Bill Text: CA AB1222 | 2013-2014 | Regular Session | Chaptered
Bill Title: Public employees' retirement: collective bargaining: transit workers: transportation.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Passed) 2013-10-04 - Chaptered by Secretary of State - Chapter 527, Statutes of 2013. [AB1222 Detail]
Download: California-2013-AB1222-Chaptered.html
BILL NUMBER: AB 1222 CHAPTERED
BILL TEXT
CHAPTER 527
FILED WITH SECRETARY OF STATE OCTOBER 4, 2013
APPROVED BY GOVERNOR OCTOBER 4, 2013
PASSED THE SENATE SEPTEMBER 6, 2013
PASSED THE ASSEMBLY SEPTEMBER 11, 2013
AMENDED IN SENATE SEPTEMBER 4, 2013
AMENDED IN SENATE JUNE 24, 2013
INTRODUCED BY Assembly Members Bloom and Dickinson
(Coauthor: Assembly Member Cooley)
FEBRUARY 22, 2013
An act to amend Section 7522.02 of the Government Code, relating
to public employees' retirement, making an appropriation therefor,
and declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1222, Bloom. Public employees' retirement: collective
bargaining: transit workers: transportation.
The California Public Employees' Pension Reform Act of 2013
(PEPRA), among other things, establishes new retirement formulas for
employees first employed on or after January 1, 2013, which a public
employer offering a defined benefit pension plan is prohibited from
exceeding, requires those employees to contribute a specified
percentage of the normal cost of the defined benefit plan, and
prohibits public employers from paying an employee's share of
retirement contributions. PEPRA excepts certain retirement systems
from its provisions.
This bill would except from PEPRA public employees whose
collective bargaining rights are subject to specified provisions of
federal law until a specified federal district court decision on a
certification by the United States Secretary of Labor, or his or her
designee, or until January 1, 2015, whichever is sooner. The bill
would also provide that if a federal district court upholds the
determination of the United States Secretary of Labor, or his or her
designee, that application of PEPRA to those public employees
precludes certification, those employees are excepted from PEPRA. The
bill would authorize the Director of Finance to authorize a loan of
up to $26,000,000 from the Public Transportation Account in the State
Transportation Fund to be made to local mass transit providers in
amounts equal to federal transportation grants not received due to
noncertification from the federal Department of Labor, as specified.
By providing for loans in the manner specified, this bill would make
an appropriation. The bill would prescribe requirements regarding the
disbursement of these funds. The bill would require a local transit
provider to repay the loan based on the occurrence of certain
contingencies or by January 1, 2019.
This bill would declare that it is to take effect immediately as
an urgency statute.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 7522.02 of the Government Code is amended to
read:
7522.02. (a) (1) Notwithstanding any other law, except as
provided in this article, on and after January 1, 2013, this article
shall apply to all state and local public retirement systems and to
their participating employers, including the Public Employees'
Retirement System, the State Teachers' Retirement System, the
Legislators' Retirement System, the Judges' Retirement System, the
Judges' Retirement System II, county and district retirement systems
created pursuant to the County Employees Retirement Law of 1937,
independent public retirement systems, and to individual retirement
plans offered by public employers. However, this article shall be
subject to the Internal Revenue Code and Section 17 of Article XVI of
the California Constitution. The administration of the requirements
of this article shall comply with applicable provisions of the
Internal Revenue Code and the Revenue and Taxation Code.
(2) Notwithstanding paragraph (1), this article shall not apply to
the entities described in Section 9 of Article IX of, and Sections 4
and 5 of Article XI of, the California Constitution, except to the
extent that these entities continue to be participating employers in
any retirement system governed by state statute. Accordingly, any
retirement plan approved before January 1, 2013, by the voters of any
entity excluded from coverage by this section shall not be affected
by this article.
(3) (A) Notwithstanding paragraph (1), this article shall not
apply to a public employee whose interests are protected under
subsection (b) of Section 5333 of Title 49 of the United States Code
until a federal district court rules that the United States Secretary
of Labor, or his or her designee, erred in determining that the
application of this article precludes certification under that
section, or until January 1, 2015, whichever is sooner.
(B) If a federal district court upholds the determination of the
United States Secretary of Labor, or his or her designee, that
application of this article precludes him or her from providing a
certification under subsection (b) of Section 5333 of Title 49 of the
United States Code, this article shall not apply to a public
employee specified in subparagraph (A).
(b) The benefit plan required by this article shall apply to
public employees who are new members as defined in Section 7522.04.
(c) Individuals who were employed by any public employer before
January 1, 2013, and who became employed by a subsequent public
employer for the first time on or after January 1, 2013, shall be
subject to the retirement plan that would have been available to
employees of the subsequent employer who were first employed by the
subsequent employer on or before December 31, 2012, if the individual
was subject to reciprocity established under any of the following
provisions:
(1) Article 5 (commencing with Section 20350) of Chapter 3 of Part
3 of Division 5 of Title 2.
