BILL ANALYSIS                                                                                                                                                                                                    



                                                          SB 1074
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Date of Hearing:   July 14, 1999

  ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL  
                            SECURITY 
                        Lou Correa, Chair
           SB 1074 (PE&R) - As Amended:  July 7, 1999

  SENATE VOTE  :   35-0
  
SUBJECT  :   State Teachers' Retirement System

  SUMMARY  :   Makes a variety of technical and conforming changes  
to the Teachers' Retirement Law (TRL).  Specifically,  this bill  :  
 

1)Makes additional conforming changes in references to the State  
  Teachers' Retirement System's (CalSTRS) Defined Benefit  
  Program and Cash Balance Benefit Program which were merged  
  last year within the State Teachers' Retirement Plan.

2)Codifies existing CalSTRS regulations.

3)Restructures the existing concurrent retirement provisions  
  contained in the TRL, with no substantive impact, to clarify  
  specifically the benefits associated with reciprocity and  
  concurrent retirement.

4)Codifies the existing practice in reporting of contributions  
  by individual districts.

5)Provides consistency in reporting deadlines with respect to  
  the Cash Balance Benefit Program.

6)Clarifies that the service credit segregated into a non-member  
  ex-spouse's account will be used when determining eligibility  
  for the career bonus.  Also specifies that nonqualified  
  service (air-time) purchased after January 1, 2000 will not be  
  included when calculating the career bonus.

7)Clarifies that the election of a member to stay a member of  
  CalSTRS or California Public Employees' Retirement System, as  
  specified, is irrevocable.

8)Codifies existing practices in the administration of the  
  CalSTRS Home Loan Progam.








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9)Clarifies that a member may participate in the Reduced  
  Workload Program for a period of less than ten years.

10)Conforms the costing methodology used to determine the cost  
  of purchasing out-of-state service credit to that used to  
  determine the cost for other types of permissive service  
  credit.

11)Removes references to repealed sections and corrects  
  grammatical errors.

12)Provides that any other act enacted by the Legislature during  
  1999 that affects any section of the bill will prevail over  
  the provisions of the bill.  This language will prevent this  
  bill from chaptering out any legislative changes made to code  
  sections contained in this bill during 1999.

  FISCAL EFFECT  :   According to CalSTRS, changing the methodology  
used to determine the cost of out-of-state service credit will  
result in an immaterial net reduction in revenues to the  
Teachers' Retirement Fund, equal to about $120,000 for every 20  
purchases of out-of-state service.  No other provisions would  
have any impact on benefits paid to members.  CalSTRS also  
states that the bill can be implemented within existing  
resources and will not increase the ongoing workload within the  
system.

  COMMENTS  :   This bill is sponsored by CalSTRS and is their  
annual technical housekeeping bill.  The changes made in the  
bill are all minor and technical in nature and  
non-controversial.

  REGISTERED SUPPORT / OPPOSITION  :

  Support  

State Teachers' Retirement System (sponsor)
  
Opposition  

None on file.

  Analysis Prepared by  :    Karon Green / P.E., R. & S.S. /  
(916)319-3957 








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