BILL NUMBER: AB 2753 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 15, 2004
INTRODUCED BY Assembly Member Corbett
FEBRUARY 20, 2004
An act to amend Sections 22714, 22714.5, 24216, and 84040.5 of the
Education Code, relating to state teachers' retirement, and
declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 2753, as amended, Corbett. State teachers' retirement: early
retirement incentive.
(1) Existing law authorizes a school district, community college
district, or county office of education to grant members of the
Defined Benefit Program of the State Teachers' Retirement Plan 2
additional years of service credit or, prior to January 1, 2005, an
additional 2 years of service and 2 years of age, if certain
conditions are satisfied and the member retires for service within a
designated period.
This bill would make technical changes to those provisions.
Any member granted additional credit for service or
service and age under those provisions forfeits that credit if he or
she is reemployed within 5 years after retirement by the district
from which he or she retired or within one year after retirement by
any district.
This bill would instead provide that any member granted additional
credit for service or service and age under those provisions would
forfeit that credit if he or she is reemployed within one year after
retirement by the school district, community college district, or
county office of education from which he or she retired.
(2) The Teachers' Retirement Law prescribes limits on the amount
of postretirement income that may be earned in specified types of
employment by a retired member of the Defined Benefit Program without
a reduction in the member's retirement benefits. Specifically,
that limit applies to a retired member who receives 2 additional
years of service credit at retirement and performs creditable service
within one year after retirement for the school district from which
he or she retired.
Under this bill, those limits that limit
would apply to a retired member who receives the
additional 2 years of service credit or the those
additional 2 years of service and 2
years of age, with respect to service performed
credit at retirement and performs creditable service within one
year after retirement for any school district, community college
district, or county office of education in the state , and
with respect to service performed within 5 years after retirement for
the school district, community college district, or county office of
education from which he or she retired .
(3) The bill would declare that it would take effect immediately
as an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 22714 of the Education Code is amended to read:
22714. (a) Whenever the governing board of a school district or a
community college district or a county office of education, by
formal action, determines pursuant to Section 44929 or 87488 that
because of impending curtailment of or changes in the manner of
performing services, the best interests of the district or county
office of education would be served by encouraging certificated
employees or academic employees to retire for service and that the
retirement will result in a net savings to the district or county
office of education, an additional two years of service credit shall
be granted under this part to a member of the Defined Benefit Program
if all of the following conditions exist:
(1) The member is credited with five or more years of service
credit and retires for service under Chapter 27 (commencing with
Section 24201) during a period of not more than 120 days or less than
60 days, commencing no sooner than the effective date of the formal
action of the employer that shall specify the period.
(2) The employer transfers to the retirement fund an amount
determined by the Teachers' Retirement Board to equal the actuarial
equivalent of the difference between the allowance the member
receives after receipt of service credit pursuant to this section and
the amount the member would have received without the service credit
and an amount determined by the Teachers' Retirement Board to equal
the actuarial equivalent of the difference between the purchasing
power protection supplemental payment the member receives after
receipt of service credit pursuant to this section and the amount the
member would have received without the service credit. The payment
for purchasing power shall be deposited in the Supplemental Benefit
Maintenance Account established by Section 22400 and shall be subject
to Section 24415. The transfer to the retirement fund shall be made
in a manner and a time period, not to exceed eight years, that is
acceptable to the Teachers' Retirement Board. The employer shall
transfer the required amount for all eligible employees who retire
pursuant to this section.
(3) The employer transmits to the retirement fund the
administrative costs incurred by the system in implementing this
section, as determined by the Teachers' Retirement Board.
(4) The employer has considered the availability of teachers or
academic employees to fill the positions that would be vacated
pursuant to this section.
(b) (1) The school district shall demonstrate and certify to the
county superintendent that the formal action taken would result in a
net savings to the district.
(2) The county superintendent shall certify to the Teachers'
Retirement Board that the result specified in paragraph (1) can be
demonstrated. The certification shall include, but not be limited
to, the information specified in subdivision (c) of Section 14502.1.
