Amended in Senate June 20, 2016

Amended in Assembly May 11, 2016

Amended in Assembly March 29, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 1853


Introduced by Assembly Member Cooper

February 10, 2016


An act to amend Sections 31459.1, 31468,begin insert 31522.3,end insert 31522.5,begin insert 31522.7, 31522.9,end insert 31528, 31529.9, 31535, 31557.3, and 31580.2 of, and to add Section 31522.75 to, the Government Code, relating to county employees’ retirement.

LEGISLATIVE COUNSEL’S DIGEST

AB 1853, as amended, Cooper. County employees’ retirement: districts: retirement system governance.

(1) The County Employees Retirement Law of 1937 (CERL) authorizes counties to establish retirement systems pursuant to its provisions in order to provide pension benefits to their employees. CERL defines a district for these purposes, includes specified county retirement systems within that definition, and permits a district to participate in CERL retirement systems. CERL generally provides that the personnel of a county retirement system are county employees, subject to county civil service provisions and salary ordinances, but also authorizes the boards of retirement in specified counties to adopt provisions providing for the appointment of personnel who are to be employees of the retirement system, as well as other administrative provisions that reflect the independence of the retirement system from the county.

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 establishes new retirement formulas that a public employer offering a defined benefit pension plan for employees first hired on or after January 1, 2013, may not exceed. PEPRA authorizes individuals who were employed by any public employer before January 1, 2013, and who became employed by a subsequent public employer for the first time on or after January 1, 2013, to be subject to the retirement plan that would have been available to employees of the subsequent employer who were first employed by the subsequent employer on or before December 31, 2012, if the individual was subject to reciprocity, as specified.

This bill would authorize the retirement board of any retirement system operating under CERL to elect, by resolution, to be a district under the law. The bill would authorize a board to adopt, by resolution, specified administrative provisions that would classify various personnel of the retirement system as employees of the retirement system and not employees of the county.begin insert The bill would require the retirement system to notify, and to meet and discuss with, participating employers in the retirement system, the employees of the system, and an employee organization of the retirement system’s intent to exercise this authority at least 60 days before considering a resolution to make these provisions applicable. The bill would grant an employee organization representing people who work for the retirement system, and an unrepresented person who works for the retirement system, the right to elect to be employees of the retirement system, which would be irrevokable, except as specified, and the status of the affected employee positions would remain changed for successor employees.end insert In regard to county employees who would become retirement system employees, the bill would prescribe requirements in connection with their compensation and employment benefits and status. These provisions would include maintaining their county retirement benefits that would otherwise be reduced under PEPRA, keeping their employment classifications, and affording employees the opportunity to continue participation in group health and dental plans, among other plans and programs.begin insert The bill would also prescribe requirements regarding labor negotiations and the continuity of labor agreements.end insert The bill would grant a retirement system electing these provisions the authority to adopt the regulations and enter into the agreements necessary to implement them.begin insert The bill would require counties to cooperate and act in a timely manner to establish and implement agreements in this regard. The bill would authorize retirement systems currently operating under alternative administrative structures also to adopt these provisions.end insert The bill would also extend this authorization and the associated provisions to a board of investment, as specified. The bill would make technical and conforming changes.

begin insert

(2) CERL authorizes the retirement boards of 5 specified counties to appoint assistant administrators and chief investment officers who, following appointment, are outside county charter, civil service, and merit system rules, except as specified. CERL provides that these administrators and officers are employees of the county, as specified, while serving at the pleasure of the appointing boards, and they may be dismissed without cause.

end insert
begin insert

This bill would remove the limitation on these provisions to certain counties, thereby making them applicable to all CERL retirement systems.

end insert
begin delete

(2)

end delete

begin insert(3)end insert Existing law permits a board of retirement operating under CERL to issue subpoenas and to compensate persons who are subpoenaed. Existing law permits a board to delegate its subpoena power to a referee or administrator who is appointed pursuant to specified authority.

This bill would authorize specified retirement systems operating as districts to delegate the subpoena power, as described above.

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

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

P3    1

SECTION 1.  

Section 31459.1 of the Government Code is
2amended to read:

3

31459.1.  

(a) In a county in which a board of investments has
4been established pursuant to Section 31520.2:

5(1) As used in Sections 31453, 31453.5, 31454, 31454.1,
631454.5, 31472, 31588.1, 31589.1, 31591, 31592.3, 31594,
731595.1, 31595.9, 31596, 31596.1, 31601.1, 31607, 31610, 31611,
831612, 31613, 31616, 31618, 31621.11, 31625, 31639.26, 31784,
9and 31872, “board” means board of investments.

