Amended in Senate August 2, 2016

Amended in Senate June 13, 2016

Amended in Assembly April 12, 2016

Amended in Assembly March 15, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2404

Introduced by Assembly Member Cooley

February 19, 2016

An act to amend Sections 21356, 21357, 21385, 21450, 21451, 21452, 21453, 21454, 21455, 21456, 21457, 21458, 21459, 21460, 21461, 21461.5, 21462, 21463, 21464, 21465, 21492, 21503, 21504, 21505, 21530, 21547, 21547.7, 21548, 21604, 21625, 21628, 21629, 21630, 21631, 21632, 21633, 21752, 75070, 75071, 75073, 75094, 75522, 75570, 75571, 75573, and 75590, to amend the heading of Article 6 (commencing with Section 21450) of Chapter 13 of Part 3 of Division 5 of Title 2 of, to add Sections 75070.5, 75071.5, 75570.5, and 75571.5 to, and to add Article 7 (commencing with Section 21470) to Chapter 13 of Part 3 of Division 5 of Title 2 of, the Government Code, relating to retirement benefits.

LEGISLATIVE COUNSEL’S DIGEST

AB 2404, as amended, Cooley. Public Employees’ Retirement System: optional settlements.

Existing law creates the Public Employees’ Retirement System (PERS), the Judges’ Retirement System, and the Judges’ Retirement System II, all of which are administrated by the Board of Administration of the Public Employees’ Retirement System. Existing law permits a member of the Public Employees’ Retirement System to elect from among several optional settlements for the purpose of structuring his or her retirement allowance, which may result in a reduction of the allowance paid to the member in relation to the payments to his or her beneficiary after the member’s death. Existing law includes among these options the following: optional settlement 1, which provides for payment of a retirement allowance until death and the payment of any remaining contributions at death to his or her beneficiary or estate; optional settlement 2, which provides an allowance for life to the member and thereafter to his or her beneficiary; optional settlement 3, which provides an allowance for life to the member and thereafter 1/2 of his or her allowance to his or her beneficiary; optional settlement 4, which provides for such other benefits that are the actuarial equivalent of a member’s retirement allowance, subject to approval of the board and that the benefits payable not exceed actuarial equivalent of benefits under optional settlement 2, as specified; and optional settlement 5, which provides for a partial present distribution of the actuarial present value of a portion of a member’s unmodified monthly allowance, as specified. Existing law entitles a member to elect certain variations within these settlements and, in certain instances, to a recalculated, increased allowance if the beneficiary predeceases the member, subject to a specified, sinking percentage. Existing begin insert law end insert similarly permits a member of the Judges’ Retirement System or the Judges’ Retirement System II to select from various optional settlements for the purpose of structuring his or her retirement benefits.

This bill would limit the application of the optional settlements and variations described above to PERS members who retire on or before December 31, 2017. For members who retire on or after January 1, 2018, the bill would revise and recast the optional retirement settlements, which would be termed the Return of Remaining Contributions Option 1, the 100 Percent Beneficiary Option 2, the 100 Percent Beneficiary Option 2 with Benefit Allowance Increase, the 50 Percent Beneficiary Option 3, the 50 Percent Beneficiary Option 3 with Benefit Allowance Increase, and the Flexible Beneficiary Option 4. The bill would revise and bring forward various administrative provisions in connection with these settlements, including those relating to adjustments of actuarial equivalents by the board, the effective dates for elections and revocations and dates of payments, the effect of dissolution of marriage, and of a beneficiary predeceasing a member, among others. The bill would similarly limit application of current optional settlements and variations described above to members of the Judges’ Retirement System or the Judges’ Retirement System II who retire on or before December 31, 2017, and would provide to members of those systems who retire on and after January 1, 2018, optional retirement settlements analogous to those provided to PERS members, as described above. The bill would make conforming and technical changes.

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 21356 of the Government Code is
amended to read:

21356.  

(a) A member who elects, pursuant to Article 1.7
(commencing with Section 19996.30) of Chapter 7 of Part 2.6 or
pursuant to Sections 21110 through 21115, to participate in partial
service retirement, while so participating, shall receive a reduced
service retirement allowance. The reduced service retirement
allowance shall be the amount of the service retirement allowance
to which the employee would otherwise have been entitled had he
or she fully retired on the effective date of the partial service
retirement, reduced by the percentage of the employee’s full-time
work which the employee has elected to work while on partial
service retirement.

(b) Article 6 (commencing with Section 21450) and Article 7
(commencing with Section 21470) shall not apply to an employee
who is participating in reduced worktime for partial service
retirement.

(c) For a member who elects pursuant to Article 1.7
(commencing with Section 19996.30) of Chapter 7 of Part 2.6 or
pursuant to Sections 21110 through 21115 to become fully retired,
the current service pension, or current and prior service pensions,
as the case may be, upon his or her full service retirement shall be
(1) the sum of a current service pension calculated on the basis of
service rendered during participation in reduced worktime in
accordance with the formula applicable to his or her current service
pension, plus his or her current service pension, or current and
prior service pensions, as the case may be, as it was prior to his or
her full service retirement, provided that full service retirement
occurs before he or she renders, while participating in reduced
worktime for partial service retirement, one year of state service
credited under this system; or (2) if he or she has rendered one
year or more of state service while participating in reduced
worktime for partial service retirement, a current service pension,
or current and prior service pensions, as the case may be, based
on the total years of service with which the member is entitled to
be credited, calculated on the basis of the formula currently
applicable to the employment in which the service was rendered.
A member shall receive service credit for service during
participation in reduced worktime for partial retirement and service
credited at the time of the election to participate in reduced
worktime for partial retirement.

SEC. 2.  

Section 21357 of the Government Code is amended
to read:

21357.  

(a) For a member reinstated from service retirement
or partial service retirement, the current service pension, or current
and prior service pensions, as the case may be, upon his or her
service retirement subsequent to the reinstatement, shall be the
sum of (1) a current service pension calculated on the basis of
service rendered after reinstatement in accordance with the formula
applicable to him or her in that service and membership, plus, (2)
if the subsequent retirement occurs before he or she renders, after
his or her reinstatement, at least one year of state service credited
under this system, or if the subsequent service or disability
retirement occurs after his or her reinstatement from service or
disability retirement pursuant to an election under Section 21465
or 21483, his or her current service pension, or current and prior
service pensions, as the case may be, as it was prior to his or her
reinstatement, adjusted for any service on which the pension was
based that was included in coverage of the federal system during
reinstatement according to the formula applicable to the service
in employment for which he or she was retired, and further adjusted
according to any change after reinstatement in the provisions
governing the calculation of his or her pension that would have
applied to him or her had he or she continued in retirement but
been subject to the formula applied in the first adjustment; or, for
state miscellaneous and state industrial service subject to Section
21076, in lieu of (2), plus (3) a current service pension, or current
and prior service pensions, as the case may be, as it would have
been prior to his or her reinstatement under the formula applicable
to Section 21076, adjusted for any service on which the pension
was based that was included in coverage of the federal system
during reinstatement according to the formula applicable to the
service in employment for which he or she was retired, and further
adjusted according to any change after reinstatement in the
provisions governing the calculations of his or her pension that
would have applied to him or her had he or she continued in
retirement and been subject to the formula applicable to Section
21076, or if he or she has rendered one year or more of state service
after reinstatement, in lieu of (2) or (3), plus (4), a current service
pension based on current service rendered prior to reinstatement,
calculated on the basis of the formula currently applicable to the
employment in which the service was rendered but on the basis of
an age taken to the preceding completed quarter year but not less
than the minimum retirement age applicable to him or her at his
or her last retirement and determined by deducting from his or her
age at his or her subsequent retirement, the aggregate time during
which he or she was under retirement. For a member reinstated
from nonindustrial disability retirement, the current service pension
upon his or her service retirement after attaining an age one year
less than the minimum age at which he or she could have retired
without an actuarial discount because of age in the employment
from which he or she was last retired, or upon his or her disability
retirement after attaining the minimum age, and subsequent to
reinstatement, shall be calculated in the manners described in the
preceding sentence, but the age determined upon subsequent
retirement after rendering at least one year of state service credited
under this system shall not be taken at less than one year less than
the minimum age if the subsequent retirement is for service, or the
minimum age if the retirement is for disability.

(b) The current service pension otherwise payable under this
section to a member whose allowance prior to reinstatement was
paid pursuant to his or her election under Section 21461, 21461.5,
21479, or 21480 shall be reduced by the actuarial equivalent, on
the date of retirement subsequent to reinstatement, of the amount
(converted as below), if any, by which:

(1) The total amount paid in the period during which a temporary
annuity was included in the payments, reduced by the total amount
that would have been payable during that period had the election
not been made, exceeds

(2) The excess of the total amount that would have been payable,
had the election not been made, during the time subsequent to that
period and prior to reinstatement, over the total amount actually
paid during that time.

The amount determined by the above formula shall be converted
to an amount equaling the actuarial equivalent on the date of
reinstatement and this latter amount shall be the basis of the
actuarial equivalent on the date of retirement subsequent to
reinstatement.

Actuarial equivalents required by this section shall be based on
the interest rate and mortality tables in use by this system on the
date of retirement subsequent to reinstatement.

(c) Notwithstanding this section, or any other provision of this
part, the current service pension payable to any member subject
to this section who rendered one year or more of state service
credited under this system after reinstatement on retirement for
service subsequent to reinstatement from service retirement for
any credited service for which a current service pension was paid
prior to reinstatement shall not be less than the current service
pension that would be payable on the date of the subsequent
retirement had the member not been reinstated. For state
miscellaneous and state industrial service subject to Section 21076,
the current service pension payable for any credited service for
which a current service pension was paid prior to reinstatement
shall not be less than the current service pension that would have
been payable on the date of the subsequent retirement had the
member’s retirement been subject to the formula under Section
21076 and had not been reinstated, adjusted, however, by any
reduction under this section because of an election under Section
21461, 21461.5, 21479, or 21480 and, for any service so credited
that was included in coverage of the federal system during
reinstatement, according to the formula applicable to the service
in employment from which he or she was retired.

SEC. 3.  

Section 21385 of the Government Code is amended
to read:

21385.  

The prior service pension of a member reinstated from
service retirement, upon his or her subsequent service retirement,
shall be in the same amount as his or her prior service pension
prior to his or her reinstatement, adjusted for any service on which
the pension was based that was included in coverage of the federal
system during reinstatement according to the formula applicable
to the service in employment from which he or she was retired,
and further adjusted according to any change in the provisions
governing the calculation of the pensions, using the formula applied
in the first adjustment, made after the reinstatement and applicable
to pensions being paid at the date of the change if the subsequent
retirement occurs before he or she renders after his or her
reinstatement at least one year of state service credited under this
system. Otherwise, the prior service pension calculated on the
basis of an age, taken to the preceding completed quarter year but
not less than the minimum retirement age applicable to him or her
at his or her last retirement, and determined by deducting from his
or her age at his or her subsequent retirement, the aggregate time
during which he or she was under retirement. For such a member
reinstated from nonindustrial disability retirement, the prior service
pension upon his or her service retirement after attaining an age
one year less than the minimum age at which he or she could have
retired without an actuarial discount because of age in the
employment from which he or she was last retired, or upon his or
her disability retirement after attaining the minimum age, and
subsequent to reinstatement, shall be calculated in the manners
described in the preceding sentence, but the age determined upon
subsequent retirement after rendering at least one year of state
service, shall not be taken at less than one year less than the
minimum age if the subsequent retirement is for service, or the
minimum age if the retirement is for disability.

The prior service pension otherwise payable under this section
to a member whose allowance prior to reinstatement was paid
pursuant to his or her election under Section 21461, 21461.5,
21479, or 21480 shall be reduced by the actuarial equivalent, on
the date of retirement subsequent to reinstatement, of the amount,
if any (converted as below), by which:

(a) The total amount paid in the period during which a temporary
annuity was included in the payments, the amount being reduced
by the total amount that would have been payable during the period
had the election not been made; exceeds

(b) The excess of the total amount that would have been payable,
had the election not been made, during the time subsequent to the
period and prior to reinstatement over the total amount actually
paid during that time.

The amount determined by the above formula shall be converted
to an amount equaling the actuarial equivalent on the date of
reinstatement. The latter amount shall be the basis of the actuarial
equivalent, on the date of retirement subsequent to reinstatement.

Actuarial equivalents required by this section shall be based on
the interest rate and mortality tables in use by this system on the
date of retirement subsequent to reinstatement.

Notwithstanding this section, or any other provision of this part,
the prior service pension payable to any member subject to this
section who rendered one year or more of state service credited
under this system after reinstatement on retirement for service
subsequent to reinstatement from service retirement for any
credited service for which a prior service pension was paid prior
to reinstatement shall not be less than the prior service pension
that would be payable on the date of the subsequent retirement
had the member not been reinstated, adjusted, however, by any
reduction under this section because of an election under Section
21461, 21461.5, 21479, or 21480 and, for any service so credited
that was included in coverage of the federal system during
reinstatement, according to the formula applicable to the service
in employment from which he or she was retired.

SEC. 4.  

