BILL NUMBER: SB 2122 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 26, 2000
AMENDED IN SENATE APRIL 24, 2000
INTRODUCED BY Senator Ortiz
FEBRUARY 25, 2000
An act to repeal , add, and repeal and add
Chapter 21.4 (commencing with Section 7515) of Division 7 of
Title 1 of the Government Code, relating to public retirement fund
investments.
LEGISLATIVE COUNSEL'S DIGEST
SB 2122, as amended, Ortiz. Joint Retirement System
Investment Advisory Panel Retirement systems:
investments: information sharing .
The California Constitution provides that the retirement boards of
public pension or retirement systems have plenary authority over the
assets of their respective systems, subject to their fiduciary
duties to the systems' members.
This bill would establish the Joint Retirement System
Investment Advisory Panel that would make recommendations and provide
advice to, and facilitate the sharing of information between, the
Public Employees' Retirement System and the State Teachers'
Retirement System, as specified. The provisions of the bill would be
repealed on January 1, 2004 state that the Public
Employees' Retirement System and the State Teachers' Retirement
System are authorized and encouraged to cooperate and share
information that may assist them in developing and implementing
appropriate investment strategies, with the advice of investment
experts, as specified. It would specify that confidential
information or documents relating to investments in the possession of
either system would not lose their confidential status due to the
fact that the information or documents are shared with the other
system or with investment advisors. It also would delete obsolete
provisions .
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. This act shall be known and may be cited as the Joint
Retirement System Investment Advisory Panel
Information Sharing Act of 2000.
SEC. 2. Chapter 21.4 (commencing with Section 7515) of Division 7
of Title 1 of the Government Code is repealed.
SEC. 3. Chapter 21.4 (commencing with Section 7515) is added to
Division 7 of Title 1 of the Government Code, to read:
CHAPTER 21.4. JOINT RETIREMENT SYSTEM INVESTMENT
ADVISORY PANEL INFORMATION SHARING
7515. The Joint Retirement System Investment Advisory Panel is
hereby established. As used in this chapter, "panel" shall mean the
Joint Retirement System Investment Advisory Panel. The panel shall
consist of:
(a) The Governor.
(b) The Treasurer.
(c) The Controller.
(d) Two of the elected members of the Board of Administration of
the Public Employees' Retirement System.
(e) Two of the members of the Teachers' Retirement Board described
in paragraphs (5) to (10), inclusive, of subdivision (a) of Section
22200 of the Education Code.
(f) Six investment professionals.
7516. (a) The members of the panel described in subdivisions (d)
and (e) Section 7515 shall serve for a term of one year. No person
shall serve a subsequent term until all other eligible members of his
or her respective retirement board have served on the panel.
(b) The members of the panel described in subdivision (f) of
Section 7515 shall be appointed by the Treasurer and the Controller,
jointly, for a term of two years, subject to Senate confirmation, and
may be reappointed to serve subsequent or consecutive terms at the
discretion of the Treasurer and the Controller, subject to Senate
confirmation. Each of those members shall be experienced in the
field of investments and shall have served, or shall be serving, as a
senior officer or member of the board of an insurance company,
banking corporation, or other financial or investment organization
authorized to do business in California.
(c) No member of the panel described in subdivision (f) of Section
7515 shall have any direct personal involvement or economic interest
in any financial transaction with the State Teachers' Retirement
System or the Public Employees' Retirement System while the member
serves on the panel or for one year after the expiration or earlier
termination of the member's term on the panel.
7517. (a) The members of the panel, other than the members
described in subdivision (f) of Section 7515, shall annually elect a
chairperson of the panel.
(b) The panel shall meet no less than quarterly, but may meet at
the call of the chairperson. Panel members are required to attend
meetings; however, the Governor, the Treasurer, and the Controller
may designate a representative to attend meetings and to act in his
or her stead.
(c) Notwithstanding any other provision of law, the members of the
panel shall receive no salary, compensation, or reimbursement for
expenses related to their service on the panel. The panel shall not
employ any permanent staff.
(d) Any expenses incurred by the panel shall be paid in equal
shares by the State Teachers' Retirement System and the Public
Employees' Retirement System.
7518. (a) Subject to and consistent with the provisions of
Section 17 of Article XVI of the California Constitution, the panel
shall not establish investment policies for the Public Employees'
Retirement System or the State Teachers' Retirement System, but,
instead, shall do the following:
(1) Review asset allocations and make recommendations to those
systems at least once a year prior to the asset allocation workshops
of those systems.
(2) Analyze, from a strategic perspective, active versus passive
management of investments and give advice to the respective systems
as appropriate.
(3) Facilitate information sharing and education between the
governing boards of the two systems relating to investment policy to
avoid historical problems in these areas.
7519. This chapter shall remain in effect only until January 1,
2004, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2004, deletes or extends
that date.
7515. It is the intent of this chapter to authorize and encourage
the Public Employees' Retirement System and the State Teachers'
Retirement System to regularly cooperate and share information that
may assist both systems in developing and implementing appropriate
investment strategies, with the advice of investment experts selected
by the systems who are willing to share their knowledge and
expertise.
7516. Notwithstanding any other provision of law, confidential
information or documents relating to investments in the possession of
the Public Employees' Retirement System or the State Teachers'
Retirement System shall not lose their confidential status due to the
fact that the information or documents are shared with the other
system or with investment advisors selected by the systems to advise
on asset allocation, active verses passive management, or other
investment issues of mutual interest and concern. Nothing in this
chapter shall be construed to authorize the release or sharing of
documents or information in violation of federal law or the terms of
a contract.