Amended in Assembly August 11, 2014

Amended in Assembly August 4, 2014

Amended in Assembly June 12, 2014

Amended in Senate April 10, 2014

Senate BillNo. 1220


Introduced by Senator Torres

February 20, 2014


An act to amend Sections 22109.5, 22115, 22119.3, 22121, 22131, 22134, 22134.5, 22135, 22136, 22516, 22655, 22662, 22663, 22664, 22801, 22826, 22828, 22905, 22909, 23104, 24001, 24101, 24105, 24107, 24201.5, 24203.5, 24203.6, 24204, 24205, 24210, 24211, 24212, 24213, 24214.5, 24300, 24300.1, 24307, 24309, 24310, 24402, 24412, 24415, 24600, 25015, 25100, 26113, 26703, 26704, 26803, 27201, and 33050 of, to amend and renumber Sections 22106.2, 24300.2, 24300.5, 24300.6, 24301, 24302, 24303, 24304, 24305, 24305.5, 24306, 24306.5, 24306.7, 24308, 24311, 24312, 24312.1, and 24313 of, to amend, renumber, and add Section 22106.1 of, to amend and repeal Section 22119.5 of, to amend, renumber, and repeal Section 24305.3 of, and to add Sections 24347, 24348, 25011.6, 25018.6, and 26807.7 to, the Education Code, and to amend Section 1 of Chapter 559 of the Statutes of 2013, relating to state teachers’ retirement.

LEGISLATIVE COUNSEL’S DIGEST

SB 1220, as amended, Torres. State teachers’ retirement.

Existing law, the Teachers’ Retirement Law, establishes the State Teachers’ Retirement System (STRS) and creates the Defined Benefit Program of the State Teachers’ Retirement Plan, which provides a defined benefit to members of the program, based on final compensation, credited service, and age at retirement, subject to certain variations. STRS is administered by the Teachers’ Retirement Board. Existing law establishes the Supplemental Benefit Maintenance Account, among other provisions, for the purpose of restoring the purchasing power of allowances. Existing law establishes the Defined Benefit Supplement Program to provide additional benefits to members of the Defined Benefit Program. Existing law establishes the Cash Balance Benefit Program, administered by the Teachers’ Retirement Board, as a separate benefit program within the State Teachers’ Retirement Plan in order to provide a retirement plan for persons employed to perform creditable service for less than 50% of full-time service. Existing law permits a member of STRS to purchase service credit in certain instances and permits a person who has withdrawn membership in STRS to become a member again upon redeposit of contributions plus interest, as specified. Existing law permits a member of STRS to select among various options for the payment of benefits after the retired member dies, provides certain presumptions in this regard, and permits a member to revise a beneficiary designation pursuant to specific requirements and limitations. The California Public Employees’ Pension Reform Act of 2013 (PEPRA) requires a public retirement system, as defined, to modify its plan or plans to comply with the act and, among other things, sets limits on the amount of compensation that may be used to calculate benefits.

This bill would amend the Teachers’ Retirement Law to provide a definition of base allowance for the purpose of determining specified supplemental benefits and revise the definition of a break in service to account for certain times not recognized as part of the school year. The bill would revise the definition of creditable service to account for service that is not full time and in which the member is engaged in specified school activities. The bill would revise the definition of credited service to account for members whose contributions have been reduced because of PEPRA. The bill would revise the definition of final compensation to account for the calculation of service based on months rather than years and require an employer to make a certification if a member’s salary was reduced because of reduction in school funds. The bill would prescribe requirements for a joint powers authority in order for that authority to act as employer providing creditable service subject to the Defined Benefit Program of the State Teachers’ Retirement Plan.

The bill would make conforming changes in how member contributions are credited to reflect reductions applied when payments are determined to have been paid to enhance a member’s benefits. The bill would make various technical changes regarding disability allowances, disability retirements, and service retirements following disability retirements. The bill would revise and reorganize provisions relating to a member’s right to elect among various options to provide an actuarially modified retirement allowance payable during the life of the member and the member’s chosen beneficiary or beneficiaries, particularly with regard to the election of a new beneficiary after the member’s retirement when the previous beneficiary has predeceased the member. The bill would grant a member who had retired and elected certain options and designated his or her same-sex spouse or same-sex former spouse as the option beneficiary the right to elect to change his or her option subject to specified requirements. The bill would make numerous technical and conforming changes.

Existing law requires the Teachers’ Retirement Board to establish a vendor registration process through which information about tax-deferred retirement investment products are made available for consideration by specified public employees, including those employed by local school districts and community college districts. Existing law defines vendor for this purpose.

This bill would revise the definition of vendor to include various organizations, including a public retirement system, a broker-dealer, an investment company, and life insurance company, among others, that are qualified to do business in California and provide a 403(b) product and would provide related definitions in this regard.

Existing law permits a governing board of a school district or a county board of education to request the State Board of Education waive provisions of the Education Code, but excepts from that authorization specified provisions, including provisions of the Teachers’ Retirement Law relating to STRS.

This bill would also except from this authorization provisions of the Teachers’ Retirement Law relating to the health care benefits program and the cash benefit program.

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

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

P4    1

SECTION 1.  

Section 22106.1 of the Education Code is
2amended and renumbered to read:

3

22106.2.  

“Base days” means the number of days of creditable
4service required to earn one year of service credit.

5

SEC. 2.  

Section 22106.1 is added to the Education Code, to
6read:

7

22106.1.  

For the purposes of determining supplemental benefits
8pursuant to Sections 24412 and 24415, “base allowance” means
9a monthly allowance under the Defined Benefit Program prior to
10all allowance increases by this part and after modification for an
11option, if applicable.

12

SEC. 3.  

Section 22106.2 of the Education Code is amended
13and renumbered to read:

14

22106.3.  

“Base hours” means the number of hours of creditable
15service required to earn one year of service credit.

16

SEC. 4.  

Section 22109.5 of the Education Code is amended to
17read:

18

22109.5.  

“Break in service,” for purposes of determining a
19member’s final compensation, means:

20(a) With respect to service of a member employed as a full-time
21employee and service performed by a member employed as a
22part-time employee, any period of time covering a pay period
23during which a member is on an unpaid leave of absence or a pay
24period in which a member has not performed any creditable service.

25(b) For a member who has been employed in a substitute
26position:

27(1) And has a change in assignment during a school year to a
28full-time or part-time position, a break in service is determined on
29the same basis as for the full-time or part-time employment during
30the same school year.

31(2) For less than 50 percent of their teaching career for which
32service is credited, a break in service is determined on the same
33basis as full-time employment.

34(3) For more than 50 percent of their teaching career for which
35service is credited, a break in service is any period of time within
36a school year for which compensation is not paid and service is
37not credited.

P5    1(c) If a member commenced performing service at the beginning
2of a school term, the months not recognized as part of the school
3term are not a break in service; however, if the member commenced
4performing service after the school term began, or did not complete
5the school term, the months not recognized as part of the school
6term are a break in service. The school term shall be no less than
7 the days or hours specified as full time in Section 22138.5.

8(d) Earnable salaries for a full pay period, but not beyond the
9effective date of retirement, shall be used in determining final
10compensation when the member performed service within that pay
11period.

12

SEC. 5.  

Section 22115 of the Education Code is amended to
13read:

14

22115.  

(a) “Compensation earnable” means the creditable
15compensation a person could earn in a school year for creditable
16service performed on a full-time basis, excluding service for which
17contributions are credited by the system to the Defined Benefit
18Supplement Program.

19(b) The board may determine compensation earnable for persons
20employed on a part-time basis.

21(c) If service credit for a school year is less than 1.000,
22compensation earnable shall be the quotient obtained when
23creditable compensation paid in that year is divided by the service
24credit for that year, except as provided in subdivision (d).

25(d) If a member earns creditable compensation at multiple pay
26rates during a school year and service credit at the highest pay rate
27is at least 0.900 of a year, compensation earnable shall be
28determined as if all service credit for that year had been earned at
29the highest pay rate. This subdivision shall be applicable only for
30purposes of determining final compensation. If a member earns
31creditable compensation at multiple pay rates during a school year
32and service credit at the highest pay rate is less than 0.900 of a
33year, compensation earnable shall be determined pursuant to
34subdivision (c).

35(e) If creditable service is not performed on a full-time basis
36because a member is performing those activities pursuant to
37paragraph (6) of subdivision (a) of Section 22119.5, compensation
38earnable for those activities shall be determined as if the creditable
39compensation had been earned at the lowest pay rate for other
P6    1creditable service activities performed by the member for the same
2employer during the same school year.

3(f) (1) Except as provided in subdivision (g), for purposes of
4determining compensation earnable for a member employed by a
5community college prior to July 1, 1996, full time shall be defined
6pursuant to Section 22138.5 and pursuant to Section 20521 of Title
75 of the California Code of Regulations, as those provisions read
8on June 30, 1996, if application of that definition will increase the
9compensation earnable or otherwise enhance the benefits of the
10member.

11(2) For purposes of administering this subdivision, the board
12shall have the authority to do both of the following:

13(A) Establish and implement factors and assumptions necessary
14to calculate and compare the benefits payable under the definition
15of compensation earnable described in this subdivision. Those
16factors and assumptions may be based on information reported by
17the employer, including, but not limited to, all of the following:

18(i) Base hours.

19(ii) Actual earnings.

20(iii) Compensation earnable.

21(B) Review member benefit calculations that were performed
22using the factors and assumptions described in subparagraph (A).
23If the board determines that an employer failed to identify part-time
24service performed, the board shall consider that part-time service
25to be performed in a part-time lecture assignment as defined by
26the employer. If the board determines by the review of the member
27benefit calculations that the required information reported by the
28employer is inaccurate, incomplete, or the factors and assumptions
29were applied incorrectly, the board may recalculate member
30benefits using additional factors and assumptions that may include,
31but are not limited to, all of the following:

32(i) Base hours.

33(ii) Actual earnings.

34(iii) Compensation earnable.

35(3) This subdivision shall apply to a member employed by a
36community college prior to July 1, 1996, if the community college
37subsequently acts to reduce the minimum standard for full time as
38described in subdivision (c) of Section 22138.5 for the class of
39employees, and that community college provides written notice
P7    1to the system of the act of the community college to reduce that
2minimum standard.

3(4) This subdivision shall not apply to a member employed by
4a community college that has not reduced the minimum standard
5as described in subdivision (c) of Section 22138.5.

6(g) Subdivision (f) shall not apply to a member subject to the
7California Public Employees’ Pension Reform Act of 2013.

8

SEC. 6.  

Section 22119.3 of the Education Code is amended to
9read:

10

22119.3.  

(a) “Creditable compensation” for members who are
11subject to the California Public Employees’ Pension Reform Act
12of 2013 means remuneration that is paid each pay period in which
13creditable service is performed for that position. Creditable
14compensation shall be paid in cash by an employer to all persons
15in the same class of employees in accordance with a publicly
16available written contractual agreement, including, but not limited
17to, a salary schedule or employment agreement. Creditable
18compensation shall include:

19(1) Remuneration that is paid for the use of sick leave, vacation,
20and other employer-approved leave, except as provided in
21paragraph (4) of subdivision (b).

22(2) Member contributions that are picked up by an employer
23pursuant to Section 22903 or 22904.

24(3) Amounts that are deducted from a member’s remuneration,
25including, but not limited to, deductions for participation in a
26deferred compensation plan; deductions to purchase an annuity
27contract, tax-deferred retirement plan, or insurance program; and
28contributions to a plan that meets the requirements of Section 125,
29401(a), 401(k), 403(b), 457(b), or 457(f) of Title 26 of the United
30States Code.

31(4) Notwithstanding paragraphs (6) and (8) of subdivision (c)
32of Section 7522.34 of the Government Code, remuneration that is
33paid for creditable service that exceeds one year in a school year.

34(b) “Creditable compensation” does not mean and shall not
35include:

36(1) Remuneration that is not paid in cash or is not paid to all
37persons who are in the same class of employees.

38(2) Remuneration that is paid for service that is not creditable
39service pursuant to Section 22119.5.

P8    1(3) Remuneration that is not paid each pay period in which
2creditable service is performed for that position.

3(4) Remuneration that is paid in exchange for the relinquishment
4of unused accumulated leave.

5(5) Payments, including, but not limited to, those for
6participation in a deferred compensation plan; to purchase an
7annuity contract, tax-deferred retirement plan, or insurance
8program; and for contributions to a plan that meets the requirements
9of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title
1026 of the United States Code when the cost is covered by an
11 employer.

12(6) Fringe benefits provided by an employer.

13(7) Expenses paid or reimbursed by an employer.

14(8) Severance pay, including lump sum and installment
15payments, or money paid in excess of salary or wages to a member
16as compensatory damages or as a compromise settlement.

17(9) Creditable compensation determined by the system to have
18been paid to enhance a member’s benefit.

19(10) Compensation paid to the member in lieu of benefits
20provided to the member by the employer or paid directly by the
21employer to a third party other than the system for the benefit of
22the member.

23(11) Any one-time or ad hoc payments made to a member.

24(12) Any employer-provided allowance, reimbursement, or
25payment, including, but not limited to, one made for housing,
26vehicle, or uniform.

27(13) Any bonus paid in addition to compensation described in
28subdivision (a).

29(14) Any other payments the board determines not to be
30“creditable compensation.”

31(c) (1) Except for purposes of calculating credited service in
32the Defined Benefit Program and for reporting compensation
33earnable on or after January 1, 2013, creditable compensation in
34any fiscal year shall not exceed:

35(A) One hundred twenty percent of the “contribution and benefit
36base,” as determined under Section 430(b) of the Social Security
37Act (42 U.S.C. Sec. 430(b)), on January 1, 2013, for a member
38whose service is not included in the federal system.

39(B) One hundred percent of the “contribution and benefit base,”
40as determined under Section 430(b) of the Social Security Act (42
P9    1U.S.C. Sec. 430(b)), on January 1, 2013, for a member whose
2service is included in the federal system pursuant to any changes
3in state or federal law enacted on or after January 1, 2013.

4(2) The system shall adjust the limit based on the annual changes
5to the Consumer Price Index for All Urban Consumers: U.S. City
6Average, calculated by dividing the Consumer Price Index for All
7Urban Consumers: U.S. City Average for the month of February
8in the fiscal year preceding the adjustment by the Consumer Price
9Index for All Urban Consumers: U.S. City Average for the month
10of February of the previous year rounded to the nearest thousandth.
11Notwithstanding paragraph (1) of subdivision (d) of Section
127522.10 of the Government Code, the adjustment shall be effective
13annually on July 1, beginning July 1, 2014.

14(3) The Legislature reserves the right to modify the requirements
15of this subdivision with regard to all members subject to this
16subdivision, except that the Legislature may not modify these
17provisions in a manner that would result in a decrease in benefits
18accrued prior to the effective date of the modification.

19(4) This subdivision shall apply to compensation paid during
20the 2013-14 fiscal year and each fiscal year thereafter.

21(d) An employer or individual who knowingly or willfully
22reports compensation in a manner inconsistent with subdivision
23(a) or (b) may be subject to prosecution for fraud, theft, or
24embezzlement in accordance with the Penal Code. The system
25may establish procedures to ensure that compensation reported by
26an employer is in compliance with this section.

27(e) For purposes of this section, remuneration shall be considered
28paid if distributed to any person in the same class of employees
29who meets the qualifications or requirements specified in a publicly
30available written contractual agreement, including, but not limited
31to, a collective bargaining agreement or an employment agreement,
32as a condition of receiving the remuneration.

33(f) This definition of “creditable compensation” reflects sound
34principles that support the integrity of the retirement fund. Those
35principles include, but are not limited to, consistent treatment of
36compensation throughout a member’s career, consistent treatment
37of compensation among an entire class of employees, consistent
38treatment of compensation for the position, preventing adverse
39selection, and excluding from creditable compensation
40remuneration that is paid to enhance a member’s benefits. The
P10   1system shall determine the appropriate crediting of contributions
2according to these principles, to the extent not otherwise specified
3pursuant to this part. A presumption by the system that creditable
4compensation was paid to enhance the member’s benefits may be
5rebutted by the member or by the employer on behalf of the
6member. Upon receipt of sufficient evidence to the contrary, a
7presumption by the system that creditable compensation was paid
8to enhance the member’s benefits may be reversed.

9

SEC. 7.  

Section 22119.5 of the Education Code, as amended
10by Section 1 of Chapter 375 of the Statutes of 2002, is amended
11to read:

12

22119.5.  

(a) “Creditable service” means any of the following
13activities performed for an employer in a position requiring a
14credential, certificate, or permit pursuant to this code, or under the
15appropriate minimum standards adopted by the Board of Governors
16of the California Community Colleges, or under the provisions of
17an approved charter for the operation of a charter school for which
18the charter school is eligible to receive state apportionment, or
19pursuant to a contract between a community college district and
20the United States Department of Defense to provide vocational
21training:

22(1) The work of teachers, instructors, district interns, and
23academic employees employed in the instructional program for
24pupils, including special programs such as adult education, regional
25occupation programs, child care centers, and prekindergarten
26programs pursuant to Section 22161.

27(2) Education or vocational counseling, guidance, and placement
28services.

29(3) The work of directors, coordinators, and assistant
30administrators who plan courses of study to be used in California
31public schools, or research connected with the evaluation or
32efficiency of the instructional program.

33(4) The selection, collection, preparation, classification,
34demonstration, or evaluation of instructional materials of any
35course of study for use in the development of the instructional
36program in California public schools, or other services related to
37school curriculum.

38(5) The examination, selection, in-service training, or assignment
39of teachers, principals, or other similar personnel involved in the
40instructional program.

P11   1(6) School activities related to, and an outgrowth of, the
2instructional and guidance program of the school when performed
3in addition to other activities described in this section.

4(7) The work of nurses, physicians, speech therapists,
5psychologists, audiometrists, audiologists, and other school health
6professionals.

7(8) Services as a school librarian.

8(9) The work of employees who are responsible for the
9supervision of persons or administration of the duties described
10in this section.

11(b) “Creditable service” also means the work of superintendents
12of California public schools.

13(c) The board shall have final authority for determining
14creditable service to cover any activities not already specified.

15

SEC. 8.  

Section 22119.5 of the Education Code, as added by
16Section 1 of Chapter 394 of the Statutes of 1995, is repealed.

17

SEC. 9.  

Section 22121 of the Education Code is amended to
18read:

19

22121.  

(a) “Credited service” means service for which the
20required contributions have been paid.

21(b) “Credited service” for members who are subject to the
22California Public Employees’ Pension Reform Act of 2013 means
23service for which required contributions have been paid and service
24for which required contributions would have been paid in absence
25of the limit established by subdivision (c) of Section 22119.3.

26(c) “Credited service” for the limited purpose of determining
27eligibility for benefits pursuant to Section 22134.5, 24203.5, or
2824203.6 also includes up to two-tenths of one year of service
29granted pursuant to Section 22717.

30

SEC. 10.  

Section 22131 of the Education Code is amended to
31read:

32

22131.  

(a) (1) “Employer” or “employing agency” means the
33state or any agency or political subdivision thereof, including, but
34not limited to, a joint powers authority, for which creditable service
35subject to coverage by the plan is performed.

36(2) In the case of a joint powers authority, all of the following
37criteria shall be met:

38(A) The joint powers authority shall be formed pursuant to the
39Joint Exercise of Powers Act (Chapter 5 (commencing with Section
406500) of Division 7 of Title 1 of the Government Code).

P12   1(B) All entities included in the joint powers authority shall be
2entities at which creditable service subject to coverage by the plan
3is performed.

4(C) The joint powers authority shall report through a single
5county office of education, with that county superintendent having
6responsibility for activities specified under this part, including but
7not limited to, reporting and remitting contributions.

8(b) This section shall be administered in compliance with the
9requirements defining a governmental plan set forth in Section
10414(d) of the Internal Revenue Code of 1986 (26 U.S.C. Sec.
11414(d)).

12

SEC. 11.  

Section 22134 of the Education Code is amended to
13read:

14

22134.  

(a) “Final compensation” means the highest average
15annual compensation earnable, as defined by Section 22115, by a
16member during any period of 36 consecutive months while an
17active member of the Defined Benefit Program or time during
18which he or she was not a member but for which the member has
19received credit under the Defined Benefit Program, except time
20that was so credited for service performed outside this state prior
21to July 1, 1944.

22(b) For purposes of this section, periods of service separated by
23breaks in service may be aggregated, if the periods of service are
24consecutive except for the breaks.

25(c) The determination of final compensation of a member who
26is eligible for concurrent retirement as defined in Section 22115.5
27shall take into consideration the compensation earnable while a
28member of any other system, provided that both of the following
29exist:

30(1) Service under any other system was not performed during
31the same pay period with service under the Defined Benefit
32Program.

33(2) Retirement under the Defined Benefit Program is concurrent
34with the member’s retirement under any other system pursuant to
35Section 22115.5.

36(d) The compensation earnable for the first position in which
37California service was credited shall be used when additional
38compensation earnable is required for the purpose of determining
39final compensation under Section 23805.

P13   1(e) If a member has received service credit for part-time service
2performed prior to July 1, 1956, the member’s final compensation
3shall be adjusted for that service in excess of one year by the ratio
4that part-time service bears to full-time service.

5(f) The board may specify a different final compensation with
6respect to disability allowances, disability retirement allowances,
7family allowances, and children’s portions of survivor benefit
8allowances payable on and after January 1, 1978. The compensation
9earnable for periods of part-time service shall be adjusted by the
10ratio that part-time service bears to full-time service.

11(g) The amendment of former Section 22127 made by Chapter
12782 of the Statutes of 1982 does not constitute a change in, but is
13declaratory of, the existing law.

14

SEC. 12.  

Section 22134.5 of the Education Code is amended
15to read:

16

22134.5.  

(a) Notwithstanding Section 22134, “final
17compensation” means the highest average annual compensation
18earnable, as defined in Section 22115, by a member during any
19period of 12 consecutive months while an active member of the
20Defined Benefit Program or time during which he or she was not
21a member but for which the member has received credit under the
22Defined Benefit Program, except time that was so credited for
23service performed outside this state prior to July 1, 1944.

24(b) For purposes of this section, periods of service separated by
25breaks in service may be aggregated, if the periods of service are
26consecutive except for the breaks.

27(c) The determination of final compensation of a member who
28is eligible for concurrent retirement as defined in Section 22115.5
29shall take into consideration the compensation earnable while a
30member of any other system, provided that both of the following
31exist:

32(1) Service under any other system was not performed during
33the same pay period with service under the Defined Benefit
34Program.

