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HomeMy WebLinkAboutMINUTES - 08101993 - MR.1 12 : 30 p.m. THE BOARD OR SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adopted this Order on _August 10, 1993 by the following vote: AYES: Supervisors Powers, . Smith, Bishop, McPeak, Torlakson NOES: None ABSENT: None ABSTAIN: None SUBJECT: Meeting of the Contra Costa County Employees' Retirement Board and the Board of Supervisors At 12 : 30 p.m. this day Chairman Tom Torlakson convened the meeting of the Board of Supervisors and the Contra Costa County Employees' Retirement Board at The Training Institute, George Gordon Education Center, 500 Court Street, Martinez . The scope and focus of the meeting followed the agenda as attached. During the discussion on the various issues, the Board: 1. REQUESTED the Retirement Administrator to write to the fast food chains in the Retirement Board's portfolio expressing appreciation for their efforts in the areas of nutrition and recycling; 2 . REQUESTED the Retirement Administrator and James Kennedy of the County Redevelopment Agency to report at the next joint meeting with the Retirement Board on the feasibility of using retirement funds to assist in the development of affordable housing projects and to include a survey of what other retirement funds have done in this area; and 3 . REQUESTED the Retirement Administrator, Assistant Personnel Director, and Risk Manager to review the cost of health and dental care as it pertains to retirees' health plans. I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of th,3 Boer±of supervisors on the date shown. ATTESTED: PHIL BAT99ELOR,Clerk of the Boaro of Supervisors and County Administrator By -_�L Deputy cc: P. Batchelor, County Administrator P. Wiegert, Retirement Administrator J. Kennedy, Redevelopment Agency J. Tonda, Risk Manager E. Bitten, Assistant Personnel Director AGENDA FOR MEETING OF THE RETIREMENT BOARD AND BOARD OF SUPERVISORS - GEORGE GORDON EDUCATION CENTER THE TRAINING INSTITUTE - 500 COURT STREET, MARTINEZ TUESDAY, AUGUST 10, 1993 - 12:30 P.M. to 1:30 P.M. 1. Call to order and self introductions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Tom Torlakson, Chairman, Board of Supervisors 2 . Introductory comments from any members of the Board of Supervisors and members of the Retirement Board. . . . . . . . . . . . . 3 . Retirement Board Portfolio Review. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Pat Wiegert, Retirement Administrator 4. Discussion of Affordable Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Supervisor McPeak & General Discussion 5. Legislation of Concern to the Board of Supervisors and/or Retirement Board: * AB 2381 (Bates) - Reopening window to impose a property tax override to fund the retirement system. Background andstatus. . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . .Claude Van Marter, Assistant County Administrator * AB 254 (Rainey) - Authorizing the Retirement Board to establish efficient records management procedures, including the maintenance and disposal of records within its jurisdiction. . . . . . . . . . . . . . . . . . . . . . .Claude Van Marter * SB 430 (Boatwright) - Board of Supervisors-sponsored legislation dealing with several retirement issues. . . . . . . . . . . . ..0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Pat Wiegert * Proposition 162 - Redefining the relationship between the Retirement Board and Board of Supervisors - terms of office for Retirement Board members. Description of Proposition 162 issues and areas needing clarification . , . , . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Pat Wiegert 6 . Other Issues of Concern to the Retirement Board or Board of Supervisors? 7. Summary of Actions Taken and Next Steps.Supervisor Torlakson 8. Adjourn at 1:30 P.M. CONTRA COSTA COUNTY EMPLOYEES RETIREMENT ASSOCIATION Asset Classes - Targets vs. Actuals Target Actual Domestic Equity 40.0% 42.0% International Equity 7.5 7.0 Domestic Fixed 34.0 37.0 International Fixed 5.0 5.0 Real Estate, Sep. Acct 7.0 4.5 Real Estate, Commingled 5.5 3.5 Cash 1.0 1.0 ASSET ALLOCATION Current Assets As of June 30. 1993 8% % 5% ® Domestic Equi ® International Equity 42% ® Domestic Fixed Income International Fixed Income ® Real Estate 37% O Cash 7% 1 CONTRA COSTA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION PROGRESS TOWARD IMPLEMENTING ASSET TARGETS Completed 1) Hired a second international equity manager to complement the investment style of Capital Guardian Trust. 