BILL ANALYSIS
AB 1733
Page 1
ASSEMBLY THIRD READING
AB 1733 (Wildman)
As Amended May 26, 2000
Majority vote
PUBLIC EMPLOYEES 7-0 APPROPRIATIONS 21-0
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|Ayes:|Correa, Pescetti, Briggs, |Ayes:|Migden, Campbell, |
| |Dutra Firebaugh, Honda, | |Ackerman, Alquist, |
| |Knox | |Aroner, Ashburn, Brewer, |
| | | |Cedillo, Corbett, Davis, |
| | | |Kuehl, Maldonado, Papan, |
| | | |Romero, Runner, Shelley, |
| | | |Thomson, Wesson, Wiggins, |
| | | |Wright, Zettel |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Eliminates the current postretirement earnings
limitation for members of the State Teachers' Retirement System
(CalSTRS) who first return to work more than one year after the
date they retired.
EXISTING LAW:
1)Allows retired members of CalSTRS to earn up to $19,050 in
1999-2000 for public school employment. The earnings
limitation is adjusted annually to reflect changes in the
Consumer Price Index. Any creditable earnings in excess of
this amount result in a dollar-for-dollar reduction in the
member's retirement allowance.
2)Provides an exemption from this limit if the member retired
prior to July 1, 1998, and is employed by a school district to
provide direct classroom instruction in any statutorily
authorized class size reduction program or to temporarily fill
a position vacated by a teacher who transferred to a classroom
in the same district because of the Class Size Reduction
program. This exemption sunsets on July 1, 2002.
3)Provides that an additional exemption exists for a CalSTRS
member who retired for service and who is appointed as a
trustee or administrator or who is employed on an emergency
basis to fill an administrative position. This exemption
AB 1733
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sunsets on July 1, 2003.
FISCAL EFFECT : CalSTRS indicates that the Teachers' Retirement
Fund (TRF) would lose $1.2 million in revenues annually in
benefit deductions from retirees who presently exceed the
earnings limitation. Additionally, the cost to TRF of funding
the CalSTRS defined benefit program would increase by an unknown
amount to the extent that the elimination of the earnings
limitation for members returning to work after a one-year
waiting period induces members to retire earlier than they would
otherwise.
COMMENTS : Supporters point out that "California has begun to
increasingly rely on emergency credentialed teachers to instruct
our children. Last year, over 22,000 emergency teaching
credential permits were issued; tens of thousands of
California's children are being taught by emergency credentialed
teachers. Many times, these teachers are minimally qualified
and are often inexperienced."
Supporters believe that by eliminating the postretirement
earnings limitation for members returning to work after a
one-year waiting period, experienced and credentialed retired
teachers will be encouraged to return to the classroom.
There are three other bills this year that would impact the
CalSTRS earnings limitation:
1)AB 1736 (Ducheny), pending in the Senate, exempts teachers
providing remedial instruction to pupils in grades 2-12 from
the current earnings limitation.
2)AB 141 (Knox), Chapter 22, Statutes of 2000, expands the
current earnings limitation exemption for members filling
administrative positions on an emergency basis.
3)SB 1505 (Alarcon), pending in the Senate, exempts CalSTRS
members who retired prior to 2000 and who return to provide
direct classroom instruction, or to support specified
programs, from the current earnings limitation. SB 1505 is
part of the Governor's education package.
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957
AB 1733
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FN: 0004972