35(2) Retirement under the Defined Benefit Program is concurrent
36with the member’s retirement under any other system pursuant to
37Section 22115.5.

38(d) If a member has received service credit for part-time service
39performed prior to July 1, 1956, the member’s final compensation
P14   1shall be adjusted for that service in excess of one year by the ratio
2that part-time service bears to full-time service.

3(e) The board may specify a different final compensation with
4respect to disability allowances, disability retirement allowances,
5family allowances, and children’s portions of survivor benefit
6allowances payable on and after January 1, 1978. The compensation
7earnable for periods of part-time service shall be adjusted by the
8ratio that part-time service bears to full-time service.

9(f) This section shall apply to the following:

10(1) A member who has 25 or more years of credited service,
11excluding service credited pursuant to the following:

12(A) Section 22714.

13(B) Section 22715.

14(C) Section 22717, except as provided in subdivision (c) of
15Section 22121.

16(D) Section 22826.

17(2) A nonmember spouse, if the member had 25 or more years
18of credited service, as calculated in paragraph (1), on the date the
19parties separated, as established in the judgment or court order
20pursuant to Section 22652.

21(3) This section shall not apply to a member subject to the
22California Public Employees’ Pension Reform Act of 2013.

23

SEC. 13.  

Section 22135 of the Education Code is amended to
24read:

25

22135.  

(a) Notwithstanding subdivision (a) of Section 22134,
26“final compensation” means the highest average annual
27compensation earnable, as defined by Section 22115, by an active
28member who is a classroom teacher not subject to the California
29Public Employees’ Pension Reform Act of 2013 and who retires,
30becomes disabled, or dies, after June 30, 1990, during any period
31of 12 consecutive months while an active member of the Defined
32Benefit Program.

33(b) Section 22134, except subdivision (a) of that section, shall
34apply to classroom teachers who retire after June 30, 1990, and
35any statutory reference to Section 22134 or “final compensation”
36with respect to a classroom teacher who retires, becomes disabled,
37or dies, after June 30, 1990, shall be deemed to be a reference to
38 this section.

39(c) As used in this section, “classroom teacher” means any of
40the following:

P15   1(1) All teachers and substitute teachers in positions requiring
2certification qualifications who spend, during the last 10 years of
3their employment with the same employer which immediately
4precedes their retirement, 60 percent or more of their contract time
5each year providing direct instruction. For the purpose of
6determining continuity of employment within the meaning of this
7subdivision, an authorized leave of absence for sabbatical or illness
8or other collectively bargained or employer-approved leaves shall
9not constitute a break in service.

10(2) Other certificated personnel who spend, during the last 10
11years of their employment with the same employer that
12immediately precedes their retirement, 60 percent or more of their
13 contract time each year providing direct services to pupils,
14including, but not limited to, librarians, counselors, nurses, speech
15therapists, resource specialists, audiologists, audiometrists,
16hygienists, optometrists, psychologists, driver safety instructors,
17and personnel on special assignment to perform school attendance
18and adjustment services.

19(d) As used in this section, “classroom teacher” does not include
20any of the following:

21(1) Certificated employees whose job descriptions require an
22administrative credential.

23(2) Certificated employees whose job descriptions include
24responsibility for supervision of certificated staff.

25(3) Certificated employees who serve as advisers, coordinators,
26consultants, or developers or planners of curricula, instructional
27materials, or programs, who spend, during the last 10 years of their
28employment with the same employer that immediately precedes
29their retirement, less than 60 percent of their contract time in direct
30instruction.

31(4) Certificated employees whose job descriptions require
32provision of direct instruction or services, but who are functioning
33in nonteaching assignments.

34(5) Classified employees.

35(e) This section shall apply only to teachers employed by an
36employer that has, pursuant to Chapter 10.7 (commencing with
37Section 3540) of Division 4 of Title 1 of the Government Code,
38entered into, extended, renewed, or amended a written agreement
39with an exclusive representative, prior to January 1, 2014, that
P16   1makes this section applicable to all of its classroom teachers, as
2defined in subdivision (c).

3(f) The written agreement shall include a mechanism to pay for
4all increases in allowances provided for by this section through
5employer contributions or employee contributions or both, which
6shall be collected and retained by the employer in a trust fund to
7be used solely and exclusively to pay the system for all increases
8in allowances provided by this section and related administrative
9costs; and a mechanism for disposition of the employee’s
10contributions if employment is terminated before retirement, and
11for the establishment of a trust fund board. The trust fund board
12shall administer the trust fund and shall be composed of an equal
13number of members representing classroom teachers chosen by
14the bargaining agent and the employer. If the employer agrees to
15pay the total cost of increases in allowances, the establishment of
16a trust fund and a trust fund board shall be optional to the employer.
17The employer, within 30 days of receiving an invoice from the
18system, shall reimburse the retirement fund the amount determined
19by the Teachers’ Retirement Board to be the actuarial equivalent
20of the difference between the allowance the member or beneficiary
21receives pursuant to this section and the allowance the member or
22beneficiary would have received if the member’s final
23compensation had been computed under Section 22134 and the
24proportionate share of the cost to the plan’s Defined Benefit
25Program, as determined by the Teachers’ Retirement Board, of
26administering this section. The payment shall include the cost of
27all increases in allowances provided for by this section for all years
28of service credited to the member as of the benefit effective date.
29Interest shall be charged at the regular interest rate for any payment
30not received within 30 days of receipt of the invoice. Payments
31not received within 30 days after receipt of the invoice may be
32collected pursuant to Section 23007.

33(g) Upon the execution of the agreement, the employer shall
34notify all certificated employees of the agreement and any
35certificated employee of the employer, who is a member of the
36Public Employees’ Retirement System pursuant to Section 22508,
37that he or she may, within 60 days following the date of
38notification, elect to terminate his or her membership in the Public
39Employees’ Retirement System and become a member of this
40plan’s Defined Benefit Program. However, only service credited
P17   1under the Defined Benefit Program subsequent to the date of that
2election shall be subject to this section.

3(h) An employer that agrees to become subject to this section,
4shall, on a form and within the timeframes prescribed by the
5system, certify the applicability of this section to a member
6pursuant to the criteria set forth in this section when a retirement,
7disability, or family allowance becomes payable.

8(i) For a nonmember spouse, final compensation shall be
9determined pursuant to paragraph (5) of subdivision (c) of Section
1022664. The employer, within 30 days of receiving an invoice from
11the system, shall reimburse the retirement fund pursuant to
12subdivision (f). Interest shall be charged at the regular interest rate
13for payments not received within the prescribed timeframe.
14Payments not received within 30 days of invoicing may be
15collected pursuant to Section 23007.

16

SEC. 14.  

Section 22136 of the Education Code is amended to
17read:

18

22136.  

(a) “Final compensation” with respect to a member
19whose salary while an active member was reduced because of a
20reduction in school funds as certified by the employer means the
21highest average annual compensation earnable, as defined by
22Section 22115, by the member during any 36 months while
23employed to perform creditable service subject to coverage by the
24Defined Benefit Program.

25(b) For the purposes of this section, periods of service separated
26by breaks in service or periods in which a member’s salary was
27reduced may be aggregated, if the periods of service are
28consecutive except for the breaks or periods of the salary reduction.

29

SEC. 15.  

Section 22516 of the Education Code is amended to
30read:

31

22516.  

(a) Nothing in this chapter shall be construed or applied
32to exclude from membership in the Defined Benefit Program any
33person employed to perform creditable service at a level that
34requires mandatory membership in the program for which he or
35she has the right to elect membership in the program or another
36retirement system and who elects membership in the other
37retirement system, or who is employed to perform creditable
38service at a level that does not require mandatory membership in
39the Defined Benefit Program.

P18   1(b) Service performed after becoming a member of another
2retirement system shall not be credited to the member under this
3part, nor shall contributions or benefits under this part be based
4upon that service or the compensation received by the member
5during that period of service, except as provided in the definition
6of “final compensation” contained in Section 22134 or 22134.5.

7

SEC. 16.  

Section 22655 of the Education Code is amended to
8read:

9

22655.  

(a) Upon the legal separation or dissolution of marriage
10of a retired member, the court may include in the judgment or court
11order a determination of the community property rights of the
12parties in the retired member’s retirement allowance and, if
13applicable, retirement benefit under this part consistent with this
14section. Upon election under subparagraph (B) of paragraph (3)
15of subdivision (a) of Section 2610 of the Family Code, the court
16order awarding the nonmember spouse a community property share
17in the retirement allowance or retirement benefit, or both, of a
18retired member shall be consistent with this section.

19(b) If the court does not award the entire retirement allowance
20or retirement benefit under this part to the retired member and the
21retired member is receiving a retirement allowance that has not
22been modified pursuant to Section 24300 or 24300.1, a single life
23annuity pursuant to Section 25011 or 25018, or a member only
24annuity described in paragraph (1) of subdivision (a) of Sections
2525011.1 and 25018.1, the court shall require only that the system
26pay the nonmember spouse, by separate warrant, his or her
27community property share of the retired member’s retirement
28allowance or retirement benefit, or both, under this part.

29(c) If the court does not award the entire retirement allowance
30or retirement benefit under this part to the retired member and the
31retired member is receiving an allowance that has been actuarially
32modified pursuant to Section 24300 or 24300.1, or a joint and
33survivor annuity pursuant to Section 25011, 25011.1, 25018, or
3425018.1, the court shall order only one of the following:

35(1) The retired member shall maintain the retirement allowance
36or joint and survivor annuity, or both, under this part without
37change.

38(2) The retired member shall cancel the option that modified
39the retirement allowance under this part pursuant to Section 24322
40and elect a new joint and survivor option or designate a new
P19   1beneficiary or both, and the system shall pay the nonmember
2spouse, by separate warrant, his or her community property share
3of the retirement allowance payable to the retired member, the
4option beneficiary, or both.

5(3) The retired member shall cancel the joint and survivor
6annuity under which the retirement benefit is being paid pursuant
7to Section 24324, and elect a new joint and survivor annuity or
8designate a new annuity beneficiary or both, based on the actuarial
9equivalent of the member’s canceled annuity, and the system shall
10pay the nonmember spouse, by separate warrant, his or her
11community property share of the retirement benefit payable to the
12retired member, the annuity beneficiary, or both.

13(4) The retired member shall take the action specified in both
14paragraphs (2) and (3).

15(5) The retired member shall cancel the option that modified
16the retirement allowance under this part pursuant to Section 24322
17and elect an unmodified retirement allowance and the system shall
18pay the nonmember spouse, by separate warrant, his or her
19 community property share of the retired member’s retirement
20allowance under this part.

21(6) The retired member shall cancel, pursuant to Section 24324,
22the joint and survivor annuity under which the retirement benefit
23is being paid, and elect a single life annuity, and the system shall
24pay the nonmember spouse, by separate warrant, his or her
25community property share of the retirement benefit payable to the
26retired member.

27(7) The retired member shall take the action specified in both
28paragraphs (5) and (6).

29(d) If the option beneficiary or annuity beneficiary or both under
30this part, other than the nonmember spouse, predeceases the retired
31member, the court shall order the retired member to designate a
32new option beneficiary pursuant to Section 24323, or a new annuity
33beneficiary pursuant to Section 24324 and shall order the system
34to pay the nonmember spouse, by separate warrant, his or her share
35of the community property interest in the retirement allowance or
36retirement benefit payable to the retired member or the new option
37beneficiary or annuity beneficiary or each of them.

38(e) The right of the nonmember spouse to receive his or her
39community property share of the retired member’s retirement
40allowance or retirement benefit or both under this section shall
P20   1terminate upon the death of the nonmember spouse. However, the
2nonmember spouse may designate a beneficiary under the Defined
3Benefit Program and a payee under the Defined Benefit
4Supplement Program to receive his or her community property
5share of the retired member’s accumulated retirement contributions
6and accumulated Defined Benefit Supplement account balance
7under this part in the event that there are remaining accumulated
8retirement contributions and a balance of credits in the member’s
9Defined Benefit Supplement account to be paid upon the death of
10the nonmember spouse.

11

SEC. 17.  

Section 22662 of the Education Code is amended to
12read:

13

22662.  

The nonmember spouse who is awarded a separate
14account under the Defined Benefit Program may redeposit
15accumulated retirement contributions previously refunded to the
16member in accordance with the determination of the court pursuant
17to Section 22652.

18(a) The nonmember spouse may redeposit under the Defined
19Benefit Program only those accumulated retirement contributions
20that were previously refunded to the member and in which the
21court has determined the nonmember spouse has a community
22property interest.

23(b) The nonmember spouse shall inform the system in writing
24of his or her intent to redeposit within 180 days after the judgment
25or court order that specifies the redeposit rights of the nonmember
26spouse is entered. Except as provided in subdivision (g), the
27nonmember spouse’s election to redeposit shall be made on a form
28provided by the system within 30 days after the system mails an
29election form and the billing.

30(c) If the nonmember spouse elects to redeposit under the
31Defined Benefit Program, he or she shall repay all or a portion of
32the member’s refunded accumulated retirement contributions that
33were awarded to the nonmember spouse and shall pay regular
34interest from the date of the refund to the date payment of the
35redeposit is completed.

36(d) All payments shall be received by the system before the
37effective date of the nonmember spouse’s retirement under this
38part. If any payment due because of the election is not received at
39the system’s headquarters office within 120 days of its due date,
P21   1the election shall be canceled and any payments made under the
2election shall be returned to the nonmember spouse.

3(e) The right of the nonmember spouse to redeposit shall be
4subject to Section 23203.

5(f) The member shall not have a right to redeposit the share of
6the nonmember spouse in the previously refunded accumulated
7retirement contributions under this part whether or not the
8nonmember spouse elects to redeposit. However, any accumulated
9retirement contributions previously refunded under this part and
10not explicitly awarded to the nonmember spouse under this part
11by the judgment or court order shall be deemed the exclusive
12property of the member.

13(g) The measurement of time within which the election to
14redeposit described in subdivision (b) shall be made is subject to
15Section 22337.

16

SEC. 18.  

Section 22663 of the Education Code is amended to
17read:

18

22663.  

The nonmember spouse who is awarded a separate
19account under this part has the right to purchase additional service
20credit in accordance with the determination of the court pursuant
21to Section 22652.

22(a) The nonmember spouse may purchase only the service credit
23that the court, pursuant to Section 22652, has determined to be the
24community property interest of the nonmember spouse.

25(b) The nonmember spouse shall inform the system in writing
26of his or her intent to purchase additional service credit within 180
27days after the date the judgment or court order addressing the right
28of the nonmember spouse to purchase additional service credit is
29entered. Except as provided in subdivision (f), the nonmember
30spouse shall elect to purchase additional service credit on a form
31provided by the system within 30 days after the system mails an
32election form and billing.

33(c) If the nonmember spouse elects to purchase additional
34service credit, he or she shall pay, prior to retirement under this
35part, all contributions with respect to the additional service at the
36contribution rate for additional service credit in effect at the time
37of election and regular interest from July 1 of the year following
38the year upon which contributions are based.

39(1) (A) The nonmember spouse shall purchase additional service
40credit by paying the required contributions and interest in one lump
P22   1sum, or in not more than 120 monthly installments, provided that
2no installment, except the final installment, is less than twenty-five
3dollars ($25). Regular interest shall be charged on the monthly,
4unpaid balance if the nonmember spouse pays in installments.

5(B) If any payment due, because of the election, is not received
6at the system’s headquarters office within 120 days of its due date,
7the election shall be canceled and any payments made under the
8election shall be returned to the nonmember spouse.

9(2) The contributions shall be based on the member’s
10compensation earnable in the most recent school year during which
11the member was employed, preceding the date of separation
12established by the court pursuant to Section 22652.

13(3) All payments of contributions and interest shall be received
14by the system before the effective date of the retirement of the
15nonmember spouse.

16(d) The nonmember spouse does not have a right to purchase
17additional service credit under this part after the effective date of
18a refund of the accumulated retirement contributions in the separate
19account of the nonmember spouse.

20(e) The member does not have a right to purchase the community
21property interest of the nonmember spouse of additional service
22credit under this part whether or not the nonmember spouse elects
23to purchase the additional service credit. However, any additional
24service credit eligible for purchase that is not explicitly awarded
25to the nonmember spouse by the judgment or court order shall be
26deemed the exclusive property of the member.

27(f) The measurement of time within which the election to
28purchase additional service credit described in subdivision (b) shall
29be made is subject to Section 22337.

30

SEC. 19.  

Section 22664 of the Education Code is amended to
31read:

32

22664.  

The nonmember spouse who is awarded a separate
33account shall have the right to a service retirement allowance and,
34if applicable, a retirement benefit under this part.

35(a) The nonmember spouse shall be eligible to retire for service
36under this part if the following conditions are satisfied:

37(1) The member had at least five years of credited service during
38the period of marriage, at least one year of which had been
39performed subsequent to the most recent refund to the member of
40accumulated retirement contributions. The credited service may
P23   1include service credited to the account of the member as of the
2date of the dissolution or legal separation, previously refunded
3service, out-of-state service, and permissive service credit that the
4member is eligible to purchase at the time of the dissolution or
5legal separation.

6(2) The nonmember spouse has at least two and one-half years
7of credited service in his or her separate account.

8(3) The nonmember spouse has attained 55 years of age or more.

9(b) A service retirement allowance of a nonmember spouse
10under this part shall become effective upon a date designated by
11the nonmember spouse, provided:

12(1) The requirements of subdivision (a) are satisfied.

13(2) The nonmember spouse has filed an application for service
14retirement on a properly executed form provided by the system,
15that is executed no earlier than six months before the effective date
16of the retirement allowance.

17(3) The effective date is no earlier than the first day of the month
18that the application is received at the system’s headquarters office
19and the effective date is after the date the judgment or court order
20pursuant to Section 22652 was entered.

21(c) (1) Upon service retirement at normal retirement age under
22this part, the nonmember spouse shall receive a retirement
23allowance that shall consist of an annual allowance payable in
24monthly installments equal to 2 percent of final compensation for
25each year of credited service.

26(2) If the nonmember spouse’s retirement is effective at less
27than normal retirement age and between early retirement age under
28this part and normal retirement age, the retirement allowance shall
29be reduced by one-half of 1 percent for each full month, or fraction
30of a month, that will elapse until the nonmember spouse would
31have reached normal retirement age.

32(3) If the nonmember spouse’s service retirement is effective
33at an age greater than normal retirement age and is effective on or
34after January 1, 1999, the percentage of final compensation for
35each year of credited service shall be determined pursuant to the
36following table:


37

 

Age at Retirement

Percentage

60¼   

2.033

60½   

2.067

60¾   

2.10

61   

2.133

61¼   

2.167

61½   

2.20

61¾   

2.233

62   

2.267

62¼   

2.30

62½   

2.333

62¾   

2.367

63 and over   

2.40

P24  11

 

12(4) In computing the retirement allowance of the nonmember
13spouse, the age of the nonmember spouse on the last day of the
14month that the retirement allowance begins to accrue shall be used.

15(5) Final compensation, for purposes of calculating the service
16retirement allowance of the nonmember spouse under this
17subdivision, shall be calculated according to the definition of final
18compensation in Section 22134, 22134.5, 22135, or 22136,
19whichever is applicable, and shall be based on the member’s
20compensation earnable up to the date the parties separated, as
21established in the judgment or court order pursuant to Section
2222652. The nonmember spouse shall not be entitled to use any
23other calculation of final compensation.

24(d) Upon service retirement under this part, the nonmember
25spouse shall receive a retirement benefit based on an amount equal
26to the balance of credits in the nonmember spouse’s Defined
27Benefit Supplement account on the date the retirement benefit
28becomes payable.

29(1) A retirement benefit shall be a lump-sum payment, or an
30annuity payable in monthly installments, or a combination of both
31a lump-sum payment and an annuity, as elected by the nonmember
32spouse on the application for a retirement benefit. A retirement
33benefit paid as an annuity under this chapter shall be subject to
34Sections 22660, 25011, and 25011.1.

35(2) Upon distribution of the entire retirement benefit in a
36lump-sum payment, no other benefit shall be payable to the
37nonmember spouse or the nonmember spouse’s beneficiary under
38the Defined Benefit Supplement Program.

39(e) If the member is or was receiving a disability allowance
40under this part with an effective date before or on the date the
P25   1parties separated as established in the judgment or court order
2pursuant to Section 22652, or at any time applies for and receives
3a disability allowance with an effective date that is before or
4coincides with the date the parties separated as established in the
5judgment or court order pursuant to Section 22652, the nonmember
6spouse shall not be eligible to retire until after the disability
7allowance of the member terminates. If the member who is or was
8receiving a disability allowance returns to employment to perform
9creditable service subject to coverage under the Defined Benefit
10Program or has his or her allowance terminated under Section
1124015, the nonmember spouse may not be paid a retirement
12allowance until at least six months after termination of the disability
13allowance and the return of the member to employment to perform
14creditable service subject to coverage under the Defined Benefit
15Program, or the termination of the disability allowance and the
16employment or self-employment of the member in any capacity,
17notwithstanding Section 22132. If at the end of the six-month
18period, the member has not had a recurrence of the original
19disability or has not had his or her earnings fall below the amounts
20described in Section 24015, the nonmember spouse may be paid
21a retirement allowance if all other eligibility requirements are met.

22(1) The retirement allowance of the nonmember spouse under
23this subdivision shall be calculated as follows: the disability
24allowance the member was receiving, exclusive of the portion for
25dependent children, shall be divided between the share of the
26member and the share of the nonmember spouse. The share of the
27nonmember spouse shall be the amount obtained by multiplying
28the disability allowance, exclusive of the portion for dependent
29children, by the years of service credited to the separate account
30of the nonmember spouse, including service projected to the date
31of separation, and dividing by the projected service of the member.
32The nonmember spouse’s retirement allowance shall be the lesser
33of the share of the nonmember spouse under this subdivision or
34the retirement allowance under subdivision (c).

35(2) The share of the member shall be the total disability
36allowance reduced by the share of the nonmember spouse. The
37share of the member shall be considered the disability allowance
38of the member for purposes of Section 24213.

39(f) The nonmember spouse who receives a retirement allowance
40is not a retired member under this part. However, the allowance
P26   1of the nonmember spouse shall be increased by application of the
2improvement factor and shall be eligible for the application of
3supplemental increases and other benefit maintenance provisions
4under this part, including, but not limited to, Sections 24412 and
524415 based on the same criteria used for the application of these
6benefit maintenance increases to the service retirement allowances
7of members.

