Amended in Assembly August 29, 2016

Amended in Assembly August 19, 2016

Amended in Assembly June 12, 2016

Amended in Assembly May 25, 2016

Senate BillNo. 834


Introduced by Committee on Budget and Fiscal Review

January 7, 2016


An act to amend Sections 19829.9845, 19829.9846,begin insert 20397, 20682,end insert 22871.3, 22874.3, 22879, 22944.5, and 22958.1 of the Government Code, relating to state employment, and making an appropriation therefor, to take effect immediately, bill related to the budget.

LEGISLATIVE COUNSEL’S DIGEST

SB 834, as amended, Committee on Budget and Fiscal Review. State employment: memorandum of understanding: Bargaining Unitbegin delete 7.end deletebegin insert 2.end insert

(1) Existing law provides that a provision of a memorandum of understanding reached between the state employer and a recognized employee organization representing state civil service employees that requires the expenditure of funds does not become effective unless approved by the Legislature in the annual Budget Act.

This bill would approve provisions of a memorandum of understanding entered into between the state employer and State Bargaining Unitbegin delete 7, the California Statewide Law Enforcement Association,end deletebegin insert 2, California Attorneys, Administrative Law Judges and Hearing Officers in State Employment,end insert that require the expenditure of funds and would provide that these provisions will become effective even if these provisions are approved by the Legislature in legislation other than the annual Budget Act.

This bill would provide that provisions of the memorandum of understanding approved by this bill that require the expenditure of funds will not take effect unless funds for those provisions are specifically appropriated by the Legislature and would authorize the state employer and the affected employee organization to meet and confer to renegotiate the affected provisions if funds for those provisions are not specifically appropriated by the Legislature. The bill would appropriatebegin delete $38,611,000end deletebegin insert $32,558,000end insert in augmentation of certain items of the Budget Act of 2016, according to a specified schedule, for State Bargaining Unitbegin delete 7end deletebegin insert 2end insert employee compensation for expenditure in the 2016-17 fiscal year. The bill would appropriate to the Controller from the General Fund, unallocated special funds, including federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment of compensation and employee benefits to state employees covered by the memorandum of understanding described above if the Budget Act is not enacted on or before July 1 in the 2017-18 or 2018-19 fiscal years, as specified.

begin insert

(2) Existing law, the Public Employees’ Retirement Law, creates the Public Employees’ Retirement System (PERS) for the purpose of providing pension benefits to state employees and employees of contracting agencies and prescribes the rights and duties of members of the system and their beneficiaries. PERS provides a defined benefit to members of the program, based on final compensation, credited service, and age at retirement, subject to certain variations. Existing law prescribes the officers and employees of the Assembly and the Senate, including a sergeant at arms for each house. Existing law classifies the sergeants at arms of the houses as peace officers for purposes of making arrests and enforcing the law. Existing law creates different membership categories in PERS for the purpose of prescribing benefits and contributions, including the classification of state peace officer/firefighter or member. Existing law generally includes the sergeants at arms of the Assembly and the Senate within the state peace officer/firefighter member classification, but excepts the chief sergeants at arms from this classification. Existing law provides that state peace officer/firefighter members of PERS pay greater rates of contribution and receive better benefits than miscellaneous members of the system. Existing law creates the Public Employees’ Retirement Fund as a trust fund to be expended only for purposes related to the system and its administration, as specified, and provides that the fund is continuously appropriated to these ends.

end insert
begin insert

This bill would include the Chief Sergeant at Arms of the Assembly within the state peace officer/firefighter member classification. By increasing moneys deposited in a continuously appropriated fund, this bill would make an appropriation.

end insert
begin insert

(3) Existing law creates the state miscellaneous and the state industrial membership categories in PERS. Existing law excepts certain employees from the definition of state employee for the purposes of collective bargaining regarding the terms and conditions of employment. Existing law prescribes the pension contribution percentages for state miscellaneous and state industrial members of PERS who are excepted from the definition of state employee for the purposes of collective bargaining and who are in job classifications that are related to State Bargaining Unit 2. In this regard, existing law prescribes a normal rate of pension contribution for these employee of 9% of compensation in excess of a specified amount for these employees whose service is not included in the federal social security system and 8% of compensation in excess of a specified amount for these employees whose service is included in the federal social security system.

end insert
begin insert

This bill would increase the pension contribution percentages for state miscellaneous and state industrial members of PERS excepted from the definition of state employee and related to State Bargaining Unit 2, as described above, to 10% and 9%, as specified. By increasing moneys deposited in a continuously appropriated fund, this bill would make an appropriation.

end insert
begin delete

(2)

end delete

begin insert(4)end insert The Public Employees’ Medical and Hospital Care Act (PEMHCA), which is administered by the Board of Administration of the Public Employees’ Retirement System, prescribes methods for calculating the state employer contribution for postemployment health care benefits for eligible retired public employees and their families and for the vesting of these benefits. PEMHCA requires the employer contribution for an employee or annuitant who is in employment or retired from state service to be adjusted by the Legislature in the annual Budget Act, as specified. PEMHCA prescribes different ways of calculating the employer contributions for employees and annuitants depending on date of hire, years of service, and bargaining unit.

This bill, for state employees who are first employed and become members of the retirement system on or after January 1, 2017, and are represented by State Bargaining Unitbegin delete 7,end deletebegin insert 2,end insert as specified, would limit the employer contribution for annuitants to 80% of the weighted average of the health benefit plan premiums for an active employee enrolled for self-alone, during the benefit year to which the formula is applied, for the 4 health benefit plans with the largest state civil service enrollment, as specified. The bill would similarly limit the employer contribution for an enrolled family member of an annuitant to 80% of the weighted average of the additional premiums required for enrollment of those family members during the benefit year to which the formula is applied and would provide the same limit on employer contributions for annuitants enrolled in Medicare health benefit plans.

begin delete

(3)

end delete

begin insert(5)end insert PEMHCA requires state employees to have a specified number of years of state service, depending on hiring date and other factors, before they may receive any portion of the employer contribution payable for annuitants for postretirement health benefits and increases the percentage they may receive based upon additional years of service.

This bill would prohibit state employees who are first employed and become members of the retirement system on or after January 1, 2017, and are represented by State Bargaining Unitbegin delete 7,end deletebegin insert 2,end insert as specified, from receiving any portion of the employer contribution payable for annuitants unless the person is credited with at least 15 years of state service at the time of retirement. The bill would prescribe the percentage of the employer contribution payable for postretirement health benefits for these employees based on the number of completed years of credited state service at retirement, with 50% after 15 credited years of service and 100% after 25 or more years of service.

begin delete

(4)

end delete

begin insert(6)end insert PEMHCA generally requires that an employee or annuitant who is enrolled in, or whose family member is enrolled in, a Medicare health benefit plan be paid the amount of the Medicare Part B premiums, as specified, and prohibits this payment from exceeding the difference between the maximum employer contribution and the amount contributed by the employer toward the cost of premiums for the health benefit plan in which the employee or annuitant and his or her family members are enrolled. Existing law excepts from this requirement state employees who are first employed and become members of the retirement system on or after specified dates and are represented by specified state bargaining units.

This bill would also except from the requirement described above state employees who are first employed and become members of the retirement system on or after January 1, 2017, and are represented by State Bargaining Unitbegin delete 7,end deletebegin insert 2,end insert as specified.

begin delete

(5)

end delete

begin insert(7)end insert PEMHCA establishes the Public Employees’ Contingency Reserve Fund for the purpose of funding health benefits and funding administrative expenses. PEMHCA establishes the Annuitants’ Health Care Coverage Fund, which is continuously appropriated, for the purpose of prefunding health care coverage for annuitants, including administrative costs. PEMHCA defines “prefunding” for these purposes. Existing law requires the state and employees of State Bargaining Unit 9, 10, or 12 to prefund retiree health care with the goal of reaching a 50% cost sharing of normal costs by July 1, 2019, and prescribes schedules of contribution percentages in this regard.

This bill would require the state and employees of State Bargaining Unitbegin delete 7end deletebegin insert 2end insert to prefund retiree health care with the goal of reaching a 50% cost sharing of normal costs by July 1, 2019, and would prescribe a schedule of contribution percentages in this regard, with the contributions to be deposited in the Annuitants’ Health Care Coverage Fund. By depositing new revenue in a continuously appropriated fund, this bill would make an appropriation.

begin delete

(6)

end delete

begin insert(8)end insert Existing law, the State Employees’ Dental Care Act, authorizes the state to enter into contracts, upon negotiations with employee organizations, with carriers for dental care plans for employees, annuitants, and eligible family members. Existing law permits these plans to include premiums to be paid by employees and annuitants and also authorizes the plans to be self-funded if an employer determines it to be cost effective. Existing law prohibits specified employees from receiving an employer contribution for these benefits for annuitants unless the person is credited with 10 or more years of state service or for other specified employees unless the person is credited with 15 or more years of state service.

This bill would prohibit state employees, as specified, who are first employed and become members of the retirement system on or after January 1, 2017, and are represented by State Bargaining Unitbegin delete 7end deletebegin insert 2end insert from receiving an employer contribution for dental benefits, as described above, for annuitants unless the person is credited with 15 or more years of state service. The bill would prescribe the percentage of the employer contribution payable for these dental benefits for these employees based on the number of completed years of credited state service at retirement, with 50% after 15 credited years of service and 100% after 25 or more years of service.

begin insert

(9) This bill would incorporate additional changes to Sections 19829.9845, 19829.9846, 22871.3, 22874.3, 22879, 22944.5, and 22958.1 of the Government Code, proposed by AB 1627, that would become operative only if AB 1627 and this bill are both chaptered and become effective on or before January 1, 2017, and this bill is chaptered last.

end insert
begin delete

(7)

end delete

begin insert(10)end insert This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

Vote: majority. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert
P6    1

begin insertSECTION 1.end insert  

The Legislature finds and declares that a purpose
2of this act is to approve the agreement entered into by the state
3employer and State Bargaining Unit 2 pursuant to Section 3517.5
4of the Government Code.

end insert
begin insert
5

begin insertSEC. 2.end insert  

The provisions of the memorandum of understanding
6prepared pursuant to Section 3517.5 of the Government Code and
7entered into by the state employer and State Bargaining Unit 2,
8dated August 19, 2016, and that require the expenditure of funds,
9are hereby approved for the purposes of subdivision (b) of Section
103517.6 of the Government Code.

end insert
begin insert
11

begin insertSEC. 3.end insert  

The provisions of the memorandum of understanding
12approved in Section 2 of this act that require the expenditure of
13funds shall not take effect unless funds for these provisions are
14specifically appropriated by the Legislature. If funds for these
15provisions are not specifically appropriated by the Legislature,
16either the state employer or the affected employee organization
17may reopen negotiations on all or part of the memorandum of
18understanding.

end insert
begin insert
19

begin insertSEC. 4.end insert  

Notwithstanding Section 3517.6 of the Government
20Code, the provisions of the memorandum of understanding included
21in Section 2 of this act that require the expenditure of funds shall
22become effective even if the provisions of the memorandum of
P7    1understanding are approved by the Legislature in legislation other
2than the annual Budget Act.

end insert
begin insert
3

begin insertSEC. 5.end insert  

The sum of thirty-two million five hundred fifty-eight
4thousand dollars ($32,558,000) is hereby appropriated for State
5Bargaining Unit 2 for expenditure in the 2016-17 fiscal year in
6augmentation of, and for the purpose of, state employee
7compensation, as provided in Items 9800-001-0001,
89800-001-0494, and 9800-001-0988 of Section 2.00 of the Budget
9Act of 2016, in accordance with the following schedule:

10
(a) Nine million four hundred thirty-two thousand dollars
11($9,432,000) from the General Fund in augmentation of Item
129800-001-0001.

