State Teachers' Retirement System.

(1) Under the State Teachers' Retirement Law, the compensation earnable for a member of the State Teachers' Retirement System employed by a community college prior to July 1, 1996, is defined by a specified number of hours based on provisions in effect on June 30, 1996. That law permits the Teachers' Retirement Board to establish and implement certain factors and assumptions to determine the compensation earnable of a member employed by a community college prior to July 1, 1996, including when the community college subsequently acts to reduce the minimum standard for full time, as specified. This bill would clarify that these provisions apply when the community college subsequently acts to reduce the minimum standard for full time for the class of employees, as specified. (2) That law authorizes substitute teachers and other part-time employees who perform creditable service, as defined, to elect membership in the Defined Benefit Program of the State Teachers' Retirement Plan. This bill would provide that membership election is irrevocable and remains in effect until the member terminates employment. (3) That law prescribes a comprehensive system of rights and benefits for its members and specifically permits a court, upon legal separation or dissolution of marriage, to award to a nonmember spouse, as defined to include a member's registered domestic partner, a separate account under the Defined Benefit Program pursuant to that person's community property interest. The nonmember spouse who is awarded a separate account has the right to a refund of the accumulated retirement contributions in the account under the Defined Benefit Program, and a return of the Defined Benefit Supplement account balance, of the nonmember spouse. This bill would provide an exception for nonmember domestic partners in connection with federal tax law limitations. (4) That law authorizes the governing board of a school district or a community college district or a county superintendent of schools to establish regulations that allow an employee who is a member of the Defined Benefit Program to reduce his or her workload and receive the service credit for full-time work. Among other things, the regulations must include a requirement that the member have at least 10 years of credited service, including 5 years of credited service for full-time employment immediately preceding the reduction in workload. This bill would revise the regulation to require the member to have at least 10 years of credited service prior to the reduction in workload and to have, in addition, 5 years of credited service for full-time employment immediately preceding the reduction in workload. (5) That law permits a member of the Defined Benefit Program to elect to purchase additional service credit, including out-of-state service credit, if specified contributions are paid to the State Teachers' Retirement System. That law provides that regular interest shall be charged on all contributions from the end of the school year on which the contributions were based to the date of payment. Among other things, the law permits the member to purchase as additional service credit time spent on approved family care or medical leave of up to 4 months in any 12-month period, as specified. This bill would instead add regular interest, as specified, only when the member is not employed to perform creditable service subject to coverage by the Defined Benefit Program on the date of the request to purchase additional service credit. The bill would permit a member of the Defined Benefit Program to request to purchase as additional service credit time spent on employer-approved leave based on the guidelines for the Family and Medical Leave Act or the California Family Rights Act, or both. The bill would make related technical and conforming changes. (6) That law permits a member of the Defined Benefit Program to apply for a disability allowance or disability retirement if the member has 5 or more years of credited service, and subject to specified requirements. This bill would require the member to make that application in writing to the Teachers' Retirement Board on a properly executed form provided by the State Teachers' Retirement System. (7) That law provides that upon termination of a survivor benefit allowance, if the total allowance paid or payable is less than the amount of the member's accumulated retirement contributions at the time of death, the remaining balance of accumulated retirement contributions shall be paid to the estate of the spouse. This bill would provide that if there is no spouse, and if there is a designated beneficiary, as specified, then upon termination of the survivor benefit allowance payable to all eligible dependent children, if the total allowance paid or payable is less than the amount of the member's accumulated retirement contributions at the time of death, the remaining balance of the accumulated retirement contributions shall be paid to the member's designated beneficiary, as specified. (8) That law permits a member of the Defined Benefit Program who is eligible and applies for a disability allowance or disability retirement to apply for and receive a service retirement pending a determination of his or her application for disability, and subject to specified requirements and restrictions. That law provides that if a member who applies for a service retirement pending a determination of his or her application for disability dies prior to a determination of the application for disability, any subsequent benefits payable to the member's surviving spouse or beneficiary shall be based on the service retirement allowance, as specified. That law also provides that if a member who is granted a disability allowance or a disability retirement dies prior to receiving notification of the approval of his or her application for disability, the disability allowance or disability retirement shall be payable to the member's surviving spouse or beneficiary, as specified. This bill, instead, would provide that if a member who applies for a service retirement pending a determination of his or her application for disability dies prior to a determination of the application for disability, the member shall be considered retired for service at the time of death and any subsequent benefits shall be paid accordingly. The bill also would provide that if a member who is granted a disability allowance or a disability retirement dies after the board has approved the member's application for disability, the member shall be considered a disabled member, or retired for disability, at the time of death, and any subsequent benefits shall be paid accordingly, even if the member died prior to receiving notification of the approval of his or her application for disability. The bill would provide that if the board approves the application for disability and the member has received service retirement allowance payments, the effective date for the disability allowance or disability retirement shall be the same as the effective date of the service retirement allowance. (9) That law limits the amount of postretirement compensation that may be earned in specified types of employment by a retired member of the Defined Benefit Program without a reduction in the retirement benefits of the member. That law, operative until June 30, 2010, provides exemptions from this limit, as specified. The law requires the employing school district to submit documentation to substantiate the eligibility of the temporary employment of a member retired from service for the exemption. Existing law also provides that the period of exemption for members who retired for service and are appointed or assigned to specified positions ends no more than 2 calendar years from the date of appointment or assignment. This bill would require the documentation to be received by the system no later than June 30 of the school year for which the exemption is to apply. The bill would also provide that the exemption would end no more than 24 consecutive months, rather than 2 calendar years, from the date the exemption commenced. (10) Under that law, a member may change or cancel a preretirement election of an option on a properly executed form provided by the State Teachers' Retirement System, subject to receipt within 30 days of the member's signature and on or before the effective date of retirement or other specified date. This bill would additionally require the spouse's signature, if applicable, to be included within that 30-day period. (11) That law requires the board to establish and maintain a segregated account within the retirement fund to be known as the Annuitant Reserve, for the payment of annuities under the Defined Benefit Supplement Program. Existing law provides that when the board declares an additional earnings credit for a plan year, the board may also declare by plan amendment an additional annuity credit, for members and annuity beneficiaries who are receiving an annuity as of a specified date, based on the balance of credits transferred from the member's Defined Benefit Supplement account to the Annuitant Reserve. This bill would instead provide that the credit shall be based on the annuity of the member and annuity beneficiaries for the plan year and paid to the members and annuity beneficiaries on the date specified by the board. (12) That law establishes eligibility criteria for a member to receive a retirement or a disability benefit under the Defined Benefit Supplement Program, including that a member submit an application for the benefit or allowance on a form prescribed by the system. Existing law also provides that a final benefit under this program becomes payable when the system receives proof of the member's death. This bill would expand the eligibility criteria to provide that a member retiring for service, as specified, on or after January 1, 2010, or whose disability allowance or disability retirement allowance is effective on or after January 1, 2010, shall not receive an allowance unless the member has submitted a completed application on a form prescribed by the system. The bill would also provide that no benefit shall be paid to a beneficiary until the final benefit is paid. (13) The bill would make other technical and conforming changes to related provisions. (14) The bill would provide that any section of any other act enacted by the Legislature during the 2009 calendar year that takes effect on or before January 1, 2010, and that affects a provision of this act would prevail over this act.