8(g) Paragraphs (1) to (3), inclusive, of subdivision (c) shall not
9apply to a nonmember spouse of a member subject to the California
10Public Employees’ Pension Reform Act of 2013. For a person who
11is a nonmember spouse of a member subject to the California
12Public Employees’ Pension Reform Act of 2013 and is awarded
13a separate account, the retirement allowance shall equal the
14percentage of final compensation for each year of credited service
15that is equal to the percentage specified in Section 24202.6 based
16on the age of the nonmember spouse on the effective date of the
17allowance.

18

SEC. 20.  

Section 22801 of the Education Code is amended to
19read:

20

22801.  

(a) A member who requests to purchase additional
21service credit as provided in this chapter and Chapter 14.2
22(commencing with Section 22820) shall pay, prior to retirement,
23all contributions with respect to that service at the contribution
24rate for additional service credit, adopted by the board as a plan
25amendment, in effect on the date of the request to purchase
26additional service credit. If the system is unable to inform the
27member or beneficiary of the amount required to purchase
28additional service credit prior to the effective date of the applicable
29allowance, the member or beneficiary may make the required
30payment within 30 working days after the date of mailing of the
31statement of contributions and interest required or the effective
32date of the appropriate allowance, whichever is later, except as
33provided in subdivision (i). The payment shall be paid in full before
34a member or beneficiary receives any adjustment in the appropriate
35allowance due because of that payment. Contributions shall be
36made in a lump sum, or in not more than 120 monthly installments,
37not to exceed ten years. No installment, except the final installment,
38shall be less than twenty-five dollars ($25).

39(b) If the member is employed to perform creditable service
40subject to coverage by the Defined Benefit Program on the date
P27   1of the request to purchase additional service credit, the
2contributions shall be based upon the compensation earnable in
3the current school year or either of the two immediately preceding
4school years, whichever is highest.

5(c) If the member is not employed to perform creditable service
6subject to coverage by the Defined Benefit Program on the date
7of the request to purchase additional service credit, the
8 contributions shall be based upon the compensation earnable in
9the last school year of credited service or either of the two
10immediately preceding school years, whichever is highest, and
11additional regular interest shall be added to the contributions from
12July 1 of the subsequent year in which the member last performed
13creditable service subject to coverage by the Defined Benefit
14Program to 20 days after the date of the request.

15(d) The employer may pay the amount required as employer
16contributions for additional service credited under paragraphs (7),
17(8), (9), and (10) of subdivision (a) of Section 22803.

18(e) The Public Employees’ Retirement System shall transfer
19the actuarial present value of the assets of a person who makes an
20election pursuant to paragraph (11) of subdivision (a) of Section
2122803.

22(f) Regular interest shall be charged on the monthly unpaid
23balance if the member pays in installments. Regular interest may
24not be charged or be payable for the period of a delay caused by
25the system’s inability or failure to determine and inform the
26member or beneficiary of the amount of contributions and interest
27that is payable. The period of delay shall commence on the 20th
28day following the day on which the member or beneficiary who
29wishes to make payment evidences in writing to the system that
30he or she is ready, willing, and able to make payment to the system.
31The period of delay shall cease on the first day of the month
32following the mailing of notification of contributions and interest
33payable.

34(g) If the payment described in subdivision (a) is not received
35at the system’s headquarters office within 120 days of the due date,
36the election pursuant to this section shall be canceled. The member
37shall receive credit for additional service based on the payments
38that were made or the member may request a return of his or her
39payments.

P28   1(h) If the election to purchase additional service credit is
2canceled as described in subdivision (g), the member may, prior
3to the effective date of his or her retirement, elect to purchase
4additional service credit pursuant to this section.

5(i) The measurement of time within which the purchase of
6additional service credit described in subdivision (a) shall be made
7is subject to Section 22337.

8

SEC. 21.  

Section 22826 of the Education Code is amended to
9read:

10

22826.  

(a) A member, other than a retired member, may
11request to purchase up to five years of nonqualified service credit
12provided the member is vested in the Defined Benefit Program as
13provided in Section 22156.

14(b) A member who requests to purchase nonqualified service
15credit as provided in this chapter shall contribute to the retirement
16fund the actuarial cost of the service, including interest as
17appropriate, as determined by the board based on the most recent
18valuation of the plan with respect to the Defined Benefit Program
19in effect on the date of the request, in accordance with subdivisions
20(a), (f), (g), and (h) of Section 22801.

21(c) This section shall apply only to an application to purchase
22nonqualified service credit on a properly executed form provided
23by the system and received at the system’s headquarters office
24prior to January 1, 2013, that is subsequently approved by the
25system.

26

SEC. 22.  

Section 22828 of the Education Code is amended to
27read:

28

22828.  

A request to purchase out-of-state service credit
29pursuant to Section 22827 must be received no later than June 30,
302009.

31

SEC. 23.  

Section 22905 of the Education Code is amended to
32read:

33

22905.  

(a) Member contributions pursuant to Sections 22901,
3422901.3, and 22901.7, employer contributions pursuant to Section
3522903 or 22904, and member contributions made by an employer
36pursuant to Section 22909 shall be credited to the member’s
37individual account under the Defined Benefit Program or the
38Defined Benefit Supplement Program, whichever is applicable
39pursuant to the provisions of this part.

P29   1(b) Except as provided in subdivision (g), member and employer
2contributions, exclusive of contributions pursuant to Sections
322901.7, 22950.5, and 22951, on a member’s compensation under
4the following circumstances shall be credited to the member’s
5Defined Benefit Supplement account:

6(1) Compensation for creditable service that exceeds one year
7in a school year.

8(2) Compensation that is determined by the system to have been
9paid to enhance a member’s benefits pursuant to subdivision (b)
10of Section 22119.2 or to not reflect sound principles that support
11the integrity of the retirement fund pursuant to subdivision (f) of
12Section 22119.2.

13(3) Compensation that is paid for a limited number of times as
14specified by law, a collective bargaining agreement, or an
15employment agreement.

16(c) A member may not make voluntary pretax or posttax
17contributions under the Defined Benefit Supplement Program,
18except as provided in subdivision (d), nor may a member redeposit
19amounts previously distributed based on the balance in the
20member’s Defined Benefit Supplement account.

21(d) Member and employer contributions pursuant to paragraph
22(1) of subdivision (b) under the Defined Benefit Supplement
23Program shall be credited to the accounts of members as of July
241 each year following a determination by the system under the
25provisions of this part that those contributions should be credited
26to the Defined Benefit Supplement Program. Any other
27contributions under the Defined Benefit Supplement Program
28pursuant to paragraph (2) or (3) of subdivision (b), shall be credited
29to the individual account of the member upon receipt by the system.
30Contributions to a member’s Defined Benefit Supplement account
31shall be identified separately from the member’s contributions
32credited under the Defined Benefit Program.

33(e) Any contributions on compensation that is creditable to the
34Defined Benefit Supplement account shall be limited to the
35contributions made pursuant to Sections 22901, 22901.3, 22950,
36and 22951. Any excess member contributions, as determined by
37the system, shall be returned to the member through the employer
38and any excess employer contributions shall be returned to the
39employer.

P30   1(f) The provisions of this section shall become operative on July
21, 2002, if the revenue limit cost-of-living adjustment computed
3by the Superintendent of Public Instruction for the 2001-02 fiscal
4year is equal to or greater than 3.5 percent. Otherwise this section
5shall become operative on July 1, 2003.

6(g) Paragraphs (2) and (3) of subdivision (b) shall not apply to
7a member subject to the California Public Employees’ Pension
8Reform Act of 2013.

9

SEC. 24.  

Section 22909 of the Education Code is amended to
10read:

11

22909.  

(a) Notwithstanding Sections 22901, 22956, and 23000,
12an employer may pay all or a portion of the contributions required
13to be paid by a member of the Defined Benefit Program. Where
14the member is included in a group or class of employment in which
15no members are subject to the California Public Employees’
16Pension Reform Act of 2013, the payment shall be for all members
17in the group or class of employment. The payments shall be
18credited to member accounts pursuant to Section 22905. The
19employer shall report contributions to the system as if the member
20and the employer were paying the contributions in accordance
21with this part, notwithstanding this section. For purposes of this
22chapter, the member’s contributions shall be considered to be the
23percentage of the member’s creditable compensation that would
24have been paid pursuant to this chapter, notwithstanding this
25section. Notwithstanding Section 22119.2, contributions paid
26pursuant to this section may not be included in creditable
27compensation.

28(b) Nothing in this section shall be construed to limit the
29authority of an employer to periodically increase, reduce, or
30eliminate the payment by the employer of all or a portion of the
31contributions required to be paid by members of the Defined
32Benefit Program, as authorized by this section.

33(c) This section shall only apply to an employer that is picking
34up members’ contributions pursuant to Section 22903 or 22904.

35(d) As of January 1, 2013, this section shall not apply if the
36group or class of employment includes members who are subject
37to the Public Employees’ Pension Reform Act of 2013. If the terms
38of a written agreement with an exclusive representative or a written
39employment agreement that is in effect on January 1, 2013, would
40be impaired by this subdivision, this subdivision shall not apply
P31   1to the employer and members subject to that written agreement
2until the expiration of that written agreement. A renewal,
3amendment, or any other extension of that written agreement shall
4be subject to the requirements of this subdivision.

5(e) As of January 1, 2014, this section shall not apply if the
6group or class of employment does not include members who are
7subject to the Public Employees’ Pension Reform Act of 2013. If
8the terms of a written agreement with an exclusive representative
9or a written employment agreement that is in effect on January 1,
102014, would be impaired by this subdivision, this subdivision shall
11not apply to the employer and members subject to that written
12agreement until the expiration of that written agreement. A renewal,
13amendment, or any other extension of that written agreement shall
14be subject to the requirements of this subdivision.

15

SEC. 25.  

Section 23104 of the Education Code is amended to
16read:

17

23104.  

(a) Deposit in the United States mail of an initial
18warrant drawn as directed by the member as a refund of
19contributions upon termination of employment, and addressed to
20the address directed by the member, constitutes a return of the
21member’s accumulated retirement contributions under this part.
22In lieu of an initial warrant, the system may initiate a disbursement
23by electronic funds transfer to a specific account at a financial
24institution as directed by the member as a refund of contributions
25upon termination of employment, which shall constitute a return
26of the member’s accumulated retirement contributions under this
27part.

28(b) Except as provided in subdivision (e), if the member has
29elected on a form provided by the system to transfer all or a
30specified portion of the accumulated retirement contributions that
31are eligible for direct trustee-to-trustee transfer to the trustee of a
32qualified plan under Section 402 of the Internal Revenue Code of
331986 (26 U.S.C. Sec. 402), deposit in the United States mail of a
34notice that the requested transfer has been made constitutes a return
35of the member’s accumulated retirement contributions under this
36part.

37(c) Except as provided in subdivision (e), for refunds not
38involving direct trustee-to-trustee transfers, if the member returns
39the total gross distribution amount to the system’s headquarters
40office within 30 days from the mailing date, the refund shall be
P32   1canceled and the person shall be restored as a member of the
2Defined Benefit Program with all the rights and privileges under
3this part restored.

4(d) Except as provided in subdivision (e), for refunds involving
5direct trustee-to-trustee transfers, if the member returns the warrant
6drawn to the trustee of the qualified plan or the trustee returns the
7amount of the qualified refund and, if applicable, any additional
8amounts necessary to equal, but in no event to exceed, the total
9gross distribution amount to the system’s headquarters office within
1030 days from the mailing date, the refund shall be canceled and
11the person shall be restored as a member of the Defined Benefit
12Program with all the rights and privileges under this part restored.

13(e) The mode of notice described in subdivision (b) and the
14measurement of time within which the return of total gross
15distribution amounts described in subdivisions (c) and (d) shall be
16made are subject to Section 22337.

17

SEC. 26.  

Section 24001 of the Education Code is amended to
18read:

19

24001.  

(a) (1) A member may apply for a disability allowance
20under the Defined Benefit Program, upon written application for
21disability allowance to the board on a properly executed form
22provided by the system, if the member has five or more years of
23credited service and if all of the following requirements are met:

24(A) At least four years were credited for actual performance of
25service subject to coverage under the Defined Benefit Program.
26Credit received because of workers’ compensation payments shall
27be counted toward the four-year requirement in accordance with
28Section 22710.

29(B) The last five years of credited service were performed in
30this state.

31(C) Except as described in subdivision (d) of Section 24201.5,
32the member is not currently receiving a service retirement
33allowance and at least one year was credited for service performed
34subsequent to the date on which the member terminated a service
35retirement allowance under Section 24208.

36(D) At least one year was credited for service performed
37subsequent to the most recent refund of accumulated retirement
38contributions.

P33   1(E) The member has neither attained normal retirement age, nor
2possesses sufficient unused sick leave days to receive creditable
3compensation on account of sick leave to normal retirement age.

4(F) The member is not applying for a disability allowance
5because of a physical or mental condition known to exist at the
6time the most recent membership in the Defined Benefit Program
7commenced and remains substantially unchanged at the time of
8application.

9(2) A member who becomes disabled prior to normal retirement
10age, who has sick leave which will extend beyond normal
11retirement age, and who has a dependent child, may be awarded
12a disability allowance with an effective date after normal retirement
13age if the application is filed prior to attaining normal retirement
14age.

15(b) Nothing in subdivision (a) shall affect the right of a member
16to a disability allowance under this part if the reason that the
17member is credited with less than four years of actual service
18 performed subject to coverage under the Defined Benefit Program
19is due to an on-the-job injury or a disease that occurred while the
20member was employed and the four-year requirement can be
21satisfied by credit obtained under Chapter 14 (commencing with
22Section 22800) or Chapter 14.5 (commencing with Section 22850)
23in addition to any credit received from workers’ compensation
24payments.

25(c) Nothing in subdivision (a) shall affect the right of a member
26under this part who has less than five years of credited service to
27a disability allowance if the following conditions are met:

28(1) The member has at least one year of credited service
29performed in this state.

30(2) The disability is the direct result of an unlawful act of bodily
31injury that was perpetrated on his or her person by another human
32being while the member was performing his or her official duties
33in a position subject to coverage under the Defined Benefit
34Program.

35(3) The member provides documentation of the unlawful act in
36the form of an official police report or official employer incident
37report.

38(d) A member who is eligible to apply for a disability allowance
39pursuant to this section may also apply for a service retirement
P34   1pending a determination of his or her application for disability as
2described in Section 24201.5.

3

SEC. 27.  

Section 24101 of the Education Code is amended to
4read:

5

24101.  

(a) A member may apply for a disability retirement
6under this part, upon written application for disability retirement
7to the board on a properly executed form provided by the system,
8if the member has five or more years of credited service and if all
9of the following requirements are met:

10(1) At least four years were credited for actual service performed
11subject to coverage under the Defined Benefit Program. Credit
12received because of workers’ compensation payments shall be
13counted toward the four-year requirement in accordance with
14Section 22710.

15(2) The last five years of credited service were performed in
16this state.

17(3) Except as described in subdivision (d) of Section 24201.5,
18the member is not currently receiving a service retirement
19allowance and at least one year of credited service was earned
20subsequent to the date on which the member terminated a service
21retirement allowance under Section 24208.

22(4) At least one year of credited service was earned subsequent
23to the date on which the member’s disability retirement was
24terminated.

25(5) At least one year of credited service was earned subsequent
26to the most recent refund of accumulated retirement contributions.

27(6) The member is not applying for a disability retirement
28because of a physical or mental condition known to exist at the
29time the most recent membership in the Defined Benefit Program
30commenced and that remains substantially unchanged at the time
31of application.

32(b) Nothing in subdivision (a) shall affect the right of a member
33to a disability retirement if the reason that the member has
34performed less than four years of actual service is due to an
35on-the-job injury or a disease while in employment subject to
36coverage by the Defined Benefit Program and the four-year
37requirement can be satisfied by credit obtained under Chapter 14
38(commencing with Section 22800) or Chapter 14.5 (commencing
39with Section 22850) in addition to any credit received from
40workers’ compensation payments.

P35   1(c) Nothing in subdivision (a) shall affect the right of a member
2under this part who has less than five years of credited service to
3a disability retirement allowance if the following conditions are
4met:

5(1) The member has at least one year of credited service
6performed in this state.

7(2) The disability is a direct result of an unlawful act of bodily
8injury that was perpetrated on his or her person by another human
9being while the member was performing his or her official duties
10in a position subject to coverage under the Defined Benefit
11Program.

12(3) The member provides documentation of the unlawful act in
13the form of an official police report or official employer incident
14report.

15(d) A member who is eligible to apply for a disability retirement
16pursuant to this section may also apply for a service retirement
17pending a determination of his or her application for disability as
18described in Section 24201.5.

19

SEC. 28.  

Section 24105 of the Education Code is amended to
20read:

21

24105.  

(a) A disability retirement allowance under this part
22shall become effective upon any date designated by the member,
23provided that all of the following conditions are met:

24(1) An application for disability retirement is filed on a properly
25executed form prescribed by the system.

26(2) The effective date is later than the last day of creditable
27service for which compensation is payable to the member.

28(3) The effective date is no earlier than either the first day of
29the month in which the application is received at the system’s
30headquarters office or the date upon and continuously after which
31the member is determined to the satisfaction of the board to have
32been mentally incompetent.

33(4) The application for disability retirement contains an election
34of either an unmodified allowance or an allowance modified under
35an option as provided in Section 24332.

36(b) If the member is employed to perform creditable service
37subject to coverage under the Defined Benefit Program at the time
38the disability retirement is approved, the member shall notify the
39system in writing, within 90 days, of the last day on which the
40member will perform service. If the member does not respond
P36   1within 90 days, or if the last day on which service will be
2performed is more than 90 days after the date the system notifies
3the member of the approval of disability retirement, the member’s
4application for disability retirement shall be rejected and a
5disability retirement allowance shall not be payable to the member.

6

SEC. 29.  

Section 24107 of the Education Code is amended to
7read:

8

24107.  

A member retired for disability under this part may
9elect an option pursuant to Section 24332 to modify the disability
10retirement allowance payable pursuant to subdivision (a) of Section
1124106.

12

SEC. 30.  

Section 24201.5 of the Education Code is amended
13to read:

14

24201.5.  

(a) A member who is eligible and applies for a
15disability allowance or retirement pursuant to Section 24001 or
1624101 may apply to receive a service retirement allowance pending
17the determination of his or her application for disability, subject
18to all of the following:

19(1) The member is eligible to retire for service under Section
2024201 or 24203.

21(2) The member submits the application on a form provided by
22the system, subject to all of the following:

23(A) The application is executed no earlier than the date the
24application for disability benefits is executed and no earlier than
25six months before the effective date of the retirement allowance.

26(B) The effective date is no earlier than the first day of the month
27in which the application for disability benefits is received at the
28system’s headquarters office, unless the application for disability
29benefits is denied or canceled and the member has indicated an
30earlier service retirement date on the application to use if denied
31or canceled. If the application for disability benefits is denied or
32canceled, the service retirement date of a member who submits an
33application for retirement pursuant to this section on or after
34January 1, 2014, shall be no earlier than January 1, 2014.

35(C) The effective date is later than the last day of creditable
36service for which compensation is payable to the member.

37(D) The effective date is no earlier than one year following the
38date on which a retirement allowance was terminated pursuant to
39Section 24208, unless the application for disability benefits is
40denied or canceled and the member has indicated an earlier service
P37   1retirement date on the application to use if denied or canceled. If
2the application for disability benefits is denied or canceled, the
3service retirement date is no earlier than one day after the date on
4which a retirement allowance was terminated pursuant to Section
524208, provided that the retirement allowance is terminated on or
6after January 1, 2014.

7(E) The effective date is no earlier than one year following the
8date on which a retirement allowance was terminated pursuant to
9subdivision (a) of Section 24117.

10(3) The effective date of the service retirement allowance can
11be no earlier than the date upon and continuously after which the
12member is determined to the satisfaction of the board to have been
13mentally incompetent.

14(4) A member who applies for service retirement under this
15section is not eligible to receive a lump-sum payment and an
16actuarially reduced monthly allowance pursuant to Section 24221.

17(5) A member who applies for service retirement under this
18section is not eligible to receive an allowance calculated pursuant
19to Section 24205.

20(6) (A) Except as described in subparagraph (B), a member
21who applies for service retirement under this section shall not
22receive service credit for each day of accumulated and unused
23leave of absence for illness or injury or for education pursuant to
24Section 22717 or 22717.5.

25(B) If the application for disability is denied or canceled, the
26member’s service retirement allowance shall be adjusted to the
27effective date of the service retirement to include service credited
28pursuant to Section 22717 or 22717.5.

29(7) If the application for disability is denied or canceled, a
30member who applies for a service retirement allowance under this
31section is subject to all of the following:

32(A) Unless otherwise provided in this part, a member who, on
33his or her application for service retirement, elects an option
34pursuant to Section 24300.1 or 24307 may not change or revoke
35that option.

36(B) If the member receives a modified service retirement
37allowance based on the election of an option pursuant to Section
3824300.1 or 24307, that modified service retirement allowance shall
39continue in effect and unchanged.

P38   1(C) If the member did not elect an option pursuant to Section
224300.1 or 24307 and receives an unmodified service retirement
3allowance, that unmodified service retirement allowance shall
4continue in effect and unchanged.

5(b) A member who applies for service retirement under this
6section may change or cancel his or her service retirement
7application pursuant to Section 24204, or may terminate his or her
8service retirement allowance pursuant to Section 24208.

9(c) A member may not cancel his or her application for disability
10prior to a determination of that application unless he or she submits
11a written request to the system’s headquarters office. If a member
12elects to cancel his or her service retirement application or elects
13to terminate his or her service retirement allowance as described
14in subdivision (b), that election shall not cancel the application for
15disability.

16(d) (1) Subparagraph (C) of paragraph (1) of subdivision (a)
17of Section 24001 and paragraph (3) of subdivision (a) of Section
1824101 shall not apply to a member who cancels an application for
19service retirement pursuant to Section 24204 or who terminates a
20service retirement allowance pursuant to Section 24208, if all of
21the following apply:

22(A) The member earned at least one year of credited service
23subsequent to the most recent terminated service retirement
24allowance.

25(B) The member’s application for disability under this section
26is pending determination by the board.

