Bill Text: CA AB431 | 2013-2014 | Regular Session | Amended
Bill Title: County Employees Retirement Law of 1937: federal law compliance.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Introduced - Dead) 2014-02-03 - From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB431 Detail]
Download: California-2013-AB431-Amended.html
BILL NUMBER: AB 431 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY SEPTEMBER 12, 2013
AMENDED IN ASSEMBLY APRIL 15, 2013
AMENDED IN ASSEMBLY APRIL 2, 2013
AMENDED IN ASSEMBLY MARCH 5, 2013
INTRODUCED BY Assembly Member Mullin
FEBRUARY 15, 2013
An act to add Chapter 2.55 (commencing with Section
65087) to Division 1 of Title 7 of the Government Code, relating to
regional planning. An act to amend Sections 7522.70,
7522.72, 7522.74, 31564, 31592.2, 31592.4, 31649.5, 31656, 31671,
31691, 31691.1, and 31696.3 of, and to add Sections 31485.16,
31485.17, 31485.19, 31694.6, and 31698.5 to, the Government Code,
relating to county employees.
LEGISLATIVE COUNSEL'S DIGEST
AB 431, as amended, Mullin. Regional transportation plan:
sustainable communities strategy: funding. County
Employees Retirement Law of 1937: federal law compliance.
Federal tax law regulates pension plans generally and regulates
public pension plans specifically based on their status as
governmental plans, as defined. In this regard, among other things,
federal law requires that accrued member retirement benefits be
nonforfeitable, as specified, establish conditions for the
distribution of funds to members from a retirement system, prescribe
requirements for the vesting of benefits, and limit the application
of pension funds for medical benefits.
The County Employees Retirement Law of 1937 (CERL) permits
counties and districts, as defined, to provide retirement benefits to
their employees pursuant to its provisions, and vests the management
of the retirement system in the board of retirement. CERL generally
conditions distribution of benefits upon compliance with federal
requirements. CERL requires a county to retain in its retirement fund
specified excess earnings to maintain a reserve against possible
future deficiencies in earnings, and to transfer certain of those
excess earnings into county advance reserves for the sole purpose of
paying the cost of retirement benefits, as specified. CERL authorizes
the use of these reserves for the payment of health and medical
benefits, as specified. In addition, excess earnings, as defined, and
the Supplemental Retiree Benefits Reserve, if established by the
county, may be used for payment of specified optional benefits.
This bill would revise various provisions of CERL to explicitly
conform with federal law. In this regard, the bill would provide that
a member's accrued retirement benefits are nonforfeitable, in
accordance with federal law, once the member attains normal
retirement age, as specified, or upon termination of, or
discontinuance of contributions under, the retirement system. Upon
the withdrawal of a district from a retirement system, the bill also
would prohibit a refund, distribution, or transfer of contributions
for other funds to an employee or district unless in compliance with
prescribed federal law.
This bill would authorize a retirement system to apply specified
earnings to designated health benefits if federal requirements are
met, and would allow the board of retirement to authorize payment of
those benefits with county advance reserves. The bill would specify
that, if a county establishes a Post-Employment Benefits Trust
Account as a part of its retirement fund, that account shall be used
exclusively to provide health benefits for retired members, their
spouses, and dependents.
This bill would revise county procedures applicable to providing
service credit to a member of the retirement system for all or part
of his or her military service, in accordance with federal law.
This bill would require a county that elects to provide optional
long-term care or vision benefits, to comply with applicable federal
law and regulation, including maintaining separate trust funds for
those benefits. The bill also would make various technical,
nonsubstantive changes to CERL.
The California Public Employees' Pension Reform Act of 2013
(PEPRA), on and after January 1, 2013, generally requires a public
retirement system, as defined, to modify its plan or plans to comply
with the act, as specified. Among other things, PEPRA requires a
public employee or officer who is convicted of certain enumerated
crimes to forfeit specified rights and benefits under, and membership
in, any public retirement system of which he or she is a member,
effective on the date of his or her final conviction.
This bill would revise the provisions of PEPRA relating to
forfeiture, to specify that those provisions do not apply after the
retirement system is terminated or contributions under the system are
completely discontinued.
Existing law requires certain transportation planning activities
by designated transportation planning agencies, including development
of a regional transportation plan. Certain of these agencies are
designated by federal law as metropolitan planning organizations.
Existing law requires metropolitan planning organizations to adopt,
as part of the regional transportation plan in urban areas, a
sustainable communities strategy, which is to be designed to achieve
certain targets established by the State Air Resources Board for the
reduction of greenhouse gas emissions from automobiles and light
trucks in the region.
