BILL ANALYSIS
AB 3076
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 3076 (Mullin)
As Amended August 4, 2004
Majority vote
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|ASSEMBLY: |74-0 |(May 17, 2004) |SENATE: |36-0 |(August 18, |
| | | | | |2004) |
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Original Committee Reference: P.E.,R.&S.S.
SUMMARY : Revises a provision of State Teacher's Retirement law
related to part-time community college faculty and the defined
benefit program.
The Senate amendments :
1)Add an enactment date of July 1, 2005.
2)Make minor technical changes.
EXISTING LAW :
1)Requires any person who performs creditable service, as
defined, on a part-time basis to become a member of the
Defined Benefit (DB) Program of the Teachers' Retirement Plan
if the person is not already a member and is employed to
perform 50% or more of the full-time equivalent for the
position.
2)Provides that persons who teach adult or community college
classes for not more than 60% of the full-time assignment are
classified as temporary employees.
AS PASSED BY THE ASSEMBLY , this bill prohibited part-time
community college faculty from being mandated into the
California State Teachers' Retirement System (CalSTRS) defined
benefit program when they have an occasional full-time
assignment.
FISCAL EFFECT : Provisions of this bill should result in reduced
employer costs for those employees who will not be entered into
and removed from the defined benefit plan.
AB 3076
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COMMENTS : According to the sponsor, CalSTERS, CalSTRS
administers two retirement programs under the State Teachers'
Retirement Plan (Plan). The DB Program is the primary retirement
program for California's full-time public school educators from
kindergarten through community college. The Cash Balance (CB)
Benefit Program is a qualified alternative retirement program
for part-time public school educators from kindergarten through
community college, which may be offered by an employer in
addition to, or in lieu of, Social Security.
Membership in the DB Program is mandated by law for those
employed full-time in positions requiring a credential,
certificate or permit (otherwise known as employment to perform
creditable service); however, all California public school
educators have the option to elect membership in the DB Program.
A part-time employee who typically works less than 60% of a
full-time load may be mandated as a member of the DB Program if
his or her workload during one pay period exceeds a certain
threshold; this threshold depends upon whether the employer
offers the CB Benefit Program. If the employer offers the CB
Benefit Program, then the threshold is 50% of a full-time load;
if the employer does not offer the CB Benefit Program, then the
threshold is 60% of a full-time load. These determining criteria
differ from those used to establish participation in the CB
Benefit Program; participation for the CB Benefit Program is
decided by basis of employment and is limited to those employees
who are hired to a basis of employment of no more than 50% of a
full-time load.
Employees of a community college or an adult education program
who are hired on a part-time basis might periodically and
temporarily exceed the threshold for mandatory membership in the
DB Program, which automatically enrolls the employee in the
Program, even though he or she would prefer to remain in an
alternative retirement program or Social Security. While the
part-time employee might temporarily exceed the threshold for
mandatory membership; his or her basis of employment, as defined
by the employer, remains that of a temporary part-time employee.
"Temporary," as defined by Education Code Section 87482.5, means
any person employed for not more than 60% of a full-time
workload by a community college or adult education program.
This proposal seeks to change the criteria that determine when
membership in the DB Program becomes mandatory for employees of
community colleges and adult education programs.
AB 3076
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The new criterion for mandatory membership in the DB Program:
1)Establishes mandatory membership in the DB Program by basis of
employment, regardless of whether the employer offers the CB
Benefit Program.
2)Is consistent with the existing standard for participation in
the CB Benefit Program.
3)Is consistent with the existing definition of "temporary", as
established by Education Code Section 87482.5.
4)Simplifies employer administration of the Plan because
community college and adult education employers currently
classify employees and monitor workloads according to basis of
employment.
Analysis Prepared by : Clem Meredith / P.E., R. & S.S. / (916)
319-3957
FN: 0007965