2) Developed a "fine-tuning" process by which managers can be brought to their targets without incurring transaction costs. Committed, not fully funded 3) Zell/Merrill Lynch $15 million committed $11.5 million funded commingled real estate 4) FFCA Institutional Advisors $12 million committed $10.7 million funded co-investment w/two other counties 5) Prudential, Strategic Perf.Fund $15 million committed $14 million funded commingled real estate 6) BEA Associates International Equity Hired 1/93 $25 million initial committment Searches Underway 7) Domestic Equity-Small Cap $25 million initial committment To complement existing managers CONTRA COSTA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION INVESTMENT MANAGERS and CONSULTANTS as of 8/10/93 MANAGERS: Domestic Equity Alliance Capital Mgmnt, Index Fund The Boston Company Hanson Investment Management Wentworth, Hauser and Violich International Equity Capital Guardian Trust BEA Associates Domestic Fixed Income Wells Fargo/Nikko, Index Fund Scudder, Stevens & Clark Sporl and Company AFL/CIO Housing Inv. Trust International Fix Brinson Partners, Inc. Real Estate, Sep. Acct. Mellon/McMahan Real Estate Adv. Real Estate, Commingled Metric Real Estate Advisors Zell/Merrill Lynch FFCA Institutional Advisors Prudential Asset Management CONSULTANT: Dorn, Helliesen & Cottle Manager Searches Asset Allocation Performance Measurement Performance Evaluation Investment Policy Advisor Research Assistance Trade Evaluation 3 Revenue Contributions and Investment Income $100,000,000 $90,000,000 $80,000,000 $70,000.000 $60,000,000 $50,000,000 -i i $40,000,000 $30,000,000 $20,000,000 7 $1 O"M10,000 $0 1988 1989 1990 1991 1992 ® Employee El Employer Investment Income l Eff. To Subsidize Contributions Supplmntl. Year Employer Employee Retiree COLA Total 81-82 $ 2,500,000 $1,000,000 $1,001,002 $ 4,501,002 82-83 2,725,000 1,500,000 1,110,056 5,335,056 83-84 7,282,000 3,546,511 864,315 11,692,826 84-85 8,005,000 3,166,000 486,794 11,657,794 85-86 4,750,000 2,750,000 1,050,000 8,550,000 86-87 5,739,000 2,942,000 1,453,494 10,134,494 87-88 10,711,000 3,490,000 1,605,156 15,806,156 88-89 7,231,966 3,615,983 1,561,436 12,409,385 89-90 4,943,333 2,471,667 960,490 8,375,490 90-91 5,181,420 2,640,710 2,071,371 9,893,501 91-92 5,743,481 3,007,877 1,565,433 10,316,791 92-93 5,090,058 2,462,804 1,565,294 9,118,156 93-94 17,538,988 3,269,676 2,550,721 23,359,385 TOTAL $87,441,246 $35,863,228 $17,845,562 $141,150,036 TOTAL TRANSFERS FROM UNDISTRIBUTED EARNINGS $25,000.000 $20.000.000 1 I $15.000.000 $10,000,000 $5.000.000 $0 '81 '82 183 '84 '85 '86 '87 188 189 190 191 '92 193 Retiree ® Employee Employer SENATE BILL 430 I) AMORTIZATION SCHEDULE Can lengthen schedule up to 30 years B of S must request. Based on financial necessity. B of R may deny if unsound financial risk. Can extend only one time. Effective 1/1/94. II) RETIREE SUPPLEMENTAL COLA - B of R can prefund retiree supplemental COLA. - If prefunding done, value reduces accumulated unpaid COLA. - Permissive: B of S must elect to make available to B of R. - Effective 1/1/94. III) TECHNICAL CORRECTION - TIER II retirees now eligible for supplemental COLA's - Purely preventative - nobody has been hurt yet - Effective 1/1/94 PENSION PROTECTION ACT OF 1993 PROPOSITION 162 I) CONSTITUTIONAL AMENDMENT A) No tampering with Retirement Boards - Freezes composition and terms of Retirement Boards as of July 1, 1991. - Exception: Legislature changes and ratified by voters - Delays implementation of Ch 1226, Laws of 1991, which realigned Contra Costa's Board terms. - County-wide election to ratify Ch 1226 required. B) Increases retirement boards' authority and responsibility - Reaffirms basic fiduciary principles - Strengthens retirement boards' independence - Grants full, complete and absolute authority (i.e. "plenary authority") to retirement boards. - Duty of loyalty to beneficiaries supersedes all others. II) ISSUES RAISED A) Treasurer - Custody of assets B) Auditor/Controller - Receipts & expenditures C) Legal - Use of private counsel D) Personnel - Recruitment, classification, compensation III) STATUTORY CONFLICTS "Only transfers of final administrative authority away from public retirement boards are facially invalid. Other statutes may be valid, unless their application would unduly burden or prevent the board from carrying out its constitutionally-imposed fiduciary duties. " (Legal Opinion, 7/3/93) 7 AMENDED IN ASSEMBLY JULY 15, 1993 AMENDED IN ASSEMBLY JUNE 30, 1993 CALIFORNIA LEGISLATURE-1993-94 REGULAR SESSION ASSEMBLY BILL No. 2381 F. Introduced by Assembly Member Bates April 1, 1993 An act to amend Section 97.65 of the Revenue and Taxation Code, 'relating to taxation. LEGISLATIVE COUNSEL'S DIGEST AB 2381, as amended, Bates. Taxation: property tax rate levies. Existing law permits local jurisdictions to levy an additional property tax rate fer the I ef vetet4appreyed bended indebtedness; eentretet (w speer program- ineluding the pwfment to make payments in support of pension programs approved before July 1, 1978, provided that the jurisdiction imposed the property tax rate in the 1982-83 or 1983-84 fiscal year. This bill would permit the imposition of a property tax rate by a county or city and county for these pension programs until January 1, 1995, if the program wasappy beferej* 1; 4W8 regardless of whether a rate was imposed for that purpose in the 1982-83 or 1983-84 fiscal year. Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no. 97 80 AB 2381 — 2 — The people of the State of California do enact as follows: 1 SECTION 1. Section 97.65 of the Revenue and 2 Taxation Code is amended to read: 3 97.65. (a) For the 1985-86 fiscal year and each fiscal 4 year thereafter, no jurisdiction shall impose a property-, 5 tax rate pursuant to subdivision (a) of Section 93, unless 6 it is imposed for one or more of the following purposes: 7 (1) To make annual payments for the interest and 8 principal on general obligation bonds approved by the 9 voters before July 1, 1978, and on bonded indebtedness 10 for the acquisition and improvement of real property 11 approved by the voters by a two-thirds vote after June 4, 12 1986. 13 . (2) To make payments to the State of California under 14 contracts for the sale, delivery, or use of water entered 15 into pursuant to California Water Resources 16 Development Bond Act in Chapter 8 (commencing with 17 Section 12930) of Part 6 of Division 6 of the Water Code 18 or to make payments to the United States or another 19 public agency under voter-approved contracts for the 20 sale, delivery, or use of water or for the repayment of 21 voter-approved obligations fof the construction, 22 maintenance, or operation of water conservation, 23 treatment, or distribution facilities, provided that the 24 indebtedness was approved by the voters before July 1, 25 1978. 26 (3) To make payments pursuant to lease-purchase 27 programs approved by the voters before July 1, 1978, 28 provided that the jurisdiction imposed the property -tax 29 rate in the 1982-83 fiscal year. 30 (4) To make payments in support of pension programs 31 approved by the voters before July 1, 1978, provided that 32 the local agency imposed the property tax rate in the 33 1982-83 or 1983-84 fiscal year. 34 (5) Notwithstanding paragraph (4), a county or city 35 and county may impose a property tax rate to make 36 payments in support of pension programs approved by 37 voters before July 1, 1978. If the board of supervisors has 38 not imposed a property tax rate pursuant to this 97 110 -3 — AB 2381 UOWS- I paragraph before January. 1, 1995, the board of 2 supervisors shall not have the authority to impose a sue and 3 property tax rate pursuant to this paragraph after that 4 date. ch fiscal 5 (6) To make payments in support of pgramedic, )roperty 6 library, or zoo programs approved by the voters before 3, unless 7 July 1, 1978, provided that the jurisdiction imposed the urposes: 8 property tax rate in the 1982-83 fiscal year. -est and 9 O� I by the 10 (7) To make payments for the interest and principal )tedness 11 on an indebtedness, pursuant to Section 5544.2 of the )roperty 12 Public Resources Code, approved by the voters before -June.4, 13 July 1, 1978, provided that the local agency imposed the -3 14 property tax rate in the 1982-83 fiscal year. A under 15 (b) In the 1985-86 fiscal, year and any fiscal year entered 16 thereafter., a jurisdiction shall not impose a property tax ,.,Sources 17 rate, pursuant to subdivision (a) of Section 93, in excess ng with 18 of the rate it imposed in the 1982-83 or 1983-84 fiscal.year. z..r Code 19 Notwithstanding the limit imposed by this subdivision, a another gq,, Avh, 20 higher property tax rate may be imposed whenever for the 21 necessary to make payments for any of the purposes nent of 22 specified in paragraphs (1), (2), and (3) of subdivision ruction, 23 (a). However, no property tax rate increase in excess of rvation, 24 the rate imposed in the 1984-85 fiscal year shall be hat the .IW 25 imposed if the purpose of the rate increase is to fund a .0 July 12 26 reduction in the rates charged for water at the time of the 27 property tax rate increase. urchase 28 (c) Notwithstanding subdivisions (a) and (b), a 1, 1978, 29 charter city may levy an ad valorem property tax rate to ,zrty tax 30. make payments in support of a retirement system for fire 31 and police employees if all of the following criteria are ograms 32 met: 'ed that 33 (1) The retirement system is part of the city's charter in the 34 and was approved by the voters before July 1, 1978. 35 (2) The city did not levy a separate ad valorem or city 36 property tax rate to support the retirement system in the make 37 1983-84 fiscal year. -ved by 38 (3) The retirement system provides for a cost-of-living ;ors has 39 adjustment which is indexed to a consumer price index to this 40 and does not limit the annual increases, which may be 97 110 97 130 AB 2381 — 4 - 1 paid to members after their retirement. 2 (4) The retirement system is not currently available to 3 newly hired fire and police employees and will not be 4 available in the future. 5 (5) Before January 1, 1985, the city unsuccessfully 6 litigated a limit to the cost-of-living adjustment which 7 may be paid to members of the retirement system after 8 their retirement. 