Existing law authorizes various local governmental entities,
subject to certain limitations and approval requirements, to levy a
transactions and use tax for specified purposes, in accordance with
the procedures and requirements set forth in the Transactions and Use
Tax Law, including a requirement that the combined rate of all taxes
that may be imposed under that law in the county may not exceed 2%.
This bill would authorize a transportation planning agency that is
designated as a metropolitan planning organization to impose a
transactions and use tax, as specified, at a rate of no more than
0.5% even if the combined rate of this tax and other specified taxes
imposed in the county, exceeds, if certain requirements are met. The
bill would require the ordinance to contain an expenditure plan, with
not less than 25% of available net revenues to be spent on each of
the 3 categories of transportation, affordable housing, and parks and
open space, in conformity with the sustainable communities strategy,
with the remaining net available revenues to be spent for purposes
determined by the transportation planning agency to help attain the
goals of the sustainable communities strategy.
Vote: majority. Appropriation: no. Fiscal committee: yes
no . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 7522.70 of the
Government Code is amended to read:
7522.70. (a) This section shall apply to any elected public
officer who takes public office, or is reelected to public office, on
or after January 1, 2006.
(b) If an elected public officer is convicted during or after
holding office of any felony involving accepting or giving, or
offering to give, any bribe, the embezzlement of public money,
extortion or theft of public money, perjury, or conspiracy to commit
any of those crimes arising directly out of his or her official
duties as an elected public officer, he or she shall forfeit all
rights and benefits under, and membership in, any public retirement
system in which he or she is a member, effective on the date of final
conviction.
(c) (1) The elected public officer described
in subdivision (b) shall forfeit only that portion of his or her
rights and benefits that accrued on or after January 1, 2006, on
account of his or her service in the elected public office held when
the felony occurred.
(2) The forfeiture provisions in paragraph (1) do not apply after
termination of the retirement system or complete discontinuance of
contributions under the system.
(d) Any contributions made by the elected public officer described
in subdivision (b) to the public retirement system that arose
directly from or accrued solely as a result of his or her forfeited
service as an elected public officer shall be returned, without
interest, to the public officer.
(e) The public agency that employs an elected public officer
described in subdivision (b) shall notify the public retirement
system in which the officer is a member of the officer's conviction.
(f) An elected public officer shall not forfeit his or her rights
and benefits pursuant to subdivision (b) if the governing body of
the elected public officer's employer, including, but not limited to,
the governing body of a city, county, or city and county, authorizes
the public officer to receive those rights and benefits.
(g) For purposes of this section, "public officer" means an
officer of the state, or an officer of a county, city, city and
county, district, or authority, or any department, division, bureau,
board, commission, agency, or instrumentality of any of these
entities.
(h) This section applies to any person appointed to service for
the period of an elected public officer's unexpired term of office.
(i) On and after January 1, 2013, this section shall not apply in
any instance in which Section 7522.72 or 7522.74 applies.
SEC. 2. Section 7522.72 of the
Government Code is amended to read:
7522.72. (a) This section shall apply to a public employee first
employed by a public employer or first elected or appointed to an
office before January 1, 2013, and, on and after that date, Section
7522.70 shall not apply.
(b) (1) If a public employee is convicted by a state or federal
trial court of any felony under state or federal law for conduct
arising out of or in the performance of his or her official duties,
in pursuit of the office or appointment, or in connection with
obtaining salary, disability retirement, service retirement, or other
benefits, he or she shall forfeit all accrued rights and benefits in
any public retirement system in which he or she is a member to the
extent provided in subdivision (c) and shall not accrue further
benefits in that public retirement system, effective on the date of
the conviction.
(2) If a public employee who has contact with children as part of
her official duties is convicted of a felony that was committed
within the scope of his or her official duties against or involving a
child who he or she has contact with as part of his or her official
duties, he or she shall forfeit all accrued rights and benefits in
any public retirement system in which he or she is a member to the
extent provided in subdivision (c) and shall not accrue further
benefits in that public retirement system, effective on the date of
the conviction.
(c) (1) A public employee shall forfeit all the retirement
benefits earned or accrued from the earliest date of the commission
of any felony described in subdivision (b) to the forfeiture date,
inclusive. The retirement benefits shall remain forfeited
notwithstanding any reduction in sentence or expungement of the
conviction following the date of the public employee's conviction.
