text:
(a) Upon the termination of all employment to perform creditable service subject to coverage under the plan for a reason other than retirement, disability, or death, a member shall be eligible for a termination benefit under the Defined Benefit Supplement Program.

(b) A member shall submit an application for a termination benefit on a form prescribed by the system. If a member submits an application for a refund of contributions under the Defined Benefit Program, pursuant to Section 23103, that application shall also be deemed an application for a termination benefit. If a member cancels the application for a refund of contributions under the Defined Benefit Program, the application for the termination benefit shall also be deemed to have been canceled.

(c) The member’s employer or employers shall certify in a format prescribed by the system that the member’s employment has been terminated, unless the member’s termination of employment occurred 12 consecutive months or more prior to the date the application for a termination benefit is received by the system’s headquarters office.

(d) The termination benefit shall be a lump-sum payment that is equal to the balance of credits in the member’s Defined Benefit Supplement account.

(e) Upon distribution of the termination benefit, no further benefit shall be payable to the member or the member’s beneficiary under the Defined Benefit Supplement Program.

(f) A partial distribution of the balance of credits in a member’s Defined Benefit Supplement account shall not be made, except as provided in Section 25009, 25015, 25016, or 25022.

history: (History: Amended by Stats. 2019, Ch. 96, Sec. 22. (AB 644) Effective January 1, 2020.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

article: 7. Termination Benefits

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13. STATE TEACHERS' RETIREMENT SYSTEM > 38. Defined Benefit Supplement Program > 7. Termination Benefits


kind: section

code: EDC

text: A member who is reemployed and again performs creditable service subject to coverage under the plan may not receive a termination benefit under this part if less than five years have elapsed following the date the most recent termination benefit was distributed to the member. This section does not apply to a member who has reached the age at which the Internal Revenue Code of 1986 requires a distribution of benefits.

history: (History: Added by Stats. 2005, Ch. 661, Sec. 2. Effective January 1, 2006.)

division: 1. GENERAL EDUCATION CODE PROVISIONS

part: 13. STATE TEACHERS' RETIREMENT SYSTEM

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 38. Defined Benefit Supplement Program

article: 7. Termination Benefits


text:
(a) A termination benefit under the Defined Benefit Supplement Program shall be payable after 180 calendar days have elapsed following the date the member terminated employment as specified in Section 25024.

(b) Except as provided in subdivision (c), the application for the termination benefit shall be automatically canceled if the member performs creditable service within 180 calendar days following the date of termination of employment.

(c) Subdivision (b) does not apply if the member has reached that age at which the Internal Revenue Code of 1986 requires a distribution of benefits. A member who has reached this age shall receive a distribution commencing on the earlier of the date that the member has met the conditions of subdivision (a) or the conditions of subdivision (h) of Section 24600.

history: (History: Amended by Stats. 2020, Ch. 275, Sec. 15. (AB 2101) Effective January 1, 2021.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

article: 7. Termination Benefits


text:
(a) The board shall establish a vendor registration process through which information about tax-deferred retirement investment products as described in Section 403(b) of the Internal Revenue Code of 1986 shall be made available for consideration by public employees of all local school districts, community college districts, county offices of education, and state employees of a state employer under the uniform state payroll system, excluding the California State University System, eligible to participate in an annuity contract and custodial account as described in Section 403(b) of the Internal Revenue Code of 1986.

(b) For the purposes of this chapter, “403(b) product or 403(b) products” means tax-deferred retirement investment products as described in Section 403(b) of the Internal Revenue Code of 1986, and its subsequent amendments, and complying with applicable California insurance laws, and federal and California securities laws and rules as applied by appropriate regulatory entities.

(c) For the purposes of this chapter:

(1) “Employer” means any local school district, community college district, or county office of education, or any state employer under the uniform state payroll system, excluding the California State University System, with employees eligible to participate in an annuity contract and custodial account as described in Section 403(b) of the Internal Revenue Code of 1986, with the Controller acting on the state employer’s behalf.

(2) “Vendor” means:

(A) A public retirement system, broker-dealer, registered investment company, nonbank custodian, or life insurance company qualified to do business in California that provides a 403(b) product. “Vendor” does not include individual registered representatives, brokers, financial planners, or agents.