(3) The school district shall reimburse the county superintendent
for all costs to the county superintendent that result from the
certification.
(c) (1) The county office of education shall demonstrate and
certify to the Superintendent of Public Instruction that the formal
action taken would result in a net savings to the county office of
education.
(2) The Superintendent of Public Instruction shall certify to the
Teachers' Retirement Board that the result specified in paragraph (1)
can be demonstrated. The certification shall include, but not be
limited to, the information specified in subdivision (c) of Section
14502.1.
(3) The Superintendent of Public Instruction may request
reimbursement from the county office of education for all
administrative costs that result from the certification.
(d) (1) The community college district shall demonstrate and
certify to the chancellor's office that the formal action taken would
result in a net savings to the district.
(2) The chancellor shall certify to the Teachers' Retirement Board
that the result specified in paragraph (1) can be demonstrated. The
certification shall include, but not be limited to, the information
specified in subdivision (c) of Section 84040.5.
(3) The chancellor may request reimbursement from the community
college district for all administrative costs that result from the
certification.
(e) The opportunity to be granted service credit pursuant to this
section shall be available to all members employed by the school
district, community college district, or county office of education
who meet the conditions set forth in this section.
(f) The amount of service credit shall be two years.
(g) Any member of the Defined Benefit Program who retires under
this part for service under Chapter 27 (commencing with Section
24201) with service credit granted under this section and who
subsequently reinstates shall forfeit the service credit granted
under this section.
(h) Any member of the Defined Benefit Program who retires under
this part for service under Chapter 27 (commencing with Section
24201) with service credit granted under this section and who takes
any job with any school district in the state less than one year
after receiving the credit shall forfeit the ongoing benefit he or
she receives from the additional service credit granted under this
section.
(i)
(h) Any member of the Defined Benefit Program who retires
under this part for service under Chapter 27 (commencing with Section
24201) with service credit granted under this section and who takes
any job with the school district , community college district,
or county office of education that granted the member the
service credit less than five years one year
after receiving the credit shall forfeit the ongoing benefit he
or she receives from the additional service credit granted under
this section.
(j)
(i) This section does not apply to any member otherwise
eligible if the member receives any unemployment insurance payments
arising out of employment with an employer subject to this part
during a period extending one year beyond the effective date of the
formal action, or if the member is not otherwise eligible to retire
for service.
SEC. 2. Section 22714.5 of the Education Code is amended to read:
22714.5. (a) Notwithstanding Sections 22714, 44929, and 87488, an
additional two years of service and an additional two years of age
shall be credited under this part to a member of the Defined Benefit
Program if the following conditions exist:
(1) The member is credited with five or more years of service
credit and retires for service under the provisions of Chapter 27
(commencing with Section 24201) within the period designated in the
memorandum of understanding or formal action described in paragraph
(6).
(2) The employer determines that the best interests of the school
district, community college district, or county office of education
would be served by encouraging certificated or academic employees to
retire for service and that the retirement will result in a net
savings to the district or county office of education.
(3) The employer transfers to the retirement fund an amount
determined by the Teachers' Retirement Board to equal the actuarial
equivalent of the difference between the allowance the member
receives after receipt of service and age credit pursuant to this
section and the amount the member would have received without the
service and age credit and an amount determined by the Teachers'
Retirement Board to equal the actuarial equivalent of the difference
between the purchasing power protection supplemental payment the
member receives after receipt of service and age credit pursuant to
this section and the amount the member would have received without
the service and age credit. The payment for purchasing power shall
be deposited in the Supplemental Benefit Maintenance Account
established by Section 22400 and shall be subject to Section 24415.
The transfer to the retirement fund shall be made in a manner and
time period, not to exceed eight years, that is acceptable to the
Teachers' Retirement Board.
(4) (A) A school district shall demonstrate and certify to the
county superintendent that the formal action taken would result in a
net savings to the district.
