Bill Text: CA AB584 | 2015-2016 | Regular Session | Amended
Bill Title: Public employee retirement systems.
Sponsorship: Partisan Bill (Democrat 1)
Status: (Failed) 2016-02-01 - From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB584 Detail]
Download: California-2015-AB584-Amended.html
BILL NUMBER: AB 584 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 6, 2015
INTRODUCED BY Assembly Member Cooley
FEBRUARY 24, 2015
An act to amend Sections 10600, 10601, 10602, 10605, and 10606 of,
and to amend the heading of Chapter 5 (commencing with Section
10600) of Part 2 of Division 2 of Title 2 of, the Government
Code, relating to public employee retirement systems.
LEGISLATIVE COUNSEL'S DIGEST
AB 584, as amended, Cooley. Public employee retirement systems.
Existing law creates the Joint Legislative Retirement Committee,
prescribes the composition of the committee, and requires the
committee to study and review the benefits, programs, actuarial
condition, practices, investments and procedures of, and all
legislation relating to, retirement systems for public officers and
employees in this state as well as trends in the field of retirement.
Existing law requires a copy of each bill that affects any public
employee retirement system to be transmitted to the committee.
Existing law requires the committee to establish a board of experts,
the composition of which is prescribed, and to retain an independent
actuary as a consultant to the board of experts. Existing law makes a
statement of legislative findings in this regard.
This bill would rename the committee the Joint Pension
Administration and Sustainability Committee and, in addition to the
duties described above, would require the committee to make reports
and recommendations to the Legislature and its respective
houses on these retirement issues. The bill would revise
the composition of the committee to reflect current legislative
practice. The bill would require the committee to transmit an
analysis for each bill submitted to it, including an actuarial
opinion if appropriate, to the policy committee that is responsible
for the bill. The bill would require the committee to retain a legal
advisor recognized for expertise in pension and investment law and an
academician from a California university with recognized expertise
in investing, pension administration, and the operation of financial
markets to act as consultants to its board of experts. The bill would
revise the statement of legislative findings associated with these
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. The heading of Chapter 5 (commencing with Section
10600) of Part 2 of Division 2 of Title 2 of the Government Code is
amended to read:
CHAPTER 5. JOINT PENSION ADMINISTRATION AND SUSTAINABILITY
COMMITTEE
SEC. 2. Section 10600 of the Government Code is amended to read:
10600. (a) The Legislature finds that the retirement of officers
and employees of the state, school districts, and many cities,
counties, and public jurisdictions in the state, is provided under
several independently administered and highly complex systems that
all share the distinctive feature of being organized to achieve
results over the 30- to 40-year time frame that corresponds to the
typical length of workers' careers.
(b) These pension systems are organized and administered under
highly technical statutes and protected by constitutional provisions.
Certain provisions in the California Constitution, which are
patterned upon the Employee Retirement Income Security Act, commonly
known as ERISA, require that pension funds be invested for the sole
interests of the beneficiaries and for the exclusive purpose of
providing benefits and establish a standard of conduct that makes
persons managing the pension systems fiduciaries with respect to how
they manage the money.
(c) Development and change in these systems are interrelated and
have important long-range implications both with respect to cost and
to the retirement expectations of public employees and also the state
and national economy, as the ability of persons to enter into
retirement with a source of income to spend on goods and services in
retirement provides an important source of demand for goods and
services during economic downturns to assist eventual recovery as
well as assisting the ability of public entities to transition their
workforces to younger entry level employees as older workers are able
to retire even during an economic downturn, thereby creating
openings.
(d) The Legislature recognizes the need to coordinate this change
and development and for continuing study and analysis of these
systems and legislation affecting them.
(e) Therefore, it is the desire of the Legislature to provide for
such continuing study and analysis by a joint legislative committee.
SEC. 3. Section 10601 of the Government Code is amended to read:
10601. (a) The Joint Pension Administration and Sustainability
Committee is hereby created. The committee shall study and review the
benefits, programs, actuarial condition, practices, investments, and
procedures of, and all legislation relating to, the retirement
systems for public officers and employees in this state and the
trends and developments in the field of retirement, and make reports
and recommendations thereon to both houses of the
Legislature and its respective houses. Legislature.
The committee has a continuing existence and may meet, act, and
conduct its business at any place within this state during sessions
of the Legislature, or any recess thereof, and in the interim period
between sessions. A copy of each bill that affects any public
employee retirement system shall be transmitted to the committee, and
the committee shall transmit an analysis, including an actuarial
opinion if appropriate, to the policy committee responsible for the
bill.
(b) A report submitted pursuant to the
Legislature pursuant to subdivision (a) shall be submitted
in compliance with Section 9795.
SEC. 4. Section 10602 of the Government Code is amended to read:
10602. The committee shall consist of a member from each of the
following Senate committees: Banking and Financial Institutions,
Governance and Finance, Health, Insurance, Labor and Industrial
Relations, and Public Employment and Retirement, and a member from
each of the following Assembly committees: Accountability and
Administrative Review, Banking and Finance, Insurance, Labor and
Employment, Local Government, Public Employees, Retirement and Social
Security, and Revenue and Taxation. The members shall be selected in
the manner provided for in the Joint Rules of the Senate and
Assembly. The committee shall elect its own chairman. Vacancies
occurring in the membership of the committee between general sessions
of the Legislature shall be filled in the manner provided for in the
Joint Rules of the Senate and Assembly. A vacancy shall be deemed to
exist as to any member of the committee whose term is expiring
whenever such member is not reelected at the General Election.
SEC. 5. Section 10605 of the Government Code is amended to read:
10605. (a) The committee shall establish a board of experts. The
board of experts shall include: the Controller, the chairpersons of
the investment committees of the Board of Administration of the
Public Employees' Retirement System and of the Teachers' Retirement
Board of the Teachers' Retirement System, the president and
chairperson of those boards, respectively, the executive officers of
those systems, the chiefs of investment of those systems, the chief
actuaries of those systems, the pension managers and treasurers of
two corporations, a manager of a city pension fund, and a manager of
a county pension fund.
(b) The committee shall retain as consultants to the board of
experts an independent actuary actuary,
a legal advisor recognized for expertise in pension and investment
law law, and an academician from a
California university with recognized expertise in investing, pension
administration, and the operation of financial markets.
(c) The board of experts shall be reimbursed for its actual and
necessary expenses.
SEC. 6. Section 10606 of the Government Code is amended to read:
10606. (a) There shall be held during the last week of March of
each year a joint meeting of the Joint Pension Administration and
Sustainability Committee, the board of experts, the Board of
Administration of the Public Employees' Retirement System, the
Teachers' Retirement Board, the executive officers of those systems,
and the State Treasurer, to review the performance of the systems.
The annual reports of those systems and the financial reports and
reports of operations shall be presented at the meeting.
(b) (1) At the meeting, the State Treasurer shall present a review
of the investment practices of the Public Employees' Retirement
System and the State Teachers' Retirement System and shall transmit a
copy of the report to the committee.
(2) A report submitted pursuant to paragraph (2)
(1) shall be submitted in compliance with
Section 9795.
