BILL ANALYSIS Ó AB 868 Page 1 Date of Hearing: April 29, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 868 (Obernolte) - As Introduced February 26, 2015 ----------------------------------------------------------------- |Policy |PERSS |Vote:|7 - 0 | |Committee: | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill authorizes the California Public Employees' Retirement System (CalPERS) to enter into an agreement with the Board of Retirement for the San Bernardino County Employees' Retirement Association (SBCERA) for the transfer of service credit and associated assets and liabilities for safety employees of a public agency of the state who have been transferred to a local firefighting or law enforcement agency that participates in SBCERA. As a result of this bill, employees of the Big Bear Fire Authority, a Joint Powers Authority created by the Big Bear City AB 868 Page 2 Community Services District and the Big Bear Lake Fire Protection District, can be fully consolidated and participate in SBCERA. FISCAL EFFECT: Minor and absorbable costs to CalPERS. COMMENTS: 1)Purpose. In June 2012, the boards of the Big Bear City Community Services District and the Big Bear Lake Fire Protection District established a Joint Powers Authority creating the Big Bear Fire Authority. The new authority has consolidated fire department administration, removed jurisdictional boundaries, and implemented standard operating policies and procedures. According to the author, the fire authority is now functioning in almost every aspect as one department, and is ready to manage its own financial responsibilities. The author contends the only issue impeding full consolidation is pension realignment. AB 868 allows the transfer of city employees from CalPERS to SBCERA without triggering withdrawal liability. 2)Going It Alone. Existing law allows the counties of Los Angeles, Kern, and Orange, in specified instances, to transfer service credit and associated assets and liabilities of active CalPERS members to a county retirement system in cases where firefighting or law enforcement functions are transferred from the state or an agency participating in CalPERS to an agency participating in a county retirement system. The relevant AB 868 Page 3 provision allows the transfer to occur without triggering withdrawal liability by also transferring all associated liabilities for accrued benefits to the county retirement system. Analysis Prepared by:Joel Tashjian / APPR. / (916) 319-2081