(B) The county superintendent shall certify to the Teachers'
Retirement Board that the result specified in subparagraph (A) can be
demonstrated. The certification shall include, but not be limited
to, the information specified in subdivision (c) of Section 14502.1.
(C) The school district shall reimburse that county superintendent
for all costs to the county superintendent that result from the
certification.
(5) (A) The county office of education shall demonstrate and
certify to the Superintendent of Public Instruction that the formal
action taken would result in a net savings to the county office of
education.
(B) The Superintendent of Public Instruction shall certify to the
Teachers' Retirement Board that the result specified in subparagraph
(A) can be demonstrated. The certification shall include, but not be
limited to, the information specified in subdivision (c) of Section
14502.1.
(C) The Superintendent of Public Instruction may request
reimbursement from the county office of education for all
administrative costs that result from the certification.
(6) (A) A community college district shall demonstrate and certify
to the chancellor's office that the formal action taken would result
in a net savings to the district.
(B) The chancellor shall certify to the Teachers' Retirement Board
that the result specified in subparagraph (A) can be demonstrated.
The certification shall include, but not be limited to, the
information specified in subdivision (c) of Section 84040.5.
(C) The chancellor may request reimbursement from the community
college district for all administrative costs that result from the
certification.
(7) This section has been made applicable to the employer and the
member pursuant to a memorandum of understanding between the employer
and the representative employee organization or, for members who are
not represented by a representative employee organization, this
section has been made applicable to all of the members employed by
the school district, community college district, or county office of
education, pursuant to a formal action of the governing board. The
employer shall transfer the required amount for all eligible
employees who retire pursuant to this section.
(8) The employer transmits to the retirement fund the
administrative costs incurred by the system in implementing this
section, as determined by the Teachers' Retirement Board.
(b) The amount of additional service credit and additional age
shall each be two years regardless of credited service or age. A
member of the Defined Benefit Program who is credited with additional
age and service under this section may not be credited with
additional service under Section 22714.
(c) Any member of the Defined Benefit Program who is credited with
additional age and service under this section and who subsequently
reinstates from retirement shall forfeit the additional age and
service credit granted under this section.
(d) Any member of the Defined Benefit Program who retires under
this part for service under Chapter 27 (commencing with Section
24201) with age and service credit granted under this section and who
takes any job with any school district in the state less than one
year after receiving the credit shall forfeit the ongoing benefit he
or she receives from the additional age and service credit granted
under this section.
(e)
(d) Any member of the Defined Benefit Program who retires
under this part for service under Chapter 27 (commencing with Section
24201) with age and service credit granted under this section and
who takes any job with the school district , community college
district, or county office of education that granted the member
the age and service credit less than five years
one year after receiving the credit shall forfeit the
ongoing benefit he or she receives from the additional age and
service credit granted under this section.
(f)
(e) This section is not applicable to any member otherwise
eligible if the member receives any unemployment insurance payments
arising out of employment with an employer subject to this part
during a period extending one year beyond the effective date of the
memorandum of understanding or formal action, or if the member is not
otherwise eligible to retire for service without the additional age
or service credit available under this section.
(g)
(f) This section shall become operative on January 1, 2004,
or 120 days after Assembly Bill No. 1207 of the 2003-04 Regular
Session is chaptered, whichever is later, and remain in effect only
until January 1, 2005, and as of that date is repealed, unless a
later enacted statute, that is enacted before January 1, 2005,
deletes or extends that date.
SEC. 3. Section 24216 of the Education Code is amended to read:
24216. (a) (1) A member retired for service under this part who
is appointed as a trustee or administrator by the Superintendent of
Public Instruction pursuant to Section 41320.1, or a member retired
for service who is assigned by a county superintendent of schools
pursuant to Article 2 (commencing with Section 42120) of Chapter 6 of
Part 24, shall be exempt from subdivisions (d) and (f) of Section
24214 for a maximum period of two years.
(2) The period of exemption shall commence on the date the member
retired for service is appointed or assigned and shall end no more
than two calendar years from that date, after which the limitation
specified in subdivisions (d) and (f) of Section 24214 shall apply.