13
(b) Fifteen million four hundred ninety-four thousand dollars
14($15,494,000) from unallocated special funds in augmentation of
15Item 9800-001-0494.

16
(c) Seven million six hundred thirty-two thousand dollars
17($7,632,000) from other unallocated nongovernmental cost funds
18in augmentation of Item 9800-001-0988.

end insert
19begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 19829.9845 of the end insertbegin insertGovernment Codeend insertbegin insert is
20amended to read:end insert

21

19829.9845.  

(a) Notwithstanding Section 13340, for the
222017-18 fiscal year, if the Budget Act of 2017 is not enacted by
23July 1, 2017, for thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
24entered into between the state employer andbegin insert State Bargaining Unit
252 (effective July 1, 2016, to July 1, 2019, inclusive) andend insert
State
26Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
27inclusive) there is hereby continuously appropriated to the
28Controller from the General Fund, unallocated special funds,
29including, but not limited to, federal funds and unallocated
30nongovernmental cost funds, and any other fund from which state
31employees are compensated, the amount necessary for the payment
32of compensation and employee benefits to state employees covered
33by the abovebegin delete memorandumend deletebegin insert memorandaend insert of understanding until the
34Budget Act of 2017 is enacted. The Controller may expend an
35amount no greater than necessary to enable the Controller to
36compensate state employees covered by the abovebegin delete memorandumend delete
37begin insert memorandaend insert of understanding for work performed between July
381, 2017, of the 2017-18 fiscal year and the enactment of the Budget
39Act of 2017.

P8    1(b) If thebegin delete memorandumend deletebegin insert memorandaend insert of understanding entered
2into between the state employer andbegin insert State Bargaining Unit 2
3(effective July 1, 2016, to July 1, 2019, inclusive) andend insert
State
4Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
5inclusive)begin delete isend deletebegin insert areend insert in effect and approved by the Legislature, the
6compensation and contribution for employee benefits for state
7employees represented bybegin delete thisend deletebegin insert theseend insert bargainingbegin delete unitend deletebegin insert unitsend insert shall be
8at a rate consistent with the applicable memorandum of
9understanding referenced above.

10(c) Expenditures related to any warrant drawn pursuant to
11subdivision (a) are not augmentations to the expenditure authority
12of a department. Upon the enactment of the Budget Act of 2017,
13these expenditures shall be subsumed by the expenditure authority
14approved in the Budget Act of 2017 for each affected department.

15(d) This section shall only apply to an employee covered by the
16term of thebegin insert State Bargaining Unit 2 (effective July 1, 2016, to July
171, 2019, inclusive) orend insert
State Bargaining Unit 12 (effective July 1,
182015, to July 1, 2019, inclusive) memorandum of understanding.
19Notwithstanding Section 3517.8, this section shall not apply after
20thebegin delete termend deletebegin insert termsend insert of thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
21begin delete hasend deletebegin insert haveend insert expired. For purposes of this section, thebegin delete memorandumend delete
22begin insert memorandaend insert of understanding forbegin insert State Bargaining Unit 2 andend insert
23 State Bargaining Unit 12begin delete expiresend deletebegin insert expireend insert on July 1, 2019.

24begin insert

begin insertSEC. 6.5.end insert  

end insert

begin insertSection 19829.9845 of the end insertbegin insertGovernment Codeend insertbegin insert is
25amended to read:end insert

26

19829.9845.  

(a) Notwithstanding Section 13340, for the
272017-18 fiscal year, if the Budget Act of 2017 is not enacted by
28July 1, 2017, for thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
29entered into between the state employer andbegin insert State Bargaining Unit
302 (effective July 1, 2016, to July 1, 2019, inclusive), end insert
begin insertState
31Bargaining Unit 7 (effective July 2, 2016, to July 1, 2019,
32inclusive), andend insert
State Bargaining Unit 12 (effective July 1, 2015,
33to July 1, 2019, inclusive) there is hereby continuously appropriated
34to the Controller from the General Fund, unallocated special funds,
35including, but not limited to, federal funds and unallocated
36nongovernmental cost funds, and any other fund from which state
37employees are compensated, the amount necessary for the payment
38of compensation and employee benefits to state employees covered
39by the abovebegin delete memorandumend deletebegin insert memorandaend insert of understanding until the
40Budget Act of 2017 is enacted. The Controller may expend an
P9    1amount no greater than necessary to enable the Controller to
2compensate state employees covered by the abovebegin delete memorandumend delete
3begin insert memorandaend insert of understanding for work performed between July
41, 2017, of the 2017-18 fiscal year and the enactment of the Budget
5Act of 2017.

6(b) If thebegin delete memorandumend deletebegin insert memorandaend insert of understanding entered
7into between the state employer andbegin insert State Bargaining Unit 2
8(effective July 1, 2016, to July 1, 2019, inclusive), end insert
begin insertState Bargaining
9Unit 7 (effective July 2, 2016, to July 1, 2019, inclusive), andend insert
State
10Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
11inclusive)begin delete isend deletebegin insert areend insert in effect and approved by the Legislature, the
12compensation and contribution for employee benefits for state
13employees represented bybegin delete thisend deletebegin insert theseend insert bargainingbegin delete unitend deletebegin insert unitsend insert shall be
14at a rate consistent with the applicable memorandum of
15understanding referenced above.

16(c) Expenditures related to any warrant drawn pursuant to
17subdivision (a) are not augmentations to the expenditure authority
18of a department. Upon the enactment of the Budget Act of 2017,
19these expenditures shall be subsumed by the expenditure authority
20approved in the Budget Act of 2017 for each affected department.

21(d) This section shall only apply to an employee covered by the
22term of thebegin insert State Bargaining Unit 2 (effective July 1, 2016, to July
231, 2019, inclusive), State Bargaining Unit 7 (effective July 2, 2016,
24to July 1, 2019, inclusive), orend insert
State Bargaining Unit 12 (effective
25July 1, 2015, to July 1, 2019, inclusive) memorandum of
26understanding. Notwithstanding Section 3517.8, this section shall
27not apply after thebegin delete termend deletebegin insert termsend insert of thebegin delete memorandumend deletebegin insert memorandaend insert of
28understandingbegin delete hasend deletebegin insert haveend insert expired. For purposes of this section, the
29begin delete memorandumend deletebegin insert memorandaend insert of understanding forbegin insert State Bargaining
30Unit 2, State Bargaining Unit 7, andend insert
State Bargaining Unit 12
31begin delete expiresend deletebegin insert expireend insert on July 1, 2019.

32begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 19829.9846 of the end insertbegin insertGovernment Codeend insertbegin insert is
33amended to read:end insert

34

19829.9846.  

(a) Notwithstanding Section 13340, for the
352018-19 fiscal year, if the Budget Act of 2018 is not enacted by
36July 1, 2018, for thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
37entered into between the state employer andbegin insert State Bargaining Unit
382 (effective July 1, 2016, to July 1, 2019, inclusive) andend insert
State
39Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
40inclusive) there is hereby continuously appropriated to the
P10   1Controller from the General Fund, unallocated special funds,
2including, but not limited to, federal funds and unallocated
3nongovernmental cost funds, and any other fund from which state
4employees are compensated, the amount necessary for the payment
5of compensation and employee benefits to state employees covered
6by the abovebegin delete memorandumend deletebegin insert memorandaend insert of understanding until the
7Budget Act of 2018 is enacted. The Controller may expend an
8amount no greater than necessary to enable the Controller to
9compensate state employees covered by the abovebegin delete memorandumend delete
10begin insert memorandaend insert of understanding for work performed between July
111, 2018, of the 2018-19 fiscal year and the enactment of the Budget
12Act of 2018.

13(b) If thebegin delete memorandumend deletebegin insert memorandaend insert of understanding entered
14into between the state employer andbegin insert State Bargaining Unit 2
15(effective July 1, 2016, to July 1, 2019, inclusive) andend insert
State
16Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
17inclusive)begin delete isend deletebegin insert areend insert in effect and approved by the Legislature, the
18compensation and contribution for employee benefits for state
19employees represented bybegin delete thisend deletebegin insert theseend insert bargainingbegin delete unitend deletebegin insert unitsend insert shall be
20at a rate consistent with the applicable memorandum of
21understanding referenced above.

22(c) Expenditures related to any warrant drawn pursuant to
23subdivision (a) are not augmentations to the expenditure authority
24of a department. Upon the enactment of the Budget Act of 2018,
25these expenditures shall be subsumed by the expenditure authority
26approved in the Budget Act of 2018 for each affected department.

27(d) This section shall only apply to an employee covered by the
28term of thebegin insert State Bargaining Unit 2 (effective July 1, 2016, to July
291, 2019, inclusive) orend insert
State Bargaining Unit 12 (effective July 1,
302015, to July 1, 2019, inclusive) memorandum of understanding.
31Notwithstanding Section 3517.8, this section shall not apply after
32thebegin delete termend deletebegin insert termsend insert of thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
33begin delete hasend deletebegin insert haveend insert expired. For purposes of this section, thebegin delete memorandumend delete
34begin insert memorandaend insert of understanding forbegin insert State Bargaining Unit 2 andend insert
35 State Bargaining Unit 12begin delete expiresend deletebegin insert expireend insert on July 1, 2019.

36begin insert

begin insertSEC. 7.5.end insert  

end insert

begin insertSection 19829.9846 of the end insertbegin insertGovernment Codeend insertbegin insert is
37amended to read:end insert

38

19829.9846.  

