BILL ANALYSIS �
AB 1101
Page 1
ASSEMBLY THIRD READING
AB 1101 (Eng)
As Introduced February 18, 2011
Majority vote
PUBLIC EMPLOYEES 4-2 APPROPRIATIONS 12-3
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|Ayes:|Furutani, Allen, Ma, |Ayes:|Fuentes, Blumenfield, |
| |Wieckowski | |Bradford, Charles |
| | | |Calderon, Campos, Davis, |
| | | |Gatto, Hall, Hill, Lara, |
| | | |Mitchell, Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Mansoor, Harkey |Nays:|Harkey, Donnelly, Nielsen |
| | | | |
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SUMMARY : Replaces the currently Governor-appointed retiree
representative on the Teachers' Retirement Board (TRB) with a
representative elected by the retirees of the California State
Teachers' Retirement System (CalSTRS). Specifically, this bill :
1)Replaces the TRB member who is either a retired CalSTRS
Defined Benefit (DB) Program member or a retired Cash Balance
(CB) Benefit Program participant and 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.
2)Specifies the term for this new TRB member is four years,
starting January 1, 2016.
EXISTING LAW provides that the TRB consists of the following:
1)Three member-elected positions representing current educators.
2)A retired CalSTRS member appointed by the Governor and
confirmed by the Senate.
3)Three public representatives appointed by the Governor and
confirmed by the Senate.
4)A school board representative appointed by the Governor and
AB 1101
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confirmed by the Senate.
5)Four board members who serve in an ex-officio capacity by
virtue of their office: Director of Finance, State
Controller, State Superintendent of Public Instruction, and
State Treasurer.
Under the DB Program, an "active member" is defined as a member
who is not retired or disabled and who earns creditable
compensation during the school year. A "retired member" is
defined as a member who has terminated employment and to whom a
service retirement or disability retirement benefit is payable.
A "disabled member" is defined as a member to whom a disability
allowance is payable.
Under the CB Benefit Program a "participant" is defined as a
person who has contributions credited under the program or who
is receiving an annuity under the program by reason of
creditable service.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, "CalSTRS indicates that additional election costs for
the seat (which would occur every four years) would be about
$75,000 for staff and vendor expenses, and would coincide with
the election for the other seats. Unknown impacts on CalSTRS
investments and earnings."
COMMENTS : Prior to the enactment of SB 1580 (Burton), Chapter
1049, Statutes of 2002, the TRB had no representatives that were
elected by the members of the system. With the exception of the
four ex-officio members, all of the other board members were
appointed by the Governor. SB 1580 (Burton) required the three
board members appointed by the Governor to represent active
members to instead be elected by the active members of the
system.
Most other public retirement boards in California have elected
members. For example, the Board of Administration of the
California Public Employees' Retirement System has six members
out of thirteen who are elected by their peers and each of the
20 retirement systems being operated under the County Employees'
Retirement Law of 1937 has four members elected by the active
and retired members of the system.
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According to supporters, "AB 1101 will allow retirees to have a
united voice on their retirement issues by changing the Retiree
Representative on the TRB of CalSTRS from one being appointed by
the Governor to one being appointed by the retired members of
CalSTRS. The change in statute will allow for a more democratic
process of representation."
This bill is similar to AB 1862 (Eng) of 2010, which was vetoed
by Governor Schwarzenegger. In his veto message, the Governor
stated, in part, "There is no documented problem that
demonstrates the need to change current law with this bill."
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957
FN: 0000279