BILL NUMBER: AB 2283	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Calderon

                        FEBRUARY 18, 2016

   An act to add Section 22357 to the Education Code, and to add
Section 20201.5 to the Government Code, relating to the public
retirement systems investments.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2283, as introduced, Calderon. Public retirement system:
investments: securitized rental homes.
   Existing law creates the State Teachers' Retirement System (STRS)
and the Public Employees' Retirement System (PERS) for the purpose of
providing pension and other benefits to teachers and public
employees. These systems are funded by employee and employer
contributions, investment returns and, in the case of STRS,
additional state contributions. The California Constitution
authorizes the Legislature to prohibit certain investments by a
retirement board if doing so is in the public interest and satisfies
the standards of fiduciary care and loyalty required of a retirement
board. The California Constitution commits to the retirement board of
a public pension or retirement system plenary authority and
fiduciary responsibility for investment of moneys and administration
of the system.
   This bill would require the Teachers' Retirement Board and the
Board of Administration of the Public Employees' Retirement System,
consistent with their fiduciary duties, on and after January 1, 2017,
to cease investing in securitized home rental properties. The bill
would define securitized home rental properties as single-family
homes in California used as rental properties that are aggregated,
either with properties in California or elsewhere, with the resulting
income from the properties funding publicly traded investment
products. The bill would also require the board, consistent with its
fiduciary duties, on or before January 1, 2018, to liquidate
investments in securitized home rental properties.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 22357 is added to the Education Code, to read:
   22357.  (a) For purposes of this section, "securitized home rental
properties" means single-family homes in California used as rental
properties that are aggregated, either with properties in California
or elsewhere, with the resulting income from the properties funding
publicly traded investment products.
   (b) On and after January 1, 2017, the board, consistent with its
fiduciary duties, shall not make new or additional investments in
securitized rental home properties.
   (c) On or before January 1, 2018, the board, consistent with its
fiduciary duties, shall liquidate its investments in securitized
rental home properties.
   (d) This section shall not require the board to take any action
unless the board determines in good faith that the action described
in this section is consistent with the fiduciary responsibilities of
the board described in Section 17 of Article XVI of the California
Constitution.
  SEC. 2.  Section 20201.5 is added to the Government Code, to read:
   20201.5.  (a) For purposes of this section, "securitized home
rental properties" means single-family homes in California used as
rental properties that are aggregated, either with properties in
California or elsewhere, with the resulting income from the
properties funding publicly traded investment products.
   (b) On and after January 1, 2017, the board, consistent with its
fiduciary duties, shall not make new or additional investments in
securitized rental home properties.
   (c) On or before January 1, 2018, the board, consistent with its
fiduciary duties, shall liquidate its investments in securitized
rental home properties.
   (d) This section shall not require the board to take any action
unless the board determines in good faith that the action described
in this section is consistent with the fiduciary responsibilities of
the board described in Section 17 of Article XVI of the California
Constitution.