(a) Notwithstanding Section 13340, for the
392018-19 fiscal year, if the Budget Act of 2018 is not enacted by
40July 1, 2018, for thebegin delete memorandumend deletebegin insert memorandaend insert of understanding
P11   1entered into between the state employer andbegin insert State Bargaining Unit
22 (effective July 1, 2016, to July 1, 2019, inclusive), end insert
begin insertState
3Bargaining Unit 7 (effective July 2, 2016, to July 1, 2019,
4inclusive), andend insert
State Bargaining Unit 12 (effective July 1, 2015,
5to July 1, 2019, inclusive) there is hereby continuously appropriated
6to the Controller from the General Fund, unallocated special funds,
7including, but not limited to, federal funds and unallocated
8nongovernmental cost funds, and any other fund from which state
9employees are compensated, the amount necessary for the payment
10of compensation and employee benefits to state employees covered
11by the abovebegin delete memorandumend deletebegin insert memorandaend insert of understanding until the
12Budget Act of 2018 is enacted. The Controller may expend an
13amount no greater than necessary to enable the Controller to
14compensate state employees covered by the abovebegin delete memorandumend delete
15begin insert memorandaend insert of understanding for work performed between July
161, 2018, of the 2018-19 fiscal year and the enactment of the Budget
17Act of 2018.

18(b) If thebegin delete memorandumend deletebegin insert memorandaend insert of understanding entered
19into between the state employer andbegin insert State Bargaining Unit 2
20(effective July 1, 2016, to July 1, 2019, inclusive),end insert
begin insert State Bargaining
21Unit 7 (effective July 2, 2016, to July 1, 2019, inclusive),end insert
begin insert andend insert State
22Bargaining Unit 12 (effective July 1, 2015, to July 1, 2019,
23inclusive)begin delete isend deletebegin insert areend insert in effect and approved by the Legislature, the
24compensation and contribution for employee benefits for state
25employees represented bybegin delete thisend deletebegin insert theseend insert bargainingbegin delete unitend deletebegin insert unitsend insert shall be
26at a rate consistent with the applicable memorandum of
27understanding referenced above.

28(c) Expenditures related to any warrant drawn pursuant to
29subdivision (a) are not augmentations to the expenditure authority
30of a department. Upon the enactment of the Budget Act of 2018,
31these expenditures shall be subsumed by the expenditure authority
32 approved in the Budget Act of 2018 for each affected department.

33(d) This section shall only apply to an employee covered by the
34term of thebegin insert State Bargaining Unit 2 (effective July 1, 2016, to July
351, 2019, inclusive),end insert
begin insert State Bargaining Unit 7 (effective July 2, 2016,
36to July 1, 2019, inclusive),end insert
begin insert orend insert State Bargaining Unit 12 (effective
37July 1, 2015, to July 1, 2019, inclusive) memorandum of
38understanding. Notwithstanding Section 3517.8, this section shall
39not apply after thebegin delete termend deletebegin insert termsend insert of thebegin delete memorandumend deletebegin insert memorandaend insert of
40understandingbegin delete hasend deletebegin insert haveend insert expired. For purposes of this section, the
P12   1begin delete memorandumend deletebegin insert memorandaend insert of understanding forbegin insert State Bargaining
2Unit 2, State Bargaining Unit 7, andend insert
State Bargaining Unit 12
3begin delete expiresend deletebegin insert expireend insert on July 1, 2019.

4begin insert

begin insertSEC. 8.end insert  

end insert

begin insertSection 20397 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
5read:end insert

6

20397.  

“State peace officer/firefighter member” also includes:

7(a) The Sergeants-at-Arms of each house of the Legislature who
8have been designated as peace officers in subdivision (a) of Section
9830.36 of the Penal Code, excluding the Chiefbegin delete Sergeant-at-Arms.end delete
10
begin insert Sergeant-at-Arms of the Senate.end insert

11(b) Bailiffs and security coordinators of the judicial branch who
12have been designated as peace officers in subdivision (b) of Section
13830.36 of the Penal Code.

14A member who is reclassified from state miscellaneous to state
15peace officer/firefighter pursuant to this section may make an
16irrevocable election in writing to remain subject to the
17miscellaneous service retirement benefit and the normal rate of
18contribution by filing a notice of the election with the board within
1990 days of notification by the board. A member who so elects shall
20be subject to the reduced benefit factors specified in Section 21353
21or 21354.1, as applicable, only for service included in the federal
22system.

23begin insert

begin insertSEC. end insertbegin insert9.end insert  

end insert

begin insertSection 20682 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
24read:end insert

25

20682.  

Notwithstanding Sections 20677.4, 20677.5, 20677.6,
2620677.9, 20683, 20683.1, 20686, and 20687, effective with the
27beginning of the pay period following enactment of this section,
28the normal rate of contribution for a state employee who is
29excepted from the definition of “state employee” in subdivision
30(c) of Section 3513, and an officer or employee of the executive
31branch of state government who is not a member of the civil service
32shall be the following:

33(a) For state miscellaneous or state industrial members:

34(1) Nine percent of the compensation in excess of three hundred
35seventeen dollars ($317) per month paid to a member whose service
36is not included in the federal system.

37(2) Eight percent of compensation in excess of five hundred
38thirteen dollars ($513) per month paid to that member whose
39service has been included in the federal system.

P13   1(b) begin deleteFor end deletebegin insertEffective with the beginning of the October 2016 pay
2period, for end insert
state miscellaneous or state industrial members who
3are excepted from the definition of “state employee” in subdivision
4(c) of Section 3513 and related to State Bargaining Unit 2:

5(1) begin deleteNine end deletebegin insertTen end insertpercent of the compensation in excess of three
6hundred seventeen dollars ($317) per month paid to a member
7whose service is not included in the federal system.

8(2) begin deleteEight end deletebegin insertNine end insertpercent of compensation in excess of five hundred
9thirteen dollars ($513) per month paid to that member whose
10service has been included in the federal system.

11(c) State safety members shall be 9 percent of compensation in
12excess of three hundred seventeen dollars ($317) per month paid
13to a member whose service is not included in the federal system
14or in excess of five hundred thirteen dollars ($513) for one whose
15service is included in the federal system.

16(d) Peace officer/firefighter members shall be 11 percent of
17compensation in excess of eight hundred sixty-three dollars ($863)
18for state employees who are excepted from the definition of “state
19employee” in subdivision (c) of Section 3513 and related to State
20Bargaining Unit 6.

21(e) Peace officer/firefighter members shall be 11 percent of
22compensation in excess of five hundred thirteen dollars ($513) for
23state employees who are excepted from the definition of “state
24employee” in subdivision (c) of Section 3513 and related to State
25Bargaining Unit 7.

26begin insert

begin insertSEC. 10.end insert  

end insert

begin insertSection 22871.3 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
27to read:end insert

28

22871.3.  

(a) The employer contribution for each annuitant
29enrolled in a basic plan shall be an amount equal to 80 percent of
30the weighted average of the health benefit plan premiums for an
31employee or annuitant enrolled for self-alone, during the benefit
32year to which the formula is applied, for the four health benefit
33plans that had the largest active state civil service enrollment,
34excluding family members, during the previous benefit year. For
35each annuitant with enrolled family members, the employer
36contribution shall be an amount equal to 80 percent of the weighted
37average of the additional premiums required for enrollment of
38those family members, during the benefit year to which the formula
39is applied, in the four health benefit plans that had the largest active
P14   1state civil service enrollment, excluding family members, during
2 the previous benefit year.

3(b) The employer contribution for each annuitant enrolled in a
4Medicare health benefit plan in accordance with Section 22844
5shall be an amount equal to 80 percent of the weighted average of
6the health benefit plan premiums for an annuitant enrolled in a
7Medicare health benefit plan for self-alone, during the benefit year
8to which the formula is applied, for the four Medicare health benefit
9plans that had the largest state annuitant enrollment, excluding
10family members, during the previous benefit year. For each
11annuitant with enrolled family members, the employer contribution
12shall be an amount equal to 80 percent of the weighted average of
13the additional premiums required for enrollment of those family
14members, during the benefit year to which the formula is applied,
15in the four Medicare health benefit plans that had the largest state
16annuitant enrollment, excluding family members, during the
17previous benefit year. If the annuitant is eligible for Medicare Part
18A, with or without cost, and Medicare Part B, regardless of whether
19the annuitant is actually enrolled in Medicare Part A or Part B, the
20employer contribution shall not exceed the amount calculated
21under this subdivision.

22(c) This section applies to:

23(1) A state employee who is first employed by the state and
24becomes a state member of the system on or after January 1, 2016,
25and who is represented by State Bargaining Unit 9 or 10.

26(2) A state employee related to State Bargaining Unit 9 or 10
27who is excepted from the definition of “state employee” in
28subdivision (c) of Section 3513 and first employed by the state
29and becomes a state member of the system on or after January 1,
302016.

31(3) A state employee represented by State Bargaining Unitbegin delete 6end deletebegin insert 2,
326,end insert
or 12 who is first employed by the state and becomes a state
33member of the system on or after January 1, 2017.

34(4) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or
3512 who is excepted from the definition of “state employee” in
36subdivision (c) of Section 3513 and first employed by the state
37and becomes a state member of the system on or after January 1,
382017.

39(5) A judicial branch employee who is first employed by the
40state and becomes a state member of the system on or after January
P15   11, 2017. This paragraph does not apply to a judge who is subject
2to Chapter 11 (commencing with Section 75000) or Chapter 11.5
3(commencing with Section 75500) of Title 8.

4(d) If the provisions of this section are in conflict with the
5provisions of a memorandum of understanding reached pursuant
6to Section 3517.5 or Chapter 12 (commencing with Section 3560)
7of Division 4 of Title 1, the memorandum of understanding shall
8be controlling without further legislative action, except that if those
9provisions require the expenditure of funds, the provisions may
10not become effective unless approved by the Legislature.

11begin insert

begin insertSEC. 10.5.end insert  

end insert

begin insertSection 22871.3 of the end insertbegin insertGovernment Codeend insertbegin insert is
12amended to read:end insert

13

22871.3.  

(a) The employer contribution for each annuitant
14enrolled in a basic plan shall be an amount equal to 80 percent of
15the weighted average of the health benefit plan premiums for an
16employee or annuitant enrolled for self-alone, during the benefit
17year to which the formula is applied, for the four health benefit
18plans that had the largest active state civil service enrollment,
19excluding family members, during the previous benefit year. For
20each annuitant with enrolled family members, the employer
21contribution shall be an amount equal to 80 percent of the weighted
22average of the additional premiums required for enrollment of
23those family members, during the benefit year to which the formula
24is applied, in the four health benefit plans that had the largest active
25state civil service enrollment, excluding family members, during
26 the previous benefit year.