9 (6) After July 1, 1985, the city conducted an election 10 and a question authorizing the levying of an ad valorem 11 property tax for the purpose of making payments in 12 support of the retirement system received the 13 affirmative votes of at least 60 percent of those- voting on 14 that question. 15 The proceeds of an ad valorem property tax rate levied 16 pursuant to this subdivision shall be used only to pay for 17 the obligations of a retirement system described by this 18 subdivision. The proceeds shall not be used to finance 19 more than 75 percent of the annual obligations of this 20 retirement system. A city shall not levy an ad valorem 21 property tax pursuant to this subdivision after June 30, 22 2034. 23 -(-7+ Netm4ths h +4�-, ia eeu� er eity 24 ead eeuttty may ffiapese a property te* rate to make 25 pwfmen s in suppert of pension pregrams by 26 Yetersbe' ferre j4 1978. If the beard of hes 27 flet ftnpesed* a preta* rate pursuant to this 28 paragraph before jmuary 4-,- 1995, the board ef 29 &m she& net haeme the authet4ty to impese et 30 preperty tam rte purstiant to this p h after that 31 date. 32 (d) If a jurisdiction imposes- a rate in excess of the 33 maximum rate authorized by subdivision (a), (b), or (c), 34 the amount of property tax allocated to the jurisdiction 35 pursuant to this chapter shall be reduced by one dollar 36 ($1) for each one dollar ($1) of property tax revenue 37 attributable to the excess rate. Any property tax revenue 38 which has been subtracted from a jurisdiction's allocation 39 pursuant to this subdivision shall be allocated to 40 elementary, high school, and unified school districts 971 140 - 5 — AB 2381 1 within the jurisdiction's jurisdiction in proportion to the Mable to 2 average daily attendance of each district. I not be 3 (e) This section shall be deemed to be a limit on the 4 maximum property tax rate pursuant to Section 20 of cessfully 5 Article XIII of the California Constitution. it which em, after 'election valorem vents in red the oting on to levied pay for i by this finance .s of this valorem June 30, 00 e er eity to metke 0 'eved by iseft h" te thi�s e"d of %pose a ftep the+ ;s of the isdiction le dollar revenue revenue Hocation !ated to districts 97 140 97 150 -�, t :.. �� =� --. AMENDED IN SENATE MAY 203, 1993 AMENDED IN SENATE APRIL '12, 1993 SENATE BILL No. 430 Introduced by Senator Boatwright February 24, 1993 . An act .to. amend Sections 31453.6. 31616, 31617) 316f3; ai%Q 31681.83% 31837.1, and 31874.3 of, and to -add Seetiem 31615.4-. 81616.1, aed Section 31681.9 to, the Government Code, relating to the County Employees Retirement Law of 1937. LEGISLATIVE COUNSEL'S DIGEST SB 4303, as. amended, Boatwright. County Employees Retirement Law of 1937. ' The existing County Employees Retirement Law of 1937 authorizes a county retirement board,upon the request of the county 'board - of supervisors demonstrating financial necessity, to adopt a funding period of 30 years to amortize unfunded actuarial obligations. This bill accord those county retirement boards the flexib` 'ty of adopting, instead, a funding period of up to 30 years. preeedttres. This prewsten. wee4d be elVheable eftI3� at the eptien of the eeurt-t retiremeet beard aftd the best e€ sepe��e�: This bill would establish alternative prefunded cost-of-living adjustments, for allowances. This provision would be applicable only at the option of the board of supervisors. This bill would make other clarifying, technical, corrective, and related changes in provisions relating to cost-of-living 97 80 SB 430 — 2 — payments 2 — payments to retirees, disability retirement allowances for certain employees of Contra Costa County, and supplemental cost-of-living adjustments. Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no. The people of the State of California do enact as follows: f 1 SECTION 1. Section 31453.6 of the. Government 2 Code is amended to read: 3 31453.6. Notwithstanding any other provision of this 4 chapter; the board of retirement may, at the .request of .5 the board of supervisors, adopt a funding period.of up to 6 :30 years to. amortize unfunded accrued actuarial 7 obligations, as determined by their actuary or by an .8 - actuary,.employed by the board of investments, for 9 benefits applicable to all.membership categories for the 10purpose of determining employer contribution rates for 11 counties and districts. The board of. retirement shall 12 approve a.new amortization period based upon a request j 13 from the board of supervisors that demonstrates a . 14 financial necessity. The board of-retirement may deny a 15 request when the. request. would subject the fund to an 16 unsound financial risk. 17 A board of retirement may take an action to approve 18 a request pursuant. to this: section only once. 19 . SEG..2-. Sem 31615.1 is added to the.Gevernament 20 Cede, to dead- 21 31615.1. Netm4th Seet4en 316155, the interest 22erediting PjtJeedtwes' by OAe seetien and 23 Seetiea 31616.1 may be utilized by a eek suWeet to thio 24 art4ele. Regular :mss=. at the sem ate; .shah be 25 etedited mlly-ori axe 30 and T,,.,,,.mbe- 31 to.ah . 