27(2) If the member’s application for disability under this section
28is denied or canceled, subparagraph (C) of paragraph (1) of
29subdivision (a) of Section 24001 and paragraph (3) of subdivision
30(a) of Section 24101 shall apply if the member submits a new
31application for disability.

32(e) (1) If the board approves the application for disability, and
33notwithstanding subdivision (f) of Section 24204, the board shall
34cancel the member’s application for service retirement and shall
35authorize payment of a disability allowance or disability retirement.

36(2) If the board approves the application for disability and the
37member has received service retirement allowance payments under
38this part, the effective date for the disability allowance or disability
39retirement shall be the same as the effective date of the service
40retirement allowance.

P39   1(f) If a member who applies for service retirement under this
2section dies prior to a determination by the board on the application
3for disability, the member shall be considered retired for service
4at the time of death, and any subsequent benefits shall be paid
5accordingly.

6(g) If a member who applies for service retirement under this
7section dies after the board has approved the member’s application
8for disability, the member shall be considered a disabled member,
9or retired for disability, at the time of death, and any subsequent
10benefits shall be paid accordingly, even if the member died prior
11to receiving notification of the approval of his or her application
12for disability.

13(h) If the member changes or cancels his or her service
14retirement application or terminates his or her service retirement
15allowance as described in subdivision (b), the system shall make
16appropriate adjustments to the applicable service retirement
17allowance, disability allowance, or disability retirement allowance,
18retroactive to the effective date of the disability allowance or
19 disability retirement allowance. Subdivision (a) of Section 24617
20shall not apply.

21(i) The system may recover a service retirement allowance
22overpayment made to a member by deducting that overpayment
23from any subsequent disability benefit payable to the member.

24(j) Nothing in this section shall be construed to allow a member
25or beneficiary to receive more than one type of retirement or
26disability allowance for the same period of time.

27

SEC. 31.  

Section 24203.5 of the Education Code is amended
28to read:

29

24203.5.  

(a) The percentage of final compensation used to
30compute the allowance pursuant to Section 24202.5, 24203, 24205,
3124209, 24209.3, 24210, 24211, 24212, or 24213 of a member
32retiring on or after January 1, 1999, who has 30 or more years of
33credited service, shall be increased by two-tenths of 1 percentage
34point, provided that the sum of the percentage of final
35compensation used to compute the allowance, including any
36adjustments for retiring before the normal retirement age, and the
37additional percentage provided by this section does not exceed
382.40 percent.

P40   1(b) For purposes of establishing eligibility for the increased
2allowance pursuant to this section only, credited service shall
3 exclude service credited pursuant to the following:

4(1) Section 22714.

5(2) Section 22715.

6(3) Section 22717, except as provided in subdivision (c) of
7Section 22121.

8(4) Section 22717.5.

9(c) For purposes of establishing eligibility for the increased
10allowance pursuant to this section only, credited service shall
11include credited service that a court has ordered be awarded to a
12nonmember spouse pursuant to Section 22652. A nonmember
13spouse shall also be eligible for the increased allowance pursuant
14to this section if the member had 30 or more years of credited
15service on the date the parties separated, as established in the
16judgment or court order pursuant to Section 22652.

17(d) Nonqualified service credit for which contributions pursuant
18to Section 22826 were made in a lump sum on or after January 1,
192000, or for which the first installment was made on or after
20January 1, 2000, may not be included in determining the eligibility
21for an increased allowance pursuant to this section.

22

SEC. 32.  

Section 24203.6 of the Education Code is amended
23to read:

24

24203.6.  

(a) In addition to the amount otherwise payable
25pursuant to Section 24202.5, 24203, 24203.5, 24205, 24209,
2624209.3, 24210, 24211, 24212, or 24213, a member shall receive
27an increase in the monthly allowance, prior to any modification
28pursuant to Sections 24300, 24300.1, and 24309, in the amount
29identified in subdivision (b), if the member meets all of the
30following criteria:

31(1) The member retires for service on or after January 1, 2001.

32(2) Prior to January 1, 2011, the member has 30 or more years
33of credited service, including any credited service that a court has
34ordered be awarded to a nonmember spouse pursuant to Section
3522652, but excluding service credited pursuant to the following:

36(A) Section 22714.

37(B) Section 22715.

38(C) Section 22717, except as provided in subdivision (c) of
39Section 22121.

40(D) Section 22717.5.

P41   1(E) Section 22826.

2(3) The member is receiving an allowance subject to Section
324203.5.

4(b) The amount of the increase in the monthly allowance shall
5be based on the member’s years of credited service at the time of
6retirement as follows:


7

 

30 years of credited service   

$200

31 years of credited service   

$300

32 or more years of credited service   

$400

P41  11

 

12(c) This section also applies to a nonmember spouse, if all of
13the following conditions are satisfied:

14(1) The member is eligible for the allowance increase pursuant
15to subdivisions (a) and (b) upon his or her retirement for service.

16(2) On the date the parties separated, as established in the
17judgment or court order pursuant to Section 22652, the member
18had at least 30 years of credited service, excluding service credited
19pursuant to the following:

20(A) Section 22714.

21(B) Section 22715.

22(C) Section 22717, except as provided in subdivision (c) of
23Section 22121.

24(D) Section 22717.5.

25(E) Section 22826.

26(3) The service credit of the member was divided into separate
27accounts in the name of the member and the nonmember spouse
28by a court pursuant to Section 22652. The amount identified in the
29schedule in subdivision (b) and payable pursuant to this section,
30that is based on the service credited during the marriage, shall be
31divided and paid to the member and the nonmember spouse
32proportionately according to the respective percentages of the
33member’s service credit that were allocated to the member and the
34nonmember spouse in the court’s order.

35(d) The allowance increase provided under this section is not
36subject to Sections 24415 and 24417, but is subject to Section
3722140.

38

SEC. 33.  

Section 24204 of the Education Code is amended to
39read:

P42   1

24204.  

(a) A service retirement allowance under this part shall
2become effective upon any date designated by the member,
3provided all of the following conditions are met:

4(1) An application for service retirement allowance is filed on
5a form provided by the system, which is executed no earlier than
6six months before the effective date of retirement allowance.

7(2) The effective date is later than the last day of creditable
8service for which compensation is payable to the member.

9(3) The effective date is no earlier than one day after the date
10on which the retirement allowance was terminated under Section
1124208.

12(4) The effective date is no earlier than one year following the
13date on which the retirement allowance was terminated under
14subdivision (a) of Section 24117.

15(5) The effective date is no earlier than the date upon and
16continuously after which the member is determined to the
17satisfaction of the board to have been mentally incompetent.

18(6) The effective date is no earlier than the date upon which the
19member completes payment of a service credit purchase pursuant
20to Section 22801, 22820, or 22826, or payment of a redeposit of
21contributions pursuant to Section 23200, except as provided in
22Section 22801 or 22829.

23(b) A member who files an application for service retirement
24may change or cancel his or her retirement application, as long as
25the form provided by the system is received in the system’s
26headquarters office no later than 30 days from the date the
27member’s initial benefit payment for the member’s most recent
28retirement under the Defined Benefit Program is paid by the
29system. If a member cancels his or her retirement application, the
30member shall return the total gross distribution amount of all
31payments for the canceled retirement benefit to the system’s
32headquarters office no later than 45 days from the date of the
33member’s initial benefit payment and shall be liable for any adverse
34tax consequences that may result from these actions.

35(c) The retirement date of a member who files an application
36for retirement pursuant to Section 24201 on or after January 1,
372012, shall be no earlier than January 1, 2012.

38(d) Nothing in this section shall be construed to allow a member
39to receive more than one type of retirement or disability allowance
40for the same period of time by virtue of his or her own membership.

P43   1

SEC. 34.  

Section 24205 of the Education Code is amended to
2read:

3

24205.  

A member retiring prior to 60 years of age, and who
4has attained 55 years of age, may elect to receive one-half of the
5service retirement allowance for normal retirement age for a limited
6time and then revert to the full retirement allowance for normal
7retirement age.

8(a) The retirement allowance shall be based on service credit
9and final compensation as of the date of retirement for service and
10shall be calculated with the factor for normal retirement age.

11(b) If the member elects a joint and survivor option under
12Section 24300 or 24300.1, the actuarial reduction shall be based
13on the member’s and beneficiary’s ages as of the effective date of
14the early retirement. If the member elected a preretirement option
15under Section 24307, the actuarial reduction shall be based on the
16member’s and beneficiary’s ages as determined by the provisions
17of that section.

18(c) One-half of the retirement allowance as of 60 years of age
19shall be paid for a period of time equal to twice the elapsed time
20between the effective date of retirement and the date of the retired
21member’s 60th birthday.

22(d) The full retirement allowance as calculated under subdivision
23(a) or (b) shall begin to accrue as of the first of the month following
24the reduction period as specified in subdivision (c). The full
25retirement allowance shall not begin to accrue prior to this time
26under any circumstances, including, but not limited to, divorce or
27death of the named beneficiary.

28(e) The annual improvement factor provided for in Sections
2922140 and 22141 shall be based upon the retirement allowance as
30calculated under subdivision (a) or (b). The improvement factor
31shall begin to accrue on September 1 following the retired
32member’s 60th birthday. These increases shall be accumulated
33and shall become payable when the full retirement allowance for
34normal retirement age first becomes payable.

35(f) Any ad hoc benefit increase with an effective date prior to
36the retired member’s 60th birthday shall not affect an allowance
37payable under this section. Only those ad hoc improvements with
38effective dates on or after the retired member’s 60th birthday shall
39be accrued and accumulated and shall first become payable when
P44   1the full retirement allowance for normal retirement age becomes
2payable.

3(g) The cancellation of an option election in accordance with
4Section 24322 shall not cancel the election under this section.
5Upon cancellation of the joint and survivor option, one-half of the
6retired member’s retirement allowance as calculated under
7subdivision (a) shall become payable for the balance of the
8reduction period specified in subdivision (c).

9(h) If a retired member who has elected a joint and survivor
10option dies during the period when the reduced allowance is
11payable, the beneficiary shall receive one-half of the allowance
12payable to the beneficiary until the date when the retired member
13would have received the full retirement allowance for normal
14retirement age. At that time, the beneficiary’s allowance shall be
15increased to the full amount payable to the beneficiary plus the
16appropriate annual improvement factor increases and ad hoc
17increases.

18(i) This section shall not apply to a member who retires for
19service pursuant to Section 24201.5, 24209, 24209.3, 24210,
2024211, or 24212.

21(j) This section shall not apply to a member subject to the
22California Public Employees’ Pension Reform Act of 2013.

23

SEC. 35.  

Section 24210 of the Education Code is amended to
24read:

25

24210.  

Upon retirement for service following a prior disability
26retirement granted pursuant to Chapter 26 (commencing with
27Section 24100) that was terminated, the member shall receive a
28service retirement allowance calculated pursuant to Section 24202,
2924202.5, 24202.6, 24203, 24203.5, 24203.6, or 24206 and equal
30to the sum of both of the following:

31(a) An amount based on service credit accrued prior to the
32effective date of the disability retirement, the member’s age as of
33the effective date of the service retirement, and indexed final
34compensation to the effective date of the service retirement.

35(b) An amount based on the service credit accrued after
36termination of the disability retirement, the member’s age as of
37the effective date of service retirement, and final compensation.

38

SEC. 36.  

Section 24211 of the Education Code is amended to
39read:

P45   1

24211.  

When a member who has been granted a disability
2allowance under this part after June 30, 1972, returns to
3employment subject to coverage under the Defined Benefit
4Program and performs:

5(a) Less than three years of creditable service after termination
6of the disability allowance, the member shall receive a retirement
7allowance which is the sum of the allowance calculated on service
8credit accrued after the termination date of the disability allowance,
9excluding service credited pursuant to Sections 22717 and 22717.5
10or Chapter 14 (commencing with Section 22800) or Chapter 14.2
11(commencing with Section 22820) or Chapter 19 (commencing
12with Section 23200), the age of the member on the last day of the
13 month in which the retirement allowance begins to accrue, and
14final compensation using compensation earnable or projected final
15compensation, or a combination of both, plus the greater of either
16of the following:

17(1) A service retirement allowance calculated on service credit
18accrued as of the effective date of the disability allowance,
19excluding service credited pursuant to Sections 22717 and 22717.5
20or Chapter 14 (commencing with Section 22800) or Chapter 14.2
21(commencing with Section 22820) or Chapter 19 (commencing
22with Section 23200), the age of the member on the last day of the
23month in which the retirement allowance begins to accrue, and
24projected final compensation to the termination date of the
25disability allowance.

26(2) The disability allowance the member was eligible to receive
27immediately prior to termination of that allowance, excluding
28children’s portions.

29(b) Three or more years of creditable service after termination
30of the disability allowance, the member shall receive a retirement
31allowance that is the greater of the following:

32(1) A service retirement allowance calculated on all actual and
33projected service excluding service credited pursuant to Sections
3422717 and 22717.5 or Chapter 14 (commencing with Section
3522800) or Chapter 14.2 (commencing with Section 22820) or
36Chapter 19 (commencing with Section 23200), the age of the
37member on the last day of the month in which the retirement
38allowance begins to accrue, and final compensation using
39compensation earnable, or projected final compensation, or a
40combination of both.

P46   1(2) The disability allowance the member was receiving
2immediately prior to termination of that allowance, excluding
3children’s portions.

4(c) The allowance shall be increased by an amount based on
5any service credited pursuant to Sections 22714, 22715, 22717,
6and 22717.5 or Chapter 14 (commencing with Section 22800) or
7Chapter 14.2 (commencing with Section 22820) or Chapter 19
8(commencing with Section 23200), and final compensation using
9compensation earnable, or projected final compensation, or a
10combination of both.

11(d) If the total amount of credited service, other than projected
12service or service that accrued pursuant to Sections 22714, 22715,
1322717, 22717.5, and 22826, is equal to or greater than 30 years,
14the amounts identified in subdivisions (a) and (b) shall be
15calculated pursuant to Sections 24203.5 and 24203.6.

16(e) For purposes of this section, final compensation shall not
17be based on a determination of compensation earnable as described
18in subdivision (e) of Section 22115.

19(f) Upon retirement, the member may elect to modify the service
20retirement allowance payable in accordance with any option
21provided under this part.

22

SEC. 37.  

Section 24212 of the Education Code is amended to
23read:

24

24212.  

(a) If a disability allowance granted under this part
25after June 30, 1972, is terminated for reasons other than those
26specified in Section 24213 and the member does not return to
27employment subject to coverage under the Defined Benefit
28Program, the member’s service retirement allowance, when
29payable, shall be based on projected service, excluding service
30credited pursuant to Sections 22717 and 22717.5 or Chapter 14
31(commencing with Section 22800) or Chapter 14.2 (commencing
32with Section 22820), or Chapter 19 (commencing with Section
3323200), projected final compensation, and the age of the member
34on the last day of the month in which the retirement allowance
35begins to accrue. The allowance payable under this section,
36excluding annuities payable from accumulated annuity deposit
37contributions, shall not be greater than the terminated disability
38allowance excluding children’s portions.

39(b) The allowance shall be increased by an amount based on
40any service credited pursuant to Sections 22714, 22715, 22717,
P47   1and 22717.5 or Chapter 14 (commencing with Section 22800) or
2Chapter 14.2 (commencing with Section 22820) or Chapter 19
3(commencing with Section 23200) and final compensation using
4compensation earnable, or projected final compensation, or a
5combination of both.

6(c) If the total amount of credited service, other than projected
7service or service that accrued pursuant to Sections 22714, 22715,
822717, 22717.5, and 22826, is equal to or greater than 30 years,
9the amounts identified in subdivisions (a) and (b) shall be
10calculated pursuant to Sections 24203.5 and 24203.6.

11(d) Upon retirement, the member may elect to modify the service
12 retirement allowance payable in accordance with any option
13provided under this part.

14

SEC. 38.  

Section 24213 of the Education Code is amended to
15read:

16

24213.  

(a) When a member who has been granted a disability
17allowance under this part after June 30, 1972, attains normal
18retirement age, or at a later date when there is no dependent child,
19the disability allowance shall be terminated and the member shall
20be eligible for service retirement. The retirement allowance shall
21be calculated on the projected final compensation and projected
22service to normal retirement age, excluding service credited
23pursuant to Sections 22717 and 22717.5, or Chapter 14
24(commencing with Section 22800) or Chapter 14.2 (commencing
25with Section 22820), or Chapter 19 (commencing with Section
2623200), and the age of the member on the last day of the month
27in which the retirement allowance begins to accrue. The allowance
28payable under this section, excluding annuities payable from
29accumulated annuity deposit contributions, shall not be greater
30than the terminated disability allowance, excluding children’s
31portions.

32(b) The allowance shall be increased by an amount based on
33any service credited pursuant to Section 22714, 22715, 22717, or
3422717.5, or Chapter 14 (commencing with Section 22800), Chapter
3514.2 (commencing with Section 22820), or Chapter 19
36(commencing with Section 23200) and projected final
37compensation to normal retirement age.

38(c) If the total amount of credited service, other than projected
39service or service that accrued pursuant to Sections 22714, 22715,
4022717, 22717.5, and 22826, is equal to or greater than 30 years,
P48   1the amounts identified in subdivisions (a) and (b) shall be
2calculated pursuant to Sections 24203.5 and 24203.6.

3(d) Upon retirement, the member may elect to modify the service
4retirement allowance payable in accordance with any option
5provided under this part.

6

SEC. 39.  

Section 24214.5 of the Education Code is amended
7to read:

8

24214.5.  

(a) (1) Notwithstanding subdivision (f) of Section
924214, the postretirement compensation limitation that shall apply
10to the compensation paid in cash to the retired member for
11performance of retired member activities, excluding
12reimbursements paid by an employer for expenses incurred by the
13member in which payment of the expenses by the member is
14substantiated, shall be zero dollars ($0) during the first 180 calendar
15days after the most recent retirement of a member retired for service
16under this part.

17(2) For written agreements pertaining to the performance of
18retired member activities entered into, extended, renewed, or
19amended on or after January 1, 2014, the limitation in paragraph
20(1) shall also apply to payments, including, but not limited to,
21those for participation in a deferred compensation plan; to purchase
22an annuity contract, tax-deferred retirement plan, or insurance
23program; and for contributions to a plan that meets the requirements
24of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title
2526 of the United States Code when the cost is covered by an
26employer.

27(b) If the retired member has attained normal retirement age at
28the time the compensation is earned, subdivision (a) shall not apply
29and Section 24214 shall apply if the appointment has been
30approved by the governing body of the employer in a public
31meeting, as reflected in a resolution adopted by the governing body
32of the employer prior to the performance of retired member
33activities, expressing its intent to seek an exemption from the
34limitation specified in subdivision (a). Approval of the appointment
35may not be placed on a consent calendar. Notwithstanding any
36other provision of Article 3.5 (commencing with Section 6250) of
37Division 7 of Title 1 of the Government Code or any state or
38federal law incorporated by subdivision (k) of Section 6254 of the
39Government Code, the resolution shall be subject to disclosure by
P49   1the entity adopting the resolution and the system. The resolution
2shall include the following specific information and findings:

3(1) The nature of the employment.

4(2) A finding that the appointment is necessary to fill a critically
5needed position before 180 calendar days have passed.

6(3) A finding that the member is not ineligible for application
7of this subdivision pursuant to subdivision (d).

8(4) A finding that the termination of employment of the retired
9member with the employer is not the basis for the need to acquire
10the services of the member.

11(c) Subdivision (b) shall not apply to a retired member whose
12termination of employment with the employer is the basis for the
13need to acquire the services of the member.

14(d) Subdivision (b) shall not apply if the retired member received
15additional service credit pursuant to Section 22714 or 22715 or
16received from any public employer any financial inducement to
17retire. For purposes of this section, “financial inducement to retire”
18includes, but is not limited to, any form of compensation or other
19payment that is paid directly or indirectly by a public employer to
20the member, even if not in cash, either before or after retirement,
21if the participant retires for service on or before a specific date or
22specific range of dates established by a public employer on or
23before the date the inducement is offered. The system shall liberally
24interpret this subdivision to further the Legislature’s intent to make
25subdivision (b) inapplicable to members if the member received
26a financial incentive from any public employer to retire or
27otherwise terminate employment with a public employer.

28(e) The Superintendent, the county superintendent of schools,
29or the chief executive officer of a community college shall submit
30all documentation required by the system to substantiate the
31eligibility of the retired member for application of subdivision (b),
32including, but not limited to, the resolution adopted pursuant to
33that subdivision.

34(f) The documentation required by this section shall be received
35by the system prior to the retired member’s performance of retired
36member activities.

37(g) Within 30 calendar days after the receipt of all
38documentation required by the system pursuant to this section, the
39system shall inform the entity seeking application of the exemption
40specified in subdivision (b), and the retired member whether the
P50   1compensation paid to the member will be subject to the limitation
2specified in subdivision (a).

3(h) If a member retired for service under this part earns
4compensation for performing retired member activities in excess
5of the limitation specified in subdivision (a), the member’s
6retirement allowance shall be reduced by the amount of the excess
7compensation. The amount of the reduction may be equal to the
8monthly allowance payable but may not exceed the amount of the
9allowance payable during the first 180 calendar days, after a
10member retired for service under this part.

11(i) The amendments to this section enacted during the first year
12of the 2013-14 Regular Session shall apply to compensation paid
13on or after January 1, 2014.

14

SEC. 40.  

Section 24300 of the Education Code is amended to
15read:

16

24300.  

(a) A member may, upon application for retirement,
17elect an option pursuant to this part that would provide an
18actuarially modified retirement allowance payable throughout the
19life of the member and the member’s option beneficiary or
20beneficiaries, as follows:

21(1) Option 2. The modified retirement allowance shall be paid
22to the retired member. Upon the retired member’s death, an
23allowance equal to the modified amount that the retired member
24was receiving shall be paid to the option beneficiary.

25(2) Option 3. The modified retirement allowance shall be paid
26to the retired member. Upon the retired member’s death, an
27 allowance equal to one-half of the modified amount that the retired
28member was receiving shall be paid to the option beneficiary.

29(3) Option 4. The modified retirement allowance shall be paid
30to the retired member as long as both the retired member and the
31option beneficiary are living. Upon the death of either the retired
32member or the option beneficiary, an allowance equal to two-thirds
33of the modified amount that the retired member was receiving shall
34be paid to the surviving retired member or the surviving option
35beneficiary.

36(4) Option 5. The modified retirement allowance shall be paid
37to the retired member as long as both the retired member and the
38option beneficiary are living. Upon the death of either the retired
39member or the option beneficiary, an allowance equal to one-half
40of the modified amount that the retired member was receiving shall
P51   1be paid to the surviving retired member or surviving option
2beneficiary.

