BILL ANALYSIS                                                                                                                                                                                                    



                                                                    SB 1505
                                                                    Page  1

          Date of Hearing:   August 23, 2000

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS 
                              Carole Migden, Chairwoman

                   SB 1505 (Burton) - As Amended: August 7, 2000 

          Policy Committee:                               
          P.E.R.&S.S.Vote:4-0

          Urgency:     No                   State Mandated Local  
          Program:NoReimbursable:           

           SUMMARY  :

          This bill expands eligibility for the minimum guaranteed  
          allowance paid to retired members of the California State  
          Teachers' Retirement System (CalSTRS).  Specifically, this bill  
          expands eligibility for the minimum guaranteed allowance to  
          CalSTRS members who:

          1)Retired before age 55;

          1)Retired as an inactive members;

          1)Retired by March 21, 1974, and had 19.5 years of service;

          1)Retired on or after March 21, 1974, and had sufficient unused  
            sick leave to have a total of 20 years of service; or,

          1)Were disabled prior to retirement, but would have had at least  
            20 years of service had they worked to age 60.

            FISCAL EFFECT  :

          1)CalSTRS estimates that the bill would result in a present  
            value cost to the Teachers Retirement Fund (TRF) of $89  
            million, with annual costs in the range of $12 million.

          1)Implementation costs would range between $150,000 and  
            $350,000.

           COMMENTS  :

           1)Background.  SB 713 (Burton), Chapter 632 of 1999, stablished a  








                                                                    SB 1505
                                                                    Page  2

            minimum annual allowance for retired members of CalSTRS of  
            $15,000 for those members with 20 years of credited service,  
            increasing that amount incrementally per year of service to a  
            maximum of $20,000 for those members with 30 or more years of  
            credited service.  In order to be eligible for the minimum  
            allowance, the member had to be at least age 55 at retirement  
            and an active member at retirement
           
          1)Purpose.   This bill would make an additional 4,000 to 5,000  
            retirees eligible for the program through mostly technical  
            changes to the eligibility criteria.
           
          Analysis Prepared by  :    Stephen Shea / APPR. / (916) 319-2081