(B) A statewide employee organization with an active membership primarily composed of persons employed in public education, or its wholly controlled affiliate, that has entered into a legally binding agreement with a bank custodian, as described in Section 401(f)(2) of the Internal Revenue Code, for the purpose of offering a custodial account meeting the requirements of Section 403(b)(7) of the Internal Revenue Code.

(3) “Nonbank custodian” means a fund custodian, other than a bank, that meets the criteria of a trustee specified in Section 408(a)(2) of the Internal Revenue Code.

(4) “Broker-dealer” means only those broker-dealers who offer a proprietary 403(b) product or who charge fees that are otherwise not disclosed.

history: (History: Amended by Stats. 2014, Ch. 755, Sec. 73. (SB 1220) Effective January 1, 2015.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13. STATE TEACHERS' RETIREMENT SYSTEM > 39. School Employer Retirement Investment Product Vendor Registration Process and Information Bank


text:
A prospective vendor of 403(b) products that offers those products, or the products of other 403(b) vendors, to employers and their eligible employees, shall register those products with the board pursuant to this chapter. Registered vendors shall offer only registered 403(b) products as funding vehicles for 403(b) plans.

(a) Prospective vendors shall be registered with the board based upon a complete response to the disclosures required by this subdivision. This information shall be included in the impartial investment information bank established pursuant to Section 25104. The prospective vendors shall provide the following information:

(1) A statement of experience in California and in other states in providing retirement annuities, custodial account mutual fund arrangements, or other retirement products and related financial services under public employer retirement plans.

(2) A characterization by the vendor of its offering as either an annuity or custodial account, as defined under Sections 403(b)(1) and 403(b)(7) of the Internal Revenue Code, respectively.

(3) A disclosure of all expenses paid directly or indirectly by retirement plan participants, including, but not limited to, penalties for early withdrawals, declining or fixed withdrawal charges, surrender or deposit charges, management fees, and annual fees, supported by documentation as required for prospectus disclosure by the Financial Industry Regulatory Authority and the Securities and Exchange Commission. Vendors shall be required to provide information regarding the impact of product fees upon a hypothetical investment, as described in Section 25104.

(4) The types of products, product features, including presence of two tier annuity features, services offered to participants, and information about how to access product prospectuses or other relevant product information.

(5) A discussion of the ability, experience, and commitment of the vendor to provide retirement counseling and education services, including, but not limited to, access to group meetings and individual counseling by various means, including telephone and telecommunications devices for the deaf (TDD), Internet, and face-to-face consultations by registered representatives.

(6) A statement of the financial strength and stability of the vendor, as may be applicable, by identifying its ratings assigned by nationally recognized rating services that evaluate the financial strength of life insurance, mutual funds, and other similar companies.

(7) The location of offices and counselors, or method of distribution, of the vendor relative to serving employers and their eligible employees in California.

(8) A description of the ability of the vendor to comply with all applicable provisions of federal and state law governing retirement plans, including minimum distribution requirements and contribution limits.

(9) To the extent applicable, the demonstrated ability of the vendor to offer an appropriate array of accumulation funding options, including, but not limited to, a diversified mix of value, growth, growth and income, hybrid and index funds or accounts across large, mid, and small capitalization asset classes, both domestic and international. These investment products may include mutual funds, group or individual annuity contracts, fixed or variable annuity contracts, individual retirement annuities, interests in trust and collective trusts, separate accounts, and other financial instruments.

(10) A discussion of the range of administrative and customer services provided, including asset allocation, accounting and administration of benefits for individual participants, recordkeeping for individual participants, asset purchase, control, and safekeeping, execution of a participant’s instructions as to asset and contribution allocation, calculation of daily net asset values, direct access for participants to their account information, periodic reporting to active participants, not less than quarterly, on their account balances and transactions, and compliance with the standard of care applicable in the provision of investment services and consistent with federal law.

(11) Certification by the vendor that the information provided to the board accurately reflects the provisions of the Section 403(b) products they register pursuant to this chapter.

(b) Registration may not be conditioned upon the content of the information.

