WORK WITH US
AB 1824 – Revises And Amends Provisions Of The Public Employees’ Retirement
Existing law creates the Cash Balance Benefit Program administered by the Teachers’ Retirement Board and provides a retirement plan for the benefit of participating employees who provide credible services for less than 50% of full time. Existing law defines activities that earn credible service to include trustee service. The Public Employees’ Retirement Law (PERL) creates the Public Employees’ Retirement System (PERS), which is administered by the Board of Administration of the Public Employees’ Retirement System. PERL generally authorizes the board of administration to adjust retirement payments due to errors or omissions.
AB 1824 revises and amends a number of provisions in existing law. The bill amends the definition of trustee service to link the definition of this service to mean duties performed by a member of the governing body of an employer. It also amends existing law to require that all credible services subject to coverage by the Cash Balance Benefit Program and the Defined Benefit Program, which excludes retired members or retired participants, must be terminated before the retirement date.
The bill revises existing law removing the limitation that a beneficiary, for purposes of lump-sum benefits, must be a person, trust, or the estate of the participant. A participant must make their beneficiary designation before their death and on the system’s prescribed form. The bill also restricts who can be designated as an annuity beneficiary. It provides that a corporation, trust, charitable organization, parochial institution, or public entity is not eligible as an annuity beneficiary except a qualifying revocable trust may be designated.
This bill revises current penalty rules for reporting disallowed contributions. Under existing law, 90% of the penalty is paid to the affected retired member, survivor, or beneficiary who was impacted by disallowed compensation, and 10% is paid to PERS. This bill amends existing law to require the entire penalty be paid to the affected retired member, survivor, or beneficiary eliminating the payment to PERS.
AB 1824 amends existing law incorporating the Cantwell v. San Mateo County (1980) 631 F.2d 631 decision, allowing a member to receive credit for a period of federal public service if federal law expressly permits the credit even though the member is already entitled to receive a pension or retirement allowance from that service.
The bill amends existing laws applicable to safety member retirement. It provides that a member’s retirement cannot become effective (1) earlier than the date the application is filed with the board; or (2) more than 60 days after the date of filing the application or more than a number of days that have been approved by the board.
The bill also deletes gender pronouns and replaces them with a gender-neutral phrase “the member.”
(AB 1824 amends Sections 24602, 26113, 26803, 27100, and 27201 of, and adds Section 27100.5 to, the Education Code, and amends Sections 20164.5, 31452.7, 31641.4, 31663.25, 31663.26, 31726, 31726.5, 31761, 31762, 31763, 31764, and 31781 of the Government Code.)