In the last days of the 2005 bill signing season,
Governor Arnold Schwarzenegger took action on seven bills affecting the California State Teachers'
Retirement System and its members. The bills affecting the benefits and administration of CalSTRS
signed into law by the Governor, included:
- AB 224 (PER&SS) among other things, allows CalSTRS to automatically search for a Defined Benefit
Program member's highest period of final compensation when calculating the member's benefit allowance amount.
It also provides the authority for part-time members of the Defined Benefit Program who were previously
excluded from the Cash Balance Benefit Program due to the former "multiple employer restriction," to elect
participation in the Cash Balance Benefit Program.
- AB 1044 (Aghazarian) requires an elected public officer convicted of a felony arising out of his or her
official duties to forfeit the retirement benefits that accrue on or after 1/1/06 solely as a result of his
or her service in office and shall receive only the employee contributions made during his or her term.
This measure primarily affects Defined Benefit members who are elected a county superintendent of schools.
- SB 439 (Simitian) specifies which information relating to public retirement systems alternative investments
is subject to disclosure or protected from disclosure under the California Public Records Act.
- SB 525 (Torlakson) reduces the one-year waiting period to six consecutive months for both members of
the Defined Benefit Supplement Program and participants of the Cash Balance Benefit Program to receive
a termination benefit. It also prohibits the payment of more than one termination benefit under either
program during a single five-year period.
The only CalSTRS legislation vetoed by the Governor was AB 55 (Mullin), which would have ensured the repayment
of $500 million in contributions that were withheld from the CalSTRS Supplemental Benefit Maintenance Account
in the 2003-04 Budget Act, plus interest. The previous reduction in General Fund contributions adversely
affects the long-term funding of CalSTRS' Purchasing Power Program and the CalSTRS retirees who depend on
supplemental payments to maintain their purchasing power as inflation rises.
An additional two bills addressing teachers' health care were also signed into law:
- AB 256 (De La Torre) among other things, requires that the California Public Employees' Retirement System
consult with CalSTRS to evaluate the feasibility of creating single statewide health care pool for all
school employees and report its findings to the Legislature.
- AB 1166 (Canciamilla) among other things re-enacts lapsed provisions that allow a school district,
a county superintendent of schools, or regional occupational center to participate in Medicare-only
coverage for teachers hired prior to 4/1/86 by holding an election.
Read the full text of the
bills and CalSTRS analyses.
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