26 iteeetmts, eentribut4ens; and reserves the 27 aeeetmts set up p� to fie} ftad {* of 28 Seetiee 399 and the Gentingeney Reserve Aeeetuit 29 Leh have been ea depesit fef sim menths ' 30 prier to these cites. 31 An aeeetmt she be ereated oft the books of the 32 PeSreme knewn Ae the fneember interest 97 120 i — 3 — SB 430 -es for j 1 epeedited in a of c egs aeeetmt:=r ani semiam l nental 2 m the teW amannt eredited as deseribed it 3 this sec c r}s g the ea rgs of the..etirevae�� :e: no. 4 hind is gmt .peried, the differeftee �..,,�eeft the twe 5 ametrts sheA be reeerded as a debit entry ift this aeee 6 In ai subseele se ruu J period, after erediOng �~� 7 interest as, ese:b,a hr 04e seetio�r any , net WS: 8 ea n ;s Al be apphed to reduee emy debit beJ nee ift anent 9 this aeeotmt: 10 interest at the etetu&PW tette; eetpetmded 7f this .11 se , u Ay, sheR he.tised in the ealeu4&6efbeftefits Lest of 12 under aI%y m Fta .'by the beard of P :..�,..est u to 13 s ►er i . Ne =nom be to amember=s uarial 14 aeeeem a€tei the temvAaet of the memhe =s by -an ..15 . ser"ee, Mess the member hes emoted; ift writing, to S, for 16 heave his or her aeet vi"A_ ed :eeetribttSens in tte )r the 17 it einem ifilfflmd and to be greated.rc de€rred re4r..m es for 18 agree;e -the of a deeeased member shall 19 of the appointed gtwdlan of the membe,. .; :quest .. f 20ehAdren tide. age 18 has.eleeted to leave a .tes a 21 death benefit erg deposit as preceded fey in Seet4en eny a 22 81 .2. to an 23s seet� gall net beeenre ee e� 24 . opAess and It ie adepted by reseltttiorr of tie prove .. :; 25 beard of rem and tl3e of s se : 26 : S: 8ee4fr 3161 of the Geverme3t Cede is 3t 27 mnended to read: .28 . 31616: After the A apphe& ion of 8ee6em teiest .29 3:1€15, or See1 .1, if apphes.b earmngs of the and 30: re4emtent fimd in e.*eess of the tetal interest eredited to e this 31 eent #1o�rs and reserves shah �m it the find as a be 32 reserye against ae e e e interest lesser err to a 33 inyestments, er perms Made pursttaet to Beet4en the 34 31588. er 31589.1, if appheable. 35 These fteEls shah be plaeed iff ao aeeeoet hour !vent 36'. hereafter as the Gefitingeftey eve "event. The see 37 of this aeeetrt shah be dctermarally by the 38 beard bet shall net emeeed 3 pereeet of the total assets of € the 39 the ret3ent e�est 40 at the end of a� see r ml peried, the balanee of 97 120 97 140 I - - - - - - i 3 V. - •. • -•- - i •n ae• i IrA Ift w I - - - • - - • • • - - - - - - i w• - i i i .." - - - i - - • `i • • • • i • �r • i i 1 -•. : ' . ; • % • : ' �: : % - : �•` . = : - .• ; ••� _• .•. +. ;.- . ,- -. . -- #� � �• � � • „ : .' " � � ♦ � i �• � i � + . •� � + i � + � +• • i +- • � i . i • • •. •' r � ,• � i +• •� i .•' + .•' • • I • i ' • � •• .• • + M� • � I "• � - • + .• - ;, : � ' + •^ I •'•� w + ' i i '• w � � +� i i i •' i i i + � � • ' + �••r i � i � i + + + i + " i i • ' ..•' � .• �o + �' i i +' •••I i AI + ' i �•� j � + ' + � • • i • + � '• � � * w• w • �r� � ••' ♦� + i •• • I �• i M ' i i• + • • i + i + + ' �' + � w� �+ w .•� + _ A •• � + + + ♦� i •^ I � + • •' I•' I ••' � ••' �? ��� •' • • i i ; + • + � •• "� • i + • + " " + ••I M' •� ••� i i + �•� • + • •• ,. ,.•� •• i ;,r� i + � i � • + i i •• ' + •• ' • • i•' •• + • j ' � I 1 � • • y y i ' ' j• i + ' + ' • + + + • {� w � � i •• � . • � • , • � I I •' � • � r i ••' � r r s ••_ t SB 430 —6- 1 6-1 ese=-Pe sheA be determined by the bead: 2 SEG: 7: Seel4etr 31619 of the Government Cede is 3 amended to,rear 4 3119: �iflitig eats ' :, air the A 5 appheatiee of Seems 31615 ; er 31615.1; if �;A;RUPAW 6 31616 or 316164; if a�pl eable; and 31617, if 7 app eA1h.✓`�/' aed Seed: 31618 sly be eredi to ah10,0) 8 ee ies; efves; and aeeeu in the _chief- -='` 9 €ice emeept Ohe Gentiageney Reserve Aeeettnt, in the 10 tn&rmer preseribed 4k Seefietr 3115; whether er fket 11 interest was kiMa), eredifed tmEler Seems 316115. or 12 A1615:h e*eetom.rte € rther interest sheAlbe et ted 13 to the Sup rye tA1 Ret4r6e Bet4e t R..�rye;establishe� 14 . p a o. Seedeit 31618= 15 SEG 16 SEC. 2. Section;316$1.8 of the Government Code is 17 amended to'read: I 18 31681.8. (a) The board of supervisors in any county 1 19 under the County Employees Retirement Law of.1937 1 20 may .provide, effective on a date determined by the 2 21 board, for cost-of-living payments, in addition to those 2 22 payable under Articles 16.5 '(commencing with Section 2 23 31870) and 16.6 (commencing with Section 31875), .to 2 24 members of this system or a superseded. system who , 2 25 retired and to . their surviving beneficiaries who: are 26 receiving allowances under this system, provided the 2' 27 following conditions are met: 2' 28 (1) .On January 1 of the year of adoption or readoption 2t 29 of this section, the accumulations established by Section- . 2. 