10(2) As used in the first paragraph of Section 31592.2 and the
11first paragraph and subdivision (c) of the second paragraph of
12Section 31595, “board” means a board of investments.

P4    1(3) Sections 31521, 31522, 31522.1, 31522.2, 31523, 31524,
231525, 31528, 31529, 31529.5, 31535.1, 31580.2, 31614, 31680,
3and 31680.1, apply to both the board of retirement and board of
4investments, and “board” means either or both the board of
5retirement and board of investments.

6(4) Subdivision (a) of Section 31526 and subdivisions (a) and
7(b) of the second paragraph of Section 31595 apply to both the
8board of retirement and board of investments, and “board” means
9either or both the board of retirement and board of investments.

10(5) Paragraph (5) of subdivision (l) of Section 31468 and
11Sectionsbegin delete 31522.5 and 31522.75end deletebegin insert 31522.5, 31522.7, 31522.75, and
1231522.9end insert
apply to both the board of retirement and board of
13investments. For these purposes, “board” means both the board of
14retirement and board of investments. “Board of retirement” also
15means both the board of retirement and board of investments.

16(b) In Article 17 (commencing with Section 31880) of this
17chapter, “board” means the Board of Administration of the Public
18Employees’ Retirement System.

19(c) In all other cases, “board” means the board of retirement.

20(d) This section shall apply only in a county of the first class,
21as defined in Section 28020, as amended by Chapter 1204 of the
22Statutes of 1971, and Section 28022, as amended by Chapter 43
23of the Statutes of 1961.

24

SEC. 2.  

Section 31468 of the Government Code is amended
25to read:

26

31468.  

(a) “District” means a district, formed under the laws
27of the state, located wholly or partially within the county other
28than a school district.

29(b) “District” also includes any institution operated by two or
30more counties, in one of which there has been adopted an ordinance
31placing this chapter in operation.

32(c) “District” also includes any organization or association
33authorized by Chapter 26 of the Statutes of 1935, as amended by
34Chapter 30 of the Statutes of 1941, or by Section 50024, which
35organization or association is maintained and supported entirely
36from funds derived from counties, and the board of any retirement
37system is authorized to receive the officers and employees of that
38organization or association into the retirement system managed
39by the board.

P5    1(d) “District” also includes, but is not limited to, any sanitary
2district formed under Part 1 (commencing with Section 6400) of
3Division 6 of the Health and Safety Code.

4(e) “District” also includes any city, public authority, public
5agency, and any other political subdivision or public corporation
6formed or created under the constitution or laws of this state and
7located or having jurisdiction wholly or partially within the county.

8(f) “District” also includes any nonprofit corporation or
9association conducting an agricultural fair for the county pursuant
10to a contract between the corporation or association and the board
11of supervisors under the authority of Section 25905.

12(g) “District” also includes the Regents of the University of
13California, but with respect only to employees who were employees
14of a county in a county hospital, who became university employees
15pursuant to an agreement for transfer to the regents of a county
16hospital or of the obligation to provide professional medical
17services at a county hospital, and who under that agreement had
18the right and did elect to continue membership in the county’s
19retirement system established under this chapter.

20(h) “District” also includes the South Coast Air Quality
21Management District, a new public agency created on February
221, 1977, pursuant to Chapter 5.5 (commencing with Section 40400)
23of Part 3 of Division 26 of the Health and Safety Code.

24(1) Employees of the South Coast Air Quality Management
25District shall be deemed to be employees of a new public agency
26occupying new positions on February 1, 1977. On that date, those
27new positions are deemed not to have been covered by any
28retirement system.

29(2) No retirement system coverage may be effected for an
30employee of the South Coast Air Quality Management District
31who commenced employment with the district during the period
32commencing on February 1, 1977, and ending on December 31,
331978, unless and until the employee shall have elected whether to
34become a member of the retirement association established in
35accordance with this chapter for employees of Los Angeles County
36or the retirement association established in accordance with this
37chapter for employees of San Bernardino County. The election
38shall occur before January 1, 1980. Any employee who fails to
39make the election provided for herein shall be deemed to have
40elected to become a member of the retirement association
P6    1established in accordance with this chapter for the County of Los
2Angeles.

3(3) The South Coast Air Quality Management District shall
4make application to the retirement associations established in
5accordance with this chapter for employees of Los Angeles County
6and San Bernardino County for coverage of employees of the South
7Coast Air Quality Management District.

