HomeMy WebLinkAbout08.a.2) Update re pension reform legislationS a.
Central Contra Costa Sanitary District
May 27, 2011
TO: HONORABLE BOARD OF DIRECTORS
VIA: JAMES M. KELLY, GENERAL MANAGER "
FROM: RANDALL M. MUSGRAVES, DIRECTOR OF ADMINISTRATION JAk
MICHAEL SCAHILL, COMMUNICATION SERVICES MANAGER /Ado
SUBJECT: SENATE AND ASSEMBLY BILLS COVERING ENHANCED BENEFITS
These are the latest updates on bills that could impact public employees and pension -
related benefits.
Senate Bill 27: Public retirement: final compensation: computation: retirees
Introduced 12/06/10 by Senator Joe Simitian (Dem — Palo Alto)
Passed 8 -0 by Appropriations Committee on 4/11/11
Passed 8 -0 by Senate Rules Committee on 5/26/11
Will be sent to Senate for third reading and vote. No date listed.
The key elements of the amended bill include:
• Covers members of CaISTRS and CalPERS
• Any change in salary or compensation principally for the purpose of enhancing
benefits would not be included in the calculation of a member's final
compensation.
• Calculation of a member's final compensation would be limited to an.amount not
to exceed the average of his or her highest paid 12 or 36 months of employment.
• A person who retires on or after January 1, 2013 (including public school and
state universities and colleges) may not work for any employer covered by state
or local retirement system for at least 180 days.
• Provisions become operative on July 1, 2012.
Assembly Bill 340: County Employees Retirement; post- retirement service
Passed in Assembly 73 — 0 (7 not voting or absent) on May 12, 2011
First Senate read on 5/12/11; sent to Senate Rules Committee for assignment
Assigned to Senate Committee on Public Employees & Retirement on 5/26/11
The key elements of the amended bill include:
• Amends the County Employees' Retirement Law of 1937.
• Bill would prohibit any form of spiking during last year of employment.
• County or District would be required to identify pay period in which compensation
was earned to its retirement board.
• Effective January 1, 2012, retired person would be prohibited from reemployment
in any capacity until at least 180 days have passed.
• Provisions of this bill shall not be applied to reduce the pension of anyone who
has retired prior to January 1, 2012.
Public Employee Pension Reform Act /Proposition 11 -0007:
Although granted approval on 5/24/11 to begin collecting signatures
to place the initiative before voters, the measure's author Roger Niello
has said he will not pursue signature gathering because of the
diminished likelihood of a special election in November of this year.
He also stated that he is open to introducing a new measure for one
of the 2012 ballots. He said he would likely amend his proposal to
have a lower retirement age for public safety workers and tie a benefit
cap to a specific dollar amount rather than a percentage of wages.
Key points in original initiative:
• Raise the minimum retirement age for all public workers to 62, including current
workers
• Require public employees to work at least five years, full -time before being
eligible for a pension
• Cap pension checks at no more than 60 percent of the highest three -year
average base wage
• End any form of spiking
• Require employees to contribute at least as much as their employers to
retirement accounts
• End retroactive pension increases
• Other than retirement age, the other parts would apply only to new hires
• If approved by voters, the measure would take effect immediately.
NO ACTION
Assembly Bill 961: May 4, 2011 Failed passage 5 -0 in Committee on Public
Employees, Retirement and Social Security - Reconsideration granted
Key point of bill:
Excludes matters relating to pension benefits from the scope of public employee
collective bargaining.
Senate Bills 520- 528 (referred to as Walters' "Pension Reform Act ")
May 2, 2011 hearing cancelled at bill's sponsor's request
The key points of these bills include:
• Creates a hybrid retirement plan for public employees who become members on
or after January 1, 2012.
• Eliminates pensions for part-time elected officials
• Eliminates retroactivity
• Eliminates spiking
• Raises retirement age to 55 for non - safety employees
• Limits collective bargaining
• Removes elected members from PERS Board