BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1862 (Eng)
Hearing Date: 06/28/2010 Amended: As Introduced
Consultant: Maureen Ortiz Policy Vote: PE&R 4-2
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BILL SUMMARY: AB 1862 replaces the currently
governor-appointed retiree representative on the Teachers'
Retirement Board with a representative elected by the retirees
of the California State Teachers' Retirement System (CalSTRS)
and retired participants of the Cash Balance Program, effective
for the term beginning January 1, 2012.
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
Election costs $0
$75 $0 Special*
*Teachers Retirement Fund
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STAFF COMMENTS:
The election for this board member will be held when ballots are
mailed out in October 2011, which coincides with a currently
scheduled election for other elected board positions. The
increase in costs associated with the election for the retired
member seat for staff and vendor expenses will be approximately
$75,000 every four years.
The CalSTRS board of directors consists of the following twelve
members:
a) Three member-elected positions representing current
educators;
b) One retired CalSTRS member appointed by the governor and
confirmed by the Senate;
c) Three public representatives appointed by the Governor and
confirmed by the Senate;
d) One school board representative appointed by the governor
and confirmed by the
Senate; and
e) Four board members who serve in an ex-officio capacity by
virtue of their office: the director of the Department of
Finance, the State Controller, the State Superintendent of
Public Instruction, and the State Treasurer.
AB 1862 replaces the Teachers' Retirement Board member who is
either a retired Defined Benefit (DB) member or a retired Cash
Benefit (CB) participant, and who is appointed by the Governor,
with one who is elected by the retired members of the DB Program
and the retired participants of the CB Benefit Program. The
term for this member is four years, beginning January 1, 2012.
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AB 1862 (Eng)
SB 1580 (Chapter 1049, Statutes of 2002) required three of the
Governor-appointed Teachers Retirement Board members be instead
elected by the active membership. Since the enactment of that
legislation, CalSTRS has held two elections which were in 2003
and 2007. To conduct the election, CalSTRS contracts with an
election vendor who prepares the ballots and prints the
candidate statements. The vendor carries out the election as
set forth by regulations adopted by the Board, including mailing
and tabulating the ballots.
AB 1862 is intended to provide retirees with a larger voice on
retirement issues as is the case with other retirement boards.
For instance, the Board of Administration of the
California Public Employees' Retirement System has six members
out of thirteen who are elected by their peers.