BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 203|
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THIRD READING
Bill No: SB 203
Author: Correa (D)
Amended: 3/31/11
Vote: 21
SEN. PUBLIC EMPLOYMENT & RETIREMENT COMM. : 5-0, 4/11/11
AYES: Negrete McLeod, Walters, Gaines, Padilla, Vargas
SUBJECT : County retirement boards: alternate
members/elections
SOURCE : California Retired County Employees Association
DIGEST : This bill makes various changes to the process
for filling vacancies on boards of retirement and boards of
investment in counties operating retirement systems under
the County Employees' Retirement Law of 1937.
ANALYSIS : Existing County Employees' Retirement Law of
1937 ('37 Act) sets forth the composition of the
nine-member Board of Retirement for any '37 Act county
retirement association, as follows:
1.The county treasurer.
2.Two general (non-safety) members elected by the general
members of the system (second and third members).
3.Four members who are qualified electors not in any way
connected with county government, except one may be a
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county supervisor, appointed by the board of supervisors
(fourth, fifth, sixth and ninth members).
4.One safety member elected by the safety members of the
system (seventh member).
5.One retired member elected by the retired members of the
system (eighth member).
6.An alternate seventh member who is an eligible safety
member of the system.
7.An alternate retired member of the system who is the
alternate for the eighth member (only in San Bernardino
County and other counties that adopt this option).
Existing '37 Act law creates an independent Board of
Investment in Los Angeles County and sets forth the
nine-member composition of that board in a manner
substantially similar to the composition of the boards of
retirement.
This bill makes technical changes to these provisions,
including clarifying references to the alternate seventh
member.
Existing law provides that the alternate members, unless
prohibited by a resolution or regulation of the board, have
the same rights, privileges, responsibilities, and access
to closed sessions as other specified board members, and
may participate in deliberations of the boards whether or
not other elected board members, including the seventh and
eighth members, are present.
This bill eliminates the ability of a board, by resolution
or board regulation, to prohibit an alternate member from
participation in deliberations and having the same rights,
privileges, responsibilities, and access to closed sessions
as other specified boards.
Existing law provides that, in counties without an
alternate retired member, the alternate seventh member may
vote in place of the second, third, seventh, or eighth
member if one of those members is absent, and allows the
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seventh member to fill a vacancy in one of those positions
until a successor qualifies.
In counties with an alternate retired member, the alternate
retired member may only vote if the regular eighth member
is absent and may only fill a vacancy left by the regular
eighth member.
This bill clarifies that if the county has an alternate
seventh member and an alternate retired member, the
alternate seventh member shall act on behalf of an absent
second, third, or seventh member, and may not act on behalf
of the eighth or alternate retired member unless both are
absent from the board meeting.
Existing law prescribes the manner of appointing an
alternate retired member for the eighth member of the board
of retirement. If there is a vacancy with respect to the
eighth member the alternate retired member is required to
fill the vacancy until a successor qualifies.
This bill specifies that if there is a vacancy with respect
to the eighth member, the alternate retired member will
fill the vacancy for the remainder of the eighth member's
term in office.
Existing law provides that if a vacancy on the board occurs
for any cause or on the expiration of the term of office of
any member, a successor shall be chosen in the same manner
as was his predecessor, except that if an election to fill
a vacancy for the second, third, seventh or eighth member
has been called and only one member has been duly
nominated, the board of supervisors shall order that no
election be held and shall direct the clerk to cast a
unanimous ballot in favor of such nominated member.
This bill revises and recasts provisions governing the
process for filling vacancies on both the boards of
retirement and boards of investment to provide the
following:
1.For vacancies in the fifth, sixth, seventh, or ninth
member positions, the board of supervisors is required to
appoint a replacement for the duration of the current
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term forthwith. For vacancies in the seventh member
position, candidates will be a safety member from a group
which is not represented by an incumbent alternate
seventh member. The successful candidate will serve for
the duration of the current term.
2.For vacancies in the second, third, fourth, or eighth (if
there is no alternate retired member), the board is
required to cause an election to be held at the earliest
possible date to fill the vacancy. These vacancies will
be filled for the remainder of the current term unless
only six months or less remain of that term, in which
case a single election may be held to fill the remainder
of the current term and the succeeding term.
3.For vacancies with respect to the alternate retired
member position, the board of retirement is required to
appoint a replacement alternate member in the same manner
as prescribed for the initial appointment of an alternate
retired member.
4.If an election has been called due to the expiration of
the term of office of any member or to fill a vacancy for
the second, third, seventh, eighth, or alternate seventh
member of a board of retirement, or for the second,
third, seventh, or eighth member positions on a board of
investment, and only one candidate has been duly
nominated, the board of supervisors shall order that no
election be held and shall direct the clerk to cast a
unanimous ballot in favor of such nominated candidate.
Prior Legislation
AB 2526 (Berryhill), 2007-08 Session, made various changes
to the process for filling vacancies on boards of
retirement and boards of investment in counties operating
retirement systems under the '37 Act. (Failed passage in
Senate Public Employment and Retirement Committee)
SB 414 (Correa), 2009-10 Session, made various changes to
the process for filling vacancies on boards of retirement
and boards of investment in counties operating retirement
systems under the '37 Act. Passed the Senate with a vote
of 23-11 on August 19, 2010. The bill was subsequently
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vetoed by the Governor Schwarzenegger. In his veto
message, the Governor stated"
"Among other things, this bill prohibits a county
retirement board from limiting the role of an alternate
member's participation in board meetings and
committees. It also mandates that an election to fill
board vacancies be held at the earliest possible date.
Both of these provisions are unnecessarily limiting of
the flexibility of these local entities."
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 4/13/11)
California Retired County Employees Association (source)
ARGUMENTS IN SUPPORT : According to the sponsor, the
California Retired County Employees Association, "Nothing
in statute requires the board of supervisors or county
board of retirement, as applicable, to expeditiously fill
vacancies on the board of retirement. This can affect the
board's ability to obtain a quorum for official meetings.
It can also deny the various stakeholders of the retirement
system proper representation on the board."
The sponsor also notes that alternate board members have
the same fiduciary responsibility and liability as regular
board members. Therefore, it is necessary that no
potential limitation to their activities exist.
In order to carry out their responsibilities they must be
involved in, and have access to, every aspect of the
board's business so that when called upon to vote, they
possess all of the same information as regular board
members.
Finally, the bill reduces the costs of elections by
allowing one election to fill both the remaining term of a
vacant position and the succeeding term when the remaining
term is of six months or less.
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CPM:cm 4/13/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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