2018 Legislation

Assembly Bill

AB 1597 (Nazarian) – Turkish Investment Vehicle Divestiture

Prohibits the CalSTRS and CalPERS boards from making additional or new investments or renewing existing investments in any investment vehicle issued, owned, controlled or managed by the government of Turkey, immediately upon passage of a federal law imposing sanctions on Turkey for failure to acknowledge the Armenian Genocide, and requires divestment from such investments within six months of the passage of such a federal law, subject to the fiduciary duty of the boards.  Requires the boards, within one year of the passage of such a federal law, to report to the Legislature any investments in a Turkish investment vehicle and other specified information. Also indemnifies present, former and future board members, officers and employees of and investment managers under contract with those retirement systems for actions related to the bill.  Also provides for repeal of its provisions upon determination that Turkey has officially acknowledged its responsibility for the Armenian Genocide.

  • Version: Enrolled 9/5/2018
  • Sponsor: Author
  • Location: Vetoed by Governor
  • Board Position: Oppose
Assembly Bill

AB 2052 (Bonta) – Requiring Employers to Use Electronic Payments

Upon authorization by the Teachers’ Retirement Board, requires all employers to submit their contribution payments by an electronic funds transfer method.  Also allows an employer that is unable to comply with this requirement to apply to the board for a waiver to pay in an alternative manner.

  • Version: Chaptered (Chapter 125, Statutes of 2018)
  • Sponsor: CalSTRS
  • Location: Signed by Governor
  • Board Position: Sponsor
Assembly Bill

AB 2571 (Gonzalez Fletcher) – Race and Gender Pay Equity

Requires public retirement systems to make new additional or renewed investments in alternative investment vehicles only where the investment manager has adopted and committed to comply with a race and gender pay equity policy, as specified, subject to the fiduciary duty of the retirement board.  Also requires the investment manager to submit an annual report to the public retirement system and requires the system to disclose the reported information at a public meeting and to the State Auditor.

  • Version: Introduced 2/15/2018
  • Sponsor: Unite Here, Local 11
  • Location: Assembly PER&SS Committee
  • Board Position: Watch
Assembly Bill

SB 783 (Pan) – Pension Divestment Review Program

Makes a request by the Legislature to the University of California to establish the Pension Divestment Review Program to assess, at the request of specified legislative parties, any legislative proposal for the divestment or restriction of pension fund investments and prepare a written analysis containing relevant data, as prescribed, regarding the effects of the proposal on public employee pension funds and public policy.

  • Version: Amended 6/14/2018
  • Sponsor: Author
  • Location: Assembly Appropriations Committee
  • Board Position: Oppose
Assembly Bill

SB 964 (Allen) – Climate-Related Financial Risk of Pension Investments

To the extent the CalSTRS and CalPERS boards identify “climate-related financial risk,” as defined, as a material risk to the fund, requires that risk to be analyzed. By January 1, 2020, and every three years thereafter, the bill requires the boards to publicly report on the analysis of the material climate-related financial risks of their public market portfolios. Also provides a sunset date of January 31, 2035.

  • Version: Chaptered (Chapter 731, Statutes of 2018)
  • Sponsor: Environment California, Fossil Free California
  • Location: Signed by Governor
  • Board Position: Neutral
Assembly Bill

SB 1165 (Pan) – Housekeeping Bill

Makes various technical, conforming or minor changes to the Teachers’ Retirement Law to facilitate efficient administration of the State Teachers’ Retirement Plan (Plan), which includes the Defined Benefit (DB) Program, the Defined Benefit Supplement (DBS) Program and the Cash Balance (CB) Benefit Program.

  • Version: Chaptered (Chapter 416, Statutes of 2018)
  • Sponsor: CalSTRS
  • Location: Signed by Governor
  • Board Position: Sponsor
Assembly Bill

HR 6290 (Nunes) – Public Employee Pension Transparency Act

Requires a state or local government applicable retirement plan sponsor to report specified plan information to the U.S. Treasury Secretary each plan year beginning on or after January 1, 2019, including the value of plan liabilities using the U.S. Treasury spot rate yield curve—often described as a “risk free” rate of return.  Failure to comply with the reporting requirements results in the forfeiture of federal tax benefits to bonds issued by the relevant state or political subdivision until noncompliance is remedied.

  • Version: Amended 6/28/2018
  • Sponsor: Author
  • Location: House Ways and Means Committee
  • Board Position: Oppose