The heading of Article 6 (commencing with Section
21450) of Chapter 13 of Part 3 of Division 5 of Title 2 of the Government Code is amended to read:

 

Article 6.  Optional Settlements Prior to January 1, 2018

 

SEC. 5.  

Section 21450 of the Government Code is amended
to read:

21450.  

This system shall provide to any member who requests
materials relating to retirement, a written explanation of the effects,
if any, of each possible decision relating to the selection of optional
settlements, beneficiaries, and survivor benefits upon health
benefits that are provided pursuant to Part 5 (commencing with
Section 22750).

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 6.  

Section 21451 of the Government Code is amended
to read:

21451.  

In lieu of the retirement allowance for his or her life
alone, a member or retired member may elect, or revoke or change
a previous election prior to the approval of the previous election,
to have the actuarial equivalent of his or her retirement allowance
as of the date of retirement applied to a lesser retirement allowance,
in accordance with one of the optional settlements specified in this
article. The election or revocation or change thereof, with respect
to a member subject to Section 21624, 21629, or 21630 at
retirement, shall apply to all of the retirement allowance, if, at the
effective date of retirement, the member has no spouse, begin delete children end delete
begin insert children, end insert or dependent parents who would qualify for an allowance
under Section 21624, 21629, or 21630, as applicable, after the
death of the member; or, if at retirement there are persons who
would so qualify, then the election, or revocation, or change
thereof, with respect to any optional settlement other than optional
settlement one, shall apply only to the portion of the allowance
that exceeds the amount of the allowance payable to the survivor.

An actuarial equivalent under this article may be adjusted by the
board for the intervals and upon the effective dates determined by
the board.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 7.  

Section 21452 of the Government Code is amended
to read:

21452.  

The lesser retirement allowance under an optional
settlement elected at retirement for law enforcement members
whose retirement is effective prior to October 1, 1965, and who
are entitled to receive benefits under the federal system, shall be
actuarially equivalent to that part of the retirement allowance that
is subject to option pursuant to Section 21451 that would have
been payable at retirement had no optional settlement been elected
after taking into consideration the reduction in the allowance
provided for in former Section 21252.10, as amended by Chapter
1657 of the Statutes of 1971. Upon the election of an optional
settlement by a member who has not attained the federal retirement
age the board shall estimate the federal benefit upon the basis of
information then available to it. If the death of the member should
occur before he or she has attained the federal retirement age
payments under the optional settlement elected shall be as
estimated. If the member attains the federal retirement age, the
board shall then recalculate the lesser retirement allowance payable
under the optional settlement upon the basis of the age of the
member and the beneficiary on the effective date of retirement,
actuarial tables then in use and the federal benefit.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 8.  

Section 21453 of the Government Code is amended
to read:

21453.  

An election, revocation, or change of election shall be
made within 30 calendar days after the making of the first payment
on account of any retirement allowance or, in the event of a change
of retirement status after retirement, within 30 calendar days after
the making of the first payment on account of any retirement
allowance following the change in retirement status. “Change in
retirement status” includes, but is not limited to, change from
service to disability retirement, from disability retirement to service
retirement, from nonindustrial disability retirement to industrial
disability retirement, or from industrial to nonindustrial disability
retirement.

For purposes of this section, payment shall be deemed to have
been made on the date a warrant is mailed, or the date funds are
electronically transferred to a bank, savings and loan association,
or credit union account for deposit in the member’s account.

This section shall not be construed to authorize a member to
change his or her retirement status after the election, revocation,
or change of election provided in this section.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 9.  

Section 21454 of the Government Code is amended
to read:

21454.  

Notwithstanding Section 21453, an election of optional
settlement 2 or 3, or optional settlement 4 involving life
contingency in which a spouse is designated as the beneficiary,
may be modified as provided in this section in the event of a
dissolution or annulment of the marriage or a legal separation in
which the division of the community property awards the total
interest in the retirement system to the retired member. The
modification shall provide that payment shall be continued during
the retired person’s lifetime in accordance with the optional
settlement then in effect but that no monthly allowance shall be
paid following the retired person’s death, and in lieu thereof there
shall be paid in a lump sum to the member’s estate or a beneficiary
designated by him or her the amount, if any, by which the
member’s accumulated contributions at retirement exceed the total
payments made to the retired person to the date of his or her death.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 10.  

Section 21455 of the Government Code is amended
to read:

21455.  

Optional settlement 1 consists of the right to have a
retirement allowance paid to the member until his or her death and
if the member dies before he or she receives in annuity payments
the amount of his or her accumulated contributions at retirement,
to have the balance at death paid to his or her beneficiary or estate.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 11.  

Section 21456 of the Government Code is amended
to read:

21456.  

Optional settlement 2 consists of the right to have a
retirement allowance paid to a member until his or her death and
thereafter to his or her beneficiary for life.

If the beneficiary predeceases the member and the member
elected this section to be effective on or after January 1, 1990, the
member’s allowance shall be adjusted effective the first of the
month following the death of the beneficiary, to reflect the benefit
that would have been paid had the member not selected an optional
settlement.

If a nonspouse beneficiary waives entitlement to this allowance
and the member elected this section to be effective on or after
January 1, 1993, the member’s allowance shall be adjusted effective
the first of the month following the receipt of the waiver of the
allowance entitlement from the nonspouse beneficiary to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

If the marriage of a member is dissolved or annulled or there is
a legal separation between the member and the beneficiary spouse
and the judgment dividing the community property awards the
total interest in this system to the member, and the member elects
this section to be effective on or after January 1, 1994, the
member’s allowance shall be adjusted effective the first of the
month following the filing of the judgment with the board to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

If the beneficiary spouse predeceases the member on or after
January 1, 1990, and the member elected this section to be effective
prior to January 1, 1990, the member’s allowance shall be adjusted
effective the first of the month following the death of the
beneficiary spouse to reflect a new allowance as calculated below.

If the nonspouse beneficiary waives entitlement to this allowance
on or after January 1, 1993, and the member elected this section
to be effective prior to January 1, 1993, the member’s allowance
shall be adjusted, effective the first of the month following receipt
by the board of the waiver of entitlement from the nonspouse
beneficiary, to reflect a new allowance as calculated below.

If the marriage of a member is dissolved or annulled or there is
a legal separation between the member and the beneficiary spouse
and the judgment dividing the community property awards the
total interest in the retirement system to the member, and the
member elected this section to be effective prior to January 1,
1994, the member’s allowance shall be adjusted, effective the first
of the month following the filing of the judgment with the board
to reflect a new allowance as calculated below. The qualifying
event shall be the date on which the judgment is filed with the
board.

A percentage factor shall be applied to the difference between
the member’s unmodified allowance and optional settlement 2
allowance, both of which shall include applicable cost-of-living
increases. The product of this equation shall then be added to the
member’s optional settlement 2 allowance and the total amount
shall become the member’s base allowance. The percentage factor
applicable to each member shall be determined by the time between
the member’s retirement effective date and the date of death of
the beneficiary spouse or by the time between the member’s
retirement effective date and the date of the receipt of either the
waiver of the allowance entitlement or the judgment of dissolution,
annulment, or legal separation according to the following table:

 

Period between the member’s retirement effective date and the date of the qualifying event	Percentage
Less than 12 months	95%
12 months through 23 months	85%
24 months through 35 months	75%
36 months through 47 months	65%
48 months through 59 months	55%
60 months through 71 months	45%
72 months through 83 months	35%
84 months through 95 months	25%
96 months through 107 months	15%
108 months through 119 months	5%
120 months or more	0%

 

Nothing in this section shall result in additional cost to the
employer.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 12.  

Section 21457 of the Government Code is amended
to read:

21457.  

Optional settlement 3 consists of the right to have a
retirement allowance paid to a member until his or her death, and
thereafter to have one-half of his or her retirement allowance paid
to his or her beneficiary for life.

If the beneficiary predeceases the member and the member
elected this section to be effective on or after January 1, 1990, the
member’s allowance shall be adjusted effective the first of the
month following the death of the beneficiary, to reflect the benefit
that would have been paid had the member not selected an optional
settlement.

If the marriage of a member is dissolved or annulled or there is
a legal separation between the member and the beneficiary spouse
and the judgment dividing the community property awards the
total interest in this system to the member, and the member elects
this section to be effective on or after January 1, 1994, the
member’s allowance shall be adjusted effective the first of the
month following the filing of the judgment with the board to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

If a nonspouse beneficiary waives entitlement to this allowance
and the member elected this section to be effective on or after
January 1, 1993, the member’s allowance shall be adjusted,
effective the first of the month following the receipt of the waiver
of the allowance entitlement from the nonspouse beneficiary, to
reflect the benefit that would have been paid had the member not
selected an optional settlement.

If the beneficiary spouse predeceases the member on or after
January 1, 1990, and the member elected this section to be effective
prior to January 1, 1990, the member’s allowance shall be adjusted
effective the first of the month following the death of the
beneficiary spouse to reflect a new allowance as calculated below.

If the marriage of a member is dissolved or annulled or there is
a legal separation between the member and the beneficiary spouse
and the judgment dividing the community property awards the
total interest in the retirement system to the member, and the
member elected this section to be effective prior to January 1,
1994, the member’s allowance shall be adjusted, effective the first
of the month following the filing of the judgment with the board
to reflect a new allowance as calculated below. The qualifying
event shall be the date on which the judgment is filed with the
board.

If the nonspouse beneficiary waives entitlement to this allowance
on or after January 1, 1993, and the member elected this section
to be effective prior to January 1, 1993, the member’s allowance
shall be adjusted, effective the first of the month following receipt
by the board of the waiver of entitlement from the nonspouse
beneficiary, to reflect a new allowance as calculated below.

A percentage factor shall be applied to the difference between
the member’s unmodified allowance and optional settlement 3
allowance, both of which shall include applicable cost-of-living
increases. The product of this equation shall then be added to the
member’s optional settlement 3 allowance and the total amount
shall become the member’s base allowance. The percentage factor
applicable to each member shall be determined by the time between
the member’s retirement effective date and the date of death of
the beneficiary spouse or by the time between the member’s
retirement effective date and the date of the receipt of either the
waiver of the allowance entitlement or the judgment of dissolution,
annulment, or legal separation according to the following table:

 

Period between the member’s retirement effective date and the date of the qualifying event	Percentage
Less than 12 months	95%
12 months through 23 months	85%
24 months through 35 months	75%
36 months through 47 months	65%
48 months through 59 months	55%
60 months through 71 months	45%
72 months through 83 months	35%
84 months through 95 months	25%
96 months through 107 months	15%
108 months through 119 months	5%
120 months or more	0%

 

Nothing in this section shall result in additional cost to the
employer.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 13.  

Section 21458 of the Government Code is amended
to read:

21458.  

Optional settlement 4 consists of such other benefits
as are the actuarial equivalent of a member’s retirement allowance,
that he or she may select subject to the approval of the board.
However, the actuarial equivalent of benefits under this optional
settlement payable to the member’s beneficiary shall not exceed
the actuarial equivalent of the benefits which would be payable to
that beneficiary if the member had elected optional settlement 2
and Section 21459.

The board shall include in each member benefit booklet a specific
illustration of the benefits available under optional settlement 4.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 14.  

Section 21459 of the Government Code is amended
to read:

21459.  

A member who elects to receive optional settlement 2
or 3 may concurrently and irrevocably elect to waive the provision
for an increase to his or her allowance due to the death of his or
her beneficiary and shall, instead, have his or her allowance based
upon the waiver of this benefit.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 15.  

Section 21460 of the Government Code is amended
to read:

21460.  

A member who elects to receive the unmodified
allowance or optional settlement 1, or optional settlement 2, 3, or
4 with or without making the election specified in Section 21459,
and who names his or her spouse as the option beneficiary, and
whose spouse is also an eligible survivor for the benefits provided
by Section 21624, 21626, 21627, 21628, 21629, or 21630, and
where the total benefit to the surviving spouse is at least 50 percent
of the member’s unmodified allowance, may concurrently and
irrevocably elect to have his or her allowance paid as a “qualified
joint and survivor annuity.” Notwithstanding any other provision
of this part, upon the election, the survivor allowance shall be paid
only to the member’s spouse and shall continue to be paid upon
the remarriage of the spouse. Any cost due to this election shall
be paid by the member through an actuarial reduction to his or her
allowance.

For purposes of this section, a member’s retirement allowance
shall be determined without regard to any limitation required
pursuant to Section 415 of Title 26 of the United States Code but
the amount payable to the spouse shall be subject to those limits
as if it were the retirement allowance of the member.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 16.  

Section 21461 of the Government Code is amended
to read:

21461.  

(a) A member retiring for service may elect to have
the actuarial equivalent of his or her unmodified service retirement
allowance paid in two parts as follows:

(1) A temporary annuity in an amount specified by the member
but which shall not result in a reduction to his or her unmodified
allowance by more than 50 percent.

(2) A life income consisting of his or her service retirement
annuity plus the pension provided by the actuarial value of his or
her current and prior service pensions remaining after providing
the temporary annuity in paragraph (1).