8(4) An employee of the South Coast Air Quality Management
9District who commenced employment with the district during the
10period commencing on February 1, 1977, and ending on December
1131, 1978, and who has not terminated employment before January
121, 1980, shall be covered by the retirement association elected by
13the employee pursuant to paragraph (2). That coverage shall be
14effected no later than the first day of the first month following the
15date of the election provided for in paragraph (2).

16(5) Each electing employee shall receive credit for all service
17with the South Coast Air Quality Management District. However,
18the elected retirement association may require, as a prerequisite
19to granting that credit, the payment of an appropriate sum of money
20or the transfer of funds from another retirement association in an
21amount determined by an enrolled actuary and approved by the
22elected retirement association’s board. The amount to be paid shall
23include all administrative and actuarial costs of making that
24determination. The amount to be paid shall be shared by the South
25Coast Air Quality Management District and the employee. The
26share to be paid by the employee shall be determined by good faith
27bargaining between the district and the recognized employee
28organization, but in no event shall the employee be required to
29contribute more than 25 percent of the total amount required to be
30paid. The elected retirement association’s board may not grant that
31credit for that prior service unless the request for that credit is
32made to, and the required payment deposited with, the elected
33retirement association’s board no earlier than January 1, 1980, and
34no later than June 30, 1980. The foregoing shall have no effect on
35any employee’s rights to reciprocal benefits under Article 15
36(commencing with Section 31830).

37(6) An employee of the South Coast Air Quality Management
38District who commenced employment with the district after
39December 31, 1978, shall be covered by the retirement association
40established in accordance with this chapter for employees of San
P7    1Bernardino County. That coverage shall be effected as of the first
2day of the first month following the employee’s commencement
3date.

4(7) Notwithstanding paragraphs (2) and (4) above, employees
5of the South Coast Air Quality Management District who were
6employed between February 1, 1977, and December 31, 1978, and
7who terminate their employment between February 1, 1977, and
8January 1, 1980, shall be deemed to be members of the retirement
9association established in accordance with this chapter for the
10employees of Los Angeles County commencing on the date of
11their employment with the South Coast Air Quality Management
12District.

13(i) “District” also includes any nonprofit corporation that
14operates one or more museums within a county of the 15th class,
15as described by Sections 28020 and 28036 of the Government
16Code, as amended by Chapter 1204 of the Statutes of 1971,
17pursuant to a contract between the corporation and the board of
18supervisors of the county, and that has entered into an agreement
19with the board and the county setting forth the terms and conditions
20of the corporation’s inclusion in the county’s retirement system.

21(j) “District” also includes any economic development
22association funded in whole or in part by a county of the 15th class,
23as described by Sections 28020 and 28036 of the Government
24Code, as amended by Chapter 1204 of the Statutes of 1971, and
25that has entered into an agreement with the board of supervisors
26and the county setting forth the terms and conditions of the
27association’s inclusion in the county’s retirement system.

28(k) “District” also includes any special commission established
29in the Counties of Tulare and San Joaquin as described by Section
3014087.31 of the Welfare and Institutions Code, pursuant to a
31contract between the special commission and the county setting
32forth the terms and conditions of the special commission’s
33inclusion in the county’s retirement system with the approval of
34the board of supervisors and the board of retirement.

35(l) (1) “District” also includes the retirement system established
36under this chapter in Orange County.

37(2) “District” also includes the retirement system established
38under this chapter in San Bernardino County at such time as the
39board of retirement, by resolution, makes this section applicable
40in that county.

P8    1(3) “District” also includes the retirement system established
2under this chapter in Contra Costa County.

3(4) “District” also includes the retirement system established
4under this chapter in Ventura County.

5(5) “District” also includes a retirement system established under
6this chapter at the time that the board of retirement, by resolution,
7makes this subdivision applicable to the retirement system in that
8county.

9(m) “District” also includes the Kern County Hospital Authority,
10a public agency that is a local unit of government established
11pursuant to Chapter 5.5 (commencing with Section 101852) of
12Part 4 of Division 101 of the Health and Safety Code.

13begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 31522.3 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
14to read:end insert

15

31522.3.  

(a) In a county in which the board of retirement or
16both the board of retirement and the board of investment have
17appointed personnel pursuant to Section 31522.1, the respective
18board or boards may elect to appoint assistant administrators and
19chief investment officers as provided for in this section. The
20positions of the assistant administrators and chief investment
21officers designated by the retirement board shall not be subject to
22county charter, civil service, or merit system rules. The persons
23so appointed shall be county employees and shall be included in
24the salary ordinance or salary resolution adopted by the board of
25supervisors for the compensation of county officers and employees.
26The assistant administrators and chief investment officers so
27appointed shall be directed by, shall serve at the pleasure of, and
28may be dismissed at the will of, the appointing board or boards.
29Specific charges, a statement of reasons, or good cause shall not
30be required as a basis for dismissal of the assistant administrators
31and chief investment officers by the appointing board or boards.

