BILL NUMBER: AB 821 INTRODUCED
BILL TEXT
INTRODUCED BY Committee on Public Employees, Retirement and Social
Security (Correa (Chair), Firebaugh, Honda, Knox, and Pescetti)
FEBRUARY 24, 1999
An act to amend Sections 22134 and 22136 of the Education Code,
and to add Section 20035.5 to the Government Code, relating to
retirement.
LEGISLATIVE COUNSEL'S DIGEST
AB 821, as introduced, Committee on Public Employees, Retirement
and Social Security. Retirement.
Existing law provides for the payment of retirement benefits to
various school employees under the State Teachers' Retirement System
and the Public Employees' Retirement System. Under existing law, the
retirement benefits are computed based upon various factors,
including the employees final compensation. Under existing law, for
those school employees, "final compensation" means the highest
average annual compensation earnable by a member during any period of
3 consecutive school years.
This bill would change that definition of "final compensation" to,
instead, mean the highest average annual compensation earnable by a
member during a consecutive 12-month period of employment, as
specified.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 22134 of the Education Code is amended to read:
22134. (a) "Final compensation" means the highest average annual
compensation earnable by a member during any period of three
consecutive school years the consecutive 12-month
period of employment immediately preceding the effective date of his
or her retirement or the date of his or her last separation from
service if earlier or during any other period of 12 consecutive
months while an active member of the Defined Benefit Program or
time during which he or she was not a member but
for which the member has received credit under the Defined Benefit
Program, except time that was so credited for service performed
outside this state prior to July 1, 1944. The last three
consecutive years 12-month period
of employment shall be used by the system in determining final
compensation unless designated to the contrary in writing by the
member.
(b) For purposes of this section, periods of service separated by
breaks in service may be aggregated to constitute a period of
three 12 consecutive years
months , if the periods of service are
consecutive except for the breaks.
(c) The determination of final compensation of a member who is
also a member of the Public Employees' Retirement System, the
Legislators' Retirement System, the University of California
Retirement System, county retirement systems established under
Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of
Title 3 of the Government Code, or the San Francisco City and County
Employees' Retirement System shall take into consideration the
compensation earnable while a member of the other system, provided
that all of the following exist:
(1) The member was in state service or in the employment of a
local school district or of a county superintendent of schools.
(2) Service under the other system was not performed concurrently
with service under this plan.
(3) Retirement under this plan is concurrent with the member's
retirement under the other system.
(d) The compensation earnable for the first position in which
California service is credited shall be used when additional
compensation earnable is required to accumulate three consecutive
years for the purpose of determining final compensation under Section
23804.
(e) The board may specify a different final compensation with
respect to allowances based on part-time service performed prior to
July 1, 1956, for which credit was given under this plan under board
rules in effect prior to that date.
(f) The board may specify a different final compensation with
respect to disability allowances, disability retirement allowances,
family allowances, and children's portions of survivor benefit
allowances payable on and after January 1, 1978. The compensation
earnable for periods of part-time service shall be adjusted by the
ratio that part-time service has to full-time service.
(g) The amendment of former Section 22127 made by Chapter 782 of
the Statutes of 1982 does not constitute a change in, but is
declaratory of, the existing law.
SEC. 2. Section 22136 of the Education Code is amended to read:
22136. (a) "Final compensation" with respect
to a member whose salary while an active member was reduced because
of a reduction in school funds means the highest average annual
compensation earnable by the member during any three years
12 months while employed to perform creditable
service subject to coverage by the plan if the member elects to be
subject to this section.
(b) For the purposes of this section, a year shall be considered
to be a period of 12 consecutive months.
SEC. 3. Section 20035.5 is added to the Government Code, to read:
20035.5. Notwithstanding Section 20037, "final compensation" for
the purposes of determining any pension or benefit with respect to a
school member means the highest annual compensation which was
earnable by the school member during the consecutive 12-month period
of employment immediately preceding the effective date of his or her
retirement or the date of his or her last separation from service if
earlier or during any other period of 12 consecutive months during
his or her membership in this system that the member designates on
the application for retirement.