BILL NUMBER: AB 316	CHAPTERED  06/28/99

	CHAPTER   39
	FILED WITH SECRETARY OF STATE   JUNE 28, 1999
	APPROVED BY GOVERNOR   JUNE 28, 1999
	PASSED THE SENATE   JUNE 10, 1999
	PASSED THE ASSEMBLY   MARCH 22, 1999

INTRODUCED BY   Assembly Member Machado

                        FEBRUARY 8, 1999

   An act to add Section 31874.5 to the Government Code, relating to
county retirement.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 316, Machado.  County retirement:  benefits:  cost-of-living
adjustments.
   The County Employees Retirement Law of 1937 prescribes alternative
optional cost-of-living adjustments for retirement benefits.
   This bill would authorize boards of supervisors to elect to
provide an additional prefunded 1% increase in the present
cost-of-living adjustment for each full 3% annual increase in the
cost of living over the existing maximum cost-of-living adjustment
factor.  These increases would be used to offset any existing
accumulated carryover cost-of-living adjustment balances.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 31874.5 is added to the Government Code, to
read:
   31874.5.  Whenever the percentage of annual increase in the cost
of living as of January 1 of each year as shown by the Bureau of
Labor Statistics Consumer Price Index for All Urban Consumers exceeds
a full 3 percent of the existing cost-of-living increase factor
provided by any provision of this article, an additional 1 percent of
the excess for each full 3 percent over the existing increase factor
shall be applied to the retirement allowances, optional death
allowances, or annual death allowances increased by any provision of
this article.  The increases in allowances resulting from the
adoption of this section shall be used to offset any accumulated
carryover balances under existing cost-of-living adjustments.  The
cost of implementing this section shall be prefunded commencing with
the adoption of this section by the board of supervisors.  The method
of paying the cost of implementing this section may be mutually
agreed to in a memorandum of understanding executed by the employer
and employee representatives.  The board of retirement shall conduct
the actuarial studies to determine those costs.
   This section shall not be operative in any county until it is
adopted by a majority vote of the board of supervisors.