(2) Chapter 3 (commencing with Section 31450) of Part 3 of
Division 4 of Title 3.
(3) Any agreement between public retirement systems to provide
reciprocity to members of the systems.
(d) If a public employer, before January 1, 2013, offers a defined
benefit pension plan that provides a defined benefit formula with a
lower benefit factor at normal retirement age and results in a lower
normal cost than the defined benefit formula required by this
article, that employer may continue to offer that defined benefit
formula instead of the defined benefit formula required by this
article, and shall not be subject to the requirements of Section
7522.10 for pensionable compensation subject to that formula.
However, if the employer adopts a new defined benefit formula on or
after January 1, 2013, that formula must conform to the requirements
of this article or must be determined and certified by the retirement
system's chief actuary and the retirement board to have no greater
risk and no greater cost to the employer than the defined benefit
formula required by this article and must be approved by the
Legislature. New members of the defined benefit plan may only
participate in the lower cost defined benefit formula that was in
place before January 1, 2013, or a defined benefit formula that
conforms to the requirements of this article or is approved by the
Legislature as provided in this subdivision.
(e) If a public employer, before January 1, 2013, offers a
retirement benefit plan that consists solely of a defined
contribution plan, that employer may continue to offer that plan
instead of the defined benefit pension plan required by this article.
However, if the employer adopts a new defined benefit pension plan
or defined benefit formula on or after January 1, 2013, that plan or
formula must conform to the requirements of this article or must be
determined and certified by the retirement system's chief actuary and
the system's board to have no greater risk and no greater cost to
the employer than the defined benefit formula required by this
article and must be approved by the Legislature. New members of the
employer's plan may only participate in the defined contribution plan
that was in place before January 1, 2013, or a defined contribution
plan or defined benefit formula that conforms to the requirements of
this article.
(f) The Judges' Retirement System and the Judges' Retirement
System II shall not be required to adopt the defined benefit formula
required by Section 7522.25 or 7522.30 or the compensation
limitations defined in Section 7522.10.
(g) This article shall not be construed to provide membership in
any public retirement system for an individual who would not
otherwise be eligible for membership under that system's applicable
rules or laws.
SEC. 2. (a) Notwithstanding any other law, the Director of Finance
may authorize a cashflow loan of up to twenty-six million dollars
($26,000,000) from moneys in the Public Transportation Account in the
State Transportation Fund to local mass transit providers upon their
request to the Director of Finance. The cashflow loans shall be
provided as follows:
(1) The loan to a local mass transit provider shall be in an
amount equal to the federal transportation grant not received by the
provider due to the noncertification by the United States Secretary
of Labor, or his or her designee, under subsection (b) of Section
5333 of Title 49 of the United States Code for the funds scheduled to
lapse on September 30, 2013, as determined by the Director of
Finance.
(2) The Director of Finance shall provide a schedule to the State
Controller for the disbursement of the loan amount for each local
mass transit provider that receives a loan under paragraph (1).
(3) The Controller shall draw warrants against the Public
Transportation Account in the State Transportation Fund per the
schedule provided by the Director of Finance in paragraph (2) within
14 days of receipt of the schedule.
(b) (1) On or before 60 days after a federal district court rules
that the United States Secretary of Labor, or his or her designee,
erred in determining that application of the California Public
Employees' Pension Reform Act of 2013 precludes certification under
subsection (b) of Section 5333 of Title 49 of the United States Code,
or longer if so authorized by the Director of Finance, a local mass
transit provider shall repay the amount loaned pursuant to
subdivision (a) to the Public Transportation Account in the State
Transportation Fund with the interest calculated at the rate earned
by the Pooled Money Investment Account at that time of loan, unless
interest charges are waived by the Director of Finance.
(2) On or before 60 days after a certification by the United
States Secretary of Labor, or his or her designee, that results in
the receipt of funds described in paragraph (1) of subdivision (a), a
local mass transit provider shall repay the amount loaned pursuant
to subdivision (a) to the Public Transportation Account in the State
Transportation Fund with the interest calculated at the rate earned
by the Pooled Money Investment Account at that time of loan, unless
interest charges are waived by the Director of Finance.
(3) No later than January 1, 2019, if neither of the contingencies
described in paragraph (1) or (2) have occurred, a local mass
transit provider shall repay the amount loaned pursuant to
subdivision (a) to the Public Transportation Account in the State
Transportation Fund with the interest calculated at the rate earned
by the Pooled Money Investment Account at that time of loan, unless
interest charges are waived by the Director of Finance.
(c) A cashflow loan from the Public Transportation Account in the
State Transportation Fund authorized by this section does not
constitute budgetary expenditures. A cashflow loan, and the repayment
of a cashflow loan, made under this section shall not affect the
budgetary reserve.
SEC. 3. This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:
In order to preserve the funding for essential transportation
infrastructure projects while balancing the public's need to control
the costs of public employee pension benefits, it is necessary that
this measure take effect immediately.