Retirement benefits attributable to service performed prior to the
date of the first commission of the felony for which the public
employee was convicted shall not be forfeited as a result of this
section.
(2) The forfeiture provisions in
paragraph (1) do not apply after termination of the retirement system
or complete discontinuance of contributions under the system.
(2)
(3) For purposes of this subdivision, "forfeiture date"
means the date of the conviction.
(d) (1) Any contributions to the public retirement system made by
the public employee described in subdivision (b) on or after the
earliest date of the commission of any felony described in
subdivision (b) shall be returned, without interest, to the public
employee upon the occurrence of a distribution event unless otherwise
ordered by a court or determined by the pension administrator.
(2) Any funds returned to the public employee pursuant to
subdivision (d) shall be disbursed by electronic funds transfer to an
account of the public employee, in a manner conforming with the
requirements of the Internal Revenue Code, and the public retirement
system shall notify the court and the district attorney at least
three business days before that disbursement of funds.
(3) For the purposes of this subdivision, a "distribution event"
means any of the following:
(A) Separation from employment.
(B) Death of the member.
(C) Retirement of the member.
(e) (1) Upon conviction, a public employee as described in
subdivision (b) and the prosecuting agency shall notify the public
employer who employed the public employee at the time of the
commission of the felony within 60 days of the felony conviction of
all of the following information:
(A) The date of conviction.
(B) The date of the first known commission of the felony.
(2) The operation of this section is not dependent upon the
performance of the notification obligations specified in this
subdivision.
(f) The public employer that employs or employed a public employee
described in subdivision (b) and that public employee shall each
notify the public retirement system in which the public employee is a
member of that public employee's conviction within 90 days of the
conviction. The operation of this section is not dependent upon the
performance of the notification obligations specified in this
subdivision.
(g) A public retirement system may assess a public employer a
reasonable amount to reimburse the cost of audit, adjustment, or
correction, if it determines that the public employer failed to
comply with this section.
(h) If a public employee's conviction is reversed and that
decision is final, the employee shall be entitled to do either of the
following:
(1) Recover the forfeited retirement benefits as adjusted for the
contributions received pursuant to subdivision (d).
(2) Redeposit those contributions and interest, as determined by
the system actuary, and then recover the full amount of the forfeited
benefits.
(i) A public employee first employed by a public employer or first
elected or appointed to an office on or after January 1, 2013, shall
be subject to Section 7522.74.
SEC. 3. Section 7522.74 of the
Government Code is amended to read:
7522.74. (a) This section shall apply to a public employee first
employed by a public employer or first elected or appointed to an
office on or after January 1, 2013, and on and after that date,
Section 7522.70 shall not apply.
(b) (1) If a public employee is convicted by a state or federal
trial court of any felony under state or federal law for conduct
arising out of or in the performance of his or her official duties,
in pursuit of the office or appointment, or in connection with
obtaining salary, disability retirement, service retirement, or other
benefits, he or she shall forfeit all accrued rights and benefits in
any public retirement system in which he or she is a member to the
extent provided in subdivision (c) and shall not accrue further
benefits in that public retirement system, effective on the date of
the conviction.
(2) If a public employee who has contact with children as part of
his or her official duties is convicted of a felony that was
committed within the scope of his or her official duties against or
involving a child who he or she has contact with as part of his or
her official duties, he or she shall forfeit all accrued rights and
benefits in any public retirement system in which he or she is a
member to the extent provided in subdivision (c) and shall not accrue
further benefits in that public retirement system, effective on the
date of the conviction.
(c) (1) A public employee shall forfeit all the retirement
benefits earned or accrued from the earliest date of the commission
of any felony described in subdivision (b) to the forfeiture date,
inclusive. The retirement benefits shall remain forfeited
notwithstanding any reduction in sentence or expungement of the
conviction following the date of the public employee's conviction.
Retirement benefits attributable to service performed prior to the
date of the first commission of the felony for which the public
employee was convicted shall not be forfeited as a result of this
section.
(2) The forfeiture provisions in
paragraph (1) do not apply after termination of the retirement system
or complete discontinuance of contributions under the system.
(2)
(3) For purposes of this subdivision, "forfeiture date"
means the date of the conviction.
(d) (1) Any contributions to the public retirement system made by
the public employee described in subdivision (b) on or after the
earliest date of the commission of any felony described in
subdivision (b) shall be returned, without interest, to the public
employee upon the occurrence of a distribution event unless otherwise
ordered by a court or determined by the pension administrator.