32(b) This section shall not apply to any person who was an
33assistant administrator or a chief investment officer and was
34included in the county civil service or was subject to merit system
35rules on December 31, 1996.

begin delete

36(c) This section shall only apply to a county of the third class,
37a county of the eighth class, a county of the 14th class, a county
38of the 15th class, or a county of the 18th class, as provided by
39Sections 28020, 28024, 28029, 28035, 28036, and 28039.

end delete
P9    1

begin deleteSEC. 3.end delete
2
begin insertSEC. 4.end insert  

Section 31522.5 of the Government Code is amended
3to read:

4

31522.5.  

(a) In a county in which the board of retirement has
5appointed personnel pursuant to Section 31522.1, the board of
6retirement may appoint an administrator, an assistant administrator,
7a chief investment officer, senior management employees next in
8line of authority to the chief investment officer, subordinate
9administrators, senior management employees next in line of
10authority to subordinate administrators, and legal counsel.

11(b) Notwithstanding any other provision of law, the personnel
12appointed pursuant to this section may not be county employees
13but shall be employees of the retirement system, subject to terms
14and conditions of employment established by the board of
15retirement. Except as specifically provided in this subdivision, all
16other personnel shall be county employees for purposes of the
17county’s employee relations resolution, or equivalent local rules,
18and the terms and conditions of employment established by the
19board of supervisors for county employees, including those set
20forth in a memorandum of understanding.

21(c) Except as otherwise provided by Sections 31529.9 and
2231596.1, the compensation of personnel appointed pursuant to this
23section shall be an expense of administration of the retirement
24system, pursuant to Section 31580.2.

25(d) The board of retirement and board of supervisors may enter
26into any agreements as may be necessary and appropriate to carry
27out the provisions of this section.

28(e) Section 31522.2 is not applicable to any retirement system
29that elects to appoint personnel pursuant to this section.

30(f) This section shall apply in Orange County.

31(g) This section shall apply to the retirement system established
32under this chapter in San Bernardino County at such time as the
33board of retirement, by resolution, makes this section applicable
34in that county.

35(h) This section shall apply to a retirement system established
36under this chapter at the time that the board of retirement, by
37resolution, makes this section applicable in that county.

38begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 31522.7 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
39to read:end insert

P10   1

31522.7.  

(a) In addition to the authority provided pursuant to
2Section 31522.5, the board of retirement in the County of San
3begin delete Bernardinoend deletebegin insert Bernardino, or end insertbegin insertin any other county in which this section
4has been made applicable,end insert
may appoint an administrator, an
5assistant administrator, a chief investment officer, senior
6management employees next in line of authority to the chief
7investment officer, subordinate administrators, senior management
8employees next in line of authority to subordinate administrators,
9supervisors and employees with specialized training and knowledge
10in pension benefit member services, investment reporting
11compliance, investment accounting, pension benefit tax reporting,
12pension benefit financial accounting, pension law, and legal
13counsel.

14(b) Notwithstanding any other provision of law, the personnel
15appointed pursuant to this section may not be county employees
16but shall be employees of the retirement system, subject to terms
17and conditions of employment established by the board of
18retirement. Except as specifically provided in this subdivision, all
19other personnel shall be county employees for purposes of the
20county’s employee relations resolution, or equivalent local rules,
21and the terms and conditions of employment established by the
22board of supervisors for county employees, including those set
23forth in a memorandum of understanding.

24(c) Except as otherwise provided by Sections 31529.9 and
2531596.1, the compensation of personnel appointed pursuant to this
26section shall be an expense of administration of the retirement
27system, pursuant to Section 31580.2.

28(d) The board of retirement and board of supervisors may enter
29into any agreements as may be necessary and appropriate to carry
30out the provisions of this section.

31(e) Section 31522.2 is not applicable if the retirement system
32elects to appoint personnel pursuant to this section.

33(f) This section shall applybegin delete onlyend delete to the retirement system
34established under this chapter in San Bernardino County at such
35time as the board of retirement, by resolution, makes this section
36applicable in that county.

37

begin deleteSEC. 4.end delete
38
begin insertSEC. 6.end insert  

Section 31522.75 is added to the Government Code, 39immediately following Section 31522.7, to read:

P11   1

31522.75.  