(b) The temporary annuity under subdivision (a) shall not be
subject to further optional settlement under this article and shall
be payable monthly as an addition to the member’s monthly life
income beginning on his or her effective date of retirement and
continuing until the member reaches 59 years and six months of
age or any whole age between 60 and 68 years of age, as designated
by the member at the time of his or her retirement. If his or her
death occurs prior to that age, the commuted value of any
remaining installments shall be paid to his or her designated
beneficiary in a lump sum.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 17.  

Section 21461.5 of the Government Code is amended
to read:

21461.5.  

(a) Notwithstanding Section 21461, a member retiring
for service who became a member of the system on or after January
1, 2002, and who is covered under the federal system but is not
yet receiving a retirement or disability benefit under that system,
may elect to have the actuarial equivalent of his or her unmodified
service retirement allowance paid in two parts as follows:

(1) A temporary annuity that shall not exceed the primary social
security benefit that is anticipated the member shall be entitled to
receive at social security retirement age, which age shall be
designated by the member.

(2) A life income consisting of the member’s service retirement
annuity plus the pension provided by the actuarial value of the
member’s current and prior service pensions remaining after
providing the temporary annuity in paragraph (1).

(b) The temporary annuity under paragraph (1) of subdivision
(a) shall not be subject to further optional settlement under this
article and shall be payable monthly as an addition to the member’s
monthly life income beginning on the member’s effective date of
retirement and continuing until the retired member attains the age
designated by the member under subdivision (a). If the member
dies prior to the designated age, the commuted value of any
installments payable for the period remaining until the member
would have attained that age shall be paid to the member’s
designated beneficiary in a lump sum.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 18.  

Section 21462 of the Government Code is amended
to read:

21462.  

(a) (1) Notwithstanding any other provision of this
part, a member who elected to receive optional settlement 2, 3, or
4, involving a life contingency of the beneficiary, may, if the
beneficiary predeceases the member or if the member marries and
the former spouse was not named as beneficiary, or, if a former
spouse was named, in the event of a dissolution or annulment of
the marriage or a legal separation in which the judgment dividing
the community property awards the total interest in the retirement
system to the retired member, elect to have the actuarial equivalent
reflecting any selection against the fund resulting from the election
as of the date of election of the allowance payable for the remainder
of the member’s lifetime under the optional settlement previously
chosen applied to a lesser allowance during the member’s
remaining lifetime under one of the optional settlements specified
in this article and name a different beneficiary.

(2) Notwithstanding paragraph (1), for an election pursuant to
this section that occurs on or after January 1, 2014, a member may
name the same beneficiary as previously designated, provided that
the resulting benefit to the member and the named beneficiary
otherwise meets the requirements of this section.

(b) The election shall be made within 12 months following the
death of the beneficiary who predeceased the member or within
12 months of the date of entry of the judgment dividing the
community property of the parties, or within 12 months following
marriage if the spouse is named as beneficiary. The election shall
become effective on the date specified on the election, provided
that this date is not earlier than the day following receipt of the
election in this system pursuant to this section.

(c) A member who has a qualifying event prior to January 1,
1988, and who fails to elect by January 1, 1989, or a member who
has a qualifying event on or after January 1, 1988, and who fails
to elect within 12 months, shall retain the right to make an election
under this section. However, this election shall become effective
no earlier than 12 months after the date it is filed with the board,
provided that neither the member nor the designated beneficiary
die prior to the effective date of the election.

(d) This section shall not be construed to mean that designation
of a new beneficiary causes the selection of an optional settlement.
An optional settlement shall be selected by a member in a writing
filed by the member with the board.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 19.  

Section 21463 of the Government Code is amended
to read:

21463.  

A member who elected to receive optional settlement
2 or 3 and whose beneficiary predeceases him or her, shall be
entitled to receive the increased allowance pursuant to Section
21456 or Section 21457, as applicable, unless the member elected
to waive the provision for an increase to his or her allowance
pursuant to Section 21459.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 20.  

Section 21464 of the Government Code is amended
to read:

21464.  

Notwithstanding any provision of this part, a retired
member who chose no optional settlement or optional settlement
1 at retirement may elect to have the actuarial equivalent, as of the
date of the election, of the allowance payable for the remainder of
his or her lifetime applied to a lesser allowance during his or her
remaining lifetime under one of the optional settlements specified
in this article and name his or her spouse as beneficiary.

The election provided by this section is irrevocable and shall be
made within 12 months following a member’s marriage if the
spouse is named as beneficiary. The election shall become effective
on the date specified on the election, provided that this date is not
earlier than the day following receipt of the election in this system
pursuant to this section.

A member who married prior to or after January 1, 1988, who
fails to elect within 12 months, shall retain the right to make an
election under this section. However, the election shall become
effective no earlier than 12 months after the date it is filed with
the board, provided that neither the member nor the designated
beneficiary die prior to the effective date of the election.

This section shall not be construed to mean that designation of
a new beneficiary causes the selection of an optional settlement.
An optional settlement shall be selected by a member in a writing
filed by the member with the board.

This section shall apply to any member who retires on or before
December 31, 2017.

SEC. 21.  

Section 21465 of the Government Code is amended
to read:

21465.  

(a) Optional settlement 5 consists of a partial
distribution of the actuarial present value of the portion, as
specified in this section, of the member’s unmodified monthly
allowance, as prescribed in Section 21362, 21362.2, 21363,
21363.1, 21363.4, or 21423, when a service retirement allowance
is payable. The actuarial present value shall be based upon the
investment return and postretirement mortality assumptions adopted
by the board for that purpose. The member may elect to receive
the actuarial present value of no less than 20 percent and no more
than 50 percent of his or her unmodified allowance. The member
may elect to receive the remaining portion of the unmodified
allowance, not distributed as a lump-sum payment, under one of
the settlements specified in this article for the remainder of his or
her lifetime and thereafter to his or her designated beneficiary,
unless this amount is solely limited to the survivor continuance
portion. The portion of the unmodified allowance equivalent to
the survivor continuance pursuant to Section 21624 may not be
distributed as a lump-sum payment. The benefits provided under
this section may not exceed the benefits that would have otherwise
been provided under any other section in this article.

(b) This section shall only apply to the following members who
retire on or after January 1, 1999, and on or before December 31,
2017:

(1) State peace officer/firefighter members in State Bargaining
Unit 6.

(2) State peace officer/firefighter members in State Bargaining
Unit 8 and state patrol members in State Bargaining Unit 5, if a
memorandum of understanding has been agreed upon by the state
and the recognized employee organization to become subject to
this section.

(3) This section shall also apply to state peace officer/firefighter
members and state patrol members in related supervisory and
confidential positions, if the Department of Human Resources has
approved their inclusion.

SEC. 22.  

Article 7 (commencing with Section 21470) is added
to Chapter 13 of Part 3 of Division 5 of Title 2 of the Government
Code, to read:

 

Article 7.  Optional Settlements On and After January 1, 2018

 

21470.  

This system shall provide to any member who retires
on or after January 1, 2018, and requests materials relating to
retirement, a written explanation of the effects, if any, of each
possible decision relating to the selection of optional settlements,
beneficiaries, and survivor benefits upon health benefits that are
provided pursuant to Part 5 (commencing with Section 22750).

21471.  

(a) The unmodified allowance consists of the right to
have the maximum retirement allowance paid to a member until
his or her death. There is no continuing allowance to a beneficiary
and there is no return of unused accumulated contributions after
the death of the member.

(b) This section shall apply to any member who retires on or
after January 1, 2018.

21471.1.  

(a) In lieu of electing the unmodified allowance, a
member may elect to have the actuarial equivalent of his or her
unmodified allowance as of the date of retirement applied to a
lesser retirement allowance, in accordance with one of the optional
settlements specified in this article. The election with respect to a
member subject to Section 21624, 21629, or 21630 at retirement,
shall apply to all of the retirement allowance, if, at the effective
date of retirement, the member has no spouse, children, or
dependent parents who would qualify for an allowance under
Section 21624, 21629, or 21630, as applicable, after the death of
the member; or, if at retirement there are persons who would so
qualify, then the election with respect to any optional settlement
other than the optional settlement in Section 21474, shall apply
only to the portion of the allowance that exceeds the amount of
the allowance payable to the survivor.

(b) An actuarial equivalent under this article may be adjusted
by the board for the intervals and upon the effective dates
determined by the board.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21471.2.  

If a member elects an optional settlement that provides
for a monthly allowance for his or her named beneficiary or
beneficiaries, the combined allowance payable to the member’s
named beneficiary or beneficiaries and the member’s survivor
pursuant to Section 21624, 21629, or 21630, if applicable, cannot
exceed the amount of the member’s monthly allowance.

21472.  

(a) An election, revocation, or change of election shall
be made within 30 calendar days after the making of the first
payment on account of any retirement allowance or, in the event
of a change of retirement status after retirement, within 30 calendar
days after the making of the first payment on account of any
retirement allowance following the change in retirement status.
“Change in retirement status” includes, but is not limited to, change
from service to disability retirement, from disability retirement to
service retirement, from nonindustrial disability retirement to
industrial disability retirement, or from industrial to nonindustrial
disability retirement

(b) For purposes of this section, payment shall be deemed to
have been made on the date a warrant is mailed, or the date funds
are electronically transferred to a bank, savings and loan
association, or credit union account for deposit in the member’s
account.

(c) This section shall not be construed to authorize a member
to change his or her retirement status after the election, revocation,
or change of election provided in this section.

(d) This section shall apply to any member who retires on or
after January 1, 2018.

21473.  

(a) Notwithstanding Section 21472, the election of an
optional settlement in Section 21475, 21475.5, 21476, 21476.5,
or 21477 in which a spouse is designated as the beneficiary, may
be modified as provided in this section in the event of a dissolution
or annulment of the marriage or a legal separation in which the
division of the community property awards the total interest in the
retirement system to the retired member. The modification shall
provide that payment shall be continued during the retired
member’s lifetime in accordance with the optional settlement then
in effect but that no monthly allowance shall be paid following
the retired member’s death, and in lieu thereof there shall be paid
in a lump sum to the member’s estate or a beneficiary designated
by him or her the amount, if any, by which the member’s
accumulated contributions at retirement exceed the total payments
made to the retired member to the date of his or her death.

(b) This section shall apply to any member who retires on or
after January 1, 2018.

21474.  

(a) The Return of Remaining Contributions Option 1
consists of the right to have a retirement allowance paid to a
member until his or her death and if he or she dies before he or
she receives in annuity payments the amount of his or her
accumulated contributions at retirement, to have the balance at
death paid to his or her beneficiary or beneficiaries.

(b) This section shall apply to any member who retires on or
after January 1, 2018.

21475.  

(a) The 100 Percent Beneficiary Option 2 consists of
the right to have a retirement allowance paid to a member until
his or her death, and thereafter to have the same monthly allowance
paid to his or her named beneficiary for life; provided that with
respect to a member subject to Section 21624, 21629, or 21630 at
retirement, the named beneficiary shall receive a monthly
allowance equal to that portion of the member’s allowance that
exceeds the amount of the allowance deemed payable to a survivor.

(b) Upon the death of both the member and the named
beneficiary, any remaining balance of the member’s accumulated
contributions at retirement not used to fund the allowances paid
to the member and the named beneficiary will be paid in a lump
sum to a secondary beneficiary or beneficiaries named by the
member.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21475.5.  

(a) The 100 Percent Beneficiary Option 2 with
Benefit Allowance Increase consists of the right to have a
retirement allowance paid to a member until his or her death and
thereafter to have the same monthly allowance paid to his or her
named beneficiary for life; provided that with respect to a member
subject to Section 21624, 21629, or 21630 at retirement, the named
beneficiary shall receive a monthly allowance equal to that portion
of the member’s allowance that exceeds the amount of the
allowance deemed payable to a survivor.

(1) If the beneficiary predeceases the begin delete member and the member
elected this section to be effective on or after January 1, 1990, end delete
begin insert member, end insert the member’s allowance shall be adjusted effective the
first of the month following the death of the beneficiary, to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

(2) If a nonspouse beneficiary waives entitlement to this
begin delete allowance and the member elected this section to be effective on
or after January 1, 1993, end delete begin insert allowance, end insert the member’s allowance shall
be adjusted effective the first of the month following the receipt
of the waiver of the allowance entitlement from the nonspouse
beneficiary to reflect the benefit that would have been paid had
the member not selected an optional settlement.

(3) If the marriage of a member is dissolved or annulled or there
is a legal separation between the member and the beneficiary
spouse and the judgment dividing the community property awards
the total interest in this system to the member, begin delete and the member
elects this section to be effective on or after January 1, 1994, end delete the
member’s allowance shall be adjusted effective the first of the
month following the filing of the judgment with the board to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

begin delete

(4) If the beneficiary spouse predeceases the member on or after
January 1, 1990, and the member elected this section to be effective
prior to January 1, 1990, the member’s allowance shall be adjusted
effective the first of the month following the death of the
beneficiary spouse to reflect a new allowance as calculated below.

(5) If the nonspouse beneficiary waives entitlement to this
allowance on or after January 1, 1993, and the member elected
this section to be effective prior to January 1, 1993, the member’s
allowance shall be adjusted, effective the first of the month
following receipt by the board of the waiver of entitlement from
the nonspouse beneficiary, to reflect a new allowance as calculated
below.