(2) Any funds returned to the public employee pursuant to
subdivision (d) shall be disbursed by electronic funds transfer to an
account of the public employee, in a manner conforming with the
requirements of the Internal Revenue Code, and the public retirement
system shall notify the court and the district attorney at least
three business days before that disbursement of funds.
(3) For the purposes of this subdivision, a "distribution event"
means any of the following:
(A) Separation from employment.
(B) Death of the member.
(C) Retirement of the member.
(e) (1) Upon conviction, a public employee as described in
subdivision (b) and the prosecuting agency shall notify the public
employer who employed the public employee at the time of the
commission of the felony within 60 days of the felony conviction of
all of the following information:
(A) The date of conviction.
(B) The date of the first known commission of the felony.
(2) The operation of this section is not dependent upon the
performance of the notification obligations specified in this
subdivision.
(f) The public employer that employs or employed a public employee
described in subdivision (b) and that public employee shall each
notify the public retirement system in which the public employee is a
member of that public employee's conviction within 90 days of the
conviction. The operation of this section is not dependent upon the
performance of the notification obligations specified in this
subdivision.
(g) A public retirement system may assess a public employer a
reasonable amount to reimburse the cost of audit, adjustment, or
correction, if it determines that the public employer failed to
comply with this section.
(h) If a public employee's conviction is reversed and that
decision is final, the employee shall be entitled to do either of the
following:
(1) Recover the forfeited retirement benefits as adjusted for the
contributions received pursuant to subdivision (d).
(2) Redeposit those contributions and interest, as determined by
the system actuary, and then recover the full amount of the forfeited
benefits.
(i) A public employee first employed by a public employer or first
elected or appointed to an office before January 1, 2013, shall be
subject to Section 7522.72.
SEC. 4. Section 31485.16 is added to the
Government Code , to read:
31485.16. (a) Notwithstanding any other provision of this
chapter, the rights of each member to his or her accrued retirement
benefits under the retirement system shall be nonforfeitable, in
accordance with the requirements of Sections 401(a) (7) and 411 of
Title 26 of the United States Code that are applicable to public
employee plans, as follows:
(1) On the member's attainment of normal retirement age, while
currently employed by an employer that maintains the system.
(2) To the extent then funded, on the date of the termination of
the system, the partial termination of the system, or the complete
discontinuance of contributions under the system, as provided in
Title 26 of the United States Code.
(b) When a member's accrued benefits become nonforfeitable under
this section, the member may be retired upon filing with the board a
written application in the manner provided by Article 8 and Article 9
of this chapter, as applicable.
(c) Notwithstanding subdivision (a) or (b) or any other law, a
member's earned and accrued benefits may be forfeited under Sections
7522.70, 7522.72, and 7522.74.
SEC. 5. Section 31485.17 is added to the
Government Code , to read:
31485.17. Notwithstanding any other provision of this chapter, no
amount shall be distributed from a retirement system established
under this chapter prior to the time that the distribution may be
made in compliance with the requirements of Section 401(a) of Title
26 of the United States Code that are applicable to public employee
plans, including, but not limited to, requirements relating to the
distribution of amounts prior to the earlier of a member's death,
disability, separation from service with all employers that maintain
the retirement system, or attainment of normal retirement age, as
defined by the retirement system.
SEC. 6. Section 31485.19 is added to the
Government Code , to read:
31485.19. (a) A member who has not attained normal retirement age
shall have a bona fide separation from service to the extent
required by Section 401(a) of Title 26 of the United States Code
before working for the county or a district. The board shall
establish, by regulation, the criteria under which a bona fide
separation is satisfied.
(b) Notwithstanding any other provision of this chapter, to the
extent required or permitted by Section 401(a) of Title 26 of the
United States Code, no amount shall be paid to any member before the
date the member has attained normal retirement age or has had a bona
fide separation from service, whichever is earlier.
(c) The board may establish, by regulation, normal retirement age
consistent with federal law and eligibility requirements under state
law.
SEC. 7. Section 31564 of the Government
Code is amended to read:
31564. (a) All officers and employees of
any district who have become members of the association as provided
in Section 31557, may be withdrawn by a resolution of the governing
body declaring all of the district's employees withdrawn from the
association; provided, the governing body has first received a
written petition signed by a majority of its officers and employees
requesting that the district's officers and employees be withdrawn
from the association.
Upon
(b) Upon the adoption of any
resolution to withdraw its members, all accumulated contributions
held in the association shall be refunded to the district's employees
upon the effective date of their withdrawal and in the same manner
as the accumulated contributions would be refunded upon the
termination of their employment by the district.