(3) An exemption under this subdivision shall be granted by the
system providing that the Superintendent of Public Instruction or the
county superintendent of schools submits documentation required by
the system to substantiate the eligibility of the member retired for
service for an exemption under this subdivision.
(b) (1) A member retired for service under this part who is
employed by an employer to perform creditable service in an emergency
situation to fill a vacant administrative position requiring highly
specialized skills shall be exempt from the provisions of
subdivisions (d) and (f) of Section 24214 for creditable service
performed up to one-half of the full-time equivalent for that
position, if the vacancy occurred due to circumstances beyond the
control of the employer. The limitation specified in subdivisions
(d) and (f) of Section 24214 shall apply to creditable service
performed beyond the specified exemption.
(2) An exemption under this subdivision shall be granted by the
system subject to the following conditions:
(A) The recruitment process to fill the vacancy on a permanent
basis is expected to extend over several months.
(B) The employment is reported in a public meeting of the
governing body of the employer.
(C) The employer submits documentation required by the system to
substantiate the eligibility of the member retired for service for an
exemption under this subdivision.
(c) This section does not apply to any person who has received
additional service credit pursuant to Section 22715 or 22716.
(d) (1) A person who has received additional
service credit pursuant to Section 22714 or 22714.5 shall be
ineligible for one year from the effective date of retirement for the
exemption provided in this section for service performed in any
school district, community college district, or county office of
education in the state.
(2) A person who has received additional service credit pursuant
to Section 22714 or 22714.5 shall be ineligible for five years from
the effective date of retirement for the exemption provided in this
section for service performed in the school district, community
college district, or county office of education from which he or she
retired.
(e) This section shall become operative on January 1, 2001, and
shall remain in effect only until January 1, 2008, and as of that
date is repealed, unless a later enacted statute, which is enacted
before January 1, 2008, deletes or extends that date.
SEC. 4. Section 84040.5 of the Education Code is amended to read:
84040.5. (a) The board of governors, in cooperation with, and
upon approval by, the Department of Finance, shall prescribe the
statements and other information to be included in the audit reports
filed with the state and shall develop audit procedures for carrying
out the purposes of this section. The Department of Finance may make
audits, surveys, and reports which, in the judgment of the
department will serve the best interest of the state.
(b) A review of existing audit procedures, statements, and other
information required to be included in the audit reports shall be
conducted periodically by the board of governors, in cooperation with
the Department of Finance. Standards shall be updated periodically.
(c) For the audit of community colleges electing to take formal
action pursuant to Sections 22714 , 22714.5, 87488, and 87488.1, the
audit standards shall require any information as is prescribed by the
chancellor, including, but not limited to, the following:
(1) The number and type of positions being vacated.
(2) The age and service credit of the retirees receiving the
additional service credit provided by Sections 22714 and 87488.
(3) A comparison of the salary and benefits of each retiree
receiving the additional service credit with the salary and benefits
of the replacement employee, if any.
(4) The resulting retirement costs, including interest, if any,
and postretirement healthcare benefits costs, incurred by the
employer.
(d) The chancellor shall annually prepare a cost analysis, based
upon the information included in the audit reports for the prior
fiscal year, to determine the net savings or costs resulting from
formal actions taken by community college districts pursuant to
Sections 22714, 22714.5, 87488, and 87488.1, and shall report the
results of the cost analysis to the Governor and the Legislature by
April 1 of each year.
(e) All costs incurred by the board of governors to implement
subdivision (c) shall be absorbed by the board of governors.
(f) At the request of the Department of Finance, each community
college district that elects to take formal action pursuant to
Sections 22714, 22714.5, 87488, and 87488.1 shall reimburse the
Department of Finance for any related administrative costs incurred
by the Department of Finance.
SEC. 5. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to facilitate the efficient and consistent administration
of retirement incentives for school employees, it is necessary that
this act take effect immediately. ____
CORRECTIONS Text -- Page 9. ____