BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SJR 1|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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THIRD READING
Bill No: SJR 1
Author: Beall (D) and Pavley (D), et al.
Amended: 1/12/15
Vote: 21
SENATE PUBLIC EMP. & RET. COMMITTEE: 4-1, 4/13/15
AYES: Pan, Beall, Fuller, Hall
NOES: Morrell
SUBJECT: Social security: retirement benefits: public
employees
SOURCE: Association of California School Administrators
California Retired Teachers Association
California Teachers Association
Faculty Association of California Community Colleges
DIGEST: This resolution asks Congress to pass, and President
Barack Obama to sign, legislation repealing the Social Security
Act's Windfall Elimination Provision and Government Pension
Offset.
ANALYSIS: Existing federal law requires that a beneficiary's
Social Security allowance be offset if the beneficiary also
receives a government pension and was employed by an employer
not coordinated with Social Security.
This resolution asks Congress to pass, and President Barack
Obama to sign, legislation repealing the Social Security Act's
SJR 1
Page 2
Windfall Elimination Provision (WEP) and Government Pension
Offset (GPO).
Background
Under federal law, state and local public employees who work for
an employer in a position not coordinated with Social Security
and who receive a government pension upon retirement may be
affected by two federal offsets to their Social Security
benefits.
WEP affects individuals who earn a pension in any job where the
person did not pay into Social Security and also worked in other
jobs long enough to qualify for a Social Security retirement or
disability benefit for those jobs. Depending on how many years
of qualifying substantial earnings the individual has in Social
Security, WEP results in a pro rata reduction of 40 to 90
percent of one of the three factors used in determining the
average monthly earnings upon which the Social Security benefit
is based.
GPO affects individuals who earn a government pension based on
work where the employee did not pay into Social Security but who
are also eligible for Social Security dependent's benefits
(i.e., benefits based on a spouse's Social Security benefit or
as the widow or widower of an eligible Social Security benefit
recipient). GPO reduces the dependent's Social Security
spouse/widow/widower benefit by two-thirds of the amount of the
individual's government pension.
In California, WEP and GPO primarily impact teachers and public
safety officers who begin their careers in the private sector
and earn enough qualifying quarters to receive a Social Security
benefit but then switch mid-career to become, for example, a
teacher in a public school or a safety officer in a job with a
state or local government employer not coordinated with Social
Security. Many do not learn of the consequences to their Social
Security benefits until they apply to begin receiving Social
Security benefits.
Prior/Related Legislation
All of the following resolutions are substantially the same as
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SJR 1:
SJR 30 (Hancock), Resolution Chapter 126, Statutes of 2012
AJR 10 (Torlakson), Resolution Chapter 103, Statutes of 2009
AJR 5 (Hernandez), Resolution Chapter 116, Statutes of 2007
SJR 15 (Dutton), Resolution Chapter 62, Statutes of 2006
AJR 3 (Leonard), Resolution Chapter 66, Statutes of 2001
FISCAL EFFECT: Appropriation: No Fiscal
Com.:NoLocal: No
SUPPORT: (Verified4/14/15)
Association of California School Administrators (co-source)
California Retired Teachers Association (co-source)
California Teachers Association (co-source)
Faculty Association of California Community Colleges (co-source)
American Federation of State, County and Municipal Employees,
Local 685
Association for Los Angeles Deputy Sheriffs
CAL FIRE, Local 2881
California Association of Highway Patrolmen
California Federation of Teachers
California State Teachers' Retirement System
Glendale City Employees' Association
Los Angeles Police Protective League
Los Angeles County Probation Officers Union
Organization of SMUD Employees
Retired Public Employees Association of California
Riverside Sheriffs' Association
San Bernardino Public Employees Association
San Diego County Court Employees Association
San Luis Obispo County Employees Association
OPPOSITION: (Verified4/14/15)
None received
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ARGUMENTS IN SUPPORT: The California Teachers Association
states that WEP and GPO "penalize teachers who come into the
classroom as a second career by either reducing or eliminating
the Social Security benefits they contributed to during their
time in the private sector."
According to the California Retired Teachers Association, WEP
and GPO "harm California's public school educators, fire
fighters, police and many other dedicated public servants."
The Association for Los Angeles Deputy Sheriffs adds that WEP
and GPO "affect recruitment of career peace officers and
additional public safety job holders from other states."
Prepared by:Glenn Miles / P.E. & R. / (916) 651-1519
4/15/15 16:28:51
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