(c) Vendors shall supply information and data in the format required by the board.

history: (History: Amended by Stats. 2013, Ch. 558, Sec. 51. (AB 1379) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 39. School Employer Retirement Investment Product Vendor Registration Process and Information Bank


text: Registration shall be offered to vendors once annually, and renewal of registration shall be required at least once every five years thereafter for vendors that wish to continue to participate. The board shall provide public notice prior to the initial registration, annual registration, and registration renewal periods. The board may require, through a password-based update system that allows vendors to access the registration list for the purposes of updating their product information, or through other means, an update of the information required to be provided under Section 25101 with each registration renewal. Registered vendors shall submit to the board within the time required by the Securities and Exchange Commission an amendment to the information required to be provided under Section 25101 to reflect material changes to the products or services offered that occur between registration or renewal periods. Registered vendors may register additional 403(b) products with the board between registration or renewal periods by providing the board the information required under Section 25101 and fees required under subdivision (c) of Section 25108. Upon receipt of information reflecting material changes or additions to the products or services offered by registered vendors that occur between registration or renewal periods, the board shall reflect those changes in the impartial investment information bank established pursuant to Section 25104 within the time required by the Securities and Exchange Commission.

history: (History: Added by Stats. 2002, Ch. 1095, Sec. 2. Effective January 1, 2003.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) The board may remove a vendor from the registry if the vendor submits materially inaccurate information to the board, does not remit assessed fees within 60 days, or fails to submit notice of material changes to its registered investment products, pursuant to Section 25102. Vendors found to have submitted materially inaccurate information to the board shall be allowed 60 days to correct the information. The board may refer vendors that submit information required under Section 25102 that is materially inaccurate and may constitute conduct prohibited by the Financial Industry Regulatory Authority and the California Department of Insurance to those entities.

(b) The board shall remove a vendor from the registry if the vendor is not licensed or has had its license revoked by the Financial Industry Regulatory Authority or the California Department of Insurance for engaging in conduct prohibited by those entities.

(c) The board shall establish an appeals process pursuant to Section 22219 for vendors that are denied registration or removed from the registry.

history: (History: Amended by Stats. 2013, Ch. 558, Sec. 52. (AB 1379) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) The board shall maintain an impartial investment information bank, via an Internet Web site, containing the information required by Section 25101 about the retirement investment products offered by each registered vendor and objective comparisons of vendors and types of products.

(b) The information bank shall include information on investment performance based upon the investment’s average annual total return, as measured by a nationally recognized rating service selected by the board for standard periods of time of not less than one year.

(c) The Web site shall include a table showing, for each registered fund, the total fee cost in dollars incurred by a shareholder who initially invested ten thousand dollars ($10,000), earned a 5 percent rate of return for one, five, 10, 15, and 20 year time periods. This table shall be accompanied by a disclaimer that the rate of return is for purposes of illustrating the respective impacts of different fee amounts on each investment, and is not to predict future investment returns.

(d) The board shall have the authority to organize data, but may not subjectively rank or give preference to a vendor or product.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall include notice of the existence of, and the Internet Web site address for, the impartial investment information bank in each newsletter sent to members. The board shall include a notice in the individual account statements of members of the Defined Benefit Program and participants of the Cash Balance Benefit Program that explains the purpose and Web site address of the impartial investment information bank.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
The board shall design the information bank Internet Web site and include retirement investment product plan information and education materials taken from and referenced to the Internal Revenue Service, the Securities and Exchange Commission, the National Association of Insurance Commissioners, and other applicable governmental or regulatory agencies. Information shall be presented and used in a manner that is consistent with the rules of those agencies and with rules of the Financial Industry Regulatory Authority. The information shall be offered as a preface to the vendor information required in Section 25101. The preface shall include, but shall not be limited to, the following information:

(a) An explanation of Section 403(b) of the Internal Revenue Code of 1986.

(b) The retirement investment products that may be purchased under Section 403(b) of the Internal Revenue Code of 1986, and with definitions of those products.

