BILL ANALYSIS �
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THIRD READING
Bill No: SB 1219
Author: Torres (D)
Amended: 4/1/14
Vote: 21
SENATE PUBLIC EMPLOY. & RETIRE. COMM. : 4-0, 4/21/14
AYES: Torres, Walters, Block, Gaines
NO VOTE RECORDED: Evans
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Public employees retirement: service after
retirement
SOURCE : California Public Employees Retirement System
DIGEST : This bill makes conforming changes to the Public
Employees Retirement Law (PERL), administered by the California
Public Employees Retirement System (CalPERS), in order to bring
the PERL into conformity with the Public Employees Pension
Reform Act of 2013 (PEPRA).
ANALYSIS :
Existing law:
1. Establishes PEPRA which:
A. Prohibits a retiree who is receiving a pension
benefit from returning to public employment for an
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employer in the same public retirement system from
which he/she is receiving the retirement benefit unless
specified requirements are met.
B. Prohibits a public retiree who is first appointed on
or after January 1, 2013, to a full-time, salaried
position on a state board or commission from receiving
both a full-time salary and a pension, and makes the
specified requirements in those situations.
C. Allows certain retired individuals to serve without
reinstatement or restriction in specified situations.
2. Establishes PERL which:
A. In the case of the California State University (CSU)
academic retirees returning to academic employment, sets a
limit on employment of the lesser of 960 hours or 50% of
the hours the individual worked in the fiscal year prior
to retirement.
B. Requires that an employee who has not reached normal
retirement age have a bona fide separation from service,
as required in the Internal Revenue Code, before returning
to work as a retired worker.
C. Requires that a person who is unlawfully employed as a
retiree shall be reinstated to membership in CalPERS in
the category in which, and as of the date on which, the
unlawful employment occurred, and makes specified
requirements in those cases.
D. Creates a program that allows a disabled safety officer
who retires for industrial disability to continue working
in a non-safety or unrelated safety position, either full
or part-time, and to receive his/her salary plus all or a
portion of the pension to equal the salary the individual
was receiving while employed as a safety officer, as
specified.
E. Allows a retiree who is elected to public office to
serve without loss of benefits; however, if all or part of
the retiree's benefit is based on service in that elected
office, that portion of the benefit is suspended while the
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individual is serving in the elected office.
This bill:
1. Repeals the article in PERL relative to working after
retirement and rewrites its provisions to incorporate
requirements of PEPRA, eliminates provisions of PERL in
conflict with PEPRA, and to retains provisions of PERL that
are specific to PERL or are not referenced in PEPRA.
2. Specifically, in addition to incorporating provisions of
PEPRA:
A. Specifies that the 960 hour rule applies to a fiscal
year;
B. Retains the requirement for a bona fide break in
service for individuals who retire prior to normal
retirement age;
C. Retains penalties to employees and employers who are
deemed to have purposefully worked or provided employment
unlawfully following the employee's retirement;
D. Retains references to CSU retirees, who are specific to
CalPERS;
E. Retains the program to allow disabled retirees to work
in public employment and receive a blended salary of
compensation and retirement benefit up to the retiree's
pre-retirement compensation; and
F. Retains the provision exempting retirees who are
elected to public office.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 5/7/14)
California Public Employees' Retirement System (source)
Association of California Cities, Orange County
Rural County Representatives of California
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ARGUMENTS IN SUPPORT : According to the sponsor, "CalPERS
recognizes the need for ongoing clarification and conformity of
the Public Employees' Retirement Law (PERL) to the pension
reforms signed into law in 2012. SB 1219 will serve as the
legislative vehicle for consensus clarifications and conformity
provisions related to the PEPRA and post-retirement public
employment."
JL:d 5/7/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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