BILL ANALYSIS Ó
SB 354
Page 1
Date of Hearing: July 8, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 354
(Huff) - As Amended April 6, 2015
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|Policy |Public Employees, |Vote:|6 - 0 |
|Committee: |Retirement/Soc Sec | | |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill:
1)Clarifies the period during which employees of the cities of
Brea and Fullerton who are "classic" members of the California
Public Employees' Retirement System (CalPERS) can transfer to
a Joint Powers Authority (JPA) formed by those cities and
retain their benefit formulas received prior to transfer and
not the formula required under the California Public
Employees' Pension Reform Act of 2013.
SB 354
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2)Deletes the reference date of December 31, 2012, and instead
specifies that transferred employees will receive the defined
benefit plans or formulas they were receiving prior joining
the JPA, and clarifies that if any of the three contiguous
cities to Brea and Fullerton join the JPA, transferred
employees with no more than a 6-month break will also retain
their existing benefit plans or formulas.
FISCAL EFFECT:
Insignificant costs to CalPERS and/or changes to benefits for
employees.
COMMENTS:
Purpose. SB 1251 (Huff), Chapter 757, Statutes of 2014, allowed
Brea and Fullerton to transfer employees to a new JPA while
retaining the retirement formulas those employees enjoyed prior
to the formation and implementation of the JPA. The bill used
December 31, 2012, as the reference date for determining
retirement benefits of those transferred employees. As a
result, employees who joined Brea and Fullerton as "classic"
employees after that date and were later transferred to the JPA
were not grandfathered under the statute. This bill corrects
that error by clarifying that any classic employee who transfers
to the JPA will retain the classic benefit formula.
Supporters maintain SB 1251 allowed Brea and Fullerton to form a
JPA for purposes of sharing fire services with the intent of
allowing classic employees to transfer to the JPA and retain
their classic pension formulas. Since December 31, 2012, Brea
and Fullerton have hired classic public safety employees to
replace retiring employees, and this bill allows those employees
to retain their benefits after transfer to the JPA as well.
SB 354
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Analysis Prepared by:Joel Tashjian / APPR. / (916)
319-2081