California Assembly Bill AB2468 Introduced / Bill

 BILL NUMBER: AB 2468INTRODUCED BILL TEXT INTRODUCED BY Assembly Member Hadley FEBRUARY 19, 2016 An act to amend Section 7522.20 of, and to add Section 21354.6 to, the Government Code, relating to public employees' retirement. LEGISLATIVE COUNSEL'S DIGEST AB 2468, as introduced, Hadley. Public Employees' Retirement System: contracting agencies: benefit formulas. The Public Employees' Retirement Law authorizes a public agency to participate in, and make all or part of its employees members of, the Public Employees' Retirement System (PERS) by a contract entered into between its governing body and the board of administration of the system. The California Public Employees' Pension Reform Act of 2013 (PEPRA) requires a public retirement system, as defined, to modify its plan or plans to comply with the act and, among other provisions, establishes new retirement formulas for employees first hired on or after January 1, 2013, as specified. This bill would authorize a public agency that has contracted with the board of administration of PERS to offer an alternative formula from that required by PEPRA, to be applicable to miscellaneous, nonsafety employees hired after January 1, 2017, if specified contingencies are satisfied, including that the agency and representative employee organization have agreed to its application in a valid memorandum of understanding. 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. Section 7522.20 of the Government Code is amended to read: 7522.20. (a)  Each   Except as provided in subdivision (c) or (d), each  retirement system that offers a defined benefit plan for nonsafety members of the system shall use the formula prescribed by this section. The defined benefit plan shall provide a pension at retirement for service equal to the percentage of the member's final compensation set forth opposite the member's age at retirement, taken to the preceding quarter year, in the following table, multiplied by the number of years of service in the system as a nonsafety member. A member may retire for service under this section after five years of service and upon reaching 52 years of age. Age of Retirement Fraction 52 ..................... 1.000 52 1/4.................. 1.025 52 1/2.................. 1.050 52 3/4 ................. 1.075 53 .................... 1.100 53 1/4.................. 1.125 53 1/2.................. 1.150 53 3/4.................. 1.175 54 ..................... 1.200 54 1/4.................. 1.225 54 1/2.................. 1.250 54 3/4.................. 1.275 55 ..................... 1.300 55 1/4.................. 1.325 55 1/2.................. 1.350 55 3/4.................. 1.375 56 ..................... 1.400 56 1/4.................. 1.425 56 1/2.................. 1.450 56 3/4.................. 1.475 57 ..................... 1.500 57 1/4.................. 1.525 57 1/2.................. 1.550 57 3/4.................. 1.575 58 ..................... 1.600 58 1/4.................. 1.625 58 1/2.................. 1.650 58 3/4.................. 1.675 59 ..................... 1.700 59 1/4.................. 1.725 59 1/2.................. 1.750 59 3/4.................. 1.775 60 ..................... 1.800 60 1/4.................. 1.825 60 1/2.................. 1.850 60 3/4.................. 1.875 61 ..................... 1.900 61 1/4.................. 1.925 61 1/2.................. 1.950 61 3/4.................. 1.975 62 ..................... 2.000 62 1/4.................. 2.025 62 1/2.................. 2.050 62 3/4.................. 2.075 63 ..................... 2.100 63 1/4.................. 2.125 63 1/2.................. 2.150 63 3/4.................. 2.175 64 ..................... 2.200 64 1/4.................. 2.225 64 1/2.................. 2.250 64 3/4.................. 2.275 65 ..................... 2.300 65 1/4.................. 2.325 65 1/2.................. 2.350 65 3/4.................. 2.375 66 ..................... 2.400 66 1/4.................. 2.425 66 1/2.................. 2.450 66 3/4.................. 2.475 67 ..................... 2.500 (b) Pensionable compensation used to calculate the defined benefit shall be limited as described in Section 7522.10. (c) A new member of the State Teachers' Retirement System shall be subject to the formula established pursuant to Section 24202.6 of the Education Code.  (d) With respect to new members, a public agency participating in the Public Employees' Retirement System pursuant to contract may provide the formula established in Section 21354.6 in lieu of this section and subject to the requirements of Section 21354.6.  SEC. 2. Section 21354.6 is added to the Government Code, to read: 21354.6. Notwithstanding any other law, a contracting agency may make the formula provided in this section applicable to miscellaneous, nonsafety employees hired after January 1, 2017, provided that the agency and representative employee organization have agreed to its application in a valid memorandum of understanding, the contracting agency adopts an ordinance to this effect, and the agency's contract is amended in the manner prescribed for approval of contracts or, in the case of a new contract, by express provision in the contract. The pension at retirement for service provided by this section shall be equal to the percentage of the member's final compensation set forth opposite the member's age at retirement, taken to the preceding quarter year, in the following table, multiplied by the number of years of service in the system as a nonsafety member. A member may retire for service under this section after five years of service and upon reaching 55 years of age. Age of Retirement Fraction 55 ..................... 1.000 55 1/4.................. 1.025 55 1/2.................. 1.050 55 3/4 ................. 1.075 56 .................... 1.100 56 1/4.................. 1.125 56 1/2.................. 1.150 56 3/4.................. 1.175 57 ..................... 1.200 57 1/4.................. 1.225 57 1/2.................. 1.250 57 3/4.................. 1.275 58 ..................... 1.300 58 1/4.................. 1.325 58 1/2.................. 1.350 58 3/4.................. 1.375 59 ..................... 1.400 59 1/4.................. 1.425 59 1/2.................. 1.450 59 3/4.................. 1.475 60 ..................... 1.500 60 1/4.................. 1.525 60 1/2.................. 1.550 60 3/4.................. 1.575 61 ..................... 1.600 61 1/4.................. 1.625 61 1/2.................. 1.650 61 3/4.................. 1.675 62 ..................... 1.700 62 1/4.................. 1.725 62 1/2.................. 1.750 62 3/4.................. 1.775 63 ..................... 1.800 63 1/4.................. 1.825 63 1/2.................. 1.850 63 3/4.................. 1.875 64 ..................... 1.900 64 1/4.................. 1.925 64 1/2.................. 1.950 64 3/4.................. 1.975 65 ..................... 2.000 65 1/4.................. 2.025 65 1/2.................. 2.050 65 3/4.................. 2.075 66 ..................... 2.100 66 1/4.................. 2.125 66 1/2.................. 2.150 66 3/4.................. 2.175 67 ..................... 2.200 67 1/4.................. 2.225 67 1/2.................. 2.250 67 3/4.................. 2.275 68 ..................... 2.300 68 1/4.................. 2.325 68 1/2.................. 2.350 68 3/4.................. 2.375 69 ..................... 2.400 69 1/4.................. 2.425 69 1/2.................. 2.450 69 3/4.................. 2.475 70 ..................... 2.500