30 31870 31870.1, 31870.2, or 31870.3, as applicable, shall, for N 31 any member, equal or exceed 25 percent in order for.that W 32 member to be eligible for the cost-of-living payment. 34c 33 (2) . The payments shall be made either quarterly or 34 34 34 monthly to those members and survivors eligible for the 35 first payment. 3` 36 (3) The amount of each payment is equal to the 36 37 product of a sum determined by the.board of supervisors, 37 38 but not to exceed fifteen dollars ($15) times the 38 39 member's full years of county service not exceeding 30 39 40 years. 40 �r �o -7 — SB 430 (b) The payments made pursuant to this section and ;Ode ie 2 Section 31739.5 shall be made only during the lifetimes of 3 the members or their survivors receiving allowances and 4 to no other person. keetble, 5 (c) The payments made pursuant to this section and 41-7-1 if 6 Section 31739.5 shall not be considered as a part of the to eA 7 monthly retirement allowance, optional death allowance, 8 or annual death allowance, nor shall any such payments in the 9 be construed as guaranteeing any similar payments in 10 any subsequent year. 414 er 11 (d) Notwithstanding subdivision (a),'the payments to se4ked . 12 - beneficiaries of members pursuant to Section 31760.1, Wi13 31765.1, 31781.1, r Q , `31785 or to beneficiaries who elected shed .1.4 a combined benefit pursuant'to. Section 31781.3 shall be 15 60 percent of the payments which. otherwise would have erode is 16 been payable under subdivision (a) to the members. 17 (e) Notwithstanding subdivision (a), the payments to county .18 beneficiaries of members who elected optional of 1937 19 settlement 3--pursuant to Section 31763 shall be 50 percent by the 20 of the payments which otherwise would have been Wj those 21 payable under subdivision (a) to the member. Section 22 -(f) This section shall not bb operative in any county in 75) to 23 any year, unless it is adopted or readopted in any year by tn who 24 the board of supervisors. Any such adoption or ho are 25 readoption in any particular year. shall not be construed 26 to require,any adoption or readoption in an .ed the y subsequent .27 - year. loption 28 (g) Before adoption by the board of supervisors in any Section'. 29 year., the cost of the payments authorized by this section iall, for 30 and Section '31739.5. shall be determined by a qualified for.that 31 actuary and the board of supervisors shall, with advice of vent: 32 the actuary, provide for the payment of that cost in such .erly or 33 manner as to fully fund the benefits on a sound actuarial 34 basis, including use of available funds in the reserves for the 35 provided in Section 31592.2 with the approval of the to the 36 retirement board, or an increase in the employer rates of 37 contributions, or a combination of these sources of .rvisors, Les the 38 payments. This actuarial determination shall be made ding 30 39 only upon authorization by the board of supervisors. 40 (h) Upon adoption by any county.providing benefits 97 230 97 240 SB 430 — 8 - 1 8 -1 pursuant to this section, of Article 5.5 (commencing with 2 Section 31610) of this chapter, the board of retirement 3 shall, instead, pay those benefits from the Supplemental 4 Retiree Benefits Reserve established pursuant to Section 5 31618. 6 SEG. 9. 7 SEC. 3. Section 31681.9 is added to the Government 8 Code, to read:. 9 .31681.9. (a) In lieu of the benefits described in 10 Section 31681.8, the board of retirement may provide for 11. cost-of-living payments on a prefunded basis and 12 effective on a date determined by the board, in addition 13 to,those payable under Articles 16.$.. (commencing with 14 Section 31870) and 16.6 (commencing with Section 15 31875); to members of this system or a superseded system 16 who retired either for service or.for disability, and to their 17 surviving beneficiaries who are .receiving allowances 18 under this system, provided the following conditions are . 19 met: 20 .(1) On January 1 of the year of board action pursuant 21 to this section, the.accumulations.established by Section 22 31870, 31870.1, 31870.2, or 31870.3, as=applicable, and as 23 reduced.by.subdivision (d), shall; for any member, equal 24 . or exceed 25 percent in order for that member to be .25 eligible for the cost-of-living payment. 26 (2) The payments shall be made either quarterly or 27 monthly to those members and survivors eligible for the 28 first payment. «. r.n 29 (3) ::The ,amount of each payment is equal to the 30 .product of a sum determined by the board of retirement, 31 but not to exceed fifteen dollars ($15) times the. 32 member's full years of service not exceeding 30 years. 3 33 The board of retirement may establish differing sums. 3 34 depending upon the original effective date of each 3 35 allowance. 3 36 (b) The payments made pursuant to this section shall 3' 37 be made only during the lifetimes of the members or 3' 38 their survivors receiving allowances and to no other & 39 person. 