BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      SB 98


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          (Without Reference to File)





          SENATE THIRD READING


          SB  
          98 (Committee on Budget and Fiscal Review)


          As Amended  June 16, 2015


          Majority vote. Budget Bill Appropriation Takes Effect  
          Immediately


          SENATE VOTE:  Vote not relevant


          SUMMARY:  Includes a statutory provision related to employee  
          compensation necessary to enact the 2015 Budget Act.   
          Specifically, this bill:   


           1)Repeals Government Code Section 12439 related to vacant  
            positions.
          2)States that "family member" does not include a former spouse  
            or former domestic partner of an employee or annuitant.


          3)Expands the definition of prefunding to add periodic payments  
            by an employee to fund or partially fund the "normal costs" of  
            postemployment health care benefits.










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          4)Requires an employing office to maintain the verifying  
            documentation in the employee or annuitant's official  
            personnel or member file. 


          5)Requires the employing office of the state employee or state  
            annuitant to substantiate eligibility for family members as  
            follows:


             a)   At least once every three year for spouses, domestic  
               partners, children and stepchildren, domestic partner  
               children
             b)   At least annually for other children for whom the state  
               employee or state annuitant has assumed a parent-child  
               relationship


          6)States that the employing office of a state annuitant is the  
            Public Employee's Retirement System (CalPERS).
          7)Prohibits CalPERS from granting any further exemptions after  
            July 1, 2015, to the rule against enrolling employees,  
            annuitants, and their family members who are eligible for  
            Medicare in a basic health benefit plan.


          8)Requires CalPERS to provide an initial estimate of proposed  
            changes and costs in writing to the Joint Legislative Budget  
            Committee, chairpersons of the Public Employees' Retirement  
            System's budget, the State Controller, the Trustees of the  
            California State University, the Department of Human  
            Resources, the Director of Finance, and the Legislative  
            analyst not later than 30 days prior to the approval.  


          9)Requires the CalPERS Board to report various items to the  
            Legislature and the Director of Finance annually regarding the  
            health benefits program.









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          10)Prohibits the funds in the designated state subaccounts of  
            the fund, or a successor fund, that are derived from  
            investment income from being used to pay benefits for state  
            annuitants until the earlier of:


             a)   The date the funded ratio of the designated state  
               subaccount reaches at least 100% as determined in the  
               employer's postemployment benefits; or
             b)   July 1, 2046.


          11)Defines "designed state subaccount" as a separate account  
            maintained within the fund to identify prefunding  
            contributions and assets attributable to a specified state  
            collective bargaining unit or other state entity.  
          12)Does not prohibit an alternative funding strategy agreed to  
            in a written memorandum of understanding.  


          FISCAL EFFECT:  Statutory changes contained in this bill related  
          to state costs are consistent with the 2015-16 budget package.  


          COMMENTS:  This trailer bill language provides the necessary  
          statutory references to enact the 2015-16 Budget related to  
          employee compensation.   


          Analysis Prepared by:                                             
          Genevieve Morelos / BUDGET / (916) 319-2099  FN: 0000976















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