27(b) The employer contribution for each annuitant enrolled in a
28Medicare health benefit plan in accordance with Section 22844
29shall be an amount equal to 80 percent of the weighted average of
30the health benefit plan premiums for an annuitant enrolled in a
31Medicare health benefit plan for self-alone, during the benefit year
32to which the formula is applied, for the four Medicare health benefit
33plans that had the largest state annuitant enrollment, excluding
34family members, during the previous benefit year. For each
35annuitant with enrolled family members, the employer contribution
36shall be an amount equal to 80 percent of the weighted average of
37the additional premiums required for enrollment of those family
38members, during the benefit year to which the formula is applied,
39in the four Medicare health benefit plans that had the largest state
40annuitant enrollment, excluding family members, during the
P16   1previous benefit year. If the annuitant is eligible for Medicare Part
2A, with or without cost, and Medicare Part B, regardless of whether
3the annuitant is actually enrolled in Medicare Part A or Part B, the
4employer contribution shall not exceed the amount calculated
5under this subdivision.

6(c) This section applies to:

7(1) A state employee who is first employed by the state and
8becomes a state member of the system on or after January 1, 2016,
9and who is represented by State Bargaining Unit 9 or 10.

10(2) A state employee related to State Bargaining Unit 9 or 10
11who is excepted from the definition of “state employee” in
12subdivision (c) of Section 3513 and first employed by the state
13and becomes a state member of the system on or after January 1,
142016.

15(3) A state employee represented by State Bargaining Unitbegin delete 6end deletebegin insert 2,
166, 7,end insert
or 12 who is first employed by the state and becomes a state
17member of the system on or after January 1, 2017.

18(4) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert
19 or 12 who is excepted from the definition of “state employee” in
20subdivision (c) of Section 3513 and first employed by the state
21and becomes a state member of the system on or after January 1,
222017.

23(5) A judicial branch employee who is first employed by the
24state and becomes a state member of the system on or after January
251, 2017. This paragraph does not apply to a judge who is subject
26to Chapter 11 (commencing with Section 75000) or Chapter 11.5
27(commencing with Section 75500) of Title 8.

28(d) If the provisions of this section are in conflict with the
29provisions of a memorandum of understanding reached pursuant
30to Section 3517.5 or Chapter 12 (commencing with Section 3560)
31of Division 4 of Title 1, the memorandum of understanding shall
32be controlling without further legislative action, except that if those
33provisions require the expenditure of funds, the provisions may
34not become effective unless approved by the Legislature.

35begin insert

begin insertSEC. 11.end insert  

end insert

begin insertSection 22874.3 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
36to read:end insert

37

22874.3.  

(a) Notwithstanding Sections 22870, 22871, 22873,
38andbegin delete 22874end deletebegin insert 22874,end insert a state employee, defined by subdivision (c) of
39Section 3513, who is first employed by the state and becomes a
40state member of the system on or after January 1, 2017, and who
P17   1is represented by State Bargaining Unitbegin delete 6,end deletebegin insert 2 or 6end insert shall not receive
2any portion of the employer contribution payable for annuitants
3unless the person is credited with 15 years of state service at the
4time of retirement.

5(b) The percentage of the employer contribution payable for
6postretirement health benefits for an employee subject to this
7section shall be based on the completed years of credited state
8service at retirement as shown in the following table:


9

 

begin delete

Years of Service Contribution

end delete
begin insert

Credited Years
of Service

end insert
begin delete

Credited Years Percentage
of Employer Contribution

end delete
begin insert

Percentage of Employer
Contribution

end insert

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

P17  25

 

26(c) This section shall apply only to state employees that retire
27for service. For purposes of this section, “state service” means
28service rendered as an employee of the state or an appointed or
29elected officer of the state for compensation.

30(d) This section does not apply to:

31(1) Former state employees previously employed before January
321, 2017, who return to state employment on or after January 1,
332017.

34(2) State employees hired prior to January 1, 2017, who become
35subject to representation by State Bargaining Unitbegin insert 2 orend insert 6 on or
36after January 1, 2017.

37(3) State employees on an approved leave of absence employed
38before January 1, 2017, who return to active employment on or
39after January 1, 2017.

P18   1(4) State employees hired after January 1, 2017, who are first
2represented by a State Bargaining Unit other than Bargaining Unit
3begin insert 2 orend insert 6, who later become represented by State Bargaining Unit 6.

4(e) Notwithstanding Section 22875, this section shall also apply
5to a related state employee who is excepted from the definition of
6“state employee” in subdivision (c) of Section 3513 and is first
7employed by the state and becomes a state member of the system
8on or after January 1, 2017.

9begin insert

begin insertSEC. 11.5.end insert  

end insert

begin insertSection 22874.3 of the end insertbegin insertGovernment Codeend insertbegin insert is
10amended to read:end insert

11

22874.3.  

(a) Notwithstanding Sections 22870, 22871, 22873,
12andbegin delete 22874end deletebegin insert 22874,end insert a state employee, defined by subdivision (c) of
13Section 3513, who is first employed by the state and becomes a
14state member of the system on or after January 1, 2017, and who
15is represented by State Bargaining Unitbegin delete 6,end deletebegin insert 2, 6, or 7end insert shall not
16receive any portion of the employer contribution payable for
17annuitants unless the person is credited with 15 years of state
18service at the time of retirement.

19(b) The percentage of the employer contribution payable for
20postretirement health benefits for an employee subject to this
21section shall be based on the completed years of credited state
22service at retirement as shown in the following table:


23

 

begin delete

Years of Service Contribution

end delete
begin insert

Credited Years
of Service

end insert
begin delete

Credited Years Percentage
of Employer Contribution

end delete
begin insert

Percentage of Employer
Contribution

end insert

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

P18  39

 

P19   1(c) This section shall apply only to state employees that retire
2for service. For purposes of this section, “state service” means
3service rendered as an employee of the state or an appointed or
4elected officer of the state for compensation.

5(d) This section does not apply to:

6(1) Former state employees previously employed before January
71, 2017, who return to state employment on or after January 1,
82017.

9(2) State employees hired prior to January 1, 2017, who become
10subject to representation by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, or 7end insert on
11or after January 1, 2017.

12(3) State employees on an approved leave of absence employed
13before January 1, 2017, who return to active employment on or
14after January 1, 2017.

15(4) State employees hired after January 1, 2017, who are first
16represented by a State Bargaining Unit other than Bargaining Unit
17begin delete 6,end deletebegin insert 2, 6, or 7,end insert who later become represented by State Bargaining
18Unitbegin delete 6.end deletebegin insert 2, 6, or 7.end insert

19(e) Notwithstanding Section 22875, this section shall also apply
20to a related state employee who is excepted from the definition of
21“state employee” in subdivision (c) of Section 3513 and is first
22employed by the state and becomes a state member of the system
23on or after January 1, 2017.

24begin insert

begin insertSEC. 12.end insert  

end insert

begin insertSection 22879 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
25to read:end insert

26

22879.  

(a) The board shall pay monthly to an employee or
27annuitant who is enrolled in, or whose family member is enrolled
28in, a Medicare health benefit plan under this part the amount of
29the Medicare Part B premiums, exclusive of penalties, except as
30provided in Section 22831. This payment may not exceed the
31difference between the maximum employer contribution and the
32amount contributed by the employer toward the cost of premiums
33for the health benefit plan in which the employee or annuitant and
34his or her family members are enrolled. No payment may be made
35in any month if the difference is less than one dollar ($1).

36(b) This section shall be applicable only to state employees,
37annuitants who retired while state employees, and the family
38members of those persons.

39(c) With respect to an annuitant, the board shall pay to the
40annuitant the amount required by this section from the same source
P20   1from which his or her allowance is paid. Those amounts are hereby
2appropriated monthly from the General Fund to reimburse the
3board for those payments.

4(d) There is hereby appropriated from the appropriate funds the
5amounts required by this section to be paid to active state
6employees.

7(e) This section does not apply to:

8(1) A state employee who is first employed by the state and
9becomes a state member of the system on or after January 1, 2016,
10and who is represented by State Bargaining Unit 9 or 10.

11(2) A state employee related to State Bargaining Unit 9 or 10
12who is excepted from the definition of “state employee” in
13subdivision (c) of Section 3513 and is first employed by the state
14and becomes a state member of the system on or after January 1,
152016.

16(3) A state employee who is first employed by the state and
17becomes a state member of the system on or after January 1, 2017,
18and who is represented by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or 12.

19(4) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or
2012 who is excepted from the definition of “state employee” in
21 subdivision (c) of Section 3513 and is first employed by the state
22and becomes a state member of the system on or after January 1,
232017.

24(5) A judicial branch employee who is first employed by the
25state and becomes a state member of the system on or after January
261, 2017. This paragraph does not apply to a judge who is subject
27to Chapter 11 (commencing with Section 75000) or Chapter 11.5
28(commencing with Section 75500) of Title 8.

29begin insert

begin insertSEC. 12.5.end insert  

end insert

begin insertSection 22879 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
30to read:end insert

31

22879.  

(a) The board shall pay monthly to an employee or
32annuitant who is enrolled in, or whose family member is enrolled
33in, a Medicare health benefit plan under this part the amount of
34the Medicare Part B premiums, exclusive of penalties, except as
35provided in Section 22831. This payment may not exceed the
36difference between the maximum employer contribution and the
37amount contributed by the employer toward the cost of premiums
38for the health benefit plan in which the employee or annuitant and
39his or her family members are enrolled. No payment may be made
40in any month if the difference is less than one dollar ($1).

P21   1(b) This section shall be applicable only to state employees,
2annuitants who retired while state employees, and the family
3members of those persons.

4(c) With respect to an annuitant, the board shall pay to the
5annuitant the amount required by this section from the same source
6from which his or her allowance is paid. Those amounts are hereby
7appropriated monthly from the General Fund to reimburse the
8board for those payments.

9(d) There is hereby appropriated from the appropriate funds the
10amounts required by this section to be paid to active state
11employees.

12(e) This section does not apply to:

13(1) A state employee who is first employed by the state and
14becomes a state member of the system on or after January 1, 2016,
15and who is represented by State Bargaining Unit 9 or 10.

16(2) A state employee related to State Bargaining Unit 9 or 10
17who is excepted from the definition of “state employee” in
18subdivision (c) of Section 3513 and is first employed by the state
19and becomes a state member of the system on or after January 1,
202016.

21(3) A state employee who is first employed by the state and
22becomes a state member of the system on or after January 1, 2017,
23and who is represented by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert or 12.

24(4) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert
25 or 12 who is excepted from the definition of “state employee” in
26subdivision (c) of Section 3513 and is first employed by the state
27and becomes a state member of the system on or after January 1,
282017.

