition on file.
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957
FN: 0004129