3` 40 (c) _ If the payments made pursuant to this section are 4( 97 260 -9 — SB 430 1 made to a member who retired for service-connected ng with disability or to the surviving beneficiary of the member", irement Seentctioal 3 the payments shall be computed on the basis that the n 4 member's service had continued to age 60, if a safety member, or age 70, if any other category of member, provided that this additional service credit. shall not imment 7 exceed 30 years. 8 (d) The payments made pursuant to this section shall ibed in 9 be, considered as, a part of the monthly retirement ,vide for IO allowance, optional' death allowance, or annual death sis and 11 allowance, and shall. serve to reduce the. accumulations addition 12 established Section. 31870$ 31870:1, 31870.2, or 31870.3, ing - 13 as applicable, by the same percentage. as the payment with Section. 14 that is made pursuant to this .,section. However,,, no 15 payment shall be made pursuant to- this section that I system 16 Ito their would reduce the accumulations below 25 percent. 17 (e) Notwithstanding subdivision (a), the payments to owances 18 beneficiaries *of members pursuant to Section 31760.1, tions are - 19 31765.1, 31781.1, or 31785 or to beneficiaries who elected pursuant ` 20I a combined benefit pursuant to 'Section 31781.3 shall be Section 21 60 percent of the payments which-otherwise.would have and as +T .22 . been payable under subdivision (a) to the members. 23 .(f) Notwithstanding subdivision (a), the payment to er to be er, equal 24 beneficiaries of '' members who elected , optional 25 settlement 3pursuant to Section 31763 shall be 50 percent rterly or 26 of the payments that.otherwise would have been payable 27 under subdivision .(a) to the member. e for the 28. .(g) Before action is taken to provide benefits pursuant- 29 to this section., the cost of the payments authorized by this 1 to the 30 . section shall be determined by a qualified actuary and the mesa the.) 31 board of retirement s-hall,with the advice of the actuary, 32 provide for the payment of the costs in such a manner as 30 years- 33 to fully fund the benefits on a sound actuarial basis, ing sums34 including use of available funds in the reserve provided of each 35 in.Section 31592.2, or an increase in the employer rates of tion shall 36 contribution, or a combimation of these sources . of tubers or 37 payments. no other 38 (h) This section shall not be operative in any county, 39 unless it is adopted by the board of supervisors. benefits 40 Upen adeptiett by a" eeunt-y preN4d*g :coon are 97 260 97 280 SB 430 _ 10 - 1 10 -1 ptwsa to this seetieft,of fele5.4 }ng vAth 2 Seetiee } of 949 ehapter-; the beard of retiret 3 shed knstead, pad moose beeefrts frem the 4 Retiree Benefits Reserwe la":JUant toSee#ien 5 81618. 6 SEG 40.- 7 8:7 SEC. 4. Section 31837.1 of the Government Code is 8 amended to read: 9 31837.1. . Notwithstanding Sections 31837 and 31838, 10 any member covered under Section 31751 who elects, .11 pursuant to Section 31700, to leave accumulated 12 contributions on deposit maybe retired`for disab' 'ty and 13 receive a disability retirement.. allowance under this 14 section during any period hereafter in. which ''the 15 member receives a disability retirement allowance under 16 the Public Employees' Retirement System or . a 17 retirement system _established under this chapter in 18 another county, subject to all of the following.conditions: 19 (a) That the allowance shall not be paid if the period 20 intervening between the.last service credited under this 21. system and becoming a member in the other system 22 . exceeds.180'days. 23 (b) That, . if the member is retiring for 24 non-service-connected disability, the disability 2 25 requirements shall be that of the other system and the ' + 2 26 member's retirement allowance shall be based on the . .2 27 other system's disability benefit formula. The disability 2 28 benefit received in the county shall be calculated as if.all 2 29 the.member's service was in the other system but then 2' 30 prorated using the ratio of service in this. county to the 31 31 total service in both systems. 3: 32 (c) That, if the member is retiring for disability arising 3% 33 out of and in the course of employment subject to .the 3, 34 other system, the allowance to the member shall be an 34 35 annuity which is the actuarial equivalent of the member's 30- 36 accumulated contributions at the time of retirement. 