3(5) Option 6. The modified retirement allowance shall be paid
4to the retired member and upon the retired member’s death, an
5allowance equal to the modified amount that the retired member
6was receiving shall be paid to the option beneficiary.

7(6) Option 7. The modified retirement allowance shall be paid
8to the retired member and upon the retired member’s death, an
9allowance equal to one-half of the modified amount the retired
10member was receiving shall be paid to the option beneficiary.

11(7) Option 8. (A) A member may designate multiple option
12beneficiaries. The member who has designated more than one
13option beneficiary shall elect an option that the member is
14authorized to elect subject to subdivision (e) for each beneficiary
15designated that would provide an actuarially modified retirement
16allowance payable throughout the lives of the member and the
17member’s option beneficiaries upon the member’s death.

18(B) The modified retirement allowance shall be paid to the
19retired member as long as the retired member and at least one of
20the option beneficiaries are living. Upon the retired member’s
21death, an allowance shall be paid to each surviving option
22beneficiary in accordance with the option elected respective to that
23beneficiary. The member shall determine the percentage of the
24unmodified allowance that will be modified by the election of
25Option 2, Option 3, Option 4, Option 5, Option 6, or Option 7
26within this option, the aggregate of which shall equal 100 percent
27of the member’s unmodified allowance. The election of this option
28is subject to approval by the board.

29(C) A member who is a party to an action for legal separation
30or dissolution of marriage and who is required by court order to
31designate a spouse or former spouse as an option beneficiary may
32designate his or her spouse or former spouse as a sole option
33beneficiary under subparagraphs (A) and (B). The member shall
34specify the option elected for the spouse or former spouse and the
35percentage of his or her unmodified allowance to be modified by
36the option, consistent with the court order. The percentage of the
37member’s unmodified allowance that is not modified by the option
38shall remain an unmodified allowance payable to the member. The
39aggregate of the percentages specified for the option beneficiary
P52   1and the member’s remaining unmodified allowance, if any, shall
2equal 100 percent.

3(b) For purposes of this section, the member shall designate an
4option beneficiary on a properly executed retirement application.
5Except as otherwise provided by this chapter, the option shall
6become effective on the member’s benefit effective date.

7(c) A member may revoke or change an election of an option
8at any time prior to the effective date of the member’s retirement
9under this part. A revocation or change of an option may not be
10made in derogation of a spouse’s or former spouse’s community
11property rights as specified in a court order.

12(d) On or before July 1, 2004, the board shall evaluate the
13existing options and annuities provided pursuant to this section,
14Chapter 38 (commencing with Section 25000) of this part, and
15Part 14 (commencing with Section 26000) and adopt, as a plan
16amendment, any appropriate changes to the options and annuities
17based on the needs of members, participants, and their
18beneficiaries, including, but not limited to, providing economic
19security for beneficiaries and reducing complexity in the election
20of options and annuities by members and participants. The changes
21to the options and annuities may have no net actuarial impact on
22the retirement fund, and the board may establish any eligibility
23criteria it deems necessary to prevent an adverse actuarial impact
24to the fund. The board shall designate the effective date of the plan
25amendment, which shall be at least 18 months after the amendment
26is adopted by the board, and notwithstanding any other provision
27of this section, the options and annuities available to members and
28participants eligible to retire pursuant to this part and Part 14
29(commencing with Section 26000), after the effective date of the
30plan amendment made pursuant to this subdivision, shall reflect
31the changes adopted as a plan amendment pursuant to this
32subdivision.

33(e) Any member or participant who retired and elected an option
34or a joint and survivor annuity, or who filed a preretirement election
35of an option prior to the effective date of the plan amendment made
36pursuant to subdivision (d), may elect to change to a different
37option or joint and survivor annuity, as modified by the board as
38a plan amendment pursuant to subdivision (d), if the member or
39participant meets all the criteria established by the board to prevent
40a change in an option or joint and survivor annuity from having
P53   1an adverse actuarial impact on the retirement fund, including, but
2not limited to, the effective date of a new designation or limitations
3on any changes if a member or participant, as the case may be, or
4beneficiary, or both, is currently not living or afflicted with a
5known terminal illness. The member or participant shall designate
6the change during the six-month period that begins with the
7effective date of the plan amendment, on a form prescribed by the
8system. Any member changing an option election pursuant to this
9subdivision is not subject to the allowance reduction prescribed
10in Section 24309 or 24310 as a result of the election. If a member
11or participant elects to change his or her option or joint and survivor
12annuity under this subdivision, the member or participant shall
13retain the same option beneficiary or beneficiaries as named in the
14prior designation.

15(f) The Legislature reserves the right to modify this section prior
16to the effective date of the plan amendment made pursuant to
17subdivision (d) to prevent any actuarial impact to the fund.

18(g) Except as described in subdivision (e) of Section 24300.1,
19on or after January 1, 2007, a member may not make a new election
20for an option or joint and survivor annuity described in subdivision
21(a).

22(h) Any member with a retirement effective on or after January
231, 2007, shall elect an option from the options described in Section
2424300.1. Any member making a new option election under the
25provisions of Section 24320, 24321, 24322, or 24323 shall elect
26an option from the options described in Section 24300.1 if the
27effective date of the new option election is on or after January 1,
282007.

29

SEC. 41.  

Section 24300.1 of the Education Code is amended
30to read:

31

24300.1.  

(a) A member may, upon application for retirement,
32elect an option pursuant to this part that would provide an
33actuarially modified retirement allowance payable throughout the
34life of the member and the member’s option beneficiary or
35beneficiaries, as follows:

36(1) One hundred percent beneficiary option. The modified
37retirement allowance shall be paid to the retired member and upon
38the member’s death, 100 percent of the modified allowance shall
39continue to be paid to the option beneficiary.

P54   1(2) Seventy-five percent beneficiary option. The modified
2retirement allowance shall be paid to the retired member and upon
3the member’s death, 75 percent of the modified allowance shall
4continue to be paid to the option beneficiary. Pursuant to Section
5401(a)(9) of the Internal Revenue Code, unless the option
6beneficiary is the member’s spouse or former spouse who has been
7awarded a community property interest in the benefits of the
8member under this part, the member may not designate an option
9beneficiary under this option who is more than exactly 19 years
10younger than the member.

11(3) Fifty percent beneficiary option. The modified retirement
12allowance shall be paid to the retired member and upon the
13member’s death, 50 percent of the modified allowance shall
14continue to be paid to the option beneficiary.

15(4) Compound option. The member may designate multiple
16option beneficiaries or one or multiple option beneficiaries with
17a designated percentage to remain unmodified. The member shall
18elect an option as described in paragraph (1), (2), or (3) for each
19designated option beneficiary that would provide an actuarially
20modified retirement allowance payable throughout the lives of the
21retired member and the member’s option beneficiary or
22beneficiaries upon the member’s death.

23(A) The modified retirement allowance shall be paid to the
24member as long as the member and at least one option beneficiary
25is living. Upon the member’s death, an allowance shall be paid to
26each surviving option beneficiary in accordance with the option
27elected respective to that option beneficiary.

28(B) The member shall specify the percent of the unmodified
29allowance that will be modified by the election of each option
30described in paragraph (1), (2), or (3) of this subdivision. The
31percent of the unmodified allowance that is not modified by an
32option, if any, shall be payable to the member. The sum of the
33percentages specified for the option beneficiary or beneficiaries
34and the member’s remaining unmodified allowance, if any, shall
35equal 100 percent.

36(C) The member’s election of the compound option is subject
37to all of the following:

38(i) Pursuant to Section 401(a)(9) of the Internal Revenue Code,
39unless the option beneficiary is the member’s spouse or former
40spouse who has been awarded a community property interest in
P55   1the member’s benefits under this part, the member may not
2designate an option beneficiary under the 100 percent beneficiary
3option within this compound option who is more than exactly 10
4years younger than the member.

5(ii) Pursuant to Section 401(a)(9) of the Internal Revenue Code,
6unless the option beneficiary is the member’s spouse or former
7spouse who has been awarded a community property interest in
8the member’s benefits under this part, the member may not
9designate an option beneficiary under the 75 percent beneficiary
10option within this compound option who is more than exactly 19
11years younger than the member.

12(b) For purposes of this section, the member shall designate an
13option beneficiary on a properly executed retirement application.
14Except as otherwise provided by this chapter, the option shall
15become effective on the member’s benefit effective date.

16(c) A member may revoke or change an election of an option
17no later than 30 days from the date the member’s initial benefit
18payment for the member’s most recent retirement under the Defined
19Benefit Program is paid by the system. A revocation of an option
20may not be made in derogation of a spouse’s or a former spouse’s
21community property rights as specified in a court order.

22(d) Notwithstanding Section 297 or 299.2 of the Family Code,
23a spouse described in paragraphs (2) and (4) of subdivision (a)
24does not include the domestic partner of the member, pursuant to
25Section 7 of Title 1 of the United States Code.

26(e) If there is a determination of community property rights as
27described in Chapter 12 (commencing with Section 22650) of this
28part on or before December 31, 2006, the member may elect the
29option that is required by the judgment or court order. Nothing in
30this part shall permit the member to change the option to the
31detriment of the community property interest of the nonmember
32spouse.

33(f) The board may evaluate the existing options and annuities
34provided pursuant to this section, Chapter 38 (commencing with
35Section 25000) of this part, and Part 14 (commencing with Section
3626000) and adopt, as a plan amendment, any appropriate changes
37to the options and annuities based on the needs of the members,
38participants, and their beneficiaries, including, but not limited to,
39providing economic security for beneficiaries and reducing the
40complexity of the options and annuities. The changes to the options
P56   1and annuities may have no net actuarial impact on the retirement
2fund and the board may establish any eligibility criteria the board
3deems necessary to prevent an adverse actuarial impact to the fund.
4The board shall designate the effective date of the plan amendment,
5which shall be at least 18 months after the amendment is adopted
6by the board, and notwithstanding any other provision of this
7section, the options and annuities available to members and
8participants eligible to retire pursuant to this part and Part 14
9(commencing with Section 26000), after the effective date of the
10plan amendment made pursuant to this subdivision, shall reflect
11the changes adopted as a plan amendment to this subdivision.

12

SEC. 42.  

Section 24300.2 of the Education Code is amended
13and renumbered to read:

14

24345.  

(a) A member who retired and elected an option
15pursuant to Section 24300 may elect to change options, subject to
16all of the following:

17(1) A member who elected Option 2 may elect to change to the
18100-percent beneficiary option described in paragraph (1) or the
1975-percent beneficiary option described in paragraph (2) of
20subdivision (a) of Section 24300.1.

21(2) A member who elected Option 3, Option 4, or Option 5 may
22elect to change to the 75-percent beneficiary option described in
23paragraph (2) or the 50-percent beneficiary option described in
24paragraph (3) of subdivision (a) of Section 24300.1.

25(3) A member who elected Option 6 or Option 7 may elect to
26change to the 75-percent beneficiary option described in paragraph
27(2) of subdivision (a) of Section 24300.1.

28(4) A member who elected Option 8 may elect to have any
29designated percentage of his or her unmodified allowance changed
30in accordance with paragraph (1), (2), or (3).

31(5) The election by a member under this section is made on or
32after January 1, 2007, and prior to July 1, 2007.

33(6) The member designates the same beneficiary that was
34designated under the prior option elected by the member, if the
35option and beneficiary designation were effective on or before
36December 31, 2006.

37(7) The member and the option beneficiary are not afflicted
38with a known terminal illness and the member declares, under
39penalty of perjury under the laws of this state, that to the best of
P57   1his or her knowledge, he or she and the option beneficiary are not
2afflicted with a known terminal illness.

3(8) The option beneficiary has not predeceased the member as
4of the effective date of the change in the option by the member.

5(b) The change in the option by the member shall be effective
6on the date the election is signed, provided that the election is on
7a properly executed form provided by the system and that election
8is received at the system’s headquarters office within 30 days after
9the date the election is signed.

10(c) After receipt of a member’s election document, the system
11shall mail an acknowledgment notice to the member that sets forth
12the new option elected by the member.

13(d) If the member and the option beneficiary are alive and not
14afflicted with a known terminal illness, a member may cancel the
15election to change options and elect to receive the benefit according
16to the preexisting option election. After cancellation, the member
17may elect to make a one-time change from the preexisting option
18to any other option provided by and subject to the restrictions of
19paragraph (1), (2), (3), or (4) of subdivision (a). The cancellation
20or the cancellation and one-time change shall be made on a properly
21executed form provided by the system and shall be received at the
22system’s headquarters office no later than 30 calendar days
23following the date of mailing of the acknowledgment notice. If
24the member elects to make the one-time change provided by this
25subdivision, the change shall be effective as of the member’s
26signature date on the initial election to change.

27(e) If the system is unable to mail an acknowledgment notice
28to the member on or before June 1, 2007, or prior to the end of the
29election period, provided that the member and the option
30beneficiary are alive and not afflicted with a known terminal
31illness, the system shall allow a member to cancel the election to
32change options and elect to receive the benefit according to the
33preexisting option election. After cancellation, the member may
34elect to make a one-time change from the preexisting option to
35any other option provided by and subject to the restrictions of
36paragraph (1), (2), (3), or (4) of subdivision (a). The cancellation
37or the cancellation and one-time change may be made after the
38end of the election period if it is made on a properly executed form
39provided by the system and is received at the system’s headquarters
40office no later than 30 days following the date of the
P58   1acknowledgment notice. If the member elects to make the one-time
2change provided by this subdivision, the change shall be effective
3as of the member’s signature date on the initial election to change.

4(f) If the member elects to change his or her option as described
5in subdivision (a), the retirement allowance of the member shall
6be modified in a manner determined by the board to prevent any
7additional liability to the plan.

8(g) The member shall not change options in derogation of a
9spouse’s or former spouse’s community property rights as specified
10in a court order.

11

SEC. 43.  

Section 24300.5 of the Education Code is amended
12and renumbered to read:

13

24331.  

An option beneficiary who is receiving an allowance
14pursuant to the option elected by the member may designate a
15beneficiary to receive any allowance that has accrued and is unpaid,
16and any remaining balance of the retired member’s accumulated
17retirement contributions payable pursuant to Section 23881, upon
18the death of the option beneficiary.

19

SEC. 44.  

Section 24300.6 of the Education Code is amended
20and renumbered to read:

21

24321.  

(a) Any retired member who was unmarried and not
22in a registered domestic partnership on the benefit effective date
23who did not elect an option pursuant to Section 24300, 24300.1,
24or 24307, and who thereafter marries or registers in a domestic
25partnership, may, after the effective date of the member’s
26retirement under this part, elect an option described in paragraph
27(1), (2), or (3) of subdivision (a) of Section 24300.1, naming his
28or her new spouse or registered domestic partner as the option
29beneficiary, subject to all of the following:

30(1) The retired member shall have been married or registered
31in a domestic partnership for at least one year prior to making the
32election of the option.

33(2) The retired member shall notify the board, in writing on a
34properly executed form provided by the system, of the election of
35the option and the designation of the member’s new spouse or
36registered domestic partner as the option beneficiary. That notice
37shall include a certified copy of the marriage certificate or the
38certificate of registration of domestic partnership.

39(3) The election of an option under this section is subject to
40approval by the board. A retired member may not elect a joint and
P59   1survivor option that would result in any additional liability to the
2retirement fund. A retired member may not elect the compound
3option described in paragraph (4) of subdivision (a) of Section
424300.1.

5(4) The election shall be effective six months after the date the
6notification is received by the board, provided that both the retired
7member and the retired member’s designated spouse or registered
8domestic partner are then living. If the effective date of the new
9option election is on or after January 1, 2007, at the time of the
10new election the retired member shall elect an option from the
11options described in paragraph (1), (2), or (3) of subdivision (a)
12of Section 24300.1. If, before the new election becomes effective,
13the member terminates his or her benefit pursuant to Section 24208
14or the retired member or the new option beneficiary dies, the new
15election is void and the unmodified election remains in effect.

16(b) The election of the option and designation of the option
17beneficiary under this section shall result in an actuarial
18modification of the member’s retirement allowance that shall be
19payable through the life of the member and the member’s new
20spouse or registered domestic partner. Modification of the
21member’s retirement allowance pursuant to this section shall be
22based on the ages of the retired member and the retired member’s
23new spouse or registered domestic partner as of the effective date
24of the election.

25

SEC. 45.  

Section 24301 of the Education Code is amended
26and renumbered to read:

27

24332.  

(a) A member upon application for a disability
28retirement pursuant to Chapter 26 (commencing with Section
2924100), may elect, as provided in Section 24300 or 24300.1 to
30receive an actuarially modified disability retirement allowance.

31(b) For purposes of this section, the member shall either elect
32to receive an unmodified allowance or designate an option
33beneficiary on a properly executed form prescribed by the system,
34either of which shall be filed with the system on or before the last
35day of the month in which the member’s disability retirement is
36approved by the system. The option shall become effective on the
37effective date of the disability retirement allowance. The
38modification of the disability retirement allowance under the option
39elected shall be based on the ages of the retired member and the
40designated option beneficiary as of the effective date of the
P60   1disability retirement. The modification shall be applicable only to
2the disability retirement allowance payable pursuant to subdivision
3(a) of Section 24106.

4(c) Except as provided in Sections 24300, 24300.1, 24320,
524321, 24322, and 24323, a member may revoke or change an
6election of an option no later than 30 days from the date of the
7member’s initial disability retirement benefit payment.

8(d) If a member dies prior to electing an unmodified allowance
9or an option, the death benefits shall be payable under Chapter 23
10(commencing with Section 23850), regardless of whether the
11disability retirement application is or would have been approved.

12

SEC. 46.  

Section 24302 of the Education Code is amended
13and renumbered to read:

14

24311.  

Upon termination of a service retirement allowance
15pursuant to Section 24208, any option elected pursuant to Section
1624300 or 24300.1 and in effect at the time of reinstatement shall
17be considered to be a preretirement election of an option elected
18as of the effective date of the most recent retirement and shall be
19subject to the same provisions as an option elected under Section
2024307.

21

SEC. 47.  

Section 24303 of the Education Code is amended
22and renumbered to read:

23

24312.  

Termination of the service retirement allowance
24pursuant to Section 24208 shall not cancel an option elected under
25the provisions of Section 24307. The effective date of the option
26shall remain the original election date pursuant to Section 24307.

27

SEC. 48.  

Section 24304 of the Education Code is amended
28and renumbered to read:

29

24333.  

Upon termination of a disability retirement allowance
30pursuant to Section 24117, any option elected at the time of
31retirement pursuant to Section 24332 shall be void as of the
32effective date of the reinstatement. The preretirement election of
33option subsequent to termination of the allowance pursuant to
34Section 24117 shall be subject to the following:

35(a) A member may not make a preretirement election of option
36pursuant to Section 24307 prior to becoming qualified to make
37application for service retirement under Section 24201 or 24203.

38(b) A member who was receiving an unmodified disability
39 retirement allowance prior to termination of the allowance may
40not make a preretirement election of option earlier than six months
P61   1following the date on which the disability retirement allowance
2was terminated pursuant to Section 24117.

3(c) A member who has elected an option pursuant to Section
424332, and is otherwise eligible to make a preretirement election
5of an option, may make the election anytime during the six months
6following the date on which the disability retirement allowance
7was terminated pursuant to Section 24117. The member shall elect
8the same option and designate the same option beneficiary as
9designated under Section 24332 when making the election during
10the six-month period following the date the disability retirement
11allowance was terminated.

12

SEC. 49.  

Section 24305 of the Education Code is amended
13and renumbered to read:

14

24322.  

(a) An option elected under Section 24300, 24300.1,
15or 24307 may be canceled by a retired member if the option
16beneficiary is the retired member’s spouse or former spouse and
17a final decree of dissolution of marriage or a judgment of nullity
18has been entered or an order of separate maintenance has been
19made on or after January 1, 1978, by a court of competent
20jurisdiction. A retired member may cancel the option before or
21after issuance of the first retirement allowance payment.

22(b) The retired member shall notify the board in writing of
23cancellation of the option. Notification shall not be earlier than
24the effective date of the decree, judgment, or order and shall include
25a certified copy of the final decree of dissolution, or judgment of
26nullity, or an order of separate maintenance, and any property
27settlement agreement.

28(c) Upon notification to the board, the retired member may elect:
29(1) to receive the unmodified retirement allowance from the date
30of receipt of the notification; or (2) a new joint and survivor option
31under Section 24300.1 and may designate one or multiple new
32option beneficiaries. Modification of the retirement allowance
33because of the newly elected option or newly designated
34beneficiary or beneficiaries shall be based on the ages of the retired
35member and the new option beneficiary or beneficiaries as of the
36effective date of the new option. The election of a new joint and
37survivor option or the designation of a new option beneficiary or
38beneficiaries shall be consistent with the final decree of dissolution,
39judgment of nullity, order of separate maintenance, or property
40settlement agreement, and shall not result in any additional liability
P62   1to the Teachers’ Retirement Fund. The effective date of the change
2shall be the date notification is received by the board.

3

SEC. 50.  

Section 24305.3 of the Education Code, as amended
4by Section 39 of Chapter 655 of the Statutes of 2006, is amended
5and renumbered to read:

6

24324.  

(a) A member who is receiving a joint and survivor
7annuity under the Defined Benefit Supplement Program may
8change the annuity or the annuity beneficiary elected pursuant to
9Section 25011, 25011.1, 25018, or 25018.1, provided all of the
10following conditions are met:

11(1) The annuity beneficiary is the member’s spouse or former
12spouse.

13(2) A final decree of dissolution of marriage is granted, or a
14judgment of nullity is entered, or an order of separate maintenance
15is made by a court of competent jurisdiction with respect to the
16member and the spouse or former spouse on or after the beginning
17of the initial plan year designated by the board pursuant to Section
18 22156.05.

19(3) The change is consistent with the final decree of dissolution,
20judgment of nullity, or order of separate maintenance.

21(b) A member may change the annuity pursuant to subdivision
22(a) before or after the first annuity payment is issued.

23(c) The member shall notify the system in writing of the change
24in the annuity. The notification shall not be earlier than the effective
25date of the final decree of dissolution, judgment of nullity, or order
26of separate maintenance and shall include a certified copy of the
27final decree of dissolution, judgment of nullity, or order of separate
28maintenance, and any property settlement agreement.