(c) Definitions or explanations of all fees referred to in the investment information bank.

history: (History: Amended by Stats. 2013, Ch. 558, Sec. 53. (AB 1379) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: A vendor may not charge a fee associated with a registered 403(b) product that is not disclosed, pursuant to Section 25101.

history: (History: Amended by Stats. 2004, Ch. 912, Sec. 26. Effective January 1, 2005.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) The actual cost of establishing the vendor registration system and the investment information bank shall be borne equally by registered vendors, based on the total number of registered vendors. Each registered vendor shall pay a one-time establishment fee equal to a pro rata share of the establishment costs charged to vendors that register with the board prior to the close of the initial registration period, as determined by the board. The one-time establishment fee charged to vendors that register with the board after the completion of the initial registration period shall be distributed equally among registered vendors that have paid the establishment fee, and credited toward subsequent maintenance and administrative fees charged to each vendor.

(b) The actual cost of maintaining the vendor registration system and the investment information bank, and the costs associated with publicizing the availability of the investment information bank to local school districts, community college districts, and county offices of education and their employees, shall be borne equally by registered vendors, based on the total number of registered vendors. Each registered vendor shall pay a renewal fee equal to a pro rata share of the maintenance costs, as determined by the board.

(c) Each registered vendor shall pay an administrative fee for each 403(b) product it offers to school employees, which shall represent the actual costs associated with processing the information related to the investment option and presenting it on the investment information bank, as determined by the board.

(d) The board may not divert member services resources or personnel to establish or maintain the registration list.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) The board and the system, and its officers and employees, are not responsible for, and may not be held liable for the adequacy of the information provided by the participating vendors contained in the information bank. The information bank maintained by the board serves only to provide information supplied by the participating vendors for the consideration of selection of 403(b) products.

(b) Participating vendors may not utilize the system’s logo, or claim or infer any endorsement or recommendation by the board or the system with respect to products and services identified by the vendors in the information bank. At the discretion of the board, a violation of this section may lead to removal from the registry. This restriction does not apply to 403(b) products offered by the board to school employees pursuant to Section 24950.

(c) The board and the system may not be held liable for the actions of other registered vendors.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall complete the initial registration process on or before July 1, 2004.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Each employer, in consultation with the exclusive bargaining agent of its employees, if any, may develop a process to ensure that employees are aware of, and have access to, information provided in the impartial investment bank maintained by the board.

history: (History: Amended by Stats. 2008, Ch. 230, Sec. 5. Effective January 1, 2009.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Personnel, including elected school officials, acting on behalf of an employer, may not receive consideration from a vendor in exchange for the promotion of a particular vendor or vendor’s products.

history: (History: Amended by Stats. 2008, Ch. 230, Sec. 6. Effective January 1, 2009.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: An employer may not forward annuity or custodial account consideration to the vendor of any unregistered 403(b) product, except insofar as an employee continues making contributions to an unregistered product or products as described in Section 25114.

history: (History: Amended by Stats. 2008, Ch. 230, Sec. 7. Effective January 1, 2009.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
Except as provided in this section, an employee shall select from registered 403(b) products.

(a) An employee of a local school district, community college district, or county office of education may continue to make contributions to unregistered products purchased or entered into prior to November 30, 2004.

(b) A state employee of a state employer under the uniform state payroll system, excluding the California State University System, eligible to participate in an annuity contract and custodial account as described in Section 403(b) of the Internal Revenue Code of 1986, may continue to make contributions to unregistered products purchased or entered into prior to January 1, 2009.

history: (History: Amended by Stats. 2012, Ch. 864, Sec. 18. (AB 2663) Effective January 1, 2013.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: For purposes of restricting the use of 403(b) investment products provided to eligible employees of employers by those vendors and investment products registered with the board pursuant to this chapter, the provisions of Section 770.3 of the Insurance Code do not apply.

history: (History: Amended by Stats. 2008, Ch. 230, Sec. 9. Effective January 1, 2009.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) All costs incurred by the system to develop health care benefit programs pursuant to this part shall be paid by allocations from the Teachers’ Retirement Fund as appropriated for that purpose.