(6) If the marriage of a member is dissolved or annulled or there
is a legal separation between the member and the beneficiary
spouse and the judgment dividing the community property awards
the total interest in the retirement system to the member, and the
member elected this section to be effective prior to January 1,
1994, the member’s allowance shall be adjusted, effective the first
of the month following the filing of the judgment with the board
to reflect a new allowance as calculated below. The qualifying
event shall be the date on which the judgment is filed with the
board.

(7) If applicable, a percentage factor shall be applied to the
difference between the member’s unmodified allowance and
optional settlement 2, both of which shall include applicable
cost-of-living increases. The product of this equation shall then
be added to the member’s optional settlement 2 allowance, and
the total amount shall become the member’s base allowance. The
percentage factor applicable to each member shall be determined
by the time between the member’s retirement effective date and
the date of death of the beneficiary spouse or by the time between
the member’s retirement effective date and the date of the receipt
of either the waiver of the allowance entitlement or the judgment
of dissolution, annulment, or legal separation according to the
following table:

 

Period between the member’s retirement effective date and the date of the qualifying event	Percentage
Less than 12 months	95%
12 months through 23 months	85%
24 months through 35 months	75%
36 months through 47 months	65%
48 months through 59 months	55%
60 months through 71 months	45%
72 months through 83 months	35%
84 months through 95 months	25%
96 months through 107 months	15%
108 months through 119 months	5%
120 months or more	0%

 

end delete

(b) Nothing in this section shall result in additional cost to the
employer.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21476.  

(a) The 50 Percent Beneficiary Option 3 consists of
the right to have a retirement allowance paid to a member until
his or her death, and thereafter to have one-half of the member’s
monthly allowance paid to his or her named beneficiary for life;
provided that with respect to a member subject to Section 21624,
21629, or 21630 at retirement, the named beneficiary shall receive
a monthly allowance equal to one-half of that portion of the
member’s allowance that exceeds the amount of the allowance
deemed payable to a survivor.

(b) Upon the death of both the member and the named
beneficiary, any remaining balance of the member’s accumulated
contributions at retirement not used to fund the allowances paid
to the member and the named beneficiary will be paid in a lump
sum to the secondary beneficiary or beneficiaries named by the
member.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21476.5.  

(a) The 50 Percent Beneficiary Option 3 with Benefit
Allowance Increase consists of the right to have a retirement
allowance paid to a member until his or her death, and thereafter
to have one-half of the member’s monthly allowance paid to his
or her named beneficiary for begin insert life; end insert provided that with respect to a
member subject to Section 21624, 21629, or 21630 at retirement,
the named beneficiary shall receive a monthly allowance equal to
one-half of that portion of the member’s allowance that exceeds
the amount of the allowance deemed payable to a survivor.

(1) If the beneficiary predeceases the begin delete member and the member
elected this section to be effective on or after January 1, 1990, end delete
begin insert member, end insert the member’s allowance shall be adjusted effective the
first of the month following the death of the beneficiary, to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

(2) If the marriage of a member is dissolved or annulled or there
is a legal separation between the member and the beneficiary
spouse and the judgment dividing the community property awards
the total interest in this system to the member, begin delete and the member
elects this section to be effective on or after January 1, 1994, end delete the
member’s allowance shall be adjusted effective the first of the
month following the filing of the judgment with the board to reflect
the benefit that would have been paid had the member not selected
an optional settlement.

(3) If a nonspouse beneficiary waives entitlement to this
begin delete allowance and the member elected this section to be effective on
or after January 1, 1993, end delete begin insert allowance, end insert the member’s allowance shall
be adjusted, effective the first of the month following the receipt
of the waiver of the allowance entitlement from the nonspouse
beneficiary, to reflect the benefit that would have been paid had
the member not selected an optional settlement.

begin delete

(4) If the beneficiary spouse predeceases the member on or after
January 1, 1990, and the member elected this section to be effective
prior to January 1, 1990, the member’s allowance shall be adjusted
effective the first of the month following the death of the
beneficiary spouse to reflect a new allowance as calculated below.

(5) If the marriage of a member is dissolved or annulled or there
is a legal separation between the member and the beneficiary
spouse and the judgment dividing the community property awards
the total interest in the retirement system to the member, and the
member elected this section to be effective prior to January 1,
1994, the member’s allowance shall be adjusted, effective the first
of the month following the filing of the judgment with the board
to reflect a new allowance as calculated below. The qualifying
event shall be the date on which the judgment is filed with the
board.

(6) If the nonspouse beneficiary waives entitlement to this
allowance on or after January 1, 1993, and the member elected
this section to be effective prior to January 1, 1993, the member’s
allowance shall be adjusted, effective the first of the month
following receipt by the board of the waiver of entitlement from
the nonspouse beneficiary, to reflect a new allowance as calculated
below.

(7) If applicable, a percentage factor shall be applied to the
difference between the member’s unmodified allowance and
optional settlement 3 allowance, both of which shall include
applicable cost-of-living increases. The product of this equation
shall then be added to the member’s optional settlement 3
allowance, and the total amount shall become the member’s base
allowance. The percentage factor applicable to each member shall
be determined by the time between the member’s retirement
effective date and the date of death of the beneficiary spouse or
by the time between the member’s retirement effective date and
the date of the receipt of either the waiver of the allowance
entitlement or the judgment of dissolution, annulment, or legal
separation according to the following table:

 

Period between the member’s retirement effective date and the date of the qualifying event	Percentage
Less than 12 months	95%
12 months through 23 months	85%
24 months through 35 months	75%
36 months through 47 months	65%
48 months through 59 months	55%
60 months through 71 months	45%
72 months through 83 months	35%
84 months through 95 months	25%
96 months through 107 months	15%
108 months through 119 months	5%
120 months or more	0%

 

end delete

(b) Nothing in this section shall result in additional cost to the
employer.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21477.  

(a) The Flexible Beneficiary Option 4 consists of the
right to have a retirement allowance paid to a member until his or
her death, and thereafter to have a monthly allowance paid to his
or her named beneficiary or beneficiaries for life. Subject to Section
21471.2, the member may select the monthly allowance payable
to the named beneficiary or beneficiaries from the options below:

(1) Specific Dollar Amount to a Beneficiary or Beneficiaries.
The member may specify that upon his or her death after
retirement, a monthly allowance in an amount determined by the
member be paid to a named beneficiary or beneficiaries for life.

(2) Specific Percentage to a Beneficiary or Beneficiaries. The
member may specify that upon his or her death after retirement, a
monthly allowance in an amount equivalent to a specified
percentage of the member’s allowance be paid to a named
beneficiary or beneficiaries for life.

(b) This section shall apply to any member who retires on or
after January 1, 2018.

21478.  

(a) A member who elects to receive the unmodified
allowance or the optional settlement in Section 21474, or the
optional settlement in Section 21475, 21475.5, 21476, 21476.5,
or 21477, and who names his or her spouse as the option
beneficiary, and whose spouse is also an eligible survivor for the
benefits provided by Section 21624, 21626, 21627, 21628, 21629,
or 21630, and if the total benefit to the surviving spouse is at least
50 percent of the member’s unmodified allowance, may
concurrently and irrevocably elect to have his or her allowance
paid as a “qualified joint and survivor annuity.” Notwithstanding
any other provision of this part, upon the election, the survivor
allowance shall be paid only to the member’s spouse and shall
continue to be paid upon the remarriage of the spouse. Any cost
due to this election shall be paid by the member through an
actuarial reduction to his or her allowance.

(b) For purposes of this section, a member’s retirement
allowance shall be determined without regard to any limitation
required pursuant to Section 415 of Title 26 of the United States
Code but the amount payable to the spouse shall be subject to those
limits as if it were the retirement allowance of the member.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21479.  

(a) A member retiring for service may elect to have
the actuarial equivalent of his or her unmodified service retirement
allowance paid in two parts as follows:

(1) A temporary annuity in an amount specified by the member
but which shall not result in a reduction to his or her unmodified
allowance by more than 50 percent.

(2) A life income consisting of his or her service retirement
annuity plus the pension provided by the actuarial value of his or
her current and prior service pensions remaining after providing
the temporary annuity in paragraph (1).

(b) The temporary annuity under subdivision (a) shall not be
subject to further optional settlement under this article and shall
be payable monthly as an addition to the member’s monthly life
income beginning on his or her effective date of retirement and
continuing until the member reaches 59 years and six months of
age or any whole age between 60 and 68 years of age, as designated
by the member at the time of his or her retirement. If his or her
death occurs prior to that age, the commuted value of any
remaining installments shall be paid to his or her designated
beneficiary in a lump sum.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21480.  

(a) Notwithstanding Section 21479, a member retiring
for service who became a member of the system on or after January
1, 2002, and who is covered under the federal system but is not
yet receiving a retirement or disability benefit under that system,
may elect to have the actuarial equivalent of his or her unmodified
service retirement allowance paid in two parts as follows:

(1) A temporary annuity that shall not exceed the primary social
security benefit that is anticipated the member shall be entitled to
receive at social security retirement age, which age shall be
designated by the member.

(2) A life income consisting of the member’s service retirement
annuity plus the pension provided by the actuarial value of the
member’s current and prior service pensions remaining after
providing the temporary annuity in paragraph (1).

(b) The temporary annuity under paragraph (1) of subdivision
(a) shall not be subject to further optional settlement under this
article and shall be payable monthly as an addition to the member’s
monthly life income beginning on the member’s effective date of
retirement and continuing until the retired member attains the age
designated by the member under subdivision (a). If the member
dies prior to the designated age, the commuted value of any
installments payable for the period remaining until the member
would have attained that age shall be paid to the member’s
designated beneficiary in a lump sum.

(c) This section shall apply to any member who retires on or
after January 1, 2018.

21481.  

(a) (1) Notwithstanding any other provision of this
part, a member who elected the optional settlement in Section
21475, 21475.5, 21476, 21476.5, or 21477, may, if the beneficiary
predeceases the member or if the member marries and the former
spouse was not named as beneficiary, or, if a former spouse was
named, in the event of a dissolution or annulment of the marriage
or a legal separation in which the judgment dividing the community
property awards the total interest in the retirement system to the
retired member, elect to have the actuarial equivalent reflecting
any selection against the fund resulting from the election as of the
date of election of the allowance payable for the remainder of the
member’s lifetime under the optional settlement previously chosen
applied to a lesser allowance during the member’s remaining
lifetime under one of the optional settlements specified in this
article and name a different beneficiary.

(2) Notwithstanding paragraph (1), for an election pursuant to
this section that occurs on or after January 1, 2014, a member may
name the same beneficiary as previously designated, provided that
the resulting benefit to the member and the named beneficiary
otherwise meets the requirements of this section.

(b) The election shall be made within 12 months following the
death of the beneficiary who predeceased the member or within
12 months of the date of entry of the judgment dividing the
community property of the parties, or within 12 months following
marriage if the spouse is named as beneficiary. The election shall
become effective on the date specified on the election, provided
that this date is not earlier than the day following receipt of the
election in this system pursuant to this section.

(c) A member who has a qualifying event prior to January 1,
1988, and who fails to elect by January 1, 1989, or a member who
has a qualifying event on or after January 1, 1988, and who fails
to elect within 12 months, shall retain the right to make an election
under this section. However, this election shall become effective
no earlier than 12 months after the date it is filed with the board,
provided that neither the member nor the designated beneficiary
die prior to the effective date of the election.

(d) This section shall not be construed to mean that designation
of a new beneficiary causes the selection of an optional settlement.
An optional settlement shall be selected by a member in a writing
filed by the member with the board.

(e) This section shall apply to any member who retires on or
after January 1, 2018.

21482.  

(a) Notwithstanding any provision of this part, a retired
member who chose no optional settlement or the optional
settlement in Section 21474 at retirement may elect to have the
actuarial equivalent, as of the date of the election, of the allowance
payable for the remainder of his or her lifetime applied to a lesser
allowance during his or her remaining lifetime under one of the
optional settlements specified in this article and name his or her
spouse as beneficiary.

(b) The election provided by this section is irrevocable and shall
be made within 12 months following a member’s marriage if the
spouse is named as beneficiary. The election shall become effective
on the date specified on the election, provided that this date is not
earlier than the day following receipt of the election in this system
pursuant to this section.

(c) A member who married prior to or after January 1, 1988,
who fails to elect within 12 months, shall retain the right to make
an election under this section. However, the election shall become
effective no earlier than 12 months after the date it is filed with
the board, provided that neither the member nor the designated
beneficiary die prior to the effective date of the election.

(d) This section shall not be construed to mean that designation
of a new beneficiary causes the selection of an optional settlement.
An optional settlement shall be selected by a member in a writing
filed by the member with the board.

(e) This section shall apply to any member who retires on or
after January 1, 2018.

21483.  