29(d) A change in the annuity or annuity beneficiary or both shall
30become effective on the date the notification of change is received
31by the system. The annuity amount payable to the member upon
32the change elected by the member shall be determined as of the
33effective date of the change and shall be the actuarial equivalent
34of the lump sum that would otherwise be payable to the member
35as of the date of the change. If the member elects a joint and
36survivor annuity, the amount payable under the annuity shall be
37modified consistent with the annuity elected by the member.

38

SEC. 51.  

Section 24305.3 of the Education Code, as added by
39Section 56 of Chapter 74 of the Statutes of 2000, is repealed.

P63   1

SEC. 52.  

Section 24305.5 of the Education Code is amended
2and renumbered to read:

3

24320.  

(a) An option elected under Section 24300 or 24300.1
4may be canceled by a retired member if the option beneficiary is
5not the retired member’s spouse or former spouse. A retired
6member may cancel the option before or after issuance of the first
7retirement allowance payment and shall designate his or her spouse
8as the new option beneficiary and the same or a different joint and
9survivor option described in Section 24300.1.

10(b) The retired member shall notify the board, in writing on a
11properly executed form provided by the system, of the designation
12of the new option beneficiary. Notification shall include a certified
13copy of the marriage certificate and a properly executed form for
14the change.

15(c) The effective date of the new election shall be six months
16following the date notification is received by the board, provided
17both the retired member and the new designated option beneficiary
18are then living. If the effective date of the new option election is
19on or after January 1, 2007, at the time of the new election the
20retired member shall elect an option from the options described in
21Section 24300.1. If, before the new election becomes effective,
22the member terminates his or her benefit pursuant to Section 24208
23or the retired member or the new option beneficiary dies, the new
24election is void and the previous election remains in effect.

25(d) The election of the option and designation of the option
26beneficiaries under this section and Section 24300.1 shall be subject
27to an actuarial modification of the retirement allowance. In no
28event may a retired member elect a joint and survivor option that
29would result in any additional liability to the fund. A retired
30member may not elect the compound option described in paragraph
31(4) of subdivision (a) of Section 24300.1. Modification of the
32retirement allowance because of the new option beneficiary and
33the new option shall be based on the ages of the retired member
34and the new option beneficiary as of the effective date of the new
35election.

36

SEC. 53.  

Section 24306 of the Education Code is amended
37and renumbered to read:

38

24323.  

(a) If an option beneficiary designated in the election
39of an Option 2 or Option 3 as described in Section 24300
40predeceases the retired member, the retired member may elect a
P64   1new joint and survivor option described in paragraph (1), (2), (3),
2or (4) of subdivision (a) of Section 24300.1 and designate one or
3multiple new option beneficiaries.

4(b) If an option beneficiary designated in the election of an
5Option 4 or Option 5 as described in Section 24300 predeceases
6the retired member, a retirement allowance adjusted for the
7specified option shall be payable to the retired member and shall
8commence to accrue to the retired member as of the day following
9the date of the death of the option beneficiary. The retired member
10may elect a new joint and survivor option described in paragraph
11(1), (2), (3), or (4) of subdivision (a) of Section 24300.1 and
12designate one or multiple new option beneficiaries.

13(c) If an option beneficiary designated in the election of Option
142 or Option 3 within Option 8 as described in Section 24300
15predeceases the retired member, the retired member may elect a
16new joint and survivor option described in paragraph (1), (2), or
17(3) of subdivision (a) of Section 24300.1 and designate a new
18option beneficiary for the portion of the retirement allowance that
19was modified for the prior option beneficiary. The retired member
20may not elect the compound option described in paragraph (4) of
21subdivision (a) of Section 24300.1.

22(d) If an option beneficiary designated in the election of Option
234 or Option 5 within Option 8 as described in Section 24300
24predeceases the retired member, a retirement allowance adjusted
25for the specified option for the portion of the benefit allocated to
26that beneficiary shall be payable to the retired member and shall
27commence to accrue to the retired member as of the day following
28the date of the death of the option beneficiary. The retired member
29may elect a new joint and survivor option described in paragraph
30(1), (2), or (3) of subdivision (a) of Section 24300.1 for that portion
31of the retirement allowance that was modified for the prior option
32beneficiary and designate a new option beneficiary. The retired
33member may not elect the compound option described in paragraph
34(4) of subdivision (a) of Section 24300.1.

35(e) If an option beneficiary designated in the election of an
36Option 6 or Option 7 or in the election of Option 6 or Option 7
37within Option 8, pursuant to Section 24300 predeceases the retired
38member, that portion of the retirement allowance attributable to
39Option 6 or Option 7 without modification for the option shall be
40payable to the retired member upon notification to the board and
P65   1shall commence to accrue to the retired member as of the day
2following the date of the death of the option beneficiary. The retired
3member may designate a new beneficiary for that portion of the
4retirement allowance within the same option designated for the
5prior beneficiary.

6(f) If an option beneficiary designated in the election of an
7option pursuant to paragraph (1), (2), (3), or (4) of subdivision (a)
8of Section 24300.1 predeceases the retired member, that portion
9 of the retirement allowance attributable to the option without
10modification for the option shall be payable to the member upon
11notification to the board and shall commence to accrue to the
12 retired member as of the day following the date of the death of the
13option beneficiary. The retired member may designate a new
14beneficiary for that portion of the retirement allowance within the
15same option designated for the prior beneficiary.

16(g) The retired member shall submit proof of death of the prior
17beneficiary before making a new beneficiary election under this
18section. The effective date of any new election under this section
19shall be six months following the date notification is received by
20the board provided both the retired member and the newly
21designated option beneficiary are living on the date the new
22election is to become effective. Notification shall be on a properly
23executed form prescribed by the system for the new designation.

24(h) If, before the new election becomes effective, the member
25reinstates pursuant to Section 24208 or the retired member or new
26option beneficiary dies, the new election is void.

27(i) If the retired member is eligible to elect a new option and
28the effective date of the new option election is on or after January
291, 2007, at the time of the new election the retired member shall
30elect an option from the options described in Section 24300.1.

31(j) The election of the new joint and survivor option under this
32section and Section 24300.1 is subject to an actuarial modification
33of the retirement allowance. In no event may a retired member
34elect a joint and survivor option that would result in any additional
35liability to the fund.

36(k) The new option beneficiary cannot be an existing option
37beneficiary for that member designated under paragraph (7) of
38subdivision (a) of Section 24300 or paragraph (4) of subdivision
39(a) of Section 24300.1.

P66   1

SEC. 54.  

Section 24306.5 of the Education Code is amended
2and renumbered to read:

3

24341.  

(a) A member who retired for service under Option 2
4or Option 3 with an effective date prior to January 1, 1991, may
5elect to change Option 2 to Option 6 or Option 3 to Option 7 under
6all of the following conditions:

7(1) The election is made during the six-month period
8commencing July 1, 1994, and ending December 31, 1994.

9(2) The same beneficiary under Option 2 or Option 3 is named
10as beneficiary under Option 6 or Option 7.

11(3) The change in options is consistent with Sections 22453 and
1224322.

13(4) The option beneficiary is not afflicted with any known
14terminal illness and the retired member shall state under penalty
15of perjury that to the best of his or her knowledge the option
16beneficiary is not afflicted with any known terminal illness.

17(5) The option beneficiary has not predeceased the retired
18member as of the effective date of the change in options.

19(b) The change in options shall be effective on the date the
20election is signed, provided that the election is received at the
21system’s headquarters office within 30 days after the date of the
22signature.

23(c) If an election to change options is made pursuant to this
24section, the modified allowance shall be reduced in a manner
25determined by the board to ensure that no additional liability shall
26be incurred by the plan pursuant to this section.

27

SEC. 55.  

Section 24306.7 of the Education Code is amended
28and renumbered to read:

29

24342.  

(a) Any member who retired for service under Option
304 or Option 5 with an effective date prior to January 1, 1991, may
31elect to change Option 4 to Option 6 or Option 5 to Option 7 if all
32of the following conditions are met:

33(1) The election is made during the three-month period
34commencing January 1, 1999, and ending March 31, 1999.

35(2) The same beneficiary under Option 4 or Option 5 is named
36as beneficiary under Option 6 or Option 7.

37(3) The change in options is consistent with Sections 22453 and
3824322.

39(4) The option beneficiary is not afflicted with any known
40terminal illness.

P67   1(5) The option beneficiary has not predeceased the retired
2member as of the effective date of the change in option.

3(6) The election to change the option under this section is
4received at the system’s headquarters office at least 30 days prior
5to the death of the option beneficiary.

6(b) Failure to satisfy all of the conditions in subdivision (a) shall
7render the change of election invalid.

8(c) The change in options under this section shall be effective
9on the date the election is signed, provided all the conditions set
10forth in subdivision (a) are satisfied and the election is received at
11the system’s headquarters office within 30 days after the date of
12the signature.

13(d) The election of a new joint and survivor option under this
14section is subject to a further modification of the modified
15retirement allowance. In no event may a retired member elect a
16joint and survivor option that would result in any additional liability
17to the fund.

18

SEC. 56.  

Section 24307 of the Education Code is amended to
19read:

20

24307.  

(a) A member who qualifies to apply for retirement
21under Section 24201 or 24203 may make a preretirement election
22of an option, as provided in Section 24300.1 without right of
23revocation or change after the benefit effective date, except as
24provided in this part. The preretirement election of an option shall
25become effective as of the date of the member’s signature on a
26properly executed form prescribed by the system, subject to the
27following requirements:

28(1) The form includes the signature of the member’s spouse or
29registered domestic partner, if applicable, and the signature is
30dated.

31(2) The date the form is received at the system’s headquarters
32office is within 30 days after the date of the member’s signature
33and, if applicable, the spouse’s or registered domestic partner’s
34signature.

35(b) A member who makes a preretirement election of an Option
362, Option 3, Option 4, Option 5, Option 6, or Option 7 pursuant
37to Section 24300, or an election as described in paragraph (1), (2),
38or (3) of Section 24300.1 may subsequently make a preretirement
39election of the compound option described in paragraph (4) of
40subdivision (a) of Section 24300.1. The member may retain the
P68   1same option and the same option beneficiary as named in the prior
2preretirement election for a designated percentage within the
3compound option.

4(c) Upon the member’s death prior to the benefit effective date,
5the beneficiary who was designated under the option elected and
6who survives shall receive an allowance calculated under the
7option, under the assumption that the member retired for service
8pursuant to Chapter 27 (commencing with Section 24201) on the
9date of death. The payment of the allowance to the option
10beneficiary shall be in lieu of the family allowance provided in
11Section 23804, the payment provided in paragraph (1) of
12subdivision (a) of Section 23802, the survivor benefit allowance
13provided in Section 23854, and the payment provided in
14subdivisions (a) and (b) of Section 23852, except that if the
15beneficiary dies before all of the member’s accumulated retirement
16contributions are paid, the balance, if any, shall be paid to the estate
17of the person last receiving or entitled to receive the allowance.
18The accumulated annuity deposit contributions and the death
19payment provided in Sections 23801 and 23851 shall be paid to
20the beneficiary in a lump sum.

21(d) If the member subsequently retires for service, and the
22elected option has not been canceled pursuant to Section 24309,
23a modified service retirement allowance computed under Section
24 24300 or 24300.1 and the option elected shall be paid.

25(e) The amount of the service retirement allowance prior to
26applying the option factor shall be calculated as of the earlier of
27the member’s age at death before retirement or age on the last day
28of the month in which the member requested service retirement
29be effective. The modification of the service retirement allowance
30by the option elected shall be based on the ages of the member
31and the beneficiary designated under the option, as of the date the
32election was signed.

33(f) A member who terminates the service retirement allowance
34pursuant to Section 24208 shall not be eligible to file a
35preretirement election of an option until one calendar year elapses
36from the date the allowance is terminated. If the member retires
37 again within one calendar year of the termination of their benefit
38pursuant to Section 24208, the retired member shall keep, upon
39subsequent retirement, the option and beneficiary or the unmodified
P69   1election in place upon the date the termination of the benefits
2became effective.

3(1) If the member’s option beneficiary or beneficiaries
4predecease the member within one calendar year of the termination
5of benefits and before the member has retired again, upon
6notification to the system, the system shall cancel the option and
7beneficiary from that portion of the benefit with reduction pursuant
8to Section 24309. The member shall not elect a new option or
9beneficiary pursuant to Section 24310 until one calendar year from
10the termination effective date has elapsed.

11(2) If a final decree of dissolution of marriage or a judgment of
12nullity has been entered or an order of separate maintenance has
13been made within one calendar year of the termination of benefits
14and the member has not retired again, upon notification to the
15system, the system shall cancel or change the option election in
16accordance with the court order with reduction pursuant to Section
1724309. Any additional changes shall not be made until one calendar
18year from the termination effective date has elapsed.

19(g) The system shall inform members who are qualified to make
20a preretirement election of an option, through the annual statements
21of account, that the election of an option can be made.

22

SEC. 57.  

Section 24308 of the Education Code is amended
23and renumbered to read:

24

24330.  

(a) The election of an option as provided in Section
2524307 shall preclude the payment of a family allowance to any
26beneficiary under this part.

27(b) The preretirement election of an option made by the member
28pursuant to Section 24307 shall be voided by the board as of the
29effective date of an approved disability retirement under this part.
30Members receiving a disability retirement allowance pursuant to
31Chapter 26 (commencing with Section 24100) may not file an
32election of option as provided in Section 24307.

33(c) The election of an option as provided in Section 24307 shall
34preclude the payment of a survivor benefit allowance pursuant to
35Chapter 23 (commencing with Section 23850) and shall preclude
36the payment of the remaining balance of the member’s accumulated
37retirement contributions prior to the death of the option beneficiary.

38

SEC. 58.  

Section 24309 of the Education Code is amended to
39read:

P70   1

24309.  

(a) A member may change or cancel the election of an
2option made pursuant to Section 24307. The change or cancellation
3shall be on a properly executed form provided by the system and
4received at the system’s headquarters office within 30 days after
5the date of the member’s signature and, if applicable, the spouse’s
6signature, and no later than 30 days from the date the member’s
7initial benefit payment for the member’s most recent retirement
8under the Defined Benefit Program is paid by the system. The
9change or cancellation shall become effective as of the date of the
10member’s signature or the day prior to the member’s benefit
11effective date, whichever is earlier.

12(1) Any change to an election of an option shall be made
13according to Section 24307 and shall be considered a new
14preretirement election of an option.

15(2) Regardless of how the member elects to receive his or her
16retirement allowance, a change made to an election of an option
17or a cancellation of an option shall result in the reduction of that
18allowance by an amount determined by the board to be the actuarial
19equivalent of the coverage the member received as a result of the
20preretirement election and that does not result in any adverse
21funding to the plan.

22(b) If the option beneficiary designated in the preretirement
23election of an option pursuant to Section 24307 dies prior to the
24member’s retirement, the preretirement election shall be canceled
25as of the day following the date of death and the member’s
26subsequent retirement allowance under this part shall be subject
27to the allowance reduction prescribed in this section.

28(c) If the option elected pursuant to Section 24307 is “Option
298” as described in paragraph (7) of subdivision (a) of Section 24300
30or the compound option as described in paragraph (4) of
31subdivision (a) of Section 24300.1, a member may cancel the
32designation of an option beneficiary. If the member cancels the
33designation of the option beneficiary or the option beneficiary
34predeceases the member prior to the member’s retirement, the
35member may elect to receive that portion of the retirement
36allowance without modification for the option or elect one or
37multiple new or existing option beneficiaries as described in
38Section 24307. Any change or cancellation of the designation of
39the option beneficiary under this subdivision shall result in the
40allowance reduction prescribed in this section.

P71   1

SEC. 59.  

Section 24310 of the Education Code is amended to
2read:

3

24310.  

If an election of an option is canceled under Section
424309, the member may again elect an option under Section 24307.
5If an election of an option is changed or canceled during any year,
6the reduction for that year shall be that for the option to which the
7greater reduction under Section 24309 as it read on December 31,
81995, is applicable.

9

SEC. 60.  

Section 24311 of the Education Code is amended
10and renumbered to read:

11

24340.  

(a) A member who has a preretirement election of an
12option in effect on December 31, 1990, may change his or her
13preretirement election of Option 2, Option 3, Option 4, or Option
145 to either Option 6 or Option 7 without the allowance reduction
15prescribed in Sections 24309 and 24310, provided the change is
16made on or after January 1, 1991, and prior to the earlier of January
171, 1992, or the member’s retirement under this part.

18(b) If the member elects to change his or her option under this
19section, then the member shall retain the same option beneficiary
20as named in the prior preretirement election. The election to change
21the preretirement election under this section shall be void if not
22received in the system’s headquarters office at least 30 days prior
23to the death of the option beneficiary.

24

SEC. 61.  

Section 24312 of the Education Code is amended
25and renumbered to read:

26

24344.  

(a) A member who has a preretirement election of an
27option in effect on December 31, 1999, may change his or her
28preretirement election of Option 2, Option 3, Option 4, Option 5,
29Option 6, or Option 7 to Option 8 without the allowance reduction
30prescribed in Sections 24309 and 24310, provided the change is
31made on or after January 1, 2000, and prior to the earlier of July
321, 2000, or the member’s benefit effective date.

33(b) If the member elects to change his or her option under this
34section then the member shall retain the same option and the same
35option beneficiary as named in the prior preretirement election of
36an option as one of the options under Option 8. The election to
37change the preretirement election under this section shall be void
38if not received in the system’s headquarters office at least 30 days
39prior to the death of the option beneficiary.

40(c) This section shall become operative on January 1, 2000.

P72   1

SEC. 62.  

Section 24312.1 of the Education Code is amended
2and renumbered to read:

3

24346.  

(a) A member who has a preretirement election of an
4option in effect on December 31, 2006, pursuant to paragraphs (1)
5to (6), inclusive, of subdivision (a) of Section 24300 may change
6his or her preretirement election to an option described in paragraph
7(1), (2), or (3) of subdivision (a) of Section 24300.1 without the
8allowance reduction described in Sections 24309 and 24310,
9provided the change is made on or after January 1, 2007, and prior
10to July 1, 2007.

11(b) A member who has a preretirement election of Option 8 as
12described in Section 24300 in effect on December 31, 2006, and
13in that Option 8 election has an option pursuant to paragraphs (1)
14to (6), inclusive, of subdivision (a) of Section 24300, may change
15any of the options under paragraphs (1) to (6), inclusive, of
16subdivision (a) of Section 24300 to an option described in
17paragraph (1), (2), or (3) of subdivision (a) of Section 24300.1
18without the allowance reduction described in Sections 24309 and
1924310, if change is made on or after January 1, 2007, and prior to
20July 1, 2007. A member may not change the portion of the
21unmodified benefit that would be modified pursuant to that prior
22option.

23(c) The election to change the option by a member as described
24in this section shall be subject to all of the following:

25(1) The member may not change the option beneficiary that was
26designated in the prior preretirement option election.

27(2) The change in options under this section shall be effective
28on the date the election is signed, provided that the election is on
29a properly executed form provided by the system and received at
30the system’s headquarters office within 30 days of the date of the
31signature.

32(d) If the member elects to change options as described in this
33section, the age of the member and the option beneficiary on the
34effective date of the prior preretirement option election shall be
35the age used to calculate the member’s benefit at the time of
36retirement.

37

SEC. 63.  

Section 24313 of the Education Code is amended
38and renumbered to read:

39

24343.  

(a) Any member who retired for service under Option
402 or Option 3 with an effective date prior to January 1, 1991, whose
P73   1option beneficiary had died prior to January 1, 1995, shall receive,
2effective January 1, 1999, the retirement allowance without
3modification for the option if all of the following conditions are
4met:

5(1) The retired member is living as of January 1, 1999.

6(2) The retired member has not elected a new option beneficiary
7under Section 24323.

8(3) The retirement allowance without modification for the option
9payable as of January 1, 1999, is greater than the amount payable
10under the option, plus the amounts from annual benefit
11improvements, ad hoc benefit increases, and payments from the
12Supplemental Benefit Maintenance Account.

13(4) The retired member does not inform the system in writing,
14on a form provided by the system, within 30 days of receipt of the
15notification of the change to the retirement allowance without
16modification for the option, of his or her election to continue to
17receive the option allowance.

18(b) Any member who retired for service under Option 4 or
19Option 5 with an effective date prior to January 1, 1991, whose
20option beneficiary had died prior to January 1, 1999, shall receive
21effective January 1, 1999, the retirement allowance without
22 modification for the option if all the following conditions are met:

23(1) The retired member is living as of January 1, 1999.

24(2) The retired member has not elected a new option beneficiary
25under Section 24323.

26(3) The retirement allowance without modification for the option
27payable as of January 1, 1999, is greater than the amount payable
28under the option, plus the amount from annual benefit
29improvements, ad hoc benefit increases, and payments from the
30Supplemental Benefit Maintenance Account.

31(4) The retired member does not inform the system in writing,
32on a form provided by the system, within 30 days of receipt of the
33notification of the change to the retirement allowance without
34modification for the option, of his or her election to continue to
35receive the option allowance.

36(c) The change to the retirement allowance without modification
37for the option shall be consistent with Section 22453.

38(d) A member retired for service who receives the retirement
39allowance without modification for the option provided under this
P74   1section shall not elect a new option beneficiary under Section
224323.

3(e) The cost of this section shall be paid by the transfer for that
4purpose of the one-time gain accrued to the State Teachers’
5Retirement System from the difference between the contributions
6received pursuant to Sections 22901 and 22950 in the 1997-98
7fiscal year minus the normal cost as displayed in the June 30, 1997,
8actuarial valuation.

9

SEC. 64.  

Section 24347 is added to the Education Code, to
10read:

11

24347.  

(a) A member who retired and elected an option
12pursuant to this chapter and designated his or her same-sex spouse
13or same-sex former spouse as option beneficiary may elect to
14change his or her option subject to the following:

15(1) A member who elected the 100 percent beneficiary option
16or the 50 percent beneficiary option may elect to change his or her
17option to the 75 percent beneficiary option described in paragraph
18(2) of subdivision (a) of Section 24300.1, provided the member’s
19same-sex spouse or same-sex former spouse is more than exactly
2019 years younger than the member.

21(2) (A) A member who elected the compound option may elect
22to change the option designated for his or her same-sex spouse or
23same-sex former spouse within the compound option to the 100
24percent beneficiary option described in paragraph (1) of subdivision
25(a) of Section 24300.1, provided the member’s same-sex spouse
26or same-sex former spouse is more than exactly 10 years younger
27than the member, or the 75 percent beneficiary option described
28in paragraph (2) of subdivision (a) of Section 24300.1, provided
29the member’s same-sex spouse or same-sex former spouse is more
30than exactly 19 years younger than the member.