(b) Any health care benefits program developed by the system pursuant to this part shall not be implemented by the system unless specifically authorized by a statute enacted by the Legislature.

history: (History: Added by renumbering Section 25000 by Stats. 2000, Ch. 1032, Sec. 2. Effective January 1, 2001.)

part: 13.5. HEALTH CARE BENEFITS PROGRAM

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 1. General Provisions

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13.5. HEALTH CARE BENEFITS PROGRAM > 1. General Provisions


text: Unless the context otherwise requires, the definitions set forth in this chapter govern the construction of this part.

history: (History: Added by renumbering Section 25100 by Stats. 2000, Ch. 74, Sec. 64. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 2. Definitions

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13.5. HEALTH CARE BENEFITS PROGRAM > 2. Definitions


text: “Beneficiary” or “beneficiaries” means any person or entity receiving or entitled to receive an allowance and payment pursuant to Part 13 (commencing with Section 22000) or 14 (commencing with Section 26000) because of the disability or death of a member.

history: (History: Added by renumbering Section 25110 by Stats. 2000, Ch. 74, Sec. 65. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Dependent child” or “dependent children” means a member’s unmarried offspring or stepchild who is not older than 22 years of age and who is financially dependent upon the member on the date the member becomes eligible for benefits pursuant to this part.

(b) “Offspring” shall include the member’s child who is born within the 10-month period commencing on the date the member becomes eligible for benefits pursuant to this part.

(c) “Offspring” shall include a child adopted by the member.

(d) “Dependent child” shall not include the member’s offspring or stepchild who is adopted by a person other than the member’s spouse.

(e) “Financially dependent,” for purposes of this section, means that at least one-half of the child’s support was being provided by the member on the date the member became eligible for benefits pursuant to this part. The system may require that income tax records or other data be submitted to substantiate the child’s financial dependence. In the absence of substantiating documentation, the system may determine that the child was not dependent on the date the member became eligible for benefits pursuant to this part.

history: (History: Added by renumbering Section 25115 by Stats. 2000, Ch. 74, Sec. 66. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Dependent parent” or “dependent parents” means a natural parent or parents of a member, or a parent or parents who adopted the member prior to the earlier of the occurrence of the member’s marriage or his or her attaining 18 years of age, and who was receiving one-half or more of his or her support from the member at the time the member became eligible for benefits pursuant to this part.

history: (History: Added by renumbering Section 25120 by Stats. 2000, Ch. 74, Sec. 67. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employer” means the state or any agency or political subdivision thereof for which creditable service subject to coverage by the plan, as defined in Section 22155.5, is performed.

history: (History: Added by Stats. 2001, Ch. 803, Sec. 34. Effective January 1, 2002.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Fund” means the Teachers’ Health Benefits Fund.

history: (History: Added by Stats. 2000, Ch. 1032, Sec. 3. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Member” means a current or retired employee of an employer, as defined in Section 25921.

history: (History: Amended by Stats. 2001, Ch. 803, Sec. 35. Effective January 1, 2002.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “School year” means the period of time beginning on July 1 of one calendar year and ending on June 30 of the following calendar year.

history: (History: Amended by Stats. 2018, Ch. 416, Sec. 25. (SB 1165) Effective January 1, 2019.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: There is in the State Treasury a special trust fund to be known as the Teachers’ Health Benefits Fund. There shall be deposited in the fund the employer contributions required under subdivision (c) of Section 22950, income on investments, other interest income, income from fees and penalties, premiums paid by members, donations, legacies, bequests made to the fund and accepted by the board, and any other amounts provided by this part. Notwithstanding Section 13340 of the Government Code, the proceeds of the fund are hereby continuously appropriated without regard to fiscal year for purposes of this part. The design and administration of the fund and any program financed from the fund shall comply with Section 115 of Title 26 of the United States Code.

history: (History: Amended by Stats. 2001, Ch. 803, Sec. 37. Effective January 1, 2002.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 3. Establishment and Control of Fund

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13.5. HEALTH CARE BENEFITS PROGRAM > 3. Establishment and Control of Fund


text: The board shall have exclusive control of the administration of the fund. No transfers or disbursements of any amount from the fund shall be made except upon the authorization of the board for the purpose of carrying into effect the provisions of this part. Except as otherwise limited by the California Constitution and by law, the board may, in its discretion, invest the assets of the fund through the purchase, holding, or sale of any investment, financial instrument, or financial transaction, when the investment, financial instrument, or financial transaction is prudent in the informed opinion of the board.

history: (History: Added by Stats. 2000, Ch. 1032, Sec. 4. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Return on investments shall be collected by the State Treasurer and, together with any other moneys received for the fund, shall be immediately deposited to the credit of the fund and reported immediately to the system. Money in whatever form received directly by the system for the fund shall be deposited immediately in the State Treasury to the credit of the fund.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) For purposes of this section, “plan” means any health benefits program that is financed from the proceeds of the fund.

