BILL ANALYSIS �
SENATE PUBLIC EMPLOYMENT & RETIREMENT BILL NO: AB 2664
Gloria Negrete McLeod, Chair Hearing date: June 11, 2012
AB 2664 (Asm. PER&SS Committee) as amended 5/09/12
FISCAL: NO
'37 ACT COUNTY RETIREMENT SYSTEMS: ELECTRONIC SIGNATURES;
BENEFIT ADJUSTMENT AUTHORITY FOR ERRORS & OMMISSIONS; RETIREE
DENTAL BENEFITS
HISTORY :
Sponsor: Los Angeles County Employees' Retirement
Association
State Association of County Retirement Systems
Other legislation: AB 232 (Fletcher/Hill),
Chapter 90, Statutes of 2009
AB 1288 (Hayashi),
Chapter 331, Statutes of 2007
ASSEMBLY VOTES :
PER & SS 6-0 5/02/12
Assembly Floor 77-0 5/21/12
SUMMARY :
AB 2664 would provide authority for a '37 Act County
Retirement System to:
1) use and accept an electronic signature on documents
from members if submitted using technology deemed by the
board to be sufficient to ensure authenticity;
2) for Los Angeles County Employees' Retirement
Association (LACERA), recalculate and adjust retiree
benefits as specified to account for errors and
omissions discovered within in 3 years, or 10 years if
involving fraud; and
3) enroll retirees into a group dental plan administered
by the system for active members provided that retiree
participants pay the entire premium for the dental
benefits.
Glenn A. Miles
Date: 6/04/12 Page 1
BACKGROUND AND ANALYSIS :
1)Existing law :
a) establishes the 1937 Act County Employees' Retirement
Law, which covers 20 independent county retirement
systems, each governed by an independent board of
retirement.
b) provides that when a signature is required in any
transaction involving a public entity, a digital
signature that complies with certain requirements may be
used and requires that the digital signature conform to
regulations of the Secretary of State.
c) authorizes the California State Teachers' Retirement
System (CalSTRS) to develop and implement a process for
accepting electronic signatures from members, while
maintaining the same level of security as required by
existing CalSTRS law.
d) establishes the manner in which the California Public
Employees' Retirement System (CalPERS) may adjust
retirement payments due to errors or omissions.
e) establishes the County Retirement System Vision Care
Program to provide vision care benefits to '37 Act
retirees, their survivors, and eligible dependents.
1)This bill :
a) allows the retirement boards of '37 Act retirement
systems to adopt regulations allowing for the use and
acceptance of a member's electronic signature if the
documents and signature are submitted using technology
the board deems sufficient to ensure their integrity,
security, and authenticity. Provides that the documents
and signatures will be given the same force and effect
as a signed, valid original document.
b) authorizes LACERA to adjust retirement payments due
to errors or omissions in a manner similar to that used
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Date: 6/04/12 Page 2
by CalPERS, as follows:
i. Sets a three-year statute of limitations for
LACERA to make an adjustment to a member's benefit
payment resulting from an error or omission;
ii. In cases where LACERA owes money to the
retiree, provides that the statute of limitations to
adjust the benefit payment shall not apply except as
specified;
iii. Provides a ten-year statute of limitations for
payment adjustment from the discovery of an erroneous
payment resulting from a member's or beneficiary's
death or a beneficiary's remarriage;
iv. Provides a ten-year statute of limitations for
payment adjustment from the discovery of an erroneous
payment resulting from a member's fraudulent
reporting of compensation. The ten-year limitation
commences from the later of the date of payment or
the discovery of the fraudulent reporting.
a) establishes the County Retirement System Dental Care
Program (Program) to provide dental care benefits to
county and district retirees, their survivors, and
eligible dependents of '37 Act retirement systems that
elect to offer the Program. Retirees are responsible
for the full cost of the dental care premium; counties
electing to participate may contract with a third party
administrator to provide the dental care; and the
Program may be revised or discontinued at any time.
COMMENTS :
1)Arguments in Support
a) Electronic Signatures
According to the sponsor, "A county retirement system
may accept a member's digital signature with the same
force and effect as a manual signature but only if it
meets the requirements of Section 16.5 of the Government
Code and regulations adopted by the Secretary of State.
Compliance with 16.5 and regulations adopted thereunder
is so costly and burdensome as to render it impractical
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Date: 6/04/12 Page 3
for use by county retirement systems and their members.
LACERA significantly limits the use of electronic
signatures as a result."
LACERA states that AB 2664 would result in increased
efficiency, reduced costs, and better service to their
members by allowing '37 Act County Retirement Systems to
determine whether their technology is sufficient to
ensure electronic signature integrity.
b) Benefit Payment Adjustments Due to Errors or Omissions
According to the sponsor, existing law authorizes '37
Act boards to reduce the monthly retirement benefits of
members who fraudulently report compensation or
overstate earnings but does not contain a statutory
framework to correct errors and omissions. This bill
would provide LACERA with the authority to correct
errors and omissions.
c) Retiree Group Dental Benefits
There are twenty '37 Act counties, some of which provide
dental plans for their retirees. Based upon surveys of
counties not offering dental coverage for retirees, the
State Association of Counties Retirement Systems (SACRS)
estimates that this bill would potentially extend dental
coverage to 18,000 retirees and spouses.
2)SUPPORT :
Los Angeles County Employees' Retirement Association
(LACERA), Co-sponsor
State Association of County Retirement Systems (SACRS),
Co-sponsor
American Federation of State, County and Municipal
Employees, AFL-CIO (AFSCME)
3)OPPOSITION :
None to date
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Date: 6/04/12 Page 4
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