31(B) If a member elects to change the option designated for his
32or her same-sex spouse or same-sex former spouse within the
33compound option, the member may also elect to change the option
34designated to any other option beneficiary or beneficiaries within
35the compound option to the 100 percent beneficiary option, the 75
36percent beneficiary option, or the 50 percent beneficiary option
37described in paragraph (1), (2), or (3) of subdivision (a) of Section
3824300.1.

39(C) If a member elects to change the option designated for his
40or her same-sex spouse or same-sex former spouse within the
P75   1compound option, the member may also elect to change the
2percentage of his or her unmodified allowance designated to the
3option beneficiary or beneficiaries. The percent of the allowance
4that is not modified by an option, if any, shall be payable to the
5member. The sum of all percentages specified for the option
6beneficiary or beneficiaries and the member’s remaining
7unmodified allowance, if any, shall equal 100 percent.

8(D) Any change made pursuant to this paragraph shall be subject
9to the requirements and restrictions of the compound option
10described in paragraph (4) of subdivision (a) of Section 24300.1
11and shall not be construed to allow a member to cancel his or her
12compound option.

13(3) The option change made by the member pursuant to this
14section is made on or after July 1, 2015, and on or before December
1531, 2015.

16(4) The member married a same-sex spouse, the marriage is or
17was recognized by the United States government, any state
18government, or any foreign government, and his or her same-sex
19spouse or same-sex former spouse was designated as his or her
20option beneficiary prior to July 1, 2015.

21(5) The same-sex spouse or same-sex former spouse is a current
22option beneficiary, and the member designates the same option
23beneficiary or beneficiaries that were designated for the prior
24option elected by the member.

25(6) The option beneficiary or beneficiaries have not predeceased
26the member as of the effective date of the option change made by
27the member pursuant to this section.

28(b) The option change made by a member pursuant to
29subdivision (a) shall be deemed effective as of the effective date
30of the prior option elections or June 26, 2013, whichever is later.

31(c) The option change made by the member pursuant to
32subdivision (a) shall be on a properly executed form provided by
33the system subject to the following requirements:

34(1) The form is signed and dated by the member and the
35member’s spouse, if applicable, on or after July 1, 2015, and on
36or before December 31, 2015.

37(2) The date the form is received at the system’s headquarters
38office is within 30 calendar days after the date of the member’s
39signature and within 30 calendar days after the date of the spouse’s
40signature, if applicable.

P76   1(d) After receipt of the member’s election, the system shall mail
2an acknowledgment notice to the member that set forth the new
3option elected by the member.

4(e) A member may cancel an option change made pursuant to
5subdivision (a) and elect to receive his or her benefit according to
6his or her prior option election provided the requirements of
7paragraphs (5) and (6) of subdivision (a) are still met. The
8cancellation shall become effective as of the date of the initial
9option change pursuant to subdivision (b) subject to the following
10requirements:

11(1) The cancellation is made on a properly executed form
12provided by the system.

13(2) The form includes the signatures of the member and his or
14her spouse, if applicable, and the signatures are dated.

15(3) The form is received at the system’s headquarters office
16within 30 calendar days after the date of the acknowledgment
17notice described in subdivision (d), regardless of whether the form
18is received after December 31, 2015.

19(f) A member may cancel an initial option change made pursuant
20to subdivision (a) and elect to make one subsequent change from
21his or her option election to any other option provided by and
22subject to the restrictions of subdivision (a). The subsequent change
23shall become effective as of the date of the initial option change
24pursuant to subdivision (b) and subject to the following
25requirements:

26(1) The cancellation and subsequent change are made on a
27properly executed form provided by the system.

28(2) The form includes the signatures of the member and his or
29her spouse, if applicable, and the signatures are dated.

30(3) The form is received at the system’s headquarters office
31within 30 calendar days after the date of the acknowledgment
32notice described in subdivision (d), regardless of whether the form
33is received after December 31, 2015.

34(g) If a member elects to change his or her option as described
35in subdivision (a) orbegin delete (e)end deletebegin insert (f)end insert, the retirement allowance of the member
36shall be modified in a manner determined by the board to prevent
37any additional liability to the plan.

38(h) A member shall not change options in derogation of a
39spouse’s or former spouse’s community property rights as specified
40in a court order.

P77   1

SEC. 65.  

Section 24348 is added to the Education Code, to
2read:

3

24348.  

(a) A member who has a preretirement option pursuant
4to Section 24307 in effect on July 1, 2015, and designated his or
5her same-sex spouse or same-sex former spouse as option
6beneficiary may elect to change his or her option subject to the
7following:

8(1) A member who elected the 100 percent beneficiary option
9 or the 50 percent beneficiary option may elect to change his or her
10option to the 75 percent beneficiary option described in paragraph
11(2) of subdivision (a) of Section 24300.1 provided the member’s
12same-sex spouse or same-sex former spouse is more than exactly
1319 years younger than the member.

14(2) (A) A member who elected the compound option may elect
15to change the option designated for his or her same-sex spouse or
16same-sex former spouse within the compound option to the 100
17percent beneficiary option described in paragraph (1) of subdivision
18(a) of Section 24300.1 provided the member’s same-sex spouse
19or same-sex former spouse is more than exactly 10 years younger
20than the member, or the 75 percent beneficiary option described
21in paragraph (2) of subdivision (a) of Section 24300.1 provided
22the member’s same-sex spouse or same-sex former spouse is more
23than exactly 19 years younger than the member.

24(B) If a member elects to change the option designated for his
25or her same-sex spouse or same-sex former spouse within the
26compound option, the member may also elect to change the option
27designated to any other option beneficiary or beneficiaries within
28the compound option to the 100 percent beneficiary option, the 75
29percent beneficiary option, or the 50 percent beneficiary option
30described in paragraph (1), (2), or (3) of subdivision (a) of Section
3124300.1.

32(C) If a member elects to change the option designated for his
33or her same-sex spouse or same-sex former spouse within the
34compound option, the member may also elect to change the
35percentage of his or her unmodified allowance designated to the
36option beneficiary or beneficiaries. The percent of the allowance
37that is not modified by an option, if any, shall be payable to the
38member. The sum of all percentages specified for the option
39beneficiary or beneficiaries and the member’s remaining
40unmodified allowance, if any, shall equal 100 percent.

P78   1(D) Any change made pursuant to this paragraph shall be subject
2to the requirements and restrictions of the compound option
3described in paragraph (4) of subdivision (a) of Section 24300.1
4and shall not be construed to allow a member to cancel his or her
5compound option.

6(3) The option change made by the member pursuant to this
7section is made on or after July 1, 2015, and on or before December
831, 2015.

9(4) The member married a same-sex spouse, the marriage is or
10was recognized by the United States government, any state
11government, or any foreign government, and his or her same-sex
12spouse or same-sex former spouse was designated as his or her
13option beneficiary prior to July 1, 2015.

14(5) The same-sex spouse or same-sex former spouse is a current
15option beneficiary, and the member designates the same option
16beneficiary or beneficiaries that were designated for the prior
17option elected by the member.

18(6) The option beneficiary or beneficiaries have not predeceased
19the member as of the effective date of the option change made by
20the member pursuant to this section.

21(b) The option change made by a member pursuant to
22subdivision (a) shall be deemed effective as of the effective date
23of the prior electionbegin delete ofend deletebegin insert orend insert June 26, 2013, whichever is later.

24(c) The option change made by the member pursuant to
25subdivision (a) shall be on a properly executed form provided by
26the system subject to the following requirements:

27(1) The form is signed and dated by the member and the
28member’s spouse, if applicable, on or after July 1, 2015, and on
29or before December 31, 2015.

30(2) The date the form is received at the system’s headquarters
31office is within 30 calendar days after the date of the member’s
32signature and within 30 calendar days after the date of the spouse’s
33signature, if applicable.

34(d) A preretirement option change made pursuant to this section
35will not result in the allowance reduction described in Sections
3624309 and 24310.

37(e) If a member elects to change options pursuant to this section,
38the age of the member and the option beneficiary or beneficiaries
39on the effective date of the prior preretirement option election shall
P79   1be the age used to calculate the member’s benefit at the time of
2retirement.

3

SEC. 66.  

Section 24402 of the Education Code is amended to
4read:

5

24402.  

(a) Service retirement allowances, disability
6allowances, disability retirement allowances, family allowances,
7and survivor benefit allowances payable pursuant to this part shall
8be increased by application of the benefit improvement factor.

9(b) Allowances payable to beneficiaries on account of options
10elected under Section 24300, 24300.1, 24307, or 24332 shall be
11increased by application of the improvement factor. This factor
12shall be applicable on the same date when it would have been
13applied to the allowance of the deceased person.

14(c) The benefit improvement factor shall not be applied to an
15annuity that is the actuarial equivalent of the accumulated annuity
16 deposit contributions standing to the credit of the member’s account
17on the effective date of a service or disability retirement.

18

SEC. 67.  

Section 24412 of the Education Code is amended to
19read:

20

24412.  

(a) The annual revenues deposited to the Teachers’
21Retirement Fund pursuant to Section 6217.5 of the Public
22Resources Code are continuously appropriated without regard to
23fiscal year for the purposes of this section and shall be distributed
24annually in quarterly supplemental payments commencing on
25September 1 of each year to retired members, disabled members,
26and beneficiaries under the Defined Benefit Program. The amount
27available for distribution in any year shall be the income for that
28year from the sale or use of school lands and lieu lands, as
29estimated by the State Lands Commission prior to the beginning
30of the fiscal year, adjusted by the difference between the estimated
31and actual income for the preceding fiscal year. The board shall
32deduct from the revenues an amount necessary for administrative
33expenses to implement this section.

34(b) The net revenues to be distributed shall be allocated among
35those retired members, disabled members, and beneficiaries, as
36defined in subdivision (a) of Section 22107, whose allowances
37under the Defined Benefit Program, after applying the annual
38improvement factor as defined in Section 22140, if any, are below
3980 percent of the purchasing power of the base allowance. The
40purchasing power calculation for each individual allowance shall
P80   1be based on the change in the All Urban California Consumer Price
2Index between June of the calendar year of retirement and June of
3the fiscal year preceding the fiscal year of the distribution. The
4allocation shall provide a pro rata share of the amount needed to
5restore the allowance payable, after application of the current year
6annual improvement factor to 80 percent of the purchasing power
7of the base allowance.

8(c) The allowance increase shall not be applicable to annuities
9payable from the accumulated annuity deposit contributions or the
10accumulated tax-sheltered annuity contributions.

11(d) In any year that the net revenues from school lands and lieu
12lands is greater than that needed to adjust the allowances of all
13retired members, disabled members, and beneficiaries, as defined
14in subdivision (a) of Section 22107, under the Defined Benefit
15Program to 80 percent of the purchasing power of the base
16allowance, the net revenues in excess of that needed for distribution
17shall be used by the board to reduce the unfunded actuarial
18obligation of the fund, if any.

19(e) The board shall inform each recipient of supplemental
20payments under this section that the increases are not cumulative
21and are not part of the base allowance.

22

SEC. 68.  

Section 24415 of the Education Code is amended to
23read:

24

24415.  

(a) The proceeds of the Supplemental Benefit
25Maintenance Account shall be distributed annually in quarterly
26supplemental payments commencing on September 1, 1990, to
27retired members, disabled members, and beneficiaries, as defined
28in subdivision (a) of Section 22107. The amount available for
29distribution in any fiscal year shall not exceed the amount necessary
30to restore purchasing power up to 85 percent of the purchasing
31power of the base allowance, after the application of all allowance
32increases authorized by this part, including those specified in
33Section 24412, and excluding those provided pursuant to Sections
3424410.5, 24410.6, and 24410.7.

35(b) The net revenues to be distributed shall be allocated among
36those retired members, disabled members, and beneficiaries, as
37defined in subdivision (a) of Section 22107, whose allowances,
38after sequentially applying the annual improvement factor as
39defined in Sections 22140 and 22141, and the annual supplemental
40payment as specified in Section 24412, have the lowest purchasing
P81   1power percentage. The purchasing power calculation for each
2individual shall be based on the change in the All Urban California
3Consumer Price Index between June of the calendar year of
4retirement and June of the fiscal year preceding the fiscal year of
5distribution. In any year in which the purchasing power of the
6allowances of all retired members, disabled members, and
7beneficiaries, as defined in subdivision (a) of Section 22107, equals
8not less than 85 percent and additional funds remain from the
9allocation authorized by this section, those funds shall remain in
10the Supplemental Benefit Maintenance Account for allocation in
11future years.

12(c) The allowance increase shall not be applicable to annuities
13payable from the accumulated annuity deposit contributions or the
14accumulated tax-sheltered annuity contributions.

15(d) The increases provided by subdivision (b) are not cumulative,
16not part of the base allowance, and will be payable only to the
17extent that funds are available from the Supplemental Benefit
18Maintenance Account. The board shall inform each recipient of
19the contents of this subdivision.

20(e) The adjustments authorized by this section are vested only
21up to the amount payable as a result of the annual appropriation
22made pursuant to Section 22954 and the adjustments made by the
23board pursuant to Section 24415.5. The adjustments authorized
24by this section shall not be included in the base allowance for
25purposes of calculating the annual improvement defined by
26Sections 22140 and 22141.

27(f) Notwithstanding subdivision (b), for purposes of restoring
28the purchasing power of benefits provided pursuant to Section
2924410.5 for members and beneficiaries receiving benefits pursuant
30to subdivision (b), the purchasing power calculation shall be based
31on 85 percent of the change in the All Urban California Consumer
32Price Index between January 2000 and June of the fiscal year
33preceding the fiscal year of distribution, after the application of
34increases authorized by Section 24412 that are made to the
35allowances provided pursuant to Section 24410.5.

36(g) Notwithstanding subdivision (b), for purposes of restoring
37the purchasing power of benefits provided pursuant to Sections
3824410.6 and 24410.7 for members and beneficiaries receiving
39benefits pursuant to subdivision (b), the purchasing power
40calculation shall be based on 85 percent of the change in the All
P82   1Urban California Consumer Price Index between January 2001
2and June of the fiscal year preceding the fiscal year of distribution,
3after the application of increases authorized by Section 24412 that
4are made to the allowances provided pursuant to Sections 24410.6
5and 24410.7.

6

SEC. 69.  

Section 24600 of the Education Code is amended to
7read:

8

24600.  

(a) A retirement allowance under this part begins to
9accrue on the effective date of the member’s retirement and ceases
10on the earlier of the day of the member’s death or the day on which
11the retirement allowance is terminated for a reason other than the
12member’s death.

13(b) A retirement allowance payable to an option beneficiary
14under this part begins to accrue on the day following the day of
15the retired member’s death and ceases on the day of the option
16beneficiary’s death.

17(c) A disability allowance under this part begins to accrue on
18the effective date of the member’s disability allowance and ceases
19on the earlier of the day of the member’s death or the day on which
20the disability allowance is terminated for a reason other than the
21member’s death.

22(d) A family allowance under this part begins to accrue on the
23day following the day of the member’s death and ceases on the
24day of the event that terminates eligibility for the allowance.

25(e) A survivor benefit allowance payable to a surviving spouse
26under this part pursuant to Chapter 23 (commencing with Section
2723850) begins to accrue on the day the member would have
28attained normal retirement age or on the day following the day of
29the member’s death, as elected by the surviving spouse, and ceases
30on the day of the surviving spouse’s death.

31(f) (1) Except as provided in paragraph (2), a child’s portion
32of an allowance under this part begins to accrue on the effective
33date of that allowance and ceases on the earlier of either the
34 termination of the child’s eligibility or the termination of the
35allowance.

36(2) A child’s portion of a disability retirement allowance under
37Chapter 26 (commencing with Section 24100) ceases on the earlier
38of either:

39(A) The termination date of the child’s eligibility.

P83   1(B) The termination of the allowance for reasons other than
2death.

3(g) Supplemental payments issued under this part pursuant to
4Sections 24412 and 24415 to retired members, disabled members,
5and beneficiaries shall begin to accrue pursuant to Sections 24412
6and 24415 and shall cease to accrue as of the termination dates
7specified in subdivisions (a) to (f), inclusive, of this section.

8(h) Notwithstanding any other provision of this part or other
9law, distributions payable under the plan with respect to the
10Defined Benefit Program and the Defined Benefit Supplement
11Program shall be made in accordance with applicable provisions
12of the Internal Revenue Code of 1986 and related regulations. The
13required beginning date of benefit payments that represent the
14entire interest of the member in the plan with respect to the Defined
15Benefit Program and the Defined Benefit Supplement Program
16shall be either:

17(1) In the case of a refund of contributions, as described in
18Chapter 18 (commencing with Section 23100) of this part and
19distribution of an amount equal to the balance of credits in a
20member’s Defined Benefit Supplement account, as described in
21Chapter 38 (commencing with Section 25000) of this part, not
22later than April 1 of the calendar year following the later of (A)
23the calendar year in which the member attains the age at which
24the Internal Revenue Code of 1986 requires a distribution of
25benefits or (B) the calendar year in which the member terminates
26employment within the meaning of subdivision (i).

27(2) In the case of a retirement allowance, as defined in Section
2822166, not later than April 1 of the calendar year following the
29later of (A) the calendar year in which the member attains the age
30at which the Internal Revenue Code of 1986 requires a distribution
31of benefits or (B) the calendar year in which the member terminates
32employment within the meaning of subdivision (i), to continue
33over the life of the member or the lives of the member and the
34member’s option beneficiary, or over the life expectancy of the
35member or the life expectancy of the member and the member’s
36option beneficiary.

37(i) For purposes of subdivision (h), the phrase “terminates
38employment” means the later of:

39(1) The date the member ceases to perform creditable service
40subject to coverage under this plan.

P84   1(2) The date the member ceases employment in a position
2subject to coverage under another public retirement system in this
3state if the compensation earnable while a member of the other
4system may be considered in the determination of final
5compensation pursuant to Section 22134 or 22134.5.

6

SEC. 70.  

Section 25011.6 is added to the Education Code, to
7read:

8

25011.6.  

(a) A member who retired and elected a beneficiary
9annuity pursuant to Section 25011.1 with his or her same-sex
10spouse or same-sex former spouse designated as annuity
11beneficiary pursuant to Section 25015 may elect to change his or
12her annuity subject to the following:

13(1) A member who elected the 100 percent beneficiary annuity
14or the 50 percent beneficiary annuity may elect to change his or
15her beneficiary annuity to the 75 percent beneficiary annuity
16described in paragraph (3) of subdivision (a) of Section 25011.1,
17provided the member’s same-sex spouse or same-sex former spouse
18is more than exactly 19 years younger than the member.

19(2) (A) A member who elected the compound option described
20in paragraph (4) of subdivision (a) of Section 24300.1 may elect
21to change his or her beneficiary annuity to the 100 percent
22beneficiary annuity described in paragraph (2) of subdivision (a)
23of Section 25011.1, or the 75 percent beneficiary annuity described
24in paragraph (3) of subdivision (a) of Section 25011.1, provided
25the member’s same-sex spouse or same-sex former spouse is more
26than exactly 10 years younger than the member under the 100
27percent beneficiary annuity, or more than exactly 19 years younger
28than the member under the 75 percent beneficiary annuity.

29(B) Any change made pursuant to this paragraph shall be subject
30to the requirements and restrictions of Section 25015.

31(3) The annuity change made by the member pursuant to this
32section is made on or after July 1, 2015, and on or before December
3331, 2015.

34(4) The member married a same-sex spouse, the marriage is or
35was recognized by the United States government, any state
36government, or any foreign government, and his or her same-sex
37spouse or same-sex former spouse was designated as his or her
38annuity beneficiary prior to July 1, 2015.

39(5) The same-sex spouse or same-sex former spouse is a current
40annuity beneficiary, and the same annuity beneficiary or
P85   1beneficiaries that were designated for the prior annuity elected by
2the member remain.

3(6) The annuity beneficiary or beneficiaries have not
4predeceased the member as of the effective date of the annuity
5change made by the member pursuant to this section.

6(b) The annuity change made by a member pursuant to
7subdivision (a) shall be deemed effective as of the effective date
8of the prior annuity election or June 26, 2013, whichever is later.

9(c) The annuity change made by the member pursuant to
10subdivision (a) shall be on a properly executed form provided by
11the system subject to the following requirements:

12(1) The form is signed and dated by the member and the
13member’s spouse, if applicable, on or after July 1, 2015, and on
14or before December 31, 2015.

15(2) The date the form is received at the system’s headquarters
16office is within 30 calendar days after the date of the member’s
17signature and within 30 calendar days after the date of the spouse’s
18signature, if applicable.

19(d) After receipt of a member’s election, the system shall mail
20an acknowledgment notice to the member that sets forth the new
21annuity elected by the member.

22(e) A member may cancel an annuity change made pursuant to
23subdivision (a) and elect to receive his or her benefit according to
24his or her prior annuity election provided the requirements of
25paragraphs (5) and (6) of subdivision (a) are still met. The
26cancellation shall become effective as of the date of the initial
27annuity change pursuant to subdivision (b) subject to the following
28requirements:

29(1) The cancellation is made on a properly executed form
30provided by the system.

31(2) The form includes the signatures of the member and his or
32her spouse, if applicable, and the signatures are dated.

33(3) The form is received at the system’s headquarters office
34within 30 calendar days after the date of the acknowledgment
35notice described in subdivision (d), regardless of whether the form
36is received after December 31, 2015.

37(f) A member may cancel an initial annuity change made
38pursuant to subdivision (a) and elect to make one subsequent
39change from his or her prior annuity election to any other annuity
40provided by and subject to the restrictions of subdivision (a). The
P86   1subsequent change shall become effective as of the date of the
2initial annuity change pursuant to subdivision (b) and subject to
3the following requirements:

4(1) The cancellation and subsequent change are made on a
5properly executed form provided by the system.

6(2) The form includes the signatures of the member and his or
7her spouse, if applicable, and the signatures are dated.

8(3) The form is received at the system’s headquarters office
9within 30 calendar days after the date of the acknowledgment
10notice described in subdivision (d), regardless of whether the form
11is received after December 31, 2015.

12(g) If a member elects to change his or her annuity pursuant to
13subdivision (a) or (f), the member’s annuity shall be modified in
14a manner determined by the board to prevent any additional liability
15to the plan.