(a) Any retirement system established under this
2begin delete chapterend deletebegin insert chapter, including a retirement system that, at the time of
3the enactment of this section, is operating pursuant to Section
431522.5, 31522.7, 31522.9, or 31522.10,end insert
may elect to make this
5section, paragraph (5) of subdivision (l) of Section 31468, and
6Sectionbegin delete 31522.5end deletebegin insert 31522.5, 31522.7, or 31522.9,end insert applicable to the
7retirement system upon adoption of a resolution by the board of
8retirement.

begin insert

9
(1) Before deciding upon a particular operating authority, a
10retirement system that intends to make this section applicable shall
11notify the participating employers in the retirement system, the
12employees of the retirement system, and any employee organization
13that represents those employees of its intent at least 60 days prior
14to the board of retirement’s consideration of a resolution making
15this section applicable. During this period, the retirement system
16shall meet with and discuss the proposed action with any of these
17parties that wish to do so and shall make good faith efforts to
18address any questions or concerns raised by these parties.

end insert
begin insert

19
(2) (A) Prior to the adoption by the board of retirement of a
20resolution making this section applicable, or at any time thereafter,
21any employee organization that represents people who work at
22the retirement system may advise the retirement system in writing
23that the employees represented by the organization wish to cease
24being county employees and wish to elect to become retirement
25system employees under the terms of this section.

end insert
begin insert

26
(B) Upon election by an employee organization that the
27employees it represents will become retirement system employees,
28the retirement system job classifications, positions, and future
29retirement system employees represented by that employee
30organization shall be retirement system employees.

end insert
begin insert

31
(3) (A) Prior to the adoption by the board of retirement of a
32resolution making this section applicable, or at any time thereafter,
33any unrepresented employee of the retirement system, other than
34those in positions appointed pursuant to Section 31522.2, 31522.3
35or 31522.4, may advise the retirement system in writing that the
36employee wishes to cease being a county employee and wishes to
37elect to become a retirement system employee under the terms of
38this section.

end insert
begin insert

P12   1
(B) Upon the election by an unrepresented employee to become
2a retirement system employee, that employee, and future employees
3in that position, shall be retirement system employees.

end insert
begin insert

4
(4) An election to cease being a county employee and to become
5a retirement system employee, whether made by an employee
6organization on behalf of the employees it represents or by an
7unrepresented employee, shall be irrevocable, except that an
8employee who has elected to become a retirement system employee
9by virtue of this section who subsequently moves to a position,
10whether with the retirement system or with the county, that is not
11deemed a position of the retirement system, shall be a county
12employee unless and until the time as the employee elects to return
13to being a retirement system employee as that may be authorized
14by this section.

end insert
begin insert

15
(5) The retirement system shall elect to make either Section
1631522.5, 31522.7 or 31522.9 applicable to the retirement system,
17as necessary, in order to allow the employees who elect to become
18retirement system employees, successor employees in those
19positions, and other appointed employees to have the status of
20employees of the retirement system.

end insert

21(b) A board of retirement may elect to appoint personnel, or
22may authorize the retirement administrator to appoint personnel,
23to administer the system as provided in this section.

24(c) (1) Notwithstanding any other law, the personnel appointed
25pursuant to this sectionbegin delete or Section 31522.5end deletebegin insert and the sections
26referenced of subdivision (a)end insert
shall not be county employees, but
27shall be employees of the retirement system, subject to terms and
28conditions of employment established by the board of retirement
29and the provisions of this section.

30(2) A county employee to whom the California Public
31Employees’ Pension Reform Act of 2013 (Article 4 (commencing
32with Section 7522) of Chapter 21 of Division 7 of Title 1) did not
33apply before becoming a retirement system employee shall
34maintain that status as an employee of the retirement system.

35(3) For purposes of employment by a subsequent public
36employer, as described in paragraph (1) of subdivision (c) of
37Section 7522.02, the retirement system shall have the status of the
38county as a subsequent employer.

39(4) With regard to an individual who was employed by the
40county before January 1, 2013, and who becomes a retirement
P13   1system employee and then changes employment positions as
2described in paragraph (2) of subdivision (c) of Section 7522.02,
3the retirement system shall have the former obligations of the
4county to provide a defined benefit plan that otherwise would have
5been available to the employee had he or she remained a county
6employee.

