BILL NUMBER: AB 1937 CHAPTERED 08/25/00 CHAPTER 237 FILED WITH SECRETARY OF STATE AUGUST 25, 2000 APPROVED BY GOVERNOR AUGUST 24, 2000 PASSED THE ASSEMBLY AUGUST 10, 2000 PASSED THE SENATE JULY 6, 2000 AMENDED IN SENATE JUNE 21, 2000 AMENDED IN ASSEMBLY MAY 9, 2000 INTRODUCED BY Assembly Member Correa (Principal coauthor: Senator Ortiz) (Coauthors: Assembly Members Briggs, Firebaugh, Honda, Knox, and Pescetti) FEBRUARY 15, 2000 An act to amend Section 21328 of, and to add Sections 31664.1, 31664.2, and 31681.55 to, the Government Code, relating to retirement. LEGISLATIVE COUNSEL'S DIGEST AB 1937, Correa. Retirement: benefits. Under the Public Employees' Retirement Law, retirement allowances being paid on account of retired or deceased state and school members were increased, effective January 1, 2000, by up to 6%, as specified. This bill would authorize contracting agencies of the Public Employees' Retirement System to likewise increase retirement allowances being paid on account of their retired or deceased members. Under the County Employees Retirement Law of 1937, service retirement allowances for safety members are based on a 2% at age 50 formula and allowances for other members are based on other specified formulae. This bill would authorize counties or districts, subject to approval by the county board of supervisors, to (1) provide service retirement allowances for safety members based on a 3% at age 50 formula or 3% at age 55 formula, and (2) increase allowances being paid on account of retired or deceased members by up to 6%, as specified. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 21328 of the Government Code is amended to read: 21328. (a) In addition to the increase in allowance authorized and granted pursuant to Section 21313, and notwithstanding the limitation on that increase imposed by this article and subdivision (b) of Section 21337, effective January 1, 2000, or the date this section becomes applicable to the contracting agency, the monthly allowance paid with respect to a state, local, or school member who retired or died prior to January 1, 2000, or the date this section becomes applicable to the contracting agency, other than an allowance provided by Article 3 (commencing with Section 21570) of Chapter 14, shall be increased by the percentage set forth opposite the year of retirement or death in the following schedule: Period during which retirement or death occurred: Percentage: 24 months ending Dec. 31, 1999 0.0% 12 months ending Dec. 31, 1997 1.0% 24 months ending Dec. 31, 1996 2.0% 60 months ending Dec. 31, 1994 3.0% 60 months ending Dec. 31, 1989 4.0% 120 months ending Dec. 31, 1984 5.0% 12 months ending Dec. 31, 1974 or earlier 6.0% The percentage shall be applied to the allowance payable on January 1, 2000, or the date this section becomes applicable to the contracting agency, and the allowance as so increased shall be paid for time on and after that date and until the first day of April immediately following the date of application. The base allowance shall be the allowance as increased under this section. Notwithstanding Section 21337 to the contrary, this increase shall not be included in determining the initial monthly allowance upon which a supplemental benefit is payable pursuant to Section 21337. (b) This section shall not apply to any contracting agency unless and until the agency elects to be subject to its provisions by amendment to its contract, made in the manner prescribed for approval of contracts, or, in the case of contracts made after the effective date of this section, by an express provision in the contract making the contracting agency subject to the provisions of this section. SEC. 2. Section 31664.1 is added to the Government Code, to read: 31664.1. (a) This section may be made applicable in any county on the first day of the month after the board of supervisors of the county adopts, by majority vote, a resolution providing that this section shall become applicable in the county. (b) Notwithstanding any other provisions of this chapter, the current service pension or the current service pension combined with the prior service pension is an additional pension for safety members purchased by the contributions of the county or district sufficient when added to the service retirement annuity to equal 3 percent of the member's final compensation set forth opposite his or her age at retirement, taken to the preceding completed quarter year, in the following table, multiplied by the number of years of current service or years of current and prior service with which the member is entitled to be credited at retirement. In no event shall the total retirement allowance exceed the limitation of the safety member's final compensation as set forth in Section 31676.1, as it now reads or may hereafter be amended to read. Age at Retirement Fraction 41 ................................. .6258 41 1/4 ............................. .6350 41 1/2 ............................. .6442 41 3/4 ............................. .6533 42 ................................. .6625 42 1/4 ............................. .6720 42 1/2 ............................. .6814 42 3/4 ............................. .6909 43 ................................. .7004 43 1/4 ............................. .7102 43 1/2 ............................. .7200 43 3/4 ............................. .7299 44 ................................. .7397 44 1/4 ............................. .7499 44 1/2 ............................. .7601 44 3/4 ............................. .7703 45 ................................. .7805 45 1/4 ............................. .7910 45 1/2 ............................. .8016 45 3/4 ............................. .8121 46 ................................. .8226 46 1/4 ............................. .8339 46 1/2 ............................. .8452 46 3/4 ............................. .8586 47 ................................. .8678 47 1/4 ............................. .8780 47 1/2 ............................. .8882 47 3/4 ............................. .8983 48 ................................. .9085 48 1/4 ............................. .9194 48 1/2 ............................. .9304 48 3/4 ............................. .9413 49 ................................. .9522 49 1/4 ............................. .9641 49 1/2 ............................. .9761 49 3/4 ............................. .9880 50 and over ........................ 