(b) The board shall maintain all data necessary to perform an actuarial investigation of the demographic and economic experience of the plan and for the actuarial valuation of the assets and liabilities of the plan.

(c) The board shall retain the services of an actuary to do all of the following:

(1) Make recommendations to the board for the adoption of actuarial assumptions that, in the aggregate, are reasonably related to the past experience of the plan and reflect the actuary’s informed estimate of future experience.

(2) Make an actuarial investigation of the demographic and economic experience, including the mortality, service, and other experience, of the plan with respect to members or any other persons eligible to receive benefits from the plan.

(3) At least biennially, using actuarial assumptions adopted by the board, perform an actuarial valuation of the plan that identifies the assets and liabilities of the plan, and report the findings to the board. The report of the actuary on the results of the actuarial valuation shall identify and include the components of normal cost and adequate information to determine the effects of changes in actuarial assumptions. Copies of the report on the actuarial valuation shall be transmitted to the Governor and to the Legislature.

(4) Recommend to the board all rates and factors necessary to administer the plan, including, but not limited to, mortality tables and interest rates.

(5) Recommend to the board a strategy for amortizing any unfunded actuarial obligation.

history: (History: Amended by Stats. 2001, Ch. 159, Sec. 61. Effective January 1, 2002.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) Effective July 1, 2001, the system shall pay to the federal Centers for Medicare and Medicaid Services or a successor agency the premiums associated with Medicare Part A for retired or disabled members described in this section.

(b) This section shall apply only to a retired member of the Defined Benefit Program who meets all of the following requirements:

(1) The member retired prior to January 1, 2001, or began receiving a disability allowance prior to January 1, 2001, and has been continually disabled since January 1, 2001.

(2) The member is not eligible for Medicare Part A without payment of a premium.

(3) The member is at least 65 years of age.

(4) The member enrolled in Medicare Parts A and B.

(c) The board may extend eligibility for the payments described in this section to members of the Defined Benefit Program who meet the requirements of subdivision (d) and who retire or begin receiving a disability allowance on or after January 1, 2001, within a school year specified by the board, if the board finds that the cost of the payments for members who retire or begin receiving a disability allowance during the specified school year may be paid within the anticipated resources available in the fund, as determined by the actuarial valuation of the program established by this chapter. Any extension of eligibility to members who retire or begin receiving a disability allowance on or after January 1, 2001, shall be provided equally to any member who meets the requirements of subdivision (d) and retires or begins receiving a disability allowance during the school year specified by the board.

(d) (1) Eligibility for the payments described in this section pursuant to subdivision (c) shall be limited to members of the Defined Benefit Program who do either of the following:

(A) Retires from an employer that does either of the following:

(i) Completed a division pursuant to Section 22156 of the Government Code prior to January 1, 2001.

(ii) Completed or is conducting a division pursuant to Section 22156 of the Government Code on or after January 1, 2001, and, if the member was less than 58 years of age at the time of the division, the member elected to be covered by Medicare.

(B) Began receiving a disability allowance and continuously receives a disability allowance until 65 years of age or older and the member’s last employer does any of the following:

(i) Completed a division pursuant to Section 22156 of the Government Code prior to January 1, 2001.

(ii) Completed or is conducting a division pursuant to Section 22156 of the Government Code on or after January 1, 2001, and, if the member was still actively employed and less than 58 years of age at the time of the division, the member elected to be covered by Medicare.

(iii) Completed or is conducting a division pursuant to Section 22156 of the Government Code on or after January 1, 2001, and, if the member is no longer actively employed, the division was completed prior to the time the member reached normal retirement age.

(2) For purposes of paragraph (1), a division occurs during the 10-day period during which the member has the opportunity to elect to be covered by Medicare pursuant to Section 22156 of the Government Code.

(3) This subdivision does not apply to a member who retires from a district, or is receiving a disability allowance and the member was last employed in a district, that either as of January 1, 2001, had no members who were less than 58 years of age and who were hired prior to April 1, 1986, or was created pursuant to a formation or a reorganization on or after April 1, 1986, and prior to January 1, 2001.