29(5) A judicial branch employee who is first employed by the
30state and becomes a state member of the system on or after January
311, 2017. This paragraph does not apply to a judge who is subject
32to Chapter 11 (commencing with Section 75000) or Chapter 11.5
33(commencing with Section 75500) of Title 8.

34begin insert

begin insertSEC. 13.end insert  

end insert

begin insertSection 22944.5 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
35to read:end insert

36

22944.5.  

(a)  (1)  The state and employees in State Bargaining
37Unitbegin insert 2,end insert 9, 10, or 12 shall prefund retiree health care, with the goal
38of reaching a 50-percent cost sharing of actuarially determined
39normal costs for both employer and employees by July 1, 2019.

P22   1(2) The state and employees in State Bargaining Unit 6 shall
2prefund retiree health care, with the goal of reaching a 50-percent
3cost sharing of actuarially determined normal costs for both
4employer and employees by July 1, 2018.

5(3) The state and employees in the judicial branch shall prefund
6retiree health care, with the goal of reaching a 50-percent cost
7sharing of actuarially determined normal costs for both employer
8and employees by July 1, 2017.

9(b) (1) The employees in State Bargaining Unit 9 shall make
10contributions to prefund retiree health care based on the following
11schedule, and the state shall make a matching contribution:

12(A) Effective July 1, 2017, 0.5 percent of pensionable
13compensation.

14(B) Effective July 1, 2018, an additional 0.5 percent for a total
15employee contribution of 1.0 percent of pensionable compensation.

16(C) Effective July 1, 2019, an additional 1.0 percent for a total
17employee contribution of 2.0 percent of pensionable compensation.

18(2) The employees in State Bargaining Unit 10 shall make
19contributions to prefund retiree health care based on the following
20schedule, and the state shall make a matching contribution:

21(A) Effective July 1, 2017, 0.7 percent of pensionable
22compensation.

23(B) Effective July 1, 2018, an additional 0.7 percent for a total
24employee contribution of 1.4 percent of pensionable compensation.

25(C) Effective July 1, 2019, an additional 1.4 percent for a total
26employee contribution of 2.8 percent of pensionable compensation.

27(3) The employees in State Bargaining Unit 6 shall make
28contributions to prefund retiree health care based on the following
29schedule, and the state shall make a matching contribution:

30(A) Effective July 1, 2016, 1.3 percent of pensionable
31compensation.

32(B) Effective July 1, 2017, an additional 1.3 percent for a total
33employee contribution of 2.6 percent of pensionable compensation.

34(C) Effective July 1, 2018, an additional 1.4 percent for a total
35employee contribution of 4.0 percent of pensionable compensation.

36(4) The state employees in the judicial branch shall make
37contributions to prefund retiree health care based on the following
38schedule, and the state shall make a matching contribution:

39(A) Effective July 1, 2016, 1.5 percent of pensionable
40compensation.

P23   1(B) Effective July 1, 2017, up to an additional 1.5 percent for
2a total employee contribution of up to 3.0 percent of pensionable
3compensation. The additional amount shall be determined by the
4Director of Finance no later than April 1, 2017, based on the
5actuarially determined normal costs identified in the state valuation.

6(C) This paragraph does not apply to a judge who is subject to
7Chapter 11 (commencing with Section 75000) or Chapter 11.5
8(commencing with Section 75500) of Title 8.

9(5) The employees in State Bargaining Unit 12 shall make
10contributions to prefund retiree health care based on the following
11schedule, and the state shall make a matching contribution:

12(A) Effective July 1, 2017, 1.9 percent of pensionable
13compensation.

14(B) Effective July 1, 2018, an additional 1.4 percent for a total
15employee contribution of 3.3 percent of pensionable compensation.

16(C) Effective July 1, 2019, an additional 1.3 percent for a total
17employee contribution of 4.6 percent of pensionable compensation.

begin insert

18
(6) The employees in State Bargaining Unit 2 shall make
19contributions to prefund retiree health care based on the following
20schedule, and the state shall make a matching contribution:

end insert
begin insert

21
(A) Effective July 1, 2017, 0.7 percent of pensionable
22compensation.

end insert
begin insert

23
(B) Effective July 1, 2018, an additional 0.6 percent for a total
24employee contribution of 1.3 percent of pensionable compensation.

end insert
begin insert

25
(C) Effective July 1, 2019, an additional 0.7 percent for a total
26employee contribution of 2.0 percent of pensionable compensation.

end insert

27(c) This section only applies to employees who are eligible for
28health benefits, including permanent intermittent employees.

29(d) Contributions paid pursuant to this section shall be deposited
30in the Annuitants’ Health Care Coverage Fund and shall not be
31refundable under any circumstances to an employee or his or her
32beneficiary or survivor.

33(e) If the provisions of this section are in conflict with the
34provisions of a memorandum of understanding reached pursuant
35to Section 3517.5, the memorandum of understanding shall be
36controlling without further legislative action, except that if those
37provisions of a memorandum of understanding require the
38expenditure of funds, the provisions shall not become effective
39unless approved by the Legislature in the annual Budget Act.

P24   1(f) This section shall also apply to a state employee related to
2a bargaining unit described in subdivision (a) who is excepted
3from the definition of “state employee” in subdivision (c) of
4Section 3513.

5begin insert

begin insertSEC. 13.5.end insert  

end insert

begin insertSection 22944.5 of the end insertbegin insertGovernment Codeend insertbegin insert is
6amended to read:end insert

7

22944.5.  

(a)  (1)  The state and employees in State Bargaining
8Unitbegin insert 2, 7,end insert 9, 10, or 12 shall prefund retiree health care, with the
9goal of reaching a 50-percent cost sharing of actuarially determined
10normal costs for both employer and employees by July 1, 2019.

11(2) The state and employees in State Bargaining Unit 6 shall
12prefund retiree health care, with the goal of reaching a 50-percent
13cost sharing of actuarially determined normal costs for both
14employer and employees by July 1, 2018.

15(3) The state and employees in the judicial branch shall prefund
16retiree health care, with the goal of reaching a 50-percent cost
17sharing of actuarially determined normal costs for both employer
18and employees by July 1, 2017.

19(b) (1) The employees in State Bargaining Unit 9 shall make
20contributions to prefund retiree health care based on the following
21schedule, and the state shall make a matching contribution:

22(A) Effective July 1, 2017, 0.5 percent of pensionable
23compensation.

24(B) Effective July 1, 2018, an additional 0.5 percent for a total
25employee contribution of 1.0 percent of pensionable compensation.

26(C) Effective July 1, 2019, an additional 1.0 percent for a total
27employee contribution of 2.0 percent of pensionable compensation.

28(2) The employees in State Bargaining Unit 10 shall make
29contributions to prefund retiree health care based on the following
30schedule, and the state shall make a matching contribution:

31(A) Effective July 1, 2017, 0.7 percent of pensionable
32compensation.

33(B) Effective July 1, 2018, an additional 0.7 percent for a total
34employee contribution of 1.4 percent of pensionable compensation.

35(C) Effective July 1, 2019, an additional 1.4 percent for a total
36employee contribution of 2.8 percent of pensionable compensation.

37(3) The employees in State Bargaining Unit 6 shall make
38contributions to prefund retiree health care based on the following
39schedule, and the state shall make a matching contribution:

P25   1(A) Effective July 1, 2016, 1.3 percent of pensionable
2compensation.

3(B) Effective July 1, 2017, an additional 1.3 percent for a total
4employee contribution of 2.6 percent of pensionable compensation.

5(C) Effective July 1, 2018, an additional 1.4 percent for a total
6employee contribution of 4.0 percent of pensionable compensation.

7(4) The state employees in the judicial branch shall make
8contributions to prefund retiree health care based on the following
9schedule, and the state shall make a matching contribution:

10(A) Effective July 1, 2016, 1.5 percent of pensionable
11compensation.

12(B) Effective July 1, 2017, up to an additional 1.5 percent for
13a total employee contribution of up to 3.0 percent of pensionable
14compensation. The additional amount shall be determined by the
15Director of Finance no later than April 1, 2017, based on the
16actuarially determined normal costs identified in the state valuation.

17(C) This paragraph does not apply to a judge who is subject to
18Chapter 11 (commencing with Section 75000) or Chapter 11.5
19(commencing with Section 75500) of Title 8.

20(5) The employees in State Bargaining Unit 12 shall make
21contributions to prefund retiree health care based on the following
22schedule, and the state shall make a matching contribution:

23(A) Effective July 1, 2017, 1.9 percent of pensionable
24compensation.

25(B) Effective July 1, 2018, an additional 1.4 percent for a total
26employee contribution of 3.3 percent of pensionable compensation.

27(C) Effective July 1, 2019, an additional 1.3 percent for a total
28employee contribution of 4.6 percent of pensionable compensation.

begin insert

29
(6) The employees in State Bargaining Unit 2 shall make
30contributions to prefund retiree health care based on the following
31schedule, and the state shall make a matching contribution:

end insert
begin insert

32
(A) Effective July 1, 2017, 0.7 percent of pensionable
33compensation.

end insert
begin insert

34
(B) Effective July 1, 2018, an additional 0.6 percent for a total
35employee contribution of 1.3 percent of pensionable compensation.

end insert
begin insert

36
(C) Effective July 1, 2019, an additional 0.7 percent for a total
37employee contribution of 2.0 percent of pensionable compensation.

end insert
begin insert

38
(7) The employees in State Bargaining Unit 7 shall make
39contributions to prefund retiree health care based on the following
40schedule, and the state shall make a matching contribution:

end insert
begin insert

P26   1
(A) Effective July 1, 2017, 1.3 percent of pensionable
2compensation.

end insert
begin insert

3
(B) Effective July 1, 2018, an additional 1.4 percent for a total
4employee contribution of 2.7 percent of pensionable compensation.

end insert
begin insert

5
(C) Effective July 1, 2019, an additional 1.3 percent for a total
6employee contribution of 4.0 percent of pensionable compensation.

end insert

7(c) This section only applies to employees who are eligible for
8health benefits, including permanent intermittent employees.

9(d) Contributions paid pursuant to this section shall be deposited
10in the Annuitants’ Health Care Coverage Fund and shall not be
11refundable under any circumstances to an employee or his or her
12beneficiary or survivor.

13(e) If the provisions of this section are in conflict with the
14provisions of a memorandum of understanding reached pursuant
15to Section 3517.5, the memorandum of understanding shall be
16controlling without further legislative action, except that if those
17provisions of a memorandum of understanding require the
18expenditure of funds, the provisions shall not become effective
19unless approved by the Legislature in the annual Budget Act.

20(f) This section shall also apply to a state employee related to
21a bargaining unit described in subdivision (a) who is excepted
22from the definition of “state employee” in subdivision (c) of
23Section 3513.