1.0000 (c) Contributions shall not be made by safety members having credit for 30 years of continuous service. SEC. 3. Section 31664.2 is added to the Government Code, to read: 31664.2. (a) This section may be made applicable in any county on the first day of the month after the board of supervisors of the county adopts, by majority vote, a resolution providing that this section shall become applicable in the county. (b) Notwithstanding any other provisions of this chapter, the current service pension or the current service pension combined with the prior service pension is an additional pension for safety members purchased by the contributions of the county or district sufficient when added to the service retirement annuity to equal 3 percent of the member's final compensation set forth opposite his or her age at retirement, taken to the preceding completed quarter year, in the following table, multiplied by the number of years of current service or years of current and prior service with which the member is entitled to be credited at retirement. In no event shall the total retirement allowance exceed the limitation of the safety member's final compensation as set forth in Section 31676.1, as it now reads or may hereafter be amended to read. Age at Retirement Fraction 41 ................................. .4777 41 1/4 ............................. .4848 41 1/2 ............................. .4918 41 3/4 ............................. .4987 42 ................................. .5058 42 1/4 ............................. .5130 42 1/2 ............................. .5202 42 3/4 ............................. .5274 43 ................................. .5347 43 1/4 ............................. .5422 43 1/2 ............................. .5497 43 3/4 ............................. .5572 44 ................................. .5647 44 1/4 ............................. .5725 44 1/2 ............................. .5803 44 3/4 ............................. .5881 45 ................................. .5958 45 1/4 ............................. .6039 45 1/2 ............................. .6120 45 3/4 ............................. .6200 46 ................................. .6280 46 1/4 ............................. .6366 46 1/2 ............................. .6452 46 3/4 ............................. .6555 47 ................................. .6625 47 1/4 ............................. .6703 47 1/2 ............................. .6781 47 3/4 ............................. .6858 48 ................................. .6936 48 1/4 ............................. .7019 48 1/2 ............................. .7103 48 3/4 ............................. .7186 49 ................................. .7269 49 1/4 ............................. .7360 49 1/2 ............................. .7452 49 3/4 ............................. .7543 50 ................................. .7634 50 1/4 ............................. .7733 50 1/2 ............................. .7832 50 3/4 ............................. .7930 51 ................................. .8028 51 1/4 ............................. .8135 51 1/2 ............................. .8242 51 3/4 ............................. .8349 52 ................................. .8457 52 1/4 ............................. .8574 52 1/2 ............................. .8691 52 3/4 ............................. .8808 53 ................................. .8926 53 1/4 ............................. .9053 53 1/2 ............................. .9182 53 3/4 ............................. .9310 54 ................................. .9418 54 1/4 ............................. .9579 54 1/2 ............................. .9718 54 3/4 ............................. .9860 55 and over ........................ 1.0000 (c) Contributions shall not be made by safety members having credit for 30 years of continuous service. SEC. 4. Section 31681.55 is added to the Government Code, to read: 31681.55. Effective the first day of the first month after adoption of this section by the board of supervisors, allowance paid with respect to any member of this system who retired or died prior to January 1, 2001, shall be increased by the percentage set forth opposite the year of retirement or death in the following schedule: Period during which retirement or death occurred: Percentage: January 1, 1998, or later 0.0% 12 months ending Dec. 31, 1997 1.0% 24 months ending Dec. 31, 1996 2.0% 60 months ending Dec. 31, 1994 3.0% 60 months ending Dec. 31, 1989 4.0% 120 months ending Dec. 31, 1984 5.0% 12 months ending Dec. 31, 1974, or earlier 6.0% The percentage shall be applied to the allowance payable on the effective date, and the allowance as so increased shall be paid for time on and after that date and shall be subject to annual cost-of-living adjustments. (b) This section shall not be operative in any county until such time as the board of supervisors shall, by resolution adopted by majority vote, make the provisions of this section applicable in that county.