Upon
(c) Upon the adoption of any
resolution to withdraw its members and where there are no existing
retirees from the district, the district's contributions shall be
refunded to the district, or shall, upon the election of and
designation by the governing body of the district, be transferred to
another public retirement system that meets the requirement of a
tax-qualified retirement plan under Section 401(a) of Title 26 of
the United States Code .
(d) A refund, distribution, or transfer of contributions for other
funds shall not be made to any employee or any district unless that
action complies with the requirements of Section 401(a) of Title 26
of the United States Code.
In
(e) In the event of the transfer
of district contributions to another public retirement system, the
employee contributions shall also be transferred to the other public
retirement system.
The
(f) The effective date of
withdrawal of any resolution adopted pursuant to this section shall
be at the end of the calendar month during which such resolution is
adopted.
SEC. 8. Section 31592.2 of the
Government Code is amended to read:
31592.2. (a) In any county, earnings of the
retirement fund during any year in excess of the total interest
credited to contributions and reserves during such year shall remain
in the fund as a reserve against deficiencies in interest earnings in
other years, losses on investments, and other contingencies, except
that, when such surplus exceeds 1 percent of the total assets of the
retirement system, the board may transfer all, or any part, of such
surplus in excess of 1 percent of the said total assets into county
advance reserves for the sole purpose of payment of the cost of the
benefits described in this chapter.
Where
(b) Where the board of
supervisors has provided for the payment of all, or a portion, of the
premiums, dues, or other charges for health benefits, Medicare, or
the payment of accrued sick leave at retirement to or for all, or a
portion, of officers, employees, and retired employees and their
dependents, from the county general fund or other sources, the board
of retirement may authorize the payment of all, or a portion, of
payments of the benefits described in this paragraph
subdivision from the county advance reserves.
This payment shall comply with the requirements of Section 401
of Title 26 of the United States Code. Payment may be made directly
from the county advance reserves for the benefits described in
Section 31691.1.
SEC. 9. Section 31592.4 of the
Government Code is amended to read:
31592.4. (a) Notwithstanding Article 5.5 (commencing
with Section 31610) and Article 8.6 (commencing with Section 31694),
the The amount of excess earnings
available at the end of a fiscal year of the retirement fund, shall,
subject to the limitations in this section, be treated in the
immediately succeeding fiscal year, for all purposes under this
chapter, as appropriations, transfers, and contributions made to the
retirement fund by the county and applicable districts.
That treatment shall be solely for the purposes of meeting
the applicable requirements of Section 401 of the Internal Revenue
Code of the United States. That treatment shall
also occur only to the extent that, in the immediately
succeeding fiscal year, the county and applicable
districts pay for , or otherwise make reimbursement of,
an equal amount of health benefits for members
heretofore or hereafter retired and their dependents. For
dependents, or make contributions in an equal amount
to an account established under Section 401(h) of Title 26 of the
United States Code solely for the purpose of providing
health benefits for retired members, their spouses, and dependents,
and for the associated administrative and investment expenses.
(b) For purposes of this section,
"excess earnings" means earnings of the retirement fund at the end
of any fiscal year that exceed the total interest credited to
contributions and reserves plus 1 percent of the total assets of the
retirement fund. The
(c) The board of supervisors
and or the board of retirement
may shall take any actions otherwise
authorized by law, necessary necessary and appropriate
to ensure that the program provided by this section complies
with all applicable federal and state income tax laws.
laws, including, but not limited to, establishing
rules and procedures for establishing and maintaining an account
under Section 401(h) of Title 26 of the United States Code.
(d) In accordance with Section 401(h) of Title 26 of the United
States Code and Section 1.401-14(c) of the Code of Federal
Regulations:
(1) The retirement system shall specify the medical benefits that
will be available and shall set out the amount that will be paid.
(2) Medical benefits shall be subordinate to the retirement
benefits when added to any life insurance benefits.
(3) A separate account shall be maintained for contributions to
fund the medical benefits.
(4) The funds in the separate account may be invested with the
funds for retirement benefits and the earnings shall be allocated to
each account in a reasonable manner.
(5) Amounts contributed for medical benefits shall be reasonable
and ascertainable.
(6) No part of the medical benefits account may be used for or
diverted to any purpose other than providing medical benefits and
paying necessary or appropriate expenses for the administration of
the medical benefits account.
(7) Any amounts remaining in the medical benefits account after
satisfaction of all medical benefits liabilities for all members,
their spouses, and dependents shall be returned to the employer.