24begin insert

begin insertSEC. 14.end insert  

end insert

begin insertSection 22958.1 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
25to read:end insert

26

22958.1.  

(a) Notwithstanding Sections 22953, 22957, and
2722958, the following employees shall not receive any portion of
28the employer contribution payable for annuitants unless the person
29is credited with 15 or more years of state service, as defined by
30this section, at the time of retirement:

31(1) A state employee, as defined by subdivision (c) of Section
323513, who is first employed by the state and becomes a state
33member of the system on or after January 1, 2017, and is
34represented by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or 12.

35(2) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or
3612 who is excepted from the definition of “state employee” in
37subdivision (c) of Section 3513 and is first employed by the state
38and becomes a state member of the system on or after January 1,
392017.

P27   1(b) The percentage of the employer contribution payable for
2postretirement dental care benefits for an employee subject to this
3section shall be based on the funding provision of the plan and the
4completed years of credited state service at retirement as shown
5in the following table:


6

 

Credited Years
of Service

Percentage of Employer
Contribution

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

P27  20

 

21(c) This section shall apply only to state employees that retire
22for service. For purposes of this section, “state service” means
23service rendered as an employee of the state or an appointed or
24elected officer of the state for compensation.

25(d) This section does not apply to:

26(1) Former state employees previously employed prior to
27January 1, 2017, who return to state employment on or after
28January 1, 2017.

29(2) State employees hired prior to January 1, 2017, who become
30subject to representation by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6,end insert or 12 on
31or after January 1, 2017.

32(3) State employees on an approved leave of absence employed
33before January 1, 2017, who return to active employment on or
34after January 1, 2017.

35(4) State employees hired after January 1, 2017, who are first
36represented by a State Bargaining Unit other than Bargaining Unit
37begin delete 6end deletebegin insert 2, 6,end insert or 12, who later become represented by State Bargaining
38Unitbegin delete 6end deletebegin insert 2, 6,end insert or 12.

39(e) In those cases where the state has assumed from a public
40agency a function and the related personnel, service rendered by
P28   1that personnel for compensation as employees or appointed or
2elected officers of that public agency may not be credited as state
3service for the purposes of this section unless the former employer
4has paid or agreed to pay the state the amount actuarially
5determined to equal the cost for any employee dental benefits that
6were vested at the time that the function and the related personnel
7were assumed by the state, and the Department of Finance finds
8that the contract contains a benefit factor sufficient to reimburse
9the state for the amount necessary to fully compensate for the
10postretirement dental benefit costs of those personnel. For
11noncontracting public agencies, the state agency that has assumed
12the function shall certify the completed years of public agency
13service to be credited to the employee as state service credit under
14this section.

15begin insert

begin insertSEC. 14.5.end insert  

end insert

begin insertSection 22958.1 of the end insertbegin insertGovernment Codeend insertbegin insert is
16amended to read:end insert

17

22958.1.  

(a) Notwithstanding Sections 22953, 22957, and
1822958, the following employees shall not receive any portion of
19the employer contribution payable for annuitants unless the person
20is credited with 15 or more years of state service, as defined by
21this section, at the time of retirement:

22(1) A state employee, as defined by subdivision (c) of Section
233513, who is first employed by the state and becomes a state
24member of the system on or after January 1, 2017, and is
25represented by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert or 12.

26(2) A state employee related to State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert
27 or 12 who is excepted from the definition of “state employee” in
28subdivision (c) of Section 3513 and is first employed by the state
29and becomes a state member of the system on or after January 1,
302017.

31(b) The percentage of the employer contribution payable for
32postretirement dental care benefits for an employee subject to this
33section shall be based on the funding provision of the plan and the
34completed years of credited state service at retirement as shown
35in the following table:


36

 

Credited Years
of Service

Percentage of Employer
Contribution

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

P29  10

 

11(c) This section shall apply only to state employees that retire
12for service. For purposes of this section, “state service” means
13service rendered as an employee of the state or an appointed or
14elected officer of the state for compensation.

15(d) This section does not apply to:

16(1) Former state employees previously employed prior to
17January 1, 2017, who return to state employment on or after
18January 1, 2017.

19(2) State employees hired prior to January 1, 2017, who become
20subject to representation by State Bargaining Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert or 12
21on or after January 1, 2017.

22(3) State employees on an approved leave of absence employed
23before January 1, 2017, who return to active employment on or
24after January 1, 2017.

25(4) State employees hired after January 1, 2017, who are first
26represented by a State Bargaining Unit other than Bargaining Unit
27begin delete 6end deletebegin insert 2, 6, 7,end insert or 12, who later become represented by State Bargaining
28Unitbegin delete 6end deletebegin insert 2, 6, 7,end insert or 12.

29(e) In those cases where the state has assumed from a public
30agency a function and the related personnel, service rendered by
31that personnel for compensation as employees or appointed or
32elected officers of that public agency may not be credited as state
33service for the purposes of this section unless the former employer
34has paid or agreed to pay the state the amount actuarially
35determined to equal the cost for any employee dental benefits that
36were vested at the time that the function and the related personnel
37were assumed by the state, and the Department of Finance finds
38that the contract contains a benefit factor sufficient to reimburse
39the state for the amount necessary to fully compensate for the
40postretirement dental benefit costs of those personnel. For
P30   1noncontracting public agencies, the state agency that has assumed
2the function shall certify the completed years of public agency
3service to be credited to the employee as state service credit under
4this section.

begin insert
5

begin insertSEC. 15.end insert  

Section 6.5 of this bill incorporates amendments to
6Section 19829.9845 of the Government Code proposed by this bill
7and Assembly Bill 1627. It shall only become operative if (1) both
8bills are enacted and become effective on or before January 1,
92017, (2) each bill amends Section 19829.9845 of the Government
10Code, and (3) this bill is enacted after Assembly Bill 1627, in which
11case Section 19829.9845 of the Government Code, as amended by
12Assembly Bill 1627, shall remain operative only until the operative
13date of this bill, at which time Section 6.5 of this bill shall become
14operative, and Section 6 of this bill shall not become operative.

end insert
begin insert
15

begin insertSEC. 16.end insert  

Section 7.5 of this bill incorporates amendments to
16Section 19829.9846 of the Government Code proposed by this bill
17and Assembly Bill 1627. It shall only become operative if (1) both
18bills are enacted and become effective on or before January 1,
192017, (2) each bill amends Section 19829.9846 of the Government
20Code, and (3) this bill is enacted after Assembly Bill 1627, in which
21case Section 19829.9846 of the Government Code, as amended by
22Assembly Bill 1627, shall remain operative only until the operative
23date of this bill, at which time Section 7.5 of this bill shall become
24operative, and Section 7 of this bill shall not become operative.

end insert
begin insert
25

begin insertSEC. 17.end insert  

Section 10.5 of this bill incorporates amendments to
26Section 22871.3 of the Government Code proposed by this bill and
27Assembly Bill 1627. It shall only become operative if (1) both bills
28are enacted and become effective on or before January 1, 2017,
29(2) each bill amends Section 22871.3 of the Government Code,
30and (3) this bill is enacted after Assembly Bill 1627, in which case
31Section 22871.3 of the Government Code, as amended by Assembly
32Bill 1627, shall remain operative only until the operative date of
33this bill, at which time Section 10.5 of this bill shall become
34operative, and Section 10 of this bill shall not become operative.

end insert
begin insert
35

begin insertSEC. 18.end insert  

Section 11.5 of this bill incorporates amendments to
36Section 22874.3 of the Government Code proposed by this bill and
37Assembly Bill 1627. It shall only become operative if (1) both bills
38are enacted and become effective on or before January 1, 2017,
39(2) each bill amends Section 22874.3 of the Government Code,
40and (3) this bill is enacted after Assembly Bill 1627, in which case
P31   1Section 22874.3 of the Government Code, as amended by Assembly
2Bill 1627, shall remain operative only until the operative date of
3this bill, at which time Section 11.5 of this bill shall become
4operative, and Section 11 of this bill shall not become operative.

end insert
begin insert
5

begin insertSEC. 19.end insert  

Section 12.5 of this bill incorporates amendments to
6Section 22879 of the Government Code proposed by this bill and
7Assembly Bill 1627. It shall only become operative if (1) both bills
8are enacted and become effective on or before January 1, 2017,
9(2) each bill amends Section 22879 of the Government Code, and
10(3) this bill is enacted after Assembly Bill 1627, in which case
11Section 22879 of the Government Code, as amended by Assembly
12Bill 1627, shall remain operative only until the operative date of
13this bill, at which time Section 12.5 of this bill shall become
14operative, and Section 12 of this bill shall not become operative.

end insert
begin insert
15

begin insertSEC. 20.end insert  

Section 13.5 of this bill incorporates amendments to
16Section 22944.5 of the Government Code proposed by this bill and
17Assembly Bill 1627. It shall only become operative if (1) both bills
18are enacted and become effective on or before January 1, 2017,
19(2) each bill amends Section 22944.5 of the Government Code,
20and (3) this bill is enacted after Assembly Bill 1627, in which case
21Section 22944.5 of the Government Code, as amended by Assembly
22Bill 1627, shall remain operative only until the operative date of
23this bill, at which time Section 13.5 of this bill shall become
24operative, and Section 13 of this bill shall not become operative.

end insert
begin insert
25

begin insertSEC. 21.end insert  

Section 14.5 of this bill incorporates amendments to
26Section 22958.1 of the Government Code proposed by this bill and
27Assembly Bill 1627. It shall only become operative if (1) both bills
28are enacted and become effective on or before January 1, 2017,
29(2) each bill amends Section 22958.1 of the Government Code,
30and (3) this bill is enacted after Assembly Bill 1627, in which case
31Section 22958.1 of the Government Code, as amended by Assembly
32Bill 1627, shall remain operative only until the operative date of
33this bill, at which time Section 14.5 of this bill shall become
34operative, and Section 14 of this bill shall not become operative.

end insert
begin insert
35

begin insertSEC. 22.end insert  

This act is a bill providing for appropriations related
36to the Budget Bill within the meaning of subdivision (e) of Section
3712 of Article IV of the California Constitution, has been identified
38as related to the budget in the Budget Bill, and shall take effect
39immediately.

end insert
begin delete
P32   1

SECTION 1.  

The Legislature finds and declares that the
2purposes of this act is to approve the agreement entered into by
3the state employer and State Bargaining Unit 7 pursuant to Section
43517.5 of the Government Code.

5

SEC. 2.  