7(d) Any employees who were previously appointed to retirement
8system personnel positions pursuant to Section 31522.2, 31522.3,
9or 31522.4 shall cease to be county employees and shall become
10retirement system employees at their existing or equivalent
11classifications as of the date the board of retirement makes this
12section applicable pursuant to subdivision (a), subject to any
13subsequent revisions the retirement board may make pursuant to
14regulations governing terms and conditions ofbegin delete employment.end delete
15
begin insert employment, and when applicable, the provisions of a subsequent
16memorandum of understanding or bargaining agreement covering
17the employee.end insert

begin insert

18
(e) Any employees who were previously appointed to retirement
19system personnel positions pursuant to Section 31522.1 and are
20subsequently appointed as retirement system employees pursuant
21to subdivision (a) shall cease to be county employees and shall
22become retirement system employees at their existing or equivalent
23classifications as of the date the board of retirement makes this
24section applicable, subject to any subsequent revisions the
25retirement board may make pursuant to regulations governing
26terms and conditions of employment and, when applicable, the
27provisions of a subsequent memorandum of understanding or
28bargaining agreement covering the employee.

end insert
begin insert

29
(f) A retirement system that elects to make this section applicable
30shall recognize as the exclusive representative of those former
31county employees who become retirement system employees the
32employee organization that represented those employees, if any,
33and shall honor the provisions in any memorandum of
34understanding or bargaining agreement in effect on the date the
35board of retirement makes this section applicable for the duration
36of the memorandum of understanding or bargaining agreement.

end insert
begin insert

37
(g) The following shall apply to those persons who become
38retirement system employees pursuant to this section:

end insert
begin insert

39
(1) Employment seniority of a retirement system employee,
40including, but not limited to, an employee’s continuous service
P14   1date used for purposes of retirement or other benefits, as calculated
2and used under the county system in effect before the date this
3section becomes applicable, shall be calculated and used in the
4same manner by the retirement system at the time the county
5employee becomes a retirement system employee, subject to any
6subsequent revisions the retirement board may make pursuant to
7regulations governing terms and conditions of employment, and
8when applicable, the provisions of a subsequent memorandum of
9understanding or bargaining agreement covering the employee.

end insert
begin insert

10
(2) Retirement system employees shall have the same status they
11had as probationary, permanent, or regular employees under the
12county system in effect on the date this section becomes applicable,
13subject to any subsequent revisions the retirement board may make
14pursuant to regulations governing terms and conditions of
15employment, and when applicable, the provisions of a subsequent
16memorandum of understanding or bargaining agreement covering
17the employee.

end insert
begin insert

18
(3) Retirement system employees shall receive their same salary
19rates, leaves of absence, leave accrual rates, including all related
20compensation rules and provisions applicable to those salary rates,
21leaves, and accrual rates as under the county system on the date
22this section becomes applicable, subject to any subsequent
23revisions the retirement board may make pursuant to regulations
24governing terms and conditions of employment, and when
25applicable, the provisions of a subsequent memorandum of
26understanding or bargaining agreement covering the employee.

end insert
begin delete

27(e)

end delete

28begin insert(4)end insertbegin insertend insertbegin insert(A)end insert Retirement system employees shall be afforded the
29opportunity to participate in county benefit plans and programs,
30including, but not limited to, group health, dental and life insurance,
31workers’ compensation, and deferred compensation that existed
32on the date this section becomes applicable, under the same terms
33and conditions as those programs were available to county
34employees. The retirement board shall contract with the county to
35administer the county benefit plans and programs for retirement
36system employees, under the same terms and conditions applicable
37to county employees, and shall provide the employer cost and
38reasonable administrative expenses for participation in the
39programs unless and until the retirement board chooses to provide
P15   1different benefits or different benefit levels through another
2provider.

begin insert

3
(B) The participation of retirement system employees in county
4benefit plans or programs, and the county’s administration of
5certain compensation or benefits for retirement employees pursuant
6to this section, shall not create or be construed to create, a meet
7and confer obligation between the county and any employee
8organization recognized to represent retirement system employees.

end insert
begin delete

9(f)

end delete

10begin insert(h)end insert The board of retirement and the countybegin delete mayend deletebegin insert shallend insert enter into
11any agreements necessary and appropriate to carry out this section.
12
begin insert The county shall cooperate fully, and act in a timely manner, to
13establish and implement these agreements and any other measures
14necessary to accomplish the objectives in this section. The
15retirement system shall pay reasonable and appropriate
16administrative expenses associated with implementing these
17agreements and measures. end insert

begin delete

18(g)

end delete

19begin insert(i)end insert Sectionsbegin delete 31522.1,end delete 31522.2,begin delete 32522.3, and 32522.4end deletebegin insert 31522.3,
20and 31522.4end insert
shall no longer apply to a retirement system that has
21made this section applicable.

begin delete

22(h)

end delete

23begin insert(j)end insert Upon adoption of this section, the board of retirement may
24make regulations consistent with this chapter, and the provisions
25of Section 31525 that require approval of retirement board
26regulations by the board of supervisors shall no longer apply.