(8) If a member's interest in the medical benefits account is
forfeited prior to plan termination, an amount equal to the
forfeiture shall reduce employer contributions to fund the account.
(e) Except to the extent allowed by Sections 401 and 420 of Title
26 of the United States Code, and related federal regulations, assets
shall not be transferred or otherwise paid from the funds held by
the retirement system for retirement benefits to a medical benefits
account. Assets shall not be transferred or otherwise paid from a
medical benefits account to the funds held by the retirement system
for retirement benefits.
(b)
(f) This section shall not be operative in any county
until the board of supervisors and the board of retirement of the
county, by resolution adopted by a majority vote of each board, make
this section operative in the county.
(c) Nothing in this section is intended to, or should
(g) This section is not intended, and
shall not be construed to, affect the validity of any agreement
entered into by a county and a retirement association whereby a
county has agreed to provide and fund a health insurance program for
retired employees and their dependents for hospital services, medical
services, dental services, and optical services, prior to the
effective date of this section.
(d) In any county in which this section becomes operative, the
payments provided pursuant to this section shall be in lieu of any
similar payments which could be made pursuant to Section 31592.2 and
no payments shall be made pursuant to Section 31592.2 for all, or a
portion, of the premiums, dues, or other charges for health benefits
for retired employees and their dependents.
(h) This section establishes a method of providing health benefits
for retired members, their spouses, and dependents to the extent
allowed under Sections 31592.2 and 31691. This section does not
authorize duplicate benefits.
(i) This section may be made applicable in any county that has
adopted Article 5.5 (commencing with Section 31610), in which case
the Supplemental Retiree Benefits Reserve shall be substituted for
the excess earnings described in this section. This section also may
be made applicable to any arrangement established under Article 8.6
(commencing with Section 31694).
SEC. 10. Section 31649.5 of the
Government Code is amended to read:
31649.5. (a)
Notwithstanding Section 31649, any member who resigned, or obtained a
leave of absence, to enter and did enter the armed forces of the
United States on a voluntary or involuntary basis and returned to
county service within one year after separation therefrom, under
honorable conditions, shall receive credit for service and prior
service for all or any part of his or her military service, if,
before retirement from the county, he or she contributes what he or
she would have paid to the fund based on his or her compensation
earnable pursuant to Section 31461 at the time he or she resigned or
received the leave of absence, together with regular interest
thereon, and if, when he or she contributes, the military service is
not a basis for present or future military retirement pay.
(b) This section shall not be operative in any county until the
board of supervisors so orders.
SEC. 11. Section 31656 of the
Government Code is amended to read:
31656. Nothing in this chapter shall be construed to prohibit any
district established pursuant to Part 4 (commencing with Section
40000) of Division 10 of the Public Utilities Code, from extending
retirement service credit pursuant to Section 40127 of the Public
Utilities Code to any employee of the district who is on an
authorized leave of absence to serve as an official of a recognized
employee bargaining unit, under all of the following conditions:
(a) The employee or the recognized employee organization,
or both, as determined pursuant agrees to
applicable provisions of this part, agree to pay
the total contributions which that
would otherwise be paid if the employee were not on leave, as well as
any additional costs which may accrue to the system as a result of
this extension of coverage.
(b) The maximum service credit accumulated under this section
shall not exceed 12 years.
(c) Employees covered under this section shall not be eligible for
disability benefits under any public employees' retirement system in
this state while on such leave of absence.
This section shall not be operative in any county until such time
as the board of supervisors shall, by resolution adopted by majority
vote, make the provisions of this section applicable in the county.
SEC. 12. Section 31671 of the
Government Code is amended to read:
31671. The amount of compensation that is taken into account in
computing benefits payable to any person who first becomes a member
of the retirement system on or after July 1, 1996, or January 1,
1996, for systems operating on a calendar basis, shall not
exceed the limitations in Section 401(a)(17) of Title 26 of the
United States Code upon public retirement systems, as that section
may be amended from time to time and as that limit may be adjusted by
the Commissioner of Internal Revenue for increases in cost of
living. The determination of compensation for each 12-month period
shall be subject to the annual compensation limit in effect for the
calendar year in which the 12-month period begins. In a determination
of average annual compensation over more than one 12-month period,
the amount of compensation taken into account for each 12-month
period shall be subject to the applicable annual compensation limit.