(a) Optional settlement 5 consists of a partial
distribution of the actuarial present value of the portion, as
specified in this section, of the member’s unmodified monthly
allowance, as prescribed in Section 21362, 21362.2, 21363,
21363.1, 21363.4, or 21423, when a service retirement allowance
is payable. The actuarial present value shall be based upon the
investment return and postretirement mortality assumptions adopted
by the board for that purpose. The member may elect to receive
the actuarial present value of no less than 20 percent and no more
than 50 percent of his or her unmodified allowance. The member
may elect to receive the remaining portion of the unmodified
allowance, not distributed as a lump-sum payment, under one of
the settlements specified in this article for the remainder of his or
her lifetime and thereafter to his or her designated beneficiary,
unless this amount is solely limited to the survivor continuance
portion. The portion of the unmodified allowance equivalent to
the survivor continuance pursuant to Section 21624 may not be
distributed as a lump-sum payment. The benefits provided under
this section may not exceed the benefits that would have otherwise
been provided under any other section in this article.

(b) This section shall only apply to the following members who
retire on or after January 1, 2018:

(1) State peace officer/firefighter members in State Bargaining
Unit 6.

(2) State peace officer/firefighter members in State Bargaining
Unit 8 and state patrol members in State Bargaining Unit 5, if a
memorandum of understanding has been agreed upon by the state
and the recognized employee organization to become subject to
this section.

(3) State peace officer/firefighter members and state patrol
members in supervisory and confidential positions related to the
members described in paragraph (1) or (2), if the Department of
Human Resources has approved their inclusion.

SEC. 23.  

Section 21492 of the Government Code is amended
to read:

21492.  

The designation of a beneficiary under the optional
settlements in Sections 21456, 21457, begin delete 21458, end delete 21459, 21475,
21475.5, 21476, 21476.5, and 21477, begin insert and in Section 21458, end insert if a
benefit involving the life contingency of the beneficiary is
provided, is irrevocable from the time of the first payment on
account of any retirement allowance. Otherwise a designation of
beneficiary under this system is revocable at the pleasure of the
member who made it. A member’s marriage, dissolution of
marriage, annulment of his or her marriage, the birth of his or her
child, or his or her adoption of a child shall constitute an automatic
revocation of his or her previous revocable designation of
beneficiary. A member’s termination of employment and
withdrawal of contributions shall constitute an automatic revocation
of the previous revocable designation of beneficiary. Subsequent
reemployment or reinstatement from retirement to employment
covered by this system shall not reinstate the previous designation
of beneficiary.

Upon revocation of any beneficiary designation, a member may
designate the same or another beneficiary by a writing filed with
the board, except as otherwise provided in Section 21490.

SEC. 24.  

Section 21503 of the Government Code is amended
to read:

21503.  

The board may select an optional settlement under
Article 6 (commencing with Section 21450) or Article 7
(commencing with Section 21470) of Chapter 13, as applicable,
on behalf of the surviving spouse of a member who applied for
retirement but who died prior to the mailing of a retirement
allowance warrant and prior to an election in accordance with that
article if all of the following conditions are met:

(a) The application for retirement was received by this system,
prior to the date of death.

(b) The document containing the application for retirement
received by this system did not provide for a temporary election
of the optional settlement in Sections 21456 and 21459, or in
Section 21475.

(c) The deceased member had separated from state service at
least one day prior to the effective date of retirement.

(d) The deceased member was alive on the effective date of
retirement.

(e) The beneficiary designated on the application for retirement
is the surviving spouse who requests in writing that the board make
the selection. Upon formal action by the board approving the
request, the request shall become irrevocable.

A retirement allowance provided in accordance with this section
shall be calculated as if the member had elected Sections 21456
and 21459 if his or her retirement date is on or before December
31, 2017, or Section 21475 if his or her retirement date is on or
after January 1, 2018.

SEC. 25.  

Section 21504 of the Government Code is amended
to read:

21504.  

If a member dies on or after the effective date of
retirement and prior to the mailing of a retirement allowance
warrant and if the member has elected the optional settlement in
Section 21456, 21457, 21459, 21475, 21475.5, 21476, begin delete 21476.5 end delete
begin insert 21476.5, end insert or 21477, or an optional settlement in Section 21458,
involving payment of an allowance throughout the life of the
beneficiary, or the member elected the unmodified allowance or
the optional settlement in either Section 21455 or 21474 and if a
partially continued retirement allowance under Sections 21624
through 21631, is payable, the death shall be considered to be death
after retirement and the applicable benefits shall be payable.

However, if the beneficiary designated on the election for
retirement is either (1) the surviving unmarried minor child or
children of the member and there is no surviving spouse eligible
for a partially continued retirement allowance under Sections 21624
through 21631, or (2) the surviving spouse of the member, the
surviving spouse so named or the legal representative of the minor
child or children so named may elect to receive benefits that would
have been payable had the death occurred under the conditions of
Section 21530. Except as provided in Section 21503, nothing in
this part permits a surviving spouse, surviving children, or any
person other than a member to elect an optional settlement.

SEC. 26.  

Section 21505 of the Government Code is amended
to read:

21505.  

If a member who has been retired for service because
he or she has attained the mandatory age of retirement applicable
to members of his or her category dies within 30 days after the
date upon which his or her retirement was mandatory, and without
having elected the optional settlement in Section 21456, 21457,
21459, 21475, 21475.5, 21476, 21476.5, or 21477, or an optional
settlement in Section 21458, involving payment of an allowance
throughout the life of a beneficiary, and if no part of the allowance
of the member is automatically continued by this part after his or
her death, his or her death shall be considered as that of a member
before retirement, and the basic death benefit shall be payable, or,
if the circumstances are such that a special death benefit would be
payable if the death had occurred prior to retirement, the special
death benefit shall be payable.

SEC. 27.  

Section 21530 of the Government Code is amended
to read:

21530.  

(a) This system is liable for either the basic or special
death benefit upon the death of a member in any of the following
circumstances:

(1) Before the effective date of retirement, and (A) while in
state service, or (B) while absent on military service, provided the
member has made contributions during the absence under Section
20991 or has had contributions made on his or her behalf under
Section 20997, or (C) within four months after discontinuance of
state service, or (D) while on an approved leave of absence, or (E)
while physically or mentally incapacitated for the performance of
duty, if the incapacity has been continuous from discontinuance
of state service, or (F) while employed as a member of a county
retirement system; provided, the employment resulting in
membership was begun on or after October 1, 1957, and within
90 days after discontinuance of state service.

(2) While in state service in partial service retirement pursuant
to Article 1.7 (commencing with Section 19996.30) of Chapter 7
of Part 2.6 or Sections 21110 through 21115.

(3) On or after the effective date of retirement and before the
mailing of a retirement allowance warrant and either within four
months of discontinuance of state service or while physically or
mentally incapacitated for the performance of duty if the incapacity
has been continuous from discontinuance of state service, and
providing all of the following conditions exist:

(A) The retirement of the member was not compulsory under
Article 5 (commencing with Section 21130) of Chapter 12.

(B) The member has not elected the optional settlement in
Section 21456, 21457, 21459, 21475, 21475.5, 21476, 21476.5,
or 21477, or an optional settlement in Section 21458, involving
payment of an allowance throughout the life of a beneficiary.

(C) A partially continued allowance under Sections 21624
through 21631, is not payable.

(b) This system is liable for a limited death benefit, which
consists only of the accumulated contributions of the member
payable to his or her beneficiary or estate, under the following
circumstances:

(1) Upon the death of a member before the effective date of his
or her retirement or, with respect to (A) any member whose
retirement was not compulsory under Article 5 (commencing with
Section 21130) of Chapter 12, and (B) any member who has not
elected the optional settlement in Section 21456, 21457, 21459,
21475, 21475.5, 21476, 21476.5, or 21477, or an optional
settlement in Section 21458 involving payment of an allowance
throughout the life of a beneficiary, on or after that effective date
and before the mailing of the first retirement allowance warrant.

(2) Under those circumstances in which this system is not liable
for either the basic or special death benefit provided in subdivision
(a) of this section, and a partially continued allowance under
Sections 21624 through 21631, is not payable.

SEC. 28.  

Section 21547 of the Government Code is amended
to read:

21547.  

(a) Notwithstanding any other provision of this article
requiring attainment of the minimum age for voluntary service
retirement to the member in his or her last employment preceding
death, upon the death of a state member on or after January 1,
1993, who is credited with 20 years or more of state service, the
surviving spouse, or eligible children if there is no surviving
spouse, may receive a monthly allowance in lieu of the basic death
benefit. The board shall notify the eligible survivor, as defined in
Section 21546, of this alternate death benefit. The board shall
calculate the monthly allowance that shall be payable as follows:

(1) To the member’s surviving spouse, an amount equal to the
amount the member would have received if the member had retired
for service at minimum retirement age on the date of death and
had elected the optional settlement in Section 21456 and Section
21459.

(2) If the member made a specific beneficiary designation under
Section 21490, the monthly allowance shall be based only on that
portion of the amount the member would have received described
in paragraph (1) that would have been derived from the nonmember
spouse’s community property interest in the member’s
contributions and service credit.

(3) If there is no surviving spouse or the spouse dies before all
of the children of the deceased member attain the age of 18 years,
to the surviving children, under the age of 18 years, collectively,
an amount equal to one-half of, and derived from the same source
as, the unmodified allowance the member would have received if
he or she had retired for service at minimum retirement age on the
date of death. No child shall receive any allowance after marrying
or attaining the age of 18 years. As used in this paragraph,
“surviving children” includes a posthumously born child or children
of the member.

(b) This section shall only apply to members employed in state
bargaining units for which a memorandum of understanding has
been agreed to by the state employer and the recognized employee
organization to become subject to this section, members who are
excluded from the definition of state employees in subdivision (c)
of Section 3513, and members employed by the executive branch
of government who are not members of the civil service.

(c) For purposes of this section, “state service” means service
rendered as a state employee, as defined in Section 19815. This
section shall not apply to any contracting agency nor to the
employees of any contracting agency.

(d) For purposes of this section, “state service” includes service
to the state for which the member, pursuant to Section 20281.5,
did not receive credit.

SEC. 29.  

Section 21547.7 of the Government Code is amended
to read:

21547.7.  

(a) Notwithstanding any other provision of this article
requiring attainment of the minimum age for voluntary service
retirement applicable to him or her in his or her last employment
preceding death, upon the death of a local firefighter member while
in the employ of an agency subject to this section on or after
January 1, 2001, who is credited with 20 years or more of state
service, the surviving spouse, or eligible children, if there is no
eligible spouse, may receive a monthly allowance in lieu of the
basic death benefit. The board shall notify the eligible survivor,
as defined in Section 21546, of this alternate death benefit. The
board shall calculate the monthly allowance that shall be payable
as follows:

(1) To the member’s surviving spouse, an amount equal to the
amount the member would have received if he or she had retired
for service at the minimum retirement age on the date of death and
had elected the optional settlement in Section 21456 and Section
21459. The retirement allowance shall be calculated using all
service earned by the member in this system.

(2) If the member made a specific beneficiary designation under
Section 21490, the monthly allowance shall be based only on that
portion of the amount the member would have received described
in paragraph (1) that would have been derived from the nonmember
spouse’s community property interest in the member’s
contributions and service credit.

(3) If there is no surviving spouse or the spouse dies before all
of the children of the deceased member attain the age of 18 years,
to the surviving children, under the age of 18 years, collectively,
an amount equal to one-half of, and derived from the same source
as, the unmodified allowance the member would have received if
he or she had retired for service at the minimum retirement age on
the date of death. No child shall receive any allowance after
marrying or attaining the age of 18 years. As used in this paragraph,
“surviving children” includes a posthumously born child or children
of the member. The retirement allowance shall be calculated using
all service earned by the member in this system.

(4) The cost of the allowance paid pursuant to this subdivision
shall be paid from the assets of the employer at the member’s date
of death. All member contributions made by the member to this
system shall be transferred to the plan assets of the employer liable
for the funding of this benefit.

(b) (1) Upon the death of a local firefighter member while in
the employ of an agency subject to this section on or after January
1, 2001, who is credited with 20 years or more of state service and
who has attained the minimum age for voluntary service retirement
applicable to him or her in his or her last employment preceding
death, the surviving spouse may elect to receive a monthly
allowance that is equal to the amount that member would have
received if the member had been retired from service on the date
of death and had elected the optional settlement in Section 21456
and Section 21459 in lieu of the basic death benefit. The retirement
allowance shall be calculated using all service earned by the
member in this system.

(2) If the member made a specific beneficiary designation under
Section 21490, the monthly allowance shall be based only on that
portion of the amount the member would have received described
in paragraph (1) that would have been derived from the nonmember
spouse’s community property interest in the member’s
contributions and service credit.

(3) If there is no surviving spouse or the spouse dies before all
of the children of the deceased member attain the age of 18 years,
the allowance shall continue to the surviving children, under the
age of 18 years, collectively, in an amount equal to one-half of,
and derived from the same source as, the unmodified allowance
the member would have received if he or she had been retired from
service on the date of death. No child shall receive any allowance
after marrying or attaining the age of 18 years. As used in this
paragraph, “surviving children” includes a posthumously born
child or children of the member. The retirement allowance will be
calculated using all service earned by the member in this system.

(4) The cost of the increase in service allowance paid pursuant
to this subdivision shall be paid from the assets of the employer
at the member’s date of death.