3( 37 SEG 4-1: 37 38 SEC. 5. Section 31874.3 of the Government Code is M 39 amended to read: 35 40 31874.3. (a) Whenever the percentage of annual l( 40 97 3M SB 430 g with is j 1 increase in the cost of living as of January 1 of each year ement 2 as.shown by the Bureau of Labor Statistics Consumer 3 'Price Index for All Urban Consumers exceeds 3 percent., eetien 4 the.board of retirement may provide that'all or'part of 5 the excess over either 2 percent or 3. percent shall be 6 applied to the retirement allowances, optional death :ode is 7 allowances or annual death allowances increased M* 8 , Section 31870, 31870.1, 3817-0.9, 31870.2, or 31870.3. The 31838, 9 board shall determine the amount of the -excess to be elects, 10 applied, and that amount shall not exceed an amount that - 11 can be paid from earni the retir tulated earnings of ement.fund that are ityand12 in excess of the total interest credited to,.contributions . ir this 13 and reserves plus 1 percent of the total assets of the . -h 'the 1.4 - retirement-fund. under 15 The supplemental increases in excess of the 3-percent ' or a 16, increases applied to the retirement allowances, optional )ter in 17 death allowances ces or annual death allowances increased in fitions: 18 Section 31870, 31870.1, 31870.2, or 31870.3 s.hall not period 19 become a part of the retirement allowances, optional 20 death allowances or annual death allowances ler this ces to be system 21 :increased by subsequent increases under Section 31870, 22 '31870.1, 31870.2, or 31870.3. for 23. This subdivision shall be operative in any county that sability 24 has elected by a majority 'vote of the board of supervisors ad the 25 to make either-Section 31870, 31870.1., 31870.2., or 31870.3 on the .26 applicable-in the county. sability 27 (b) 'The board of retirement may, instead of. taking 28 action pursuant to subdivision (a), provide s as if.all upplemental Ut then 29 cost-of-living. increases, effective on a date to be to the 30 determined by the board, to the retirement allowances, 31 optional death allowances or annual death allowances arising 32 increased. in Section 31870, 31870.1 , 31870.2, or 31870.3. to the 33 However, only those members shall be eligible for this a be an 34 increase whose accumulations established by Sectio ' n --mber's 35 31870, 31870.1, 31870.2, or 31870.3 shall -equal or exceed 25 nent. 36 percent as of January I of the year in which the board of 37 retirement adapts an increase hereunder. Code is 38 The supplemental increases to the retirement 39 allowances,, optional death allowances or� annual death annual j 40 allowances increased in Section 31870, 31870.1, 31870.2, or 97 300 97 320 SB 430 — 12 - 1 12 - 1 31870.3 shall not become a part of the retirement 2 allowances, optional death allowances or annual death 3 'allowances to be increased by subsequent increases 4 under Section 31870; 31870.1, 31870.2, or 31870.3. 5 This subdivision shall be operative in any county that 6 has elected by a majority vote of the board of supervisors 7 to make Section 31870, 31870.1, 31870.2, or .31870.3 8 applicable in the county. 9 (c) (1) The board of retirement may, instead of 10 taking.action pursuant to subdivision: (a) or (b), provide 11 supplemental cost-of-living . increases, . on a prefunded 12 basis and effective. on a date. to be determined by the 13 board, to the retirement allowances, optional death 14 . allowances or . annual death . allowances increased in 15 Section 31870,.31870.i, 31870.2, or 31870.3. However, only 16 those members shall.be eligible for. this increase whose 17 accumulations established by Section 31870, 31870.1, 18. or 31870.3 shall equal or exceed 25 percent as of . 19 January 1 of the year. in which the board of retirement 20 takes action pursuant to this subdivision. 21 (2) The supplemental increases to the retirement 22 allowances, optional death allowances, or annual death 23 allowances increased in Section 31870, 31870.1,31870.2, or 24 31870.3" shall become a part.of the.retirement allowances, ..25 optional death allowances, or. annual death. allowances 26 and shall serve to reduce the accumulations established 27 by Section 31870, 31870.1, 31870.2, or 31870.3, .as 28 applicable, by the same percentage as the payment that 29 is made 'pursuant to this seefief subdivision. 30 (3) Before action to provide benefits pursuant to this 31 subdivision, the cost of the payments authorized by the 32 subdivision shall be determined.by a qualified actuary 33 and the board of retirement shall, with.the advice of the 34 actuary, provide for the payment of the costs in such a 35 manner as to fully fund the benefits on a sound actuarial 36 basis. 37 (4) This subdivision shall be operative in any county 38 that has elected by a majority vote of the board of 39 supervisors to make either Section 31870, 31870.1, 31870.2, 40 or 31870.3 applicable in the county. 97 330 -- 13 -- SB 430 r1 ement 1 (d) Upon adoption by any county providing benefits death 2 pursuant to.this section, of Article 5.5 (commencing with greases .3 . Section 31610) of this chapter, the board of retirement 4 shall, instead, pay those benefits from the Supplemental ty that 5 Retiree Benefits Reserve established pursuant to Section .rvisors 6 . 31618. 31870.3 ead of )rovide funded by the death tsed in ar, only whose r 31870.1, s nt as of y rement rement a death 370.2, or wances, { >wannces L 0 iblished ` r0.3, -as ent that* t to this 1 by the actuary ;e of the r such a actuarial i county )oard of ,31870.2, 97 330 97 340