The provisions of the memorandum of understanding
6prepared pursuant to Section 3517.5 of the Government Code and
7entered into by the state employer and State Bargaining Unit 7,
8dated June 9, 2016, and that require the expenditure of funds, are
9hereby approved for the purposes of subdivision (b) of Section
103517.6 of the Government Code.

11

SEC. 3.  

The provisions of the memorandum of understanding
12approved in Section 2 of this act that require the expenditure of
13funds shall not take effect unless funds for these provisions are
14specifically appropriated by the Legislature. If funds for these
15provisions are not specifically appropriated by the Legislature,
16either the state employer or the affected employee organization
17may reopen negotiations on all or part of the memorandum of
18understanding.

19

SEC. 4.  

Notwithstanding Section 3517.6 of the Government
20Code, the provisions of the memorandum of understanding
21included in Section 2 of this act that require the expenditure of
22funds shall become effective even if the provisions of the
23memorandum of understanding are approved by the Legislature
24in legislation other than the annual Budget Act.

25

SEC. 5.  

The sum of thirty-eight million six hundred eleven
26thousand dollars ($38,611,000) is hereby appropriated for State
27Bargaining Unit 7 for expenditure in the 2016-17 fiscal year in
28augmentation of, and for the purpose of, state employee
29compensation, as provided in Items 9800-001-0001,
309800-001-0494, and 9800-001-0988 of Section 2.00 of the Budget
31Act of 2016, in accordance with the following schedule:

32(a) Nine million six hundred sixty-seven thousand dollars
33($9,667,000) from the General Fund in augmentation of Item
349800-001-0001.

35(b) Nineteen million three hundred ninety-two thousand dollars
36($19,392,000) from unallocated special funds in augmentation of
37Item 9800-001-0494.

38(c) Nine million five hundred fifty-two thousand dollars
39($9,552,000) from other unallocated nongovernmental cost funds
40in augmentation of Item 9800-001-0988.

P33   1

SEC. 6.  

Section 19829.9845 of the Government Code is
2amended to read:

3

19829.9845.  

(a) Notwithstanding Section 13340, for the
42017-18 fiscal year, if the Budget Act of 2017 is not enacted by
5July 1, 2017, for the memoranda of understanding entered into
6between the state employer and State Bargaining Unit 7 (effective
7July 2, 2016, to July 1, 2019, inclusive) and State Bargaining Unit
812 (effective July 1, 2015, to July 1, 2019, inclusive) there is hereby
9continuously appropriated to the Controller from the General Fund,
10unallocated special funds, including, but not limited to, federal
11funds and unallocated nongovernmental cost funds, and any other
12fund from which state employees are compensated, the amount
13necessary for the payment of compensation and employee benefits
14to state employees covered by an above memorandum of
15understanding until the Budget Act of 2017 is enacted. The
16Controller may expend an amount no greater than necessary to
17enable the Controller to compensate state employees covered by
18an above memorandum of understanding for work performed
19between July 1, 2017, of the 2017-18 fiscal year and the enactment
20of the Budget Act of 2017.

21(b) If the memoranda of understanding entered into between
22the state employer and State Bargaining Unit 7 (effective July 2,
232016, to July 1, 2019, inclusive) and State Bargaining Unit 12
24(effective July 1, 2015, to July 1, 2019, inclusive) are in effect and
25approved by the Legislature, the compensation and contribution
26for employee benefits for state employees represented by these
27bargaining units shall be at a rate consistent with the applicable
28memorandum of understanding referenced above.

29(c) Expenditures related to any warrant drawn pursuant to
30subdivision (a) are not augmentations to the expenditure authority
31of a department. Upon the enactment of the Budget Act of 2017,
32these expenditures shall be subsumed by the expenditure authority
33approved in the Budget Act of 2017 for each affected department.

34(d) This section shall only apply to an employee covered by the
35terms of the State Bargaining Unit 7 (effective July 2, 2016, to
36July 1, 2019, inclusive) and State Bargaining Unit 12 (effective
37July 1, 2015, to July 1, 2019, inclusive) memoranda of
38understanding. Notwithstanding Section 3517.8, this section shall
39not apply after the terms of the memoranda of understanding have
40expired. For purposes of this section, the memoranda of
P34   1understanding for State Bargaining Unit 7 and State Bargaining
2Unit 12 expire on July 1, 2019.

3

SEC. 7.  

Section 19829.9846 of the Government Code is
4amended to read:

5

19829.9846.  

(a) Notwithstanding Section 13340, for the
62018-19 fiscal year, if the Budget Act of 2018 is not enacted by
7July 1, 2018, for the memoranda of understanding entered into
8between the state employer and State Bargaining Unit 7 (effective
9July 2, 2016, to July 1, 2019, inclusive) and State Bargaining Unit
1012 (effective July 1, 2015, to July 1, 2019, inclusive) there is hereby
11continuously appropriated to the Controller from the General Fund,
12unallocated special funds, including, but not limited to, federal
13funds and unallocated nongovernmental cost funds, and any other
14fund from which state employees are compensated, the amount
15necessary for the payment of compensation and employee benefits
16to state employees covered by an above memorandum of
17understanding until the Budget Act of 2018 is enacted. The
18Controller may expend an amount no greater than necessary to
19enable the Controller to compensate state employees covered by
20an above memorandum of understanding for work performed
21between July 1, 2018, of the 2018-19 fiscal year and the enactment
22of the Budget Act of 2018.

23(b) If the memoranda of understanding entered into between
24the state employer and State Bargaining Unit 7 (effective July 2,
252016, to July 1, 2019, inclusive) and State Bargaining Unit 12
26(effective July 1, 2015, to July 1, 2019, inclusive) are in effect and
27approved by the Legislature, the compensation and contribution
28for employee benefits for state employees represented by these
29bargaining units shall be at a rate consistent with the applicable
30memorandum of understanding referenced above.

31(c) Expenditures related to any warrant drawn pursuant to
32subdivision (a) are not augmentations to the expenditure authority
33of a department. Upon the enactment of the Budget Act of 2018,
34these expenditures shall be subsumed by the expenditure authority
35approved in the Budget Act of 2018 for each affected department.

36(d) This section shall only apply to an employee covered by the
37terms of the State Bargaining Unit 7 (effective July 2, 2016, to
38July 1, 2019, inclusive) and State Bargaining Unit 12 (effective
39July 1, 2015, to July 1, 2019, inclusive) memoranda of
40understanding. Notwithstanding Section 3517.8, this section shall
P35   1not apply after the terms of the memoranda of understanding have
2expired. For purposes of this section, the memoranda of
3understanding for State Bargaining Unit 7 and State Bargaining
4Unit 12 expire on July 1, 2019.

5

SEC. 8.  

Section 22871.3 of the Government Code is amended
6to read:

7

22871.3.  

(a) The employer contribution for each annuitant
8enrolled in a basic plan shall be an amount equal to 80 percent of
9the weighted average of the health benefit plan premiums for an
10employee or annuitant enrolled for self-alone, during the benefit
11year to which the formula is applied, for the four health benefit
12plans that had the largest active state civil service enrollment,
13excluding family members, during the previous benefit year. For
14each annuitant with enrolled family members, the employer
15contribution shall be an amount equal to 80 percent of the weighted
16average of the additional premiums required for enrollment of
17those family members, during the benefit year to which the formula
18is applied, in the four health benefit plans that had the largest active
19state civil service enrollment, excluding family members, during
20 the previous benefit year.

21(b) The employer contribution for each annuitant enrolled in a
22Medicare health benefit plan in accordance with Section 22844
23shall be an amount equal to 80 percent of the weighted average of
24the health benefit plan premiums for an annuitant enrolled in a
25Medicare health benefit plan for self-alone, during the benefit year
26to which the formula is applied, for the four Medicare health benefit
27plans that had the largest state annuitant enrollment, excluding
28family members, during the previous benefit year. For each
29annuitant with enrolled family members, the employer contribution
30shall be an amount equal to 80 percent of the weighted average of
31the additional premiums required for enrollment of those family
32members, during the benefit year to which the formula is applied,
33in the four Medicare health benefit plans that had the largest state
34annuitant enrollment, excluding family members, during the
35previous benefit year. If the annuitant is eligible for Medicare Part
36A, with or without cost, and Medicare Part B, regardless of whether
37the annuitant is actually enrolled in Medicare Part A or Part B, the
38employer contribution shall not exceed the amount calculated
39under this subdivision.

40(c) This section applies to:

P36   1(1) A state employee who is first employed by the state and
2becomes a state member of the system on or after January 1, 2016,
3and who is represented by State Bargaining Unit 9 or 10.

4(2) A state employee related to State Bargaining Unit 9 or 10
5who is excepted from the definition of “state employee” in
6subdivision (c) of Section 3513 and first employed by the state
7and becomes a state member of the system on or after January 1,
82016.

9(3) A state employee represented by State Bargaining Unit 6,
107, or 12 who is first employed by the state and becomes a state
11member of the system on or after January 1, 2017.

12(4) A state employee related to State Bargaining Unit 6, 7, or
1312 who is excepted from the definition of “state employee” in
14subdivision (c) of Section 3513 and first employed by the state
15and becomes a state member of the system on or after January 1,
162017.

17(5) A judicial branch employee who is first employed by the
18state and becomes a state member of the system on or after January
191, 2017. This paragraph does not apply to a judge who is subject
20to Chapter 11 (commencing with Section 75000) or Chapter 11.5
21(commencing with Section 75500) of Title 8.

22(d) If the provisions of this section are in conflict with the
23provisions of a memorandum of understanding reached pursuant
24to Section 3517.5 or Chapter 12 (commencing with Section 3560)
25of Division 4 of Title 1, the memorandum of understanding shall
26be controlling without further legislative action, except that if those
27provisions require the expenditure of funds, the provisions may
28not become effective unless approved by the Legislature.

29

SEC. 9.  

Section 22874.3 of the Government Code is amended
30to read:

31

22874.3.  

(a) Notwithstanding Sections 22870, 22871, 22873,
32and 22874, a state employee, defined by subdivision (c) of Section
333513, who is first employed by the state and becomes a state
34member of the system on or after January 1, 2017, and who is
35represented by State Bargaining Unit 6 or 7 shall not receive any
36portion of the employer contribution payable for annuitants unless
37the person is credited with 15 years of state service at the time of
38retirement.

39(b) The percentage of the employer contribution payable for
40postretirement health benefits for an employee subject to this
P37   1section shall be based on the completed years of credited state
2service at retirement as shown in the following table:


3

 

Credited Years
of Service

Percentage
of Employer
Contribution

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

P37  18

 

19(c) This section shall apply only to state employees that retire
20for service. For purposes of this section, “state service” means
21service rendered as an employee of the state or an appointed or
22 elected officer of the state for compensation.