(c)  This section shall not apply to any contracting agency, nor
to the employees of any contracting agency, unless and until the
agency elects to be subject to this section by amendment to its
contract made in the manner prescribed for approval of contracts,
except that an election among the employees is not required.

SEC. 30.  

Section 21548 of the Government Code is amended
to read:

21548.  

(a) The surviving spouse of a member who has attained
the minimum age for voluntary service retirement applicable to
the member in his or her last employment preceding death, and
who is eligible to receive an allowance pursuant to Section 21546,
shall instead receive an allowance that is equal to the amount that
the member would have received if the member had been retired
from service on the date of death and had elected the optional
settlement begin insert in end insert Section 21456 and Section 21459.

(b) The surviving spouse of a member who has attained the
minimum age for voluntary service retirement applicable to the
member in his or her last employment preceding death, and who
is eligible to receive a special death benefit in lieu of an allowance
under Section 21546, may elect to instead receive an allowance
that is equal to the amount that the member would have received
if the member had been retired from service on the date of death
and had elected the optional settlement in Section 21456 and
Section 21459.

(c) If the member made a specific beneficiary designation under
Section 21490, the allowance under this section shall be based
only on that portion of the amount the member would have received
described in subdivision (a) or (b) that would have been derived
from the nonmember spouse’s community property interest in the
member’s contributions and service credit.

(d) The allowance provided by this section shall be payable as
long as the surviving spouse lives. Upon the death of the surviving
spouse, the benefit shall be continued to minor children, as defined
in Section 6500 of the Family Code, or a lump sum shall be paid
as provided under circumstances specified in Section 21546 or in
Sections 21541 and 21543, as the case may be.

(e) The allowance provided by this section shall be paid in lieu
of the basic death benefit, but the surviving spouse qualifying for
the allowance may elect before the first payment on account of it
to receive the basic death benefit in lieu of the allowance.

(f) This section shall apply with respect to state members whose
death occurs on and after July 1, 1976.

(g) All references in this code to Section 21546 shall be deemed
to include this section in the alternative.

(h) This section shall not apply to any contracting agency nor
to the employees of any contracting agency unless and until the
agency elects to be subject to this section by amendment to its
contract made in the manner prescribed for approval of contracts,
except that an election among the employees is not required, or,
in the case of contracts made after January 1, 1985, by express
provision in the contract making the contracting agency subject
to this section.

SEC. 31.  

Section 21604 of the Government Code is amended
to read:

21604.  

The insurance benefit shall be paid upon death of an
insured member of this system to the beneficiary entitled to receive
the basic or special death benefit if all of the following conditions
occur:

(a) Death occurs during any of the following:

(1) While in state service.

(2) While absent from state service on military service or on
approved leave of absence.

(3) Within four months of discontinuance of state service.

(4) While physically or mentally incapacitated for performance
of duty continuously from discontinuance of state service.

(b) If either of the following exists:

(1) Death occurs while a member and before the effective date
of retirement.

(2) If the optional settlement in Section 21456, 21457, 21459,
21475, 21475.5, 21476, 21476.5, or 21477, or an optional
settlement in Section 21458, involving payment of an allowance
throughout the life of the beneficiary, has not been elected and if
an allowance under Section 21624, 21627, 21629, or 21630 is not
payable, and death occurs on or after the effective date of
retirement and before the mailing of a retirement allowance
warrant.

(c) Death occurs during a period of insurance.

(d) Death occurs under circumstances other than those described
in subparagraph (F) of paragraph (1) of subdivision (a) of Section
21530.

If this section is in conflict with the provisions of a memorandum
of understanding reached pursuant to Section 3517.5, the
memorandum of understanding shall be controlling without further
legislative action, except that, if the provisions of a memorandum
of understanding require the expenditure of funds, the provisions
shall not become effective unless approved by the Legislature in
the annual Budget Act.

SEC. 32.  

Section 21625 of the Government Code is amended
to read:

21625.  

Notwithstanding any other provision of this part, upon
the member’s election to be subject to Section 21460 or 21478,
the benefits provided by Section 21624, 21626, 21627, 21628,
21629, or 21630, as applicable, shall be payable only to the
member’s eligible surviving spouse and for his or her lifetime.
The benefit shall not cease upon the remarriage of the surviving
spouse.

SEC. 33.  

Section 21628 of the Government Code is amended
to read:

21628.  

The allowance provided by Section 21624 shall be paid
with respect to a local miscellaneous or local safety member whose
retirement was effective prior to his or her employer’s election to
be subject to the section with respect to employees in his or her
employment, if at retirement he or she did not elect the optional
settlement in Section 21456, 21457, 21459, 21475, 21475.5, 21476,
21476.5, or 21477 or an optional settlement involving life
contingency in Section 21458. The retirement allowance payable
to a retired member who elected any of these optional settlements,
or to a beneficiary of a retired member, shall be increased by 15
percent, for time on and after the operative date and prior to the
next annual adjustment under Article 3 (commencing with Section
21310) of Chapter 13 and the base allowance shall be increased
by 15 percent for purpose of that and all subsequent annual
adjustments. The amount payable to the beneficiary under the
optional settlement shall be increased by the same percentage and
in the same manner as the increase provided for the payment to
the member.

The increased allowance provided by this section shall not be
payable to a beneficiary who is receiving an allowance pursuant
to this article or Article 4 (commencing with Section 21350) of
Chapter 13 on September 29, 1980, until the employer of the retired
member elects to be subject to this section as so amended by
amendment to its contract made in the manner prescribed for
approval of contracts, except that an election among employees
shall not be required. In the case of contracts made on or after
September 29, 1980, the operative date of Section 21624, for
purposes of application of that section to local members, shall be
the effective date of the contract or contract amendment.

SEC. 34.  

Section 21629 of the Government Code is amended
to read:

21629.  

Upon the death, after the effective date of retirement,
of a state miscellaneous member none of whose service rendered
in state employment has been included in the federal system and
whose retirement is effective on or after July 1, 1974, or of a school
member or school safety member none of whose service rendered
in school service or school safety service has been included in the
federal system and whose retirement is effective on or after July
1, 1983, a monthly allowance derived from employer contributions
equal to 50 percent of the amount of his or her retirement allowance
as it was at his or her death and based on service credited to him
or her as a member subject to this section but excluding any portion
of the retirement allowance derived from additional contributions
of the member shall be paid to the surviving spouse throughout
life. If there is no surviving spouse, or upon the death of the
surviving spouse, the allowance shall be paid collectively to every
unmarried child of the deceased member who has not attained age
18, or who is disabled by a condition which disabled that child
prior to attaining age 18 and which has continued without
interruption after age 18, until the disability ceases. If at the time
of the retired member’s death there is no eligible surviving spouse
or children, the allowance shall be paid to a parent, or collectively
to parents, of the deceased member dependent upon him or her for
support. If on the effective date of retirement there is a person who
will be eligible if the person survives, the member’s election of
an optional settlement other than the optional settlement begin delete settlement end delete
in Section 21455 or 21474 shall apply only to a portion of his or
her allowance as provided in Section 21451 or 21471.1. If on the
effective date of his or her retirement the member has no surviving
spouse, eligible children, or dependent parents and elected an
optional settlement, no allowance under this section shall be paid.

“Surviving spouse,” for purposes of service retirement subject
to this section, means a husband or wife who was married to the
member for a continuous period beginning at least one year prior
to his or her retirement and ending on the date of his or her death
and, for purposes of disability retirement subject to this section
where the member retired on or after January 1, 1995, means a
husband or wife who was married to the member on the date of
his or her retirement and continuously to the date of his or her
death.

SEC. 35.  

Section 21630 of the Government Code is amended
to read:

21630.  

Upon death after the effective date of retirement of a
state miscellaneous member some of whose service rendered in
state employment has been included in the federal system and
whose retirement is effective on or after July 1, 1975, or of a school
member or school safety member some of whose service rendered
in school employment has been included in the federal system and
whose retirement is effective on or after July 1, 1983, a monthly
allowance, derived from employer contributions, equal to a
percentage of the amount of his or her retirement allowance as it
was at his or her death based on service credited to him or her as
a member subject to this section but excluding any portion of the
retirement allowance derived from additional contributions of the
member shall be paid to the surviving spouse throughout life. The
percentage shall be 25 percent for an allowance based on service
that was also covered under the federal system and 50 percent for
an allowance based on any other service, except that the percentage
shall be 50 percent for the allowance of a member whose service
was subject to Section 21076 or 21077 and who had become a
member prior to November 1, 1988. If there is no surviving spouse,
or upon the death of the surviving spouse, the allowance shall be
paid collectively to every unmarried child of the deceased member
who has not attained age 18, or who is disabled by a condition that
disabled that child prior to attaining age 18 and that has continued
without interruption after age 18, until the disability ceases. If at
the time of the retired member’s death there is no eligible surviving
spouse or children, the allowance shall be paid to a parent, or
collectively to parents, of the deceased member dependent upon
him or her for support. If on the effective date of retirement there
is a person who will be eligible if the person survives, the
member’s election of an optional settlement, other than the optional
settlement in Section 21455 or 21474, shall apply only to a portion
of the allowance as provided in Section 21451 or 21471.1. If on
the effective date of his or her retirement the member has no
surviving spouse, eligible children, or dependent parents and
elected an optional settlement, no allowance under this section
shall be paid.

“Surviving spouse,” for purposes of service retirement subject
to this section, means a husband or wife who was married to the
member for a continuous period beginning at least one year prior
to his or her retirement and ending on the date of his or her death
and, for purposes of disability retirement subject to this section
where the member retired on or after January 1, 1995, means a
husband or wife who was married to the member on the date of
his or her retirement and continuously to the date of his or her
death.

SEC. 36.  

Section 21631 of the Government Code is amended
to read:

21631.  

(a) The monthly allowance provided by Sections 21629
and 21630 shall be paid on account of retired school members who
did not at retirement elect the optional settlement in Section 21456,
21457, 21459, 21475, 21475.5, 21476, 21476.5, or 21477 or an
optional settlement involving life contingency in Section 21458.

(b) Upon receipt of a written application for benefits at the office
of the board, the benefits provided by this section shall be payable
to eligible survivors of retired school members who are not
receiving a monthly allowance on account of miscellaneous service
as a state member.

(c) When there are no records in the board’s possession that
contain necessary data for determining the retirement benefit
claimed, the applicant or applicants for the benefit shall be required
to establish entitlement to the benefit upon evidence satisfactory
to the board. That data, at a minimum, shall be sufficient to
establish the date of the retired member’s death and the amount
of the retired member’s monthly allowance payable at the time of
his or her death. The net benefit payable to the retired school
member at the date of death may be determined by the board on
the basis of the evidence submitted or upon other evidence if that
evidence allows the board to determine the unmodified allowance
payable on the date of death. The board shall use available
evidence, whether from information provided by the applicant,
partial records in possession of the board, or from other sources,
as the basis for assumptions that are necessary in order to calculate
the allowance payable to the eligible survivor or survivors.

(d) The benefits provided by this section shall be subject to the
same eligibility and termination provisions that apply to members
at their retirement and shall be paid commencing on the first day
of the month succeeding the month in which the application for
the benefits of this section is received by the board.

(e) The board has no duty to identify, locate, or notify any
survivor of a retired school member who may potentially be eligible
for the benefits of this section. The board has no duty to provide
the name or address of any potential survivor to any person,
agency, or entity for the purpose of notifying survivors who may
potentially be eligible for the benefits of this section.

(f) The cost of the additional benefits provided pursuant to the
trial court decision in California State Employees Association, et
al. v. Board of Administration of the Public Employees’ Retirement
System et al. (Sacramento County Superior Court, Case No.
332315) shall be paid out of the reserve against deficiencies
established by Section 20174.

SEC. 37.  

Section 21632 of the Government Code is amended
to read:

21632.  

(a) The monthly allowances provided by Sections
21629 and 21630 shall be paid on account of retired state
miscellaneous members who did not at retirement elect the optional
settlement in Section 21456, 21457, or 21459, or an optional
settlement involving life contingency in Section 21458, and whose
retirement dates were effective before July 1, 1974, with respect
to members who were not covered by the federal system, and
before July 1, 1975, with respect to members who were covered
under the federal system. Upon receipt of a written application by
the board, the benefits provided by this section shall be payable
to eligible survivors of retired members who are not receiving a
monthly allowance on account of miscellaneous service as a state
member. However, if, on the date the application is received by
the board, there is no longer in existence a record in the board’s
possession setting forth the retirement data relating to the retired
member, the applicant survivor or survivors of the retired member
shall be required, as a condition precedent to his or her entitlement
to the benefit provided by this section, to furnish documentary
evidence satisfactory to the board to enable it to determine the date
of the retired member’s death and the amount of the member’s
allowance that was currently payable at the time of death. The net
benefit payable to the retired member at the time of death shall be
determined on the basis of the evidence submitted, unless the board
is able to determine the unmodified allowance payable at the time
of death. If the allowance payable to an eligible survivor is based
on evidence furnished by the survivor or partial member records
in the board’s possession, or both, the board shall use that
information to assume any additional factors required to calculate
the allowance payable. The benefits shall be subject to the same
eligibility and termination provisions that apply to members at
retirement and shall, subject to subdivision (b), be paid only for
the period of time commencing on the first of the month following
receipt by the board of the application for the benefits. The board
has no duty to locate or notify any potential survivor or to provide
the name or address of any potential survivor to any person,
agency, or entity for the purpose of notifying survivors.