begin delete

27(i)

end delete

28begin insert(k)end insert The compensation of personnel appointed pursuant to this
29section shall be an expense of administration of the retirement
30system pursuant to Section 31580.2, except as provided in Section
31
begin delete 31522.5.end deletebegin insert 31522.5, 31522.7, or 31522.9, as those sections may
32apply to a retirement system that has adopted them.end insert

begin delete

33(j)

end delete

34begin insert(l)end insert This section shall not be construed as to modify any authority,
35or to require any subsequent action by, a retirement system that
36has made paragraph (5) of subdivision (l) of Section 31468 and
37Section 31522.5, 31522.7, 31522.9, or 31522.10 applicable to the
38retirement system prior to the effective date of this section.

begin insert

39
(m) A retirement system that has elected to make either Section
4031522.5, 31522.7, 31522.9, or 31522.10 applicable upon adoption
P16   1of a subsequent resolution by the board of retirement may make
2a different section apply.

end insert
3begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 31522.9 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
4to read:end insert

5

31522.9.  

(a) The board of retirement of a county may appoint
6a retirement administrator and other personnel as are required to
7accomplish the necessary work of the board. The board may
8authorize the administrator to make these appointments on its
9behalf. Notwithstanding any other law, the personnel so appointed
10shall not be county employees but shall become employees of the
11retirement system, subject to terms and conditions of employment
12established by the board of retirement, including those set forth in
13begin delete memorandaend deletebegin insert a end insertbegin insertmemorandumend insert of understanding executed by the
14board of retirement and recognized employee organizations.

15(b) Sections 31522.1 and 31522.2 shall not apply to a retirement
16system that appoints personnel pursuant to this section.

17(c) The retirement system that appoints personnel pursuant to
18this section is a public agency for purposes of the
19Meyers-Milias-Brown Act (Chapter 10 (commencing with Section
203500) of Division 4).

21(d) The compensation of personnel appointed pursuant to this
22section shall be an expense of administration of the retirement
23system, pursuant to Section 31580.2, except as provided in Sections
2431529.5, 31529.9, and 31596.1.

25(e) The board of retirement and the board of supervisors may
26enter into agreements as they determine are necessary and
27appropriate in order to carry out the provisions of this section.

28(f) The retirement system, upon the effective date of this section,
29shall retain, for a 90-day transition employment period,
30nonprobationary employees who, upon the effective date of this
31section, were covered by a county memorandum of understanding
32and employed by the county at the retirement system’s facilities,
33unless just cause exists to terminate the employees or legitimate
34grounds exist to lay off these employees. If during the 90-day
35period the retirement system determines that a layoff of these
36employees is necessary, the retirement system shall retain the
37employees by seniority within job classification. The terms and
38conditions of employment of the employees retained pursuant to
39this subdivision shall be subject to the terms and conditions
40established by the applicablebegin delete memorandaend deletebegin insert memorandumend insert of
P17   1understanding executed by the board of retirement and the
2recognized employee organizations. During the 90-day transition
3period, probationary employees shall maintain only those rights
4they initially acquired pursuant to their employment with the
5county.

6(g) Subject to the employees’ rights under the
7Meyers-Milias-Brown Act (Chapter 10 (commencing with Section
83500) of Division 4), the retirement system, upon the effective
9date of this section, shall recognize as the exclusive representative
10of the employees retained pursuant to subdivision (f) the recognized
11employee organizations that represented those employees when
12employed by the county. The initial terms and conditions for those
13employees shall be as previously established by the applicable
14begin delete memorandaend deletebegin insert memorandumend insert of understanding executed by the county
15and recognized employee organizations.

16(h) This section shall applybegin delete onlyend delete in Contra Costa County.

begin insert

17
(i) This section shall apply to a retirement system established
18under this chapter at the time that the board of retirement, by
19resolution, makes this section applicable in that county.

end insert
20

begin deleteSEC. 5.end delete
21
begin insertSEC. 8.end insert  

Section 31528 of the Government Code is amended
22to read:

23

31528.  

(a) Unless permitted by this chapter, a member or
24employee of the board shall not become an endorser, surety, or
25obligor on, or have any personal interest, direct or indirect, in the
26making of any investment for the board, or in the gains or profits
27accruing from those investments. A member or employee of the
28board shall not directly or indirectly, for himself or herself, or as
29an agent or partner of others, borrow or use any of the funds or
30deposits of the retirement system, except to make current and
31necessary payments authorized by the board.

