BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  SCR 105
                                                                  Page  1


          SENATE THIRD READING
          SCR 105 (Negrete McLeod)
          As Introduced August 22, 2012
          Majority vote 

           SENATE VOTE  :36-1  
           
           RULES               6-0                                         
           
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          |Ayes:|Skinner, Brownley,        |     |                           |
          |     |Carter, Eng, Feuer,       |     |                           |
          |     |Furutani                  |     |                           |
          |     |                          |     |                           |
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           SUMMARY  :  This resolution encourages the State Teachers' 
          Retirement System (STRS) to develop and submit to the 
          Legislature three options that would address the long-term 
          funding needs of the Defined Benefit Program (DBP).  
          Specifically,  this resolution  makes the following legislative 
          findings:

          1)The DBP of the State Teachers' Retirement Plan has an unfunded 
            liability mainly as a result of market downturns in the last 
            ten years and insufficient contributions by members of the 
            Defined Benefit Program, school employers, and the state since 
            the 2001-02 fiscal year.  As a result, the State Teachers' 
            Retirement Plan has not been able to reduce the unfunded 
            liability in accordance with governmental accounting 
            standards.

          2)Any change in contributions to the DBP requires the enactment 
            of legislation. 

           FISCAL EFFECT  :  According to the Assembly Appropriations 
          Committee, costs should be absorbable as the resolution is 
          consistent with the current responsibilities of the State 
          Teachers' Retirement System.  

           COMMENTS  :  According to the author, the State Teachers' 
          Retirement System has an unfunded liability of $64 billion and 
          requires legislation to increase contributions because its 
          members are public school and community college district 
          employees who receive most of their funding from the state.  The 








                                                                  SCR 105
                                                                  Page  2


          resolution was developed by the author as a result of 
          stakeholder meetings of the Conference Committee on Pension 
          Reform. 


           Analysis Prepared by:   Mukhtar Ali / RLS. / (916) 319-2800
           
           
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