(b) Upon receipt of a written application pursuant to subdivision
(a), the benefits provided by this section shall be paid both
prospectively and retroactively for the period of time commencing
with the first day of the month following receipt of the application.

(c) The payment of benefits pursuant to this section, as amended
by Chapter 788 of the Statutes of 1984, shall commence no sooner
than January 1, 1985.

SEC. 38.  

Section 21633 of the Government Code is amended
to read:

21633.  

The monthly allowance provided by Section 21624
shall be paid on account of patrol and state safety members retired
for nonindustrial disability with effective dates of retirement prior
to April 1, 1972, and who did not at retirement elect the optional
settlement in Section 21456, 21457, or 21459 or an optional
settlement involving life contingency in Section 21458. Upon
receipt of a written application by the board, the benefits provided
by this section shall also be payable to eligible survivors of retired
members who are not receiving a monthly allowance on account
of service as a patrol or state safety member if the retired member
was alive and receiving a monthly allowance on June 30, 1974.
The benefits shall be subject to the same eligibility and termination
provisions that apply to members at retirement and shall be paid
only for the period of time commencing on the first of the month
following receipt by the board of the application for those benefits.

SEC. 39.  

Section 21752 of the Government Code is amended
to read:

21752.  

(a) (1) In accordance with Section 21756, a member’s
annual retirement benefits, adjusted to the actuarial equivalent of
a straight-life annuity if payable in a form other than a straight-life
annuity or a qualified joint and survivor annuity as provided under
Section 21460 or 21478 and determined without regard to any
employee contributions or rollover contributions, as defined in
Sections 402(a)(5), 403(a)(4), and 408(d)(3) of Title 26 of the
United States Code, otherwise payable to the member under Part
3 (commencing with Section 20000) and under any other defined
benefit plan maintained by the employer that is subject to Section
415 of Title 26 of the United States Code, shall not exceed, in the
aggregate, the dollar limit applicable pursuant to Section
415(b)(1)(A) of Title 26 of the United States Code, as appropriately
modified by Section 415(b)(2)(F) and (G) of Title 26 of the United
States Code.

(2) A member who receives benefits based on credited service
with multiple employers shall not exceed the limitations set forth
in this subdivision with regard to his or her annual retirement
benefits.

(3) However, the annual retirement benefit payable to a member
shall be deemed not to exceed the limitations prescribed in
paragraph (1) if the benefit does not exceed ten thousand dollars
($10,000) and the member has at no time participated in a tax
qualified defined contribution plan maintained by the employer.

(b) These limitations shall be applied pursuant to Section
415(b)(10) of Title 26 of the United States Code.

(c) Part 3 (commencing with Section 20000) shall be construed
as if it included this section.

SEC. 40.  

Section 75070 of the Government Code is amended
to read:

75070.  

In lieu of electing the unmodified allowance for his or
her life alone, a judge may elect to have the actuarial equivalent
of his or her retirement allowance as of the date of retirement
applied to a lesser retirement allowance, in accordance with one
of the optional settlements specified in Section 75071 when the
judge retires on or before December 31, 2017, or Section 75071.5
when the judge retires on or after January 1, 2018.

That election, revocation, or change of election shall be made
by a writing filed with the Judges’ Retirement System within 30
calendar days after the making of the first payment on account of
any retirement allowance.

If a person qualifies for the survivor allowance under Section
75077 or 75096.3, then the election with respect to any optional
settlement other than the optional settlement in subdivision (a) of
Section 75071 or subdivision (b) of Section 75071.5, shall apply
only to the portion of the retirement allowance that exceeds the
amount of the allowance deemed payable to the survivor.

SEC. 41.  

Section 75070.5 is added to the Government Code,
to read:

75070.5.  

If a judge elects an optional settlement that provides
for a monthly allowance for his or her named beneficiary or
beneficiaries, the combined allowance payable to the judge’s named
beneficiary or beneficiaries and the judge’s survivor pursuant to
Section 75077 or 75096.3, if applicable, shall begin insert not end insert exceed the
amount of the judge’s monthly allowance.

SEC. 42.  

Section 75071 of the Government Code is amended
to read:

75071.  

This section shall apply to any judge who retires on or
before December 31, 2017.

(a) Optional settlement one consists of the right to have a
retirement allowance paid to the judge for life and if he or she dies
before receiving the amount of his or her accumulated contributions
at retirement, to have the balance at death paid to his or her
designated beneficiary or, if no beneficiary designation is in effect
on the date of death, to his or her estate.

(b) (1) Optional settlement two consists of the right to have a
retirement allowance paid to him or her for life and thereafter to
his or her designated beneficiary for life.

(2) If the judge’s designated beneficiary predeceases the judge
and the judge elected this optional settlement to be effective on or
after January 1, 2002, the judge’s allowance shall be adjusted
effective the first day of the month following the death of the
beneficiary to reflect the benefit that would have been paid had
the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her beneficiary spouse are legally
separated and the judgment dividing their community property
awards the total interest in this system to the retired judge, and the
retired judge elected this optional settlement to be effective on or
after January 1, 2002, the retired judge’s allowance shall be
adjusted effective the first day of the month following the filing
of the judgment with the board to reflect the benefit that would
have been paid had the judge not elected an optional settlement.

(c) (1) Optional settlement three consists of the right to have a
retirement allowance paid him or her for life, and thereafter to
have one-half of his or her retirement allowance paid to his or her
designated beneficiary for life.

(2) If the judge’s designated beneficiary predeceases the judge
and the judge elected this optional settlement to be effective on or
after January 1, 2002, the judge’s allowance shall be adjusted
effective the first day of the month following the death of the
beneficiary to reflect the benefit that would have been paid had
the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her beneficiary spouse are legally
separated and the judgment dividing their community property
awards the total interest in this system to the retired judge, and the
retired judge elected this optional settlement to be effective on or
after January 1, 2002, the retired judge’s allowance shall be
adjusted effective the first day of the month following the filing
of the judgment with the board to reflect the benefit that would
have been paid had the judge not elected an optional settlement.

(d) Optional settlement four consists of other benefits that are
the actuarial equivalent of his or her retirement allowance, that he
or she may select subject to the approval of the Judges’ Retirement
System.

(e) When a judge elects, on or after January 1, 2003, to receive
benefits provided by paragraph (2) of subdivision (b) or paragraph
(2) of subdivision (c), and the judge and his or her optional
settlement beneficiary both die before receiving in annuity
payments the full amount of the judge’s accumulated contributions
at retirement, the balance of the judge’s accumulated contributions
shall be paid to the beneficiary designated by the judge. If the
judge had no designated beneficiary in effect on the date of death,
payment shall be made to the judge’s estate.

SEC. 43.  

Section 75071.5 is added to the Government Code,
to read:

75071.5.  

This section shall apply to any judge who retires on
or after January 1, 2018.

(a) The unmodified allowance consists of the right to have the
maximum retirement allowance paid to the judge for his or her
life alone. There is no continuing allowance to a beneficiary and
there is no return of unused accumulated contributions after the
death of the judge.

(b) The Return of Remaining Contributions Option 1 consists
of the right to have a retirement allowance paid to the judge until
his or her death and, if he or she dies before he or she receives in
annuity payments the amount of his or her accumulated
contributions at retirement, to have the balance at death paid to
his or her designated beneficiary or estate.

(c) (1) The 100 Percent Beneficiary Option 2 consists of the
right to have a retirement allowance paid to the judge until his or
her death, and thereafter to have the same monthly allowance paid
to his or her designated beneficiary for life; provided that with
respect to a judge subject to Section 75077 or 75096.3 at
retirement, the beneficiary shall receive a monthly allowance equal
to that portion of the judge’s monthly allowance that exceeds the
amount of the allowance deemed payable to the judge’s survivor.

(2) Upon the death of both the judge and the designated
beneficiary, any remaining balance of the judge’s accumulated
contributions at retirement not used to fund the allowances paid
to the judge and the designated beneficiary will be paid in a lump
sum to the secondary beneficiary or beneficiaries designated by
the judge.

(d) (1) The 100 Percent Beneficiary Option 2 with Benefit
Allowance Increase consists of the right to have a retirement
allowance paid to the judge until his or her death and thereafter to
have the same monthly allowance paid to his or her designated
beneficiary for life; provided that with respect to a judge subject
to Section 75077 or 75096.3 at retirement, the beneficiary shall
receive a monthly allowance equal to that portion of the judge’s
monthly allowance that exceeds the amount of the allowance
deemed payable to the judge’s survivor.

(2) If the judge’s designated beneficiary predeceases the judge
and the judge elected this optional settlement, the judge’s allowance
shall be adjusted effective the first day of the month following the
death of the beneficiary to reflect the benefit that would have been
paid had the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her beneficiary spouse are legally
separated and the judgment dividing their community property
awards the total interest in this system to the retired judge, and the
retired judge elected this optional settlement, the retired judge’s
allowance shall be adjusted effective the first day of the month
following the filing of the judgment with the board to reflect the
benefit that would have been paid had the judge not elected an
optional settlement.

(e) (1) The 50 Percent Beneficiary Option 3 consists of the
right to have a retirement allowance paid to the judge until his or
her death, and thereafter to have one-half of the monthly allowance
paid to his or her designated beneficiary for life, provided that,
with respect to a judge subject to Section 75077 or 75096.3 at
retirement, the beneficiary shall receive a monthly allowance equal
to one-half of that portion of the judge’s allowance that exceeds
the amount of the allowance deemed payable to the judge’s
survivor.

(2) Upon the death of both the judge and the designated
beneficiary, any remaining balance of the judge’s accumulated
contributions at retirement not used to fund the allowances paid
to the judge and the designated beneficiary will be paid in a lump
sum to the secondary beneficiary or beneficiaries designated by
the judge.

(f) (1) The 50 Percent Beneficiary Option 3 with Benefit
Allowance Increase consists of the right to have a retirement
allowance paid to the judge until his or her death and thereafter to
have one-half of the monthly allowance paid to his or her
designated beneficiary for life; provided that with respect to a
judge subject to Section 75077 or 75096.3 at retirement, the
beneficiary shall receive a monthly allowance equal to one-half
of that portion of the judge’s monthly allowance that exceeds the
amount of the allowance deemed payable to the judge’s survivor.

(2) If the judge’s designated beneficiary predeceases the judge
and the judge elected this optional settlement, the judge’s allowance
shall be adjusted effective the first day of the month following the
death of the beneficiary to reflect the benefit that would have been
paid had the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her beneficiary spouse are legally
separated and the judgment dividing their community property
awards the total interest in this system to the retired judge, and the
retired judge elected this optional settlement, the retired judge’s
allowance shall be adjusted effective the first day of the month
following the filing of the judgment with the board to reflect the
benefit that would have been paid had the judge not elected an
optional settlement.

(g) The Flexible Beneficiary Option 4 consists of the right to
have a retirement allowance paid to a judge until his or her death,
and thereafter to have a monthly allowance paid to his or her
designated beneficiary or beneficiaries for life. Subject to Section
75070.5, the judge may select the monthly allowance payable to
the designated beneficiary or beneficiaries from the options below:

(1) Specific Dollar Amount to a Beneficiary or Beneficiaries.
The judge may specify that upon his or her death after retirement,
a monthly allowance in an amount determined by the judge be
paid to a designated beneficiary or beneficiaries for life.

(2) Specific Percentage to a Beneficiary or Beneficiaries. The
judge may specify that upon his or her death after retirement, a
monthly allowance in an amount equivalent to a specified
percentage of the judge’s begin delete unmodified end delete allowance be paid to a
designated beneficiary or beneficiaries for life.

SEC. 44.  

Section 75073 of the Government Code is amended
to read:

75073.  

A judge who elects to receive optional settlement two
or three in Section 75071 may concurrently and irrevocably elect
to waive the provision for an increase to his or her allowance, as
specified in subdivisions (b) and (c) of Section 75071, and shall,
instead, have his or her allowance based upon the waiver of this
benefit.

This section shall apply to any judge who retires on or before
December 31, 2017.

SEC. 45.  

Section 75094 of the Government Code is amended
to read:

75094.  

(a) Notwithstanding any other provision of this article
to the contrary, the surviving spouse of a judge shall receive an
allowance that is equal to the amount that the judge would have
received had the judge been retired from service on the date of his
or her death and had elected the optional settlement specified in
subdivision (b) of Section 75071 and 75073, if all of the following
apply to the judge:

(1) The judge died in office on or after January 1, 2005.

(2) The judge had attained the minimum age for service
retirement applicable to the judge preceding his or her death, with
a minimum of 20 years of service.

(3) The judge was eligible to receive an allowance pursuant to
Section 75025 or 75033.5.