16(h) A member shall not change his or her annuity in derogation
17 of a spouse’s or former spouse’s community property rights as
18specified in a court order.

19

SEC. 71.  

Section 25015 of the Education Code is amended to
20read:

21

25015.  

(a) If a member elects to receive a benefit payable
22under the Defined Benefit Supplement Program as a joint and
23survivor annuity, the designation of the beneficiary made pursuant
24to Section 24300 or 24300.1 shall apply to the benefit payable
25under this chapter. The annuity beneficiary designation shall not
26be changed after the date the benefit becomes payable to the
27member, except as provided in Section 24324, 25011, 25011.1,
2825018, or 25018.1, or Chapter 12 (commencing with Section
2922650).

30(b) If the member designates one or multiple option beneficiaries
31within Option 8 pursuant to Section 24300 or the compound option
32pursuant to Section 24300.1, the percentage of the unmodified
33allowance attributable to each option beneficiary specified in that
34designation shall apply to the joint and survivor annuity payable
35under this chapter. The member shall elect one joint and survivor
36annuity type and this annuity type shall be applied the same for
37each beneficiary and each designated percentage of the member
38only annuity. If any percentage of the allowance was designated
39to remain unmodified, the member only annuity shall apply for
40the corresponding percentage of the annuity provided under this
P87   1chapter. The annuity amount payable to the member during his or
2her lifetime shall be modified to be payable over the combined
3lives of the member and the annuity beneficiary or beneficiaries.

4(1) Pursuant to Section 401(a)(9) of the Internal Revenue Code,
5the member shall not designate the 100 percent beneficiary annuity
6type under this subdivision if any annuity beneficiary is more than
7exactly 10 years younger than the member, unless that annuity
8beneficiary is the member’s spouse or former spouse who has been
9awarded a community property interest in the member’s benefits
10under this part.

11(2) Pursuant to Section 401(a)(9) of the Internal Revenue Code,
12the member shall not designate the 75 percent beneficiary annuity
13type under this subdivision if any annuity beneficiary is more than
14exactly 19 years younger than the member, unless that annuity
15beneficiary is the member’s spouse or former spouse who has been
16awarded a community property interest in the member’s benefits
17under this part.

18(c) If the member predeceases an annuity beneficiary, the
19annuity beneficiary may designate, on a properly executed form
20provided by the system, a payee to receive an amount that may be
21payable in a lump sum pursuant to Section 25023 upon the death
22of the annuity beneficiary.

23

SEC. 72.  

Section 25018.6 is added to the Education Code, to
24read:

25

25018.6.  

(a) A member receiving a disability retirement
26allowance who elected a beneficiary annuity pursuant to Section
2725018.1 with a same-sex spouse or same-sex former spouse
28designated as annuity beneficiary pursuant to Section 25015 may
29elect to change his or her annuity subject to the following:

30(1) A member who elected the 100 percent beneficiary annuity
31or the 50 percent beneficiary annuity may elect to change his or
32her beneficiary annuity to the 75 percent beneficiary annuity
33described in paragraph (3) of subdivision (a) of Section 25018.1,
34provided the member’s same-sex spouse or same-sex former spouse
35is more than exactly 19 years younger than the member.

36(2) (A) A member who elected the compound option described
37in paragraph (4) of subdivision (a) of Section 24300.1 may elect
38to change his or her beneficiary annuity to the 100 percent
39beneficiary annuity described in paragraph (2) of subdivision (a)
40of Section 25018.1, or the 75 percent beneficiary annuity described
P88   1in paragraph (3) of subdivision (a) of Section 25018.1, provided
2the member’s same-sex spouse or same-sex former spouse is more
3than exactly 10 years younger than the member under the 100
4percent beneficiary annuity, or more than exactly 19 years younger
5than the member under the 75 percent beneficiary annuity.

6(B) Any change made pursuant to this paragraph shall be subject
7to the requirements and restrictions of Section 25015.

8(3) The annuity change made by the member pursuant to this
9section is made on or after July 1, 2015, and on or before December
1031, 2015.

11(4) The member married a same-sex spouse, the marriage is or
12was recognized by the United States government, any state
13government, or any foreign government, and his or her same-sex
14spouse or same-sex former spouse was designated as his or her
15annuity beneficiary prior to July 1, 2015.

16(5) The same-sex spouse or same-sex former spouse is a current
17annuity beneficiary, and the same annuity beneficiary or
18beneficiaries that were designated for the prior annuity elected by
19the member remain.

20(6) The annuity beneficiary or beneficiaries have not
21predeceased the member as of the effective date of the annuity
22change made by the member pursuant to this section.

23(b) The annuity change made by a member pursuant to
24subdivision (a) shall be deemed effective as of the effective date
25of the prior annuity election or June 26, 2013, whichever is later.

26(c) The annuity change made by the member pursuant to
27subdivision (a) shall be on a properly executed form provided by
28the system subject to the following requirements:

29(1) The form is signed and dated by the member and the
30member’s spouse, if applicable, on or after July 1, 2015, and on
31or before December 31, 2015.

32(2) The date the form is received at the system’s headquarters
33office is within 30 calendar days after the date of the member’s
34signature and within 30 calendar days after the date of the spouse’s
35signature, if applicable.

36(d) After receipt of a member’s election, the system shall mail
37an acknowledgment notice to the member that sets forth the new
38annuity elected by the member.

39(e) A member may cancel an annuity change made pursuant to
40subdivision (a) and elect to receive his or her benefit according to
P89   1his or her prior annuity election provided the requirements of
2paragraphs (5) and (6) of subdivision (a) are still met. The
3cancellation shall become effective as of the date of the initial
4annuity change pursuant to subdivision (b) subject to the following
5requirements:

6(1) The cancellation is made on a properly executed form
7provided by the system.

8(2) The form includes the signatures of the member and his or
9her spouse, if applicable, and the signatures are dated.

10(3) The form is received at the system’s headquarters office
11within 30 calendar days after the date of the acknowledgment
12notice described in subdivision (d), regardless of whether the form
13is received after December 31, 2015.

14(f) A member may cancel an initial annuity change made
15pursuant to subdivision (a) and elect to make one subsequent
16change from his or her prior annuity election to any other annuity
17provided by and subject to the restrictions of subdivision (a). The
18subsequent change shall become effective as of the date of the
19initial annuity change pursuant to subdivision (b) and subject to
20the following requirements:

21(1) The cancellation and subsequent change are made on a
22properly executed form provided by the system.

23(2) The form includes the signatures of the member and his or
24her spouse, if applicable, and the signatures are dated.

25(3) The form is received at the system’s headquarters office
26within 30 calendar days after the date of the acknowledgment
27notice described in subdivision (d), regardless of whether the form
28is received after December 31, 2015.

29(g) If a member elects to change his or her annuity pursuant to
30subdivision (a) or (f), the member’s annuity shall be modified in
31a manner determined by the board to prevent any additional liability
32to the plan.

33(h) A member shall not change his or her annuity in derogation
34of a spouse’s or former spouse’s community property rights as
35specified in a court order.

36

SEC. 73.  

Section 25100 of the Education Code is amended to
37read:

38

25100.  

(a) The board shall establish a vendor registration
39process through which information about tax-deferred retirement
40investment products as described in Section 403(b) of the Internal
P90   1Revenue Code of 1986 shall be made available for consideration
2by public employees of all local school districts, community college
3districts, county offices of education, and state employees of a
4state employer under the uniform state payroll system, excluding
5the California State University System, eligible to participate in
6an annuity contract and custodial account as described in Section
7403(b) of the Internal Revenue Code of 1986.

8(b) For the purposes of this chapter, “403(b) product or 403(b)
9products” means tax-deferred retirement investment products as
10described in Section 403(b) of the Internal Revenue Code of 1986,
11and its subsequent amendments, and complying with applicable
12California insurance laws, and federal and California securities
13laws and rules as applied by appropriate regulatory entities.

14(c) For the purposes of this chapter:

15(1) “Employer” means any local school district, community
16college district, or county office of education, or any state employer
17under the uniform state payroll system, excluding the California
18State University System, with employees eligible to participate in
19an annuity contract and custodial account as described in Section
20403(b) of the Internal Revenue Code of 1986, with the Controller
21acting on the state employer’s behalf.

22(2) “Vendor” means:

23(A) A public retirement system, broker-dealer, registered
24investment company, nonbank custodian, or life insurance company
25qualified to do business in California that provides a 403(b)
26product. “Vendor” does not include individual registered
27representatives, brokers, financial planners, or agents.

28(B) A statewide employee organization with an active
29membership primarily composed of persons employed in public
30education, or its wholly controlled affiliate, that has entered into
31a legally binding agreement with a bank custodian, as described
32in Section 401(f)(2) of the Internal Revenue Code, for the purpose
33of offering a custodial account meeting the requirements of Section
34403(b)(7) of the Internal Revenue Code.

35(3) “Nonbank custodian” means a fund custodian, other than a
36bank, that meets the criteria of a trustee specified in Section
37408(a)(2) of the Internal Revenue Code.

38(4) “Broker-dealer” means only those broker-dealers who offer
39a proprietary 403(b) product or who charge fees that are otherwise
40not disclosed.

P91   1

SEC. 74.  

Section 26113 of the Education Code is amended to
2read:

3

26113.  

(a) “Creditable service” means any of the following
4activities performed for an employer in a position requiring a
5credential, certificate, or permit pursuant to this code, or under the
6appropriate minimum standards adopted by the Board of Governors
7of the California Community Colleges, or under the provisions of
8an approved charter for the operation of a charter school for which
9the charter school is eligible to receive state apportionment, or
10pursuant to a contract between a community college district and
11the United States Department of Defense to provide vocational
12training:

13(1) The work of teachers, instructors, district interns, and
14 academic employees employed in the instructional program for
15pupils, including special programs such as adult education, regional
16occupational programs, child care centers, and prekindergarten
17programs pursuant to Section 22161.

18(2) Education or vocational counseling, guidance, and placement
19services.

20(3) The work of directors, coordinators, and assistant
21administrators who plan courses of study to be used in California
22public schools, or research connected with the evaluation or
23efficiency of the instructional program.

24(4) The selection, collection, preparation, classification,
25demonstration, or evaluation of instructional materials of any
26course of study for use in the development of the instructional
27program in California public schools, or other services related to
28school curriculum.

29(5) The examination, selection, in-service training, or assignment
30of teachers, principals, or other similar personnel involved in the
31instructional program.

32(6) School activities related to, and an outgrowth of, the
33instructional and guidance program of the school when performed
34in addition to other activities described in this section.

35(7) The work of nurses, physicians, speech therapists,
36psychologists, audiometrists, audiologists, and other school health
37professionals.

38(8) Services as a school librarian.

P92   1(9) The work of county and district superintendents and other
2employees who are responsible for the supervision of persons or
3administration of the duties described in this section.

4(10) Trustee service as described in Section 26403.

5(b) “Creditable service” also means the work of superintendents
6of California public schools.

7(c) The board shall have final authority for determining
8creditable service to cover activities not already specified.

9

SEC. 75.  

Section 26703 of the Education Code is amended to
10read:

11

26703.  

The signature of the spouse of a participant shall be
12required on a designation of beneficiary form, an election, change,
13or termination of an annuity, or an application for a retirement
14benefit, disability benefit, or termination benefit under this part,
15unless the participant declares in writing, under penalty of perjury,
16that one of the following conditions exists:

17(a) The participant is not married.

18(b) The participant does not know, and has taken all reasonable
19steps to determine, the whereabouts of the spouse.

20(c) The spouse is incapable of executing the acknowledgment
21because of an incapacitating mental or physical condition.

22(d) The participant and spouse have executed a marriage
23settlement agreement pursuant to Part 5 (commencing with Section
241500) of Division 4 of the Family Code that makes the community
25property law inapplicable to the marriage.

26(e) The current spouse has no identifiable community property
27interest in the benefit.

28

SEC. 76.  

Section 26704 of the Education Code is amended to
29read:

30

26704.  

If a spouse refuses to sign a beneficiary designation,
31an election, change, or termination of an annuity, or an application
32for a retirement benefit, disability benefit, or termination benefit
33payable under this part, the participant may bring an action in court
34to enforce the spousal signature requirement or to waive the spousal
35signature requirement. Either party may bring an action pursuant
36to Section 1101 of the Family Code to determine the rights of the
37party.

38

SEC. 77.  

Section 26803 of the Education Code is amended to
39read:

P93   1

26803.  

(a) All creditable service subject to coverage by the
2Cash Balance Benefit Program and all service with the participant’s
3last employer or employers that is creditable under the Defined
4Benefit Program shall be terminated prior to the retirement date.

5(b) All employers with which the participant is employed to
6perform creditable service subject to coverage by the plan shall
7certify on a form prescribed by the system that the participant’s
8employment has been terminated unless the employment was
9terminated 12 months or more prior to the member’s retirement
10date.

11

SEC. 78.  

Section 26807.7 is added to the Education Code, to
12read:

13

26807.7.  

(a) A participant who retired and elected a beneficiary
14annuity pursuant to Section 26807.5 and designated his or her
15same-sex spouse or same-sex former spouse as annuity beneficiary
16may elect to change his or her annuity subject to all of the
17following:

18(1) A participant who elected the 100 percent beneficiary annuity
19or the 50 percent beneficiary annuity may elect to change his or
20her beneficiary annuity to the 75 percent beneficiary annuity
21described in paragraph (3) of subdivision (a) of Section 26807.5,
22provided the participant’s same-sex spouse or same-sex former
23spouse is more than exactly 19 years younger than the participant.

24(2) The annuity change made by the participant pursuant to this
25section is made on or after July 1, 2015, and on or before December
2631, 2015.

27(3) The participant married a same-sex spouse, the marriage is
28or was recognized by the United States government, any state
29government, or any foreign government, and his or her same-sex
30spouse or same-sex former spouse was designated as his or her
31annuity beneficiary prior to July 1, 2015.

32(4) The same-sex spouse or same-sex former spouse is the
33current annuity beneficiary and remains the annuity beneficiary
34following the annuity change made pursuant to this section.

35(5) The annuity beneficiary has not predeceased the participant
36as of the effective date of the annuity change made by the
37participant pursuant to this section.

38(b) The annuity change made by a participant pursuant to
39subdivision (a) shall be deemed effective as of the effective date
40of the prior annuity election or June 26, 2013, whichever is later.

P94   1(c) The annuity change made by the participant pursuant to
2subdivision (a) shall be on a properly executed form provided by
3the system subject to the following requirements:

4(1) The form is signed and dated by the participant and the
5participant’s spouse, if applicable, on or after July 1, 2015, and on
6or before December 31, 2015.

7(2) The date the form is received at the system’s headquarters
8office is within 30 calendar days after the date of the participant’s
9signature and within 30 calendar days after the date of the spouse’s
10signature, if applicable.

11(d) After receipt of a participant’s election, the system shall
12mail an acknowledgment notice to the participant that sets forth
13the new annuity elected by the participant.

14(e) A participant may cancel an annuity change made pursuant
15to subdivision (a) and elect to receive his or her benefit according
16to his or her prior annuity election provided the requirements of
17paragraphs (4) and (5) of subdivision (a) are still met. The
18cancellation shall become effective as of the date of the initial
19option change pursuant to subdivision (b) subject to the following
20requirements:

21(1) The cancellation is made on a properly executed form
22provided by the system.

23(2) The form includes the signatures of the participant and his
24or her spouse, if applicable, and the signatures are dated.

25(3) The form is received at the system’s headquarters office
26within 30 calendar days after the date of the acknowledgment
27notice described in subdivision (d), regardless of whether the form
28is received after December 31, 2015.

29(f) If a participant elects to change his or her annuity pursuant
30to subdivision (a), the participant’s annuity shall be modified in a
31manner determined by the board to prevent any additional liability
32to the plan.

33(g) A participant shall not change his or her annuity in
34derogation of a spouse’s or former spouse’s community property
35rights as specified in a court order.

36

SEC. 79.  

Section 27201 of the Education Code is amended to
37read:

38

27201.  

(a) All creditable service subject to coverage by the
39Cash Balance Benefit Program and all service with the participant’s
40last employer or employers that is creditable service under the
P95   1Defined Benefit Program shall terminate prior to application for
2a termination benefit under this part.

3(b) All employers with which the participant is employed to
4perform creditable service subject to coverage by the plan shall
5certify on a form prescribed by the system that the participant’s
6employment has been terminated unless the employment was
7terminated 12 months or more prior to the date the member signed
8the termination application.

9

SEC. 80.  

Section 33050 of the Education Code is amended to
10read:

11

33050.  

(a) The governing board of a school district or a county
12board of education, on a districtwide or countywide basis or on
13behalf of one or more of its schools or programs, after a public
14hearing on the matter, may request the State Board of Education
15to waive all or part of any section of this code or any regulation
16adopted by the State Board of Education that implements a
17provision of this code that may be waived, except:

18(1) Article 1 (commencing with Section 15700) and Article 2
19(commencing with Section 15780) of Chapter 4 of Part 10.

20(2) Chapter 6 (commencing with Section 16000) of Part 10.

21(3) Chapter 12 (commencing with Section 17000), Chapter 12.5
22(commencing with Section 17070.10), and Chapter 14
23(commencing with Section 17085) of Part 10.

24(4) Part 13 (commencing with Section 22000), Part 13.5
25(commencing with Section 25900), and Part 14 (commencing with
26Section 26000).

27(5) Section 35735.1.

28(6) Paragraph (8) of subdivision (a) of Section 37220.

29(7) The following provisions of Part 10.5 (commencing with
30Section 17211):

31(A) Chapter 1 (commencing with Section 17211).

32(B) Article 1 (commencing with Section 17251) to Article 6
33(commencing with Section 17365), inclusive, of Chapter 3.

34(C) Sections 17416 to 17429, inclusive; Sections 17459 and
3517462 and subdivision (a) of Section 17464; and Sections 17582
36to 17592, inclusive.

37(8) The following provisions of Part 24 (commencing with
38Section 41000):

39(A) Sections 41000 to 41360, inclusive.

40(B) Sections 41420 to 41423, inclusive.

P96   1(C) Sections 41600 to 41866, inclusive.

2(D) Sections 41920 to 42911, inclusive.

3(9) Sections 44504 and 44505.

4(10) Article 3 (commencing with Section 44930) of Chapter 4
5of Part 25 and regulations in Title 5 of the California Code of
6Regulations adopted pursuant to Article 3 (commencing with
7Section 44930) of Chapter 4 of Part 25.

8(11) Part 26 (commencing with Section 46000).

9(12) Chapter 6 (commencing with Section 48900) and Chapter
106.5 (commencing with Section 49060) of Part 27.

11(13) Section 51513.

12(14) Chapter 6.10 (commencing with Section 52120) of Part
1328, relating to class size reduction.

14(15) Section 52163.

15(16) The identification and assessment criteria relating to any
16categorical aid program, including Sections 52164.1 and 52164.6.

17(17) Sections 52165, 52166, and 52178.

18(18) Article 3 (commencing with Section 52850) of Chapter 12
19of Part 28.

20(19) Section 56364.1, except that this restriction shall not
21prohibit the State Board of Education from approving any waiver
22of Section 56364 or 56364.2, as applicable, relating to full
23inclusion.

24(20) Article 4 (commencing with Section 60640) of Chapter 5
25of Part 33, relating to the STAR Program, and any other provisions
26of Chapter 5 (commencing with Section 60600) of Part 33 that
27establish requirements for the STAR Program.

28(b) Any waiver of provisions related to the programs identified
29in Section 52851 shall be granted only pursuant to Article 3
30(commencing with Section 52850) of Chapter 12 of Part 28.

31(c) The waiver of an advisory committee required by law shall
32be granted only pursuant to Article 4 (commencing with Section
3352870) of Chapter 12 of Part 28.

34(d) Any request for a waiver submitted by the governing board
35of a school district or a county board of education pursuant to
36subdivision (a) shall include a written statement as to both of the
37following:

38(1) Whether the exclusive representative of employees, if any,
39as provided in Chapter 10.7 (commencing with Section 3540) of
P97   1Division 4 of Title 1 of the Government Code, participated in the
2development of the waiver.

3(2) The exclusive representative’s position regarding the waiver.

4(e) Any request for a waiver submitted pursuant to subdivision
5(a) relating to a regional occupational center or program established
6pursuant to Article 1 (commencing with Section 52300) of Chapter
79 of Part 28, that is operated by a joint powers entity established
8pursuant to Chapter 5 (commencing with Section 6500) of Division
97 of Title 1 of the Government Code, shall be submitted as a joint
10waiver request for each participating school district and shall meet
11both of the following conditions:

12(1) Each joint waiver request shall comply with all of the
13requirements of this article.

14(2) The submission of a joint waiver request shall be approved
15by a unanimous vote of the governing board of the joint powers
16agency.

17(f) The governing board of any school district requesting a
18waiver under this section of any provision of Article 5
19 (commencing with Section 39390) of Chapter 3 of Part 23 shall
20provide written notice of any public hearing it conducted pursuant
21to subdivision (a), at least 30 days prior to the hearing, to each
22public agency identified under Section 39394.

23

SEC. 81.  

Section 1 of Chapter 559 of the Statutes of 2013 is
24amended to read:

25

Section 1.  

The Legislature finds and declares that this act, as
26it applies to the State Teachers’ Retirement Plan, clarifies the
27California Public Employees’ Pension Reform Act of 2013, is
28declaratory of existing law, and is intended to apply concurrently
29with the initial operation of that act. The amendments made by
30this act, excluding those amendments made in Sections 4, 12, 28,
3129, 30, and 36, shall be deemed to be operative January 1, 2013,
32unless otherwise stated.

33

SEC. 82.  

Any section of any other act enacted by the
34Legislature during the 2014 calendar year, except Assembly Bill
351469 of the 2013-14 Regular Session, that takes effect on or before
36January 1, 2015, and that amends, amends and renumbers, adds,
37repeals and adds, or repeals a section that is amended, amended
38and renumbered, added, repealed and added, or repealed by this
39act, shall prevail over this act, whether that act is enacted prior to
40or subsequent to the enactment of this act. The repeal, or repeal
P98   1and addition, of any article, chapter, part, title, or division of any
2code by this act shall not become operative if any section of any
3other act that is enacted by the Legislature during the 2014 calendar
4year and takes effect on or before January 1, 2015, amends, amends
5and renumbers, adds, repeals and adds, or repeals any section
6contained in that article, chapter, part, title, or division.



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