BILL NUMBER: SB 292	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 25, 2015
	AMENDED IN SENATE  APRIL 21, 2015

INTRODUCED BY   Senator Pan

                        FEBRUARY 23, 2015

   An act to amend Section 7522.30 of the Government Code, relating
to public employees' retirement.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 292, as amended, Pan. Public employee retirement:
contributions.
   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 that may not be exceeded by a
public employer offering a defined benefit pension plan for employees
first hired on or after January 1, 2013.  On and after
January 1, 2013,  PEPRA requires new employees of 
specified  public employers,  the Legislature, the
California State University, and the judicial branch  
as specified,  who participate in a defined benefit plan to have
an initial contribution rate of at least 50% of the normal cost rate
for that defined benefit plan, rounded to the nearest 1/4 of 1%, or
the current contribution rate of similarly situated employees,
whichever is greater.  PEPRA prohibits an employer from paying
the employee contribution. 
   The California Constitution generally limits ad valorem taxes on
real property to 1% of the full cash value of that property. The
California Constitution exempts from that limit an additional ad
valorem property tax rate for, among other things, indebtedness
approved by the voters of the local entity prior to July 1, 1978,
including pension programs.
   This bill would exempt a city or county that pays its pension
costs with revenues from a property tax  rate,  
r   ate  approved by  the voters of a city or
county   its voters  to make payments in support of
pension programs and levied in addition to the general property tax
rate, and that city's or county's  employees  
employees,  from the above-described  50% contribution
rate provision under PEPRA.   prohibition on employer
payment of employee contribution, with respect to an employee whose
pension is funded by these revenues. 
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 7522.30 of the Government Code is amended to
read:
   7522.30.  (a) This section shall apply to all public employers and
to all new members. Equal sharing of normal costs between public
employers and public employees shall be the standard. The standard
shall be that employees pay at least 50 percent of normal costs and
that employers not pay any of the required employee contribution.
   (b) The "normal cost rate" shall mean the annual actuarially
determined normal cost for the plan of retirement benefits provided
to the new member and shall be established based on the actuarial
assumptions used to determine the liabilities and costs as part of
the annual actuarial valuation. The plan of retirement benefits shall
include any elements that would impact the actuarial determination
of the normal cost, including, but not limited to, the retirement
formula, eligibility and vesting criteria, ancillary benefit
provisions, and any automatic cost-of-living adjustments as
determined by the public retirement system.
   (c)  (1)    New members employed by those public
employers defined in paragraphs (2) and (3) of subdivision (i) of
Section 7522.04, the Legislature, the California State University,
and the judicial branch who participate in a defined benefit plan
shall have an initial contribution rate of at least 50 percent of the
normal cost rate for that defined benefit plan, rounded to the
nearest quarter   1/4  of 1 percent, unless
a greater contribution rate has been agreed to pursuant to the
requirements in subdivision (e).  This   Except
as provided in paragraph (2), this  contribution shall not be
paid by the employer on the employee's behalf. 
   (2) With respect to an employee whose pension is funded as
described in this subdivision, the prohibition against an employer
paying an employee's contribution does not apply to a city or county
that pays its pension program costs with revenues derived from a
property tax rate approved by the voters of the city or county to
make payments in support of pension programs and levied in addition
to the property tax rate limited by subdivision (a) of Section 1 of
Article XIII A of the California Constitution. 
   (d) Notwithstanding subdivision (c), once established, the
employee contribution rate described in subdivision (c) shall not be
adjusted on account of a change to the normal cost rate unless the
normal cost rate increases or decreases by more than 1 percent of
payroll above or below the normal cost rate in effect at the time the
employee contribution rate is first established or, if later, the
normal cost rate in effect at the time of the last adjustment to the
employee contribution rate under this section.
   (e) Notwithstanding subdivision (c), employee contributions may be
more than one-half of the normal cost rate if the increase has been
agreed to through the collective bargaining process, subject to the
following conditions:
   (1) The employer shall not contribute at a greater rate to the
plan for nonrepresented, managerial, or supervisory employees than
the employer contributes for other public employees, including
represented employees, of the same employer who are in related
retirement membership classifications.
   (2) The employer shall not increase an employee contribution rate
in the absence of a memorandum of understanding that has been
collectively bargained in accordance with applicable laws.
   (3) The employer shall not use impasse procedures to increase an
employee contribution rate above the rate required by this section.
   (f) If the terms of a contract, including a memorandum of
understanding, between a public employer and its public employees,
that is in effect on January 1, 2013, would be impaired by any
provision of this section, that provision shall not apply to the
public employer and public employees subject to that contract until
the expiration of that contract. A renewal, amendment, or any other
extension of that contract shall be subject to the requirements of
this section. 
   (g) This section does not apply to a public employer and its
public employees if the public employer is a city or county that pays
its pension program costs with revenues derived from a property tax
rate, approved by the voters of a city or county to make payments in
support of pension programs and levied in addition to the property
tax rate limited by subdivision (a) of Section 1 of Article XIII A of
the California Constitution.