32(b) A member or employee of the board shall not, directly or
33indirectly, by himself or herself, or as an agent or partner or
34employee of others, sell or provide any investment product that
35would be considered an asset of the fund, to any retirement system
36established pursuant to this chapter.

37(c) An individual who held a position designated in Section
3831522.3, 31522.4, 31522.5, or established pursuant to Section
3931522.75, or was a member of the board or an administrator, shall
40not, for a period of two years after leaving that position, for
P18   1compensation, act as agent or attorney for, or otherwise represent,
2any other person except the county, by making any formal or
3informal appearance before, or any oral or written communication
4to, the retirement system, or any officer or employee thereof, if
5the appearance or communication is made for the purpose of
6influencing administrative or legislative action, or any action or
7proceeding involving the issuance, amendment, awarding, or
8revocation of a permit, license, grant, contract, or sale or purchase
9of goods or property.

10

begin deleteSEC. 6.end delete
11
begin insertSEC. 9.end insert  

Section 31529.9 of the Government Code is amended
12to read:

13

31529.9.  

(a) In addition to the powers granted by Sections
1431522.5, 31522.75, 31522.9, 31529, 31529.5, 31614, and 31732,
15the board of retirement and the board of investment may contract
16with the county counsel or with attorneys in private practice or
17employ staff attorneys for legal services.

18(b) Notwithstanding Sections 31522.5, 31522.7, 31522.75,
1931529.5, and 31580, the board shall pay, from system assets,
20reasonable compensation for the legal services.

21(c) This section applies to any county of the 2nd class, 7th class,
229th class, 14th class, 15th class, or the 16th class as described by
23Sections 28020, 28023, 28028, 28030, 28035, 28036, and 28037.

24(d) This section shall also apply to any other county if the board
25of retirement, by resolution adopted by majority vote, makes this
26section applicable in the county.

27

begin deleteSEC. 7.end delete
28
begin insertSEC. 10.end insert  

Section 31535 of the Government Code is amended
29to read:

30

31535.  

The board may issue subpoenas and subpoenas duces
31tecum, and compensate persons subpoenaed. This power shall be
32exercised and enforced in the same manner as the similar power
33granted the board of supervisors in Article 9 (commencing with
34Section 25170) of Chapter 1, Part 2, Division 2, except that the
35power shall extend only to matters within the retirement board’s
36jurisdiction, and committees of the board shall not have this power.
37Reasonable fees and expenses may be provided for by board
38regulation for any or all of such witnesses regardless of which
39party subpoenaed them.

P19   1Subpoenas shall be signed by the chairman or secretary of the
2retirement board, except that the board may by regulation provide
3for express written delegation of its subpoena power to any referee
4it appoints pursuant to this chapter or to any administrator
5appointed pursuant to Section 31522.2, 31522.5, 31522.7, 31522.9,
6or 31522.10.

7Any member of the board, the referee, or any person otherwise
8empowered to issue subpoenas may administer oaths to, or take
9depositions from, witnesses before the board or referee.

10

begin deleteSEC. 8.end delete
11
begin insertSEC. 11.end insert  

Section 31557.3 of the Government Code is amended
12to read:

13

31557.3.  

On the date a district, as defined in subdivision (l) of
14Section 31468, is included in the retirement system, any personnel
15appointed pursuant to Sections 31522.5, 31522.9, 31522.10,
1631522.7, 31522.75, and 31529.9 who had previously been in county
17service shall continue to be members of the system without
18interruption in service or loss of credit. Thereafter, each person
19entering employment with the district shall become a member of
20the system on the first day of the calendar month following his or
21her entrance into service.

22

begin deleteSEC. 9.end delete
23
begin insertSEC. 12.end insert  

Section 31580.2 of the Government Code is amended
24to read:

25

31580.2.  

(a) In counties in which the board of retirement, or
26the board of retirement and the board of investment, have appointed
27personnel pursuant to Section 31522.1, 31522.5, 31522.7,
2831522.75, 31522.9, or 31522.10, the respective board or boards
29shall annually adopt a budget covering the entire expense of
30administration of the retirement system which expense shall be
31charged against the earnings of the retirement fund. The expense
32incurred in any year may not exceed the greater of either of the
33following:

34(1) Twenty-one hundredths of 1 percent of the accrued actuarial
35liability of the retirement system.

36(2) Two million dollars ($2,000,000), as adjusted annually by
37the amount of the annual cost-of-living adjustment computed in
38accordance with Article 16.5 (commencing with Section 31870).

39(b) Expenditures for computer software, computer hardware,
40and computer technology consulting services in support of these
P20   1computer products shall not be considered a cost of administration
2of the retirement system for purposes of this section.



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