BILL NUMBER: AB 2341	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Huber

                        FEBRUARY 19, 2010

   An act to add Section 20094.5 to the Government Code, relating to
the Public Employees' Retirement System.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2341, as introduced, Huber. Public Employees' Retirement
System: Board of Administration.
   The California Constitution prescribes that, with regard to the
retirement board of a public pension or retirement system that
includes in its composition elected employee members, the number,
terms, and method of selection or removal of members of the
retirement board that were required by law or otherwise in effect on
July 1, 1991, shall not be changed, amended, or modified by the
Legislature unless the change, amendment, or modification enacted by
the Legislature is ratified by a majority vote of the electors of the
jurisdiction in which the participants of the system are or were,
prior to retirement, employed.
   The Public Employees' Retirement Law requires the Board of
Administration of the Public Employees' Retirement System to
administer the Public Employees' Retirement Law. Under that law,
state employees and employees of local agencies that contract with
the Board of Administration for retirement benefits are within the
membership of the retirement system. That law, as in effect on July
1, 1991, requires the Board of Administration to consist of 13
members including 2 members elected from the membership of the
retirement system by the members of the retirement system, one member
elected from state membership by active state members, 2 members
elected by and from active local members, and one member elected by
and from the retired members of the retirement system, among others.
The law also provides, in the event of a vacancy, for a special
election or the appointment of a new member, as specified.
   The Trust Law provides for the removal of a trustee by the court
under specified circumstances, including, but not limited to, when
the trustee has committed a breach of the trust, or when the trustee
is insolvent or otherwise unfit to administer the trust. The law
provides that there is a vacancy in the office of trustee in
specified circumstances, including, but not limited to, that the
trustee resigns or is removed, or the trustee files a petition for
adjudication of bankruptcy, as specified.
   This bill similarly would provide for the removal of a member of
the Board of Administration if the board member has committed a
breach of his or her fiduciary duties to the system, or if the board
member is insolvent or otherwise unfit to administer the system. The
bill would provide that there is a vacancy in the office of member of
the board in specified circumstances, including, but not limited to,
that the board member resigns or is removed, or the board member
files a petition for adjudication of bankruptcy, as specified. The
bill would provide that these changes would take effect only when
submitted to and approved by the voters, and would require its
provisions to be submitted for approval by the voters.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 20094.5 is added to the Government Code, to
read:
   20094.5.  (a) A member of the board may be removed by the court on
its own motion, or on petition of a member, retired member, or their
survivor or beneficiary.
   (b) The grounds for removal of a board member by the court include
the following:
   (1) If the board member has committed a breach of his or her
fiduciary duties to the system imposed pursuant to Article 3
(commencing with Section 20150).
   (2) If the board member is insolvent or otherwise unfit to
administer the system.
   (c) There is a vacancy in the office of member of the board in any
of the following circumstances:
   (1) The person named as a board member cannot be identified or
does not exist.
   (2) The board member resigns or is removed.
   (3) The board member dies.
   (4) The board member files a petition for adjudication of
bankruptcy or for approval of an arrangement, composition, or other
extension under the federal Bankruptcy Code, or a petition filed
against the board member for any of these purposes is approved.
   (d) Nothing in this section precludes a quo warranto action
pursuant to Section 803 of the Code of Civil Procedure.
  SEC. 2.  Section 1 of this act shall become effective only when
submitted to and approved by the voters. The Secretary of State shall
submit Section 1 of this act for approval by the voters at a
statewide election in accordance with Section 9040 of the Elections
Code.