(b) A surviving spouse receiving an allowance pursuant to this
section shall have no other claim to benefits with respect to the
Judges’ Retirement Fund or with respect to any other provision of
the Judges’ Retirement Law.

(c) The benefits provided by this section are only payable to the
surviving spouse of a judge who elects to come within this section.
Notwithstanding Section 75090, that election may be made at any
time while the judge is in office and, once made, the election is
irrevocable.

(d) This section does not prevent a surviving spouse from
claiming or receiving any payments to which he or she may be
entitled as a beneficiary under the Extended Service Incentive
Program set forth in Article 4.5 (commencing with Section 75085).

SEC. 46.  

Section 75522 of the Government Code is amended
to read:

75522.  

(a) A judge is eligible to retire pursuant to this section
upon attaining both 65 years of age and 20 or more years of service,
or upon attaining 70 years of age with a minimum of five years of
service.

(b) The office of a judge who retires under this section becomes
vacant on the date of the retirement.

(c) A judge who retires pursuant to this section shall, within 30
days after the effective date of the retirement, elect to receive either
the benefits provided by subdivision (d) or the benefits provided
by subdivision (e). Under rules adopted by the board, the time for
the election may be extended in cases of illness or other hardship,
but once made, the election shall be final and irrevocable.

(d) The judge may elect to receive for life a monthly retirement
allowance equal to the benefit factor multiplied by the judge’s
final compensation multiplied by the number of years of service
credit.

(1) The benefit factor for a judge eligible to retire pursuant to
this section equals 3.75 percent per year of service.

(2) In no event shall the retirement allowance at the time of
retirement exceed 75 percent of the judge’s final compensation.

(e) The judge may elect to receive the amount of his or her
monetary credits determined pursuant to Section 75520, including
the credits added under subdivision (b) of that section computed
to the last day of the month preceding the date of distribution.
Under rules adopted by the board, the judge may elect to receive
that amount in a single payment, or may direct that it be paid in
an annuity of actuarially equivalent value for the judge’s life or in
one of the optional forms provided for in Section 75571 if the
judge retires on or before December 31, 2017, or Section 75571.5
if the judge retires on or after January 1, 2018.

(f) If a retired judge fails or refuses to make an election pursuant
to subdivision (c) within the time allowed, he or she shall be
deemed to have elected to receive a monthly retirement allowance
under subdivision (d).

SEC. 47.  

Section 75570 of the Government Code is amended
to read:

75570.  

(a) In lieu of electing the unmodified allowance under
subdivision (d) of Section 75522 for his or her life alone, a judge
who elects to retire with a monthly allowance under subdivision
(d) of Section 75522 may elect to have the actuarial equivalent of
his or her retirement allowance as of the date of retirement applied
to a lesser retirement allowance, in accordance with one of the
optional settlements specified in Section 75571 if the judge retires
on or before December 31, 2017, or Section 75571.5 if the judge
retires on or after January 1, 2018.

(b) That election, revocation, or change of election shall be
made by a writing filed with the system within 30 calendar days
after the making of the first payment on account of any retirement
allowance.

(c) If there is a spouse who would qualify for the survivor
allowance under subdivision (b) of Section 75590, then the
election, with respect to any optional settlement other than the
optional settlement in subdivision (a) of Section 75571 or
subdivision (b) of Section 75571.5, shall apply only to the portion
of the retirement allowance that exceeds the amount of the
allowance deemed payable to the surviving spouse.

SEC. 48.  

Section 75570.5 is added to the Government Code,
to read:

75570.5.  

If a judge elects an optional settlement that provides
for a monthly allowance for his or her surviving spouse, the
combined allowance payable to the surviving spouse pursuant to
the optional settlement and Section 75590, if applicable, cannot
exceed the amount of the begin delete member’s end delete begin insert judge’s end insert monthly allowance.

SEC. 49.  

Section 75571 of the Government Code is amended
to read:

75571.  

This section shall apply to any judge who retires on or
before December 31, 2017.

(a) Optional settlement one consists of the right to have a
retirement allowance paid to the judge until his or her death and
if he or she dies before he or she receives the amount of his or her
accumulated contributions at retirement, to have the balance at
death paid to his or her surviving spouse or estate.

(b) (1) Optional settlement two consists of the right to have a
retirement allowance paid to the judge until his or her death and
thereafter to his or her surviving spouse for life.

(2) If the judge’s spouse predeceases the judge and the judge
elected this optional settlement to be effective on or after January
1, 2002, the judge’s allowance shall be adjusted effective the first
day of the month following the death of the spouse to reflect the
benefit that would have been paid had the judge not elected an
optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her spouse are legally separated and
the judgment dividing their community property awards the total
interest in this system to the retired judge, and the retired judge
elected this optional settlement to be effective on or after January
1, 2002, the retired judge’s allowance shall be adjusted effective
the first day of the month following the filing of the judgment with
the board to reflect the benefit that would have been paid had the
judge not elected an optional settlement.

(c) (1) Optional settlement three consists of the right to have a
retirement allowance paid to the judge until his or her death, and
thereafter to have one-half of his or her retirement allowance paid
to his or her surviving spouse for life.

(2) If the judge’s spouse predeceases the judge and the judge
elected this optional settlement to be effective on or after January
1, 2002, the judge’s allowance shall be adjusted effective the first
day of the month following the death of the spouse to reflect the
benefit that would have been paid had the judge not elected an
optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her spouse are legally separated and
the judgment dividing their community property awards the total
interest in this system to the retired judge, and the retired judge
elected this optional settlement to be effective on or after January
1, 2002, the retired judge’s allowance shall be adjusted effective
the first day of the month following the filing of the judgment with
the board to reflect the benefit that would have been paid had the
judge not elected an optional settlement.

(d) Optional settlement four consists of other benefits that are
the actuarial equivalent of his or her retirement allowance, that he
or she may select subject to the approval of the board.

SEC. 50.  

Section 75571.5 is added to the Government Code,
to read:

75571.5.  

This section shall apply to any judge who retires on
or after January 1, 2018.

(a) The unmodified allowance consists of the right to have the
maximum retirement allowance paid to the judge for his or her
life alone. A continuing allowance to the surviving spouse, other
than the benefit provided in subdivision (b) of Section 75590, is
not provided and there is not a return of unused accumulated
contributions after the death of the judge.

(b) The Return of Remaining Contributions Option 1 consists
of the right to have a retirement allowance paid to the judge for
his or her life alone and if he or she dies before he or she receives
in annuity payments the amount of his or her accumulated
contributions at retirement, to have the balance at death paid to
his or her surviving spouse, or if none, to his or her estate.

(c) (1) The 100 Percent Beneficiary Option 2 consists of the
right to have a retirement allowance paid to the judge until his or
her death and thereafter to have the same monthly allowance paid
to his or her surviving spouse for life; provided that with respect
to a judge subject to subdivision (b) of Section 75590, the surviving
spouse shall receive that portion of the judge’s monthly allowance
that exceeds the amount of the allowance deemed payable pursuant
to subdivision (b) of Section 75590.

(2) Upon the death of both the judge and the surviving spouse,
any remaining balance of the judge’s accumulated contributions
at retirement not used to fund the allowances paid to the judge and
the surviving spouse pursuant to this subdivision will be paid in a
lump sum to the estate of the deceased.

(d) (1) The 100 Percent Beneficiary Option 2 with Benefit
Allowance Increase consists of the right to have a retirement
allowance paid to the judge until his or her death and thereafter to
have the same monthly allowance paid to his or her surviving
spouse for life; provided that with respect to a judge subject to
subdivision (b) of Section 75590, the surviving spouse shall receive
that portion of the judge’s monthly allowance that exceeds the
amount of the allowance deemed payable pursuant to subdivision
(b) of Section 75590.

(2) If the judge’s spouse predeceases the judge and the judge
elected this optional settlement, the judge’s allowance shall be
adjusted effective the first day of the month following the death
of the spouse to reflect the benefit that would have been paid had
the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her spouse are legally separated and
the judgment dividing their community property awards the total
interest in this system to the retired judge, and the retired judge
elected this optional settlement, the retired judge’s allowance shall
be adjusted effective the first day of the month following the filing
of the judgment with the board to reflect the benefit that would
have been paid had the judge not elected an optional settlement.

(e) (1) The 50 Percent Beneficiary Option 3 consists of the
right to have a retirement allowance paid to the judge until his or
her death and thereafter to have one-half of the monthly allowance
paid to his or her surviving spouse for life; provided that with
respect to a judge subject to subdivision (b) of Section 75590, the
surviving spouse shall receive one-half of that portion of the
judge’s monthly allowance that exceeds the amount of the
allowance deemed payable pursuant to subdivision (b) of Section
75590.

(2) Upon the death of both the judge and the surviving spouse,
any remaining balance of the judge’s accumulated contributions
at retirement not used to fund the allowances paid to the judge and
the surviving spouse pursuant to this subdivision will be paid in a
lump sum to the estate of the deceased.

(f) (1) The 50 Percent Beneficiary Option 3 with Benefit
Allowance Increase consists of the right to have a retirement
allowance paid to the judge until his or her death and thereafter to
have one-half of the monthly allowance paid to his or her surviving
spouse for life; provided that with respect to a judge subject to
subdivision (b) of Section 75590, the surviving spouse shall receive
one-half of that portion of the judge’s monthly allowance that
exceeds the amount of the allowance deemed payable pursuant to
subdivision (b) of Section 75590.

(2) If the judge’s spouse predeceases the judge and the judge
elected this optional settlement, the judge’s allowance shall be
adjusted effective the first day of the month following the death
of the spouse to reflect the benefit that would have been paid had
the judge not elected an optional settlement.

(3) If the marriage of a retired judge is dissolved or annulled or
if the retired judge and his or her spouse are legally separated and
the judgment dividing their community property awards the total
interest in this system to the retired judge, and the retired judge
elected this optional settlement, the retired judge’s allowance shall
be adjusted effective the first day of the month following the filing
of the judgment with the board to reflect the benefit that would
have been paid had the judge not elected an optional settlement.

(g) The Flexible Beneficiary Option 4 consists of the right to
have a retirement allowance paid to a judge until his or her death,
and thereafter to have a monthly allowance paid to his or her
surviving spouse for life. Subject to Section 75570.5, the judge
may select the monthly allowance payable to the surviving spouse
from the options below:

(1) Specific Dollar Amount to a Surviving Spouse. The judge
may specify that upon his or her death after retirement, a monthly
allowance in an amount determined by the judge be paid to his or
her surviving spouse for life.

(2) Specific Percentage to a Surviving Spouse. The judge may
specify that upon his or her death after retirement, a monthly
allowance in an amount equivalent to a specified percentage of
the judge’s allowance be paid to his or her surviving spouse for
life.

SEC. 51.  

Section 75573 of the Government Code is amended
to read:

75573.  

A judge who elects to receive optional settlement two
or three in Section 75571 may concurrently and irrevocably elect
to waive the provision for an increase to his or her allowance, as
specified in subdivisions (b) and (c) of Section 75571, and shall,
instead, have his or her allowance based upon the waiver of this
benefit.

This section shall apply to any judge who retires on or before
December 31, 2017.

SEC. 52.  

Section 75590 of the Government Code is amended
to read:

75590.  

(a) A surviving spouse of a judge who was eligible to
retire pursuant to subdivision (a) of Section 75522 shall, within
90 days after the judge’s death, elect to receive either of the
following:

(1) A monthly retirement allowance equal to one-half of the
judge’s benefit factor computed as stated in subdivision (d) of
Section 75522 as of the date of death, multiplied by the judge’s
final compensation multiplied by the number of years of service
credit. This allowance shall be adjusted for changes in the cost of
living as provided in Section 75523.

(2) The judge’s monetary credits determined pursuant to Section
75520, including the credits added under subdivision (b) of that
section computed to the last day of the month preceding the date
of distribution.

(b) A surviving spouse of a retired judge who elected to receive
a monthly allowance under subdivision (d) of Section 75522 or
who was retired for disability and receiving an allowance under
Section 75560.4 shall receive a monthly allowance equal to 50
percent of the deceased judge’s last monthly retirement allowance.
This allowance shall be adjusted for changes in the cost of living
as provided in Section 75523.

(c) (1) Notwithstanding any other provision of this article to
the contrary, the surviving spouse of a judge who (A) died in office,
(B) had attained the minimum age for service retirement applicable
to the judge preceding his or her death, with a minimum of 20
years of service, and (C) was eligible to receive an allowance
pursuant to Section 75522, shall receive an allowance that is equal
to the amount that the judge would have received if the judge had
been retired from service on the date of death and had elected the
optional settlement specified in subdivision (b) of Section 75571
and in Section 75573.

(2) A surviving spouse receiving an allowance pursuant to this
subdivision shall have no other claim to benefits with respect to
the Judges’ Retirement Fund or with respect to any other provision
of the Judges’ Retirement System II Law.

(3) The benefits provided by this subdivision are only payable
to the surviving spouse of a judge who elects to come within this
subdivision. That election may be made at any time while the judge
is in office and, once made, the election is irrevocable.

(d) A monthly allowance payable to a surviving spouse pursuant
to this section is payable commencing upon the death of the judge
and continuing until the death of the surviving spouse.