SEC. 13. Section 31691 of the
Government Code is amended to read:
31691. (a) The board of supervisors of any county by ordinance,
or the governing body of any district under the County Employees
Retirement Law, by ordinance or resolution, may provide for the
contribution by the county or district from its funds and not from
the retirement fund, toward the payment of all or a portion of the
premiums on a policy or certificate of life insurance or disability
insurance issued by an admitted insurer, or toward the payment of all
or part of the consideration for any hospital service or medical
service corporation, including any corporation lawfully operating
under Section 9201 of the Corporations Code, contract, or for any
combination thereof, for the benefit of any member heretofore or
hereafter retired or his or her dependents. At least one of these
plans shall include free choice of physician and surgeon.
(b) The benefits provided by this section are in addition to any
other benefits provided by this chapter.
(c) The board of retirement may provide on behalf of a member who
has retired, or an eligible surviving spouse who was married to the
member for one year prior to the date of retirement of the member,
or, if there is no such spouse, the surviving unmarried children of
the member who are under 18 years of age, or under 22 years of age
and full-time students, for the hospital and medical
benefits enumerated herein in subdivision (a)
from the earnings of the retirement fund that are in excess of
the total interest credited to contributions and reserves plus 1
percent of the total assets of the retirement fund. The board may
provide for the benefits enumerated from like sources when the board
of supervisors or the governing body of a district has elected to
provide these benefits to its active employees, even though the
benefits are not provided to those who have retired from the service
of the county or district. Hospital and medical benefits
provided under this section shall be provided in compliance with
Section 401(h) of Title 26 of the United States Code. They may also
be provided in compliance with Section 31592.2.
(d) Except in a county of the first class, upon adoption by any
county providing benefits pursuant to this section, the
board of retirement shall, instead, pay those benefits from the
that has adopted Article 5.5 (commencing with Section
31610), the Supplemental Retiree Benefits Reserve established
pursuant to Section 31618. 31618 shall be
substituted for the excess earnings described in subdivision (c).
SEC. 14. Section 31691.1 of the
Government Code is amended to read:
31691.1. (a) In lieu of the benefits prescribed by
subdivision (d) of Section 31691, the board of retirement
may provide on behalf of a member who has retired, or an eligible
surviving spouse who was married to the member prior to the date of
retirement of the member, or, if there is no such spouse, the
surviving unmarried children of the member who are under 18 years of
age, or under 22 years of age and full-time students, for an
equivalent increase in allowance from the earnings of the retirement
fund that are in excess of the total interest credited to
contributions and reserves plus 1 percent of the total assets of the
retirement fund. Any benefit provided by this section shall be
subject to Section 31692.
(b) Except in a county of the first class, upon adoption by any
county providing benefits pursuant to this section, the board of
retirement shall, instead, pay those benefits from the Supplemental
Retiree Benefits Reserve established pursuant to Section 31618.
SEC. 15. Section 31694.6 is added to the
Government Code , to read:
31694.6. (a) Notwithstanding any provision to the contrary in
this article, if the Post-Employment Benefits Trust Account
established under Section 31694 is established as a part of the
retirement fund, then that account shall be established for the sole
purpose of providing health benefits for retired members, their
spouses, and dependents, and shall comply with all requirements,
including the limitations on contributions, of Section 401(h) of
Title 26 of the United States Code, as applicable.
(b) The board of supervisors or the board of retirement shall take
any actions necessary or appropriate to ensure that the program
provided by this section complies with all applicable federal and
state income tax laws, including, but not limited to, establishing
rules and procedures for establishing and maintaining an account
under Section 401(h) of Title 26 of the United States Code.
(c) If the Post-Employment Benefits Trust Account is established
under Section 31694, assets shall not be transferred or otherwise
paid from the funds held by the retirement system for retirement
benefits to a medical benefits account. Assets shall not be
transferred or otherwise paid from a medical benefits account to the
funds held by the retirement system for retirement benefits.
SEC. 16. Section 31696.3 of the
Government Code is amended to read:
31696.3. (a) The board shall establish a trust fund designated as
the Long-Term Care Fund for the purpose of the payment of the costs
and administration of the long-term care plan. The Long-Term Care
Fund shall be held for the exclusive benefit of enrollees and the
payment of the costs and administration of the program.
(b) The board shall have exclusive control of the administration
and investment of the Long-Term Care Fund, except that in a county
having a board of investments, the board of investments shall have
exclusive control of the investment of the fund. Funds in the
Long-Term Care Fund shall be invested pursuant to the law governing
the investment of the retirement fund.
(c) Income, of whatever nature, earned on the Long-Term Care Fund
shall be credited to the fund.
(d) If the Long-Term Care Fund is intended to be a part of the
retirement system trust fund, then the operation of the Long-Term
Care Fund, including, but not limited to, its funding, governance,
investment of assets, allocation of income, and payment of benefits,
shall comply with the requirements of Section 401(h) of Title 26 of
the United States Code, to the extent required by that title and
related federal regulations. If the Long-Term Care Fund is intended
to be separate from and not a part of the retirement system, then the
assets shall not be commingled for investment with the assets of the
retirement system and shall constitute a separate fund with a trust
that is separate from the funds and trust of the retirement system.
The board shall indicate, as a part of establishment of the Long-Term
Care Fund, whether the separate fund is intended to be a part of, or
separate from, the retirement system.
SEC. 17. Section 31698.5 is added to the
Government Code , to read:
31698.5. If the vision care program is intended to be part of the
retirement system trust fund, the operation of the vision care
program, including, but not limited to, its funding, governance,
investment of assets, allocation of income, and payment of benefits,
shall comply with the requirements of Section 401(h) of Title 26 of
the United States Code, to the extent required by that title, and
related federal regulations. If the vision care program is intended
to be separate from and not a part of the retirement system, then no
assets attributable to that program shall be commingled for
investment with the assets of the retirement system and the program
shall be separate from the funds and trust of the retirement system.
The sponsor of the vision care program shall indicate as part of the
establishment of the program whether that separate fund is intended
to be a part of, or separate from, the retirement system.
SECTION 1. Chapter 2.55 (commencing with
Section 65087) is added to Division 1 of Title 7 of the Government
Code, to read:
CHAPTER 2.55. SUSTAINABLE COMMUNITIES STRATEGY TRANSACTIONS
AND USE TAX
65087. (a) (1) A transportation planning agency that is
designated as a metropolitan planning organization pursuant to
Section 134 of Title 23 of the United States Code may, subject to
approval of an ordinance pursuant to Section 65087.1 and voter
approval pursuant to Section 65087.2, impose a transactions and use
tax within its jurisdiction for the purpose of achieving the goals of
the sustainable communities strategy required pursuant to paragraph
(2) of subdivision (b) of Section 65080 at a rate of no more than 0.5
percent.
(2) Notwithstanding any other law, this transactions and use tax
may be imposed even if the combined rate of this tax and all taxes
imposed in accordance with Part 1.6 (commencing with Section 7251) of
the Revenue and Taxation Code, exceed the limit established in
Section 7251.1 of the Revenue and Taxation Code.
(b) A transportation planning agency that includes territory of
more than one county may elect to exclude one or more counties from
the transactions and use tax ordinance.
(c) As part of the ordinance under Section 65087.1, the
transportation planning agency shall adopt an expenditure plan for
the net revenues to be generated by the transactions and use tax. The
expenditure plan shall include funding for transportation,
affordable housing, and parks and open space in conformity with the
sustainable communities strategy for the region and its priorities.
Not less than 25 percent of available net revenues shall be allocated
under the expenditure plan to each of these three categories.
Available net revenues not used for these purposes shall be available
for purposes determined by the transportation planning agency to
assist in attaining the goals of the sustainable communities strategy
adopted for the region.
65087.1. To impose the transactions and use tax authorized under
this chapter, all of the following shall be required:
(a) An ordinance proposing the tax and the expenditure plan and
submitting the tax and expenditure plan to the voters for approval
shall be approved by two-thirds of the governing board of the
transportation planning agency.
(b) The voters within the jurisdiction of the transportation
planning agency, or a portion of that jurisdiction pursuant to
subdivision (b) of Section 65087, approve the ballot measure pursuant
to Section 65087.2. For purposes of voter approval, the ordinance
will be approved if the requisite number of voters from all areas
cumulatively voting on the measure approve the ordinance in
accordance with Article XIII C of the California Constitution.
(c) With the exception of Section 7251.1 of the Revenue and
Taxation Code, the transaction and use tax is levied in accordance
with the Transaction and Use Tax Law (Part 1.6 (commencing with
Section 7251) of the Revenue and Tax Code).
65087.2. The transportation planning agency may call a special
election for the purposes of submitting the ordinance containing the
tax and the expenditure plan to the voters within the jurisdiction of
the transportation planning agency, or a portion of that
jurisdiction pursuant to subdivision (b) of Section 65087. The
election shall be consolidated with a statewide primary or general
election specified by the transportation planning agency.