23(d) This section does not apply to:

24(1) Former state employees previously employed before January
251, 2017, who return to state employment on or after January 1,
262017.

27(2) State employees hired prior to January 1, 2017, who become
28subject to representation by State Bargaining Unit 6 or 7 on or
29after January 1, 2017.

30(3) State employees on an approved leave of absence employed
31before January 1, 2017, who return to active employment on or
32after January 1, 2017.

33(4) State employees hired after January 1, 2017, who are first
34represented by a State Bargaining Unit other than Bargaining Unit
356 or 7, who later become represented by State Bargaining Unit 6
36or 7.

37(e) Notwithstanding Section 22875, this section shall also apply
38to a related state employee who is excepted from the definition of
39“state employee” in subdivision (c) of Section 3513 and is first
P38   1employed by the state and becomes a state member of the system
2on or after January 1, 2017.

3

SEC. 10.  

Section 22879 of the Government Code is amended
4to read:

5

22879.  

(a) The board shall pay monthly to an employee or
6annuitant who is enrolled in, or whose family member is enrolled
7in, a Medicare health benefit plan under this part the amount of
8the Medicare Part B premiums, exclusive of penalties, except as
9provided in Section 22831. This payment may not exceed the
10difference between the maximum employer contribution and the
11amount contributed by the employer toward the cost of premiums
12for the health benefit plan in which the employee or annuitant and
13his or her family members are enrolled. No payment may be made
14in any month if the difference is less than one dollar ($1).

15(b) This section shall be applicable only to state employees,
16annuitants who retired while state employees, and the family
17members of those persons.

18(c) With respect to an annuitant, the board shall pay to the
19annuitant the amount required by this section from the same source
20from which his or her allowance is paid. Those amounts are hereby
21appropriated monthly from the General Fund to reimburse the
22board for those payments.

23(d) There is hereby appropriated from the appropriate funds the
24amounts required by this section to be paid to active state
25employees.

26(e) This section does not apply to:

27(1) A state employee who is first employed by the state and
28becomes a state member of the system on or after January 1, 2016,
29and who is represented by State Bargaining Unit 9 or 10.

30(2) A state employee related to State Bargaining Unit 9 or 10
31who is excepted from the definition of “state employee” in
32subdivision (c) of Section 3513 and is first employed by the state
33and becomes a state member of the system on or after January 1,
342016.

35(3) A state employee who is first employed by the state and
36becomes a state member of the system on or after January 1, 2017,
37and who is represented by State Bargaining Unit 6, 7, or 12.

38(4) A state employee related to State Bargaining Unit 6, 7, or
3912 who is excepted from the definition of “state employee” in
40subdivision (c) of Section 3513 and is first employed by the state
P39   1and becomes a state member of the system on or after January 1,
22017.

3(5) A judicial branch employee who is first employed by the
4state and becomes a state member of the system on or after January
51, 2017. This paragraph does not apply to a judge who is subject
6to Chapter 11 (commencing with Section 75000) or Chapter 11.5
7(commencing with Section 75500) of Title 8.

8

SEC. 11.  

Section 22944.5 of the Government Code is amended
9to read:

10

22944.5.  

(a) (1) The state and employees in State Bargaining
11Unit 7, 9, 10, or 12 shall prefund retiree health care, with the goal
12of reaching a 50-percent cost sharing of actuarially determined
13normal costs for both employer and employees by July 1, 2019.

14(2) The state and employees in State Bargaining Unit 6 shall
15prefund retiree health care, with the goal of reaching a 50-percent
16cost sharing of actuarially determined normal costs for both
17employer and employees by July 1, 2018.

18(3) The state and employees in the judicial branch shall prefund
19retiree health care, with the goal of reaching a 50-percent cost
20sharing of actuarially determined normal costs for both employer
21and employees by July 1, 2017.

22(b) (1) The employees in State Bargaining Unit 9 shall make
23contributions to prefund retiree health care based on the following
24schedule, and the state shall make a matching contribution:

25(A) Effective July 1, 2017, 0.5 percent of pensionable
26compensation.

27(B) Effective July 1, 2018, an additional 0.5 percent for a total
28employee contribution of 1.0 percent of pensionable compensation.

29(C) Effective July 1, 2019, an additional 1.0 percent for a total
30employee contribution of 2.0 percent of pensionable compensation.

31(2) The employees in State Bargaining Unit 10 shall make
32contributions to prefund retiree health care based on the following
33schedule, and the state shall make a matching contribution:

34(A) Effective July 1, 2017, 0.7 percent of pensionable
35compensation.

36(B) Effective July 1, 2018, an additional 0.7 percent for a total
37employee contribution of 1.4 percent of pensionable compensation.

38(C) Effective July 1, 2019, an additional 1.4 percent for a total
39employee contribution of 2.8 percent of pensionable compensation.

P40   1(3) The employees in State Bargaining Unit 6 shall make
2contributions to prefund retiree health care based on the following
3schedule, and the state shall make a matching contribution:

4(A) Effective July 1, 2016, 1.3 percent of pensionable
5compensation.

6(B) Effective July 1, 2017, an additional 1.3 percent for a total
7employee contribution of 2.6 percent of pensionable compensation.

8(C) Effective July 1, 2018, an additional 1.4 percent for a total
9employee contribution of 4.0 percent of pensionable compensation.

10(4) The state employees in the judicial branch shall make
11contributions to prefund retiree health care based on the following
12schedule, and the state shall make a matching contribution:

13(A) Effective July 1, 2016, 1.5 percent of pensionable
14compensation.

15(B) Effective July 1, 2017, up to an additional 1.5 percent for
16a total employee contribution of up to 3.0 percent of pensionable
17compensation. The additional amount shall be determined by the
18Director of Finance no later than April 1, 2017, based on the
19actuarially determined normal costs identified in the state valuation.

20(C) This paragraph does not apply to a judge who is subject to
21Chapter 11 (commencing with Section 75000) or Chapter 11.5
22(commencing with Section 75500) of Title 8.

23(5) The employees in State Bargaining Unit 12 shall make
24contributions to prefund retiree health care based on the following
25schedule, and the state shall make a matching contribution:

26(A) Effective July 1, 2017, 1.9 percent of pensionable
27compensation.

28(B) Effective July 1, 2018, an additional 1.4 percent for a total
29employee contribution of 3.3 percent of pensionable compensation.

30(C) Effective July 1, 2019, an additional 1.3 percent for a total
31employee contribution of 4.6 percent of pensionable compensation.

32(6) The employees in State Bargaining Unit 7 shall make
33contributions to prefund retiree health care based on the following
34schedule, and the state shall make a matching contribution:

35(A) Effective July 1, 2017, 1.3 percent of pensionable
36compensation.

37(B) Effective July 1, 2018, an additional 1.4 percent for a total
38employee contribution of 2.7 percent of pensionable compensation.

39(C) Effective July 1, 2019, an additional 1.3 percent for a total
40employee contribution of 4.0 percent of pensionable compensation.

P41   1(c) This section only applies to employees who are eligible for
2health benefits, including permanent intermittent employees.

3(d) Contributions paid pursuant to this section shall be deposited
4in the Annuitants’ Health Care Coverage Fund and shall not be
5refundable under any circumstances to an employee or his or her
6beneficiary or survivor.

7(e) If the provisions of this section are in conflict with the
8provisions of a memorandum of understanding reached pursuant
9to Section 3517.5, the memorandum of understanding shall be
10controlling without further legislative action, except that if those
11provisions of a memorandum of understanding require the
12expenditure of funds, the provisions shall not become effective
13unless approved by the Legislature in the annual Budget Act.

14(f) This section shall also apply to a state employee related to
15a bargaining unit described in subdivision (a) who is excepted
16from the definition of “state employee” in subdivision (c) of
17Section 3513.

18

SEC. 12.  

Section 22958.1 of the Government Code is amended
19to read:

20

22958.1.  

(a) Notwithstanding Sections 22953, 22957, and
2122958, the following employees shall not receive any portion of
22the employer contribution payable for annuitants unless the person
23is credited with 15 or more years of state service, as defined by
24this section, at the time of retirement:

25(1) A state employee, as defined by subdivision (c) of Section
263513, who is first employed by the state and becomes a state
27member of the system on or after January 1, 2017, and is
28represented by State Bargaining Unit 6, 7, or 12.

29(2) A state employee related to State Bargaining Unit 6, 7, or
3012 who is excepted from the definition of “state employee” in
31subdivision (c) of Section 3513 and is first employed by the state
32and becomes a state member of the system on or after January 1,
332017.

34(b) The percentage of the employer contribution payable for
35postretirement dental care benefits for an employee subject to this
36section shall be based on the funding provision of the plan and the
37completed years of credited state service at retirement as shown
38in the following table:


P42  14

 

Credited Years
of Service

Percentage of Employer
Contribution

15   

50

16   

55

17   

60

18   

65

19   

70

20   

75

21   

80

22   

85

23   

90

24   

95

25 or more   

100

 

15(c) This section shall apply only to state employees that retire
16for service. For purposes of this section, “state service” means
17service rendered as an employee of the state or an appointed or
18elected officer of the state for compensation.

19(d) This section does not apply to:

20(1) Former state employees previously employed prior to
21January 1, 2017, who return to state employment on or after
22January 1, 2017.

23(2) State employees hired prior to January 1, 2017, who become
24subject to representation by State Bargaining Unit 6, 7, or 12 on
25or after January 1, 2017.

26(3) State employees on an approved leave of absence employed
27before January 1, 2017, who return to active employment on or
28after January 1, 2017.

29(4) State employees hired after January 1, 2017, who are first
30represented by a State Bargaining Unit other than Bargaining Unit
316, 7, or 12, who later become represented by State Bargaining Unit
326, 7, or 12.

33(e) In those cases where the state has assumed from a public
34agency a function and the related personnel, service rendered by
35that personnel for compensation as employees or appointed or
36elected officers of that public agency may not be credited as state
37service for the purposes of this section unless the former employer
38has paid or agreed to pay the state the amount actuarially
39determined to equal the cost for any employee dental benefits that
40were vested at the time that the function and the related personnel
P43   1were assumed by the state, and the Department of Finance finds
2that the contract contains a benefit factor sufficient to reimburse
3the state for the amount necessary to fully compensate for the
4postretirement dental benefit costs of those personnel. For
5 noncontracting public agencies, the state agency that has assumed
6the function shall certify the completed years of public agency
7service to be credited to the employee as state service credit under
8this section.

9

SEC. 13.  

This act is a bill providing for appropriations related
10to the Budget Bill within the meaning of subdivision (e) of Section
1112 of Article IV of the California Constitution, has been identified
12as related to the budget in the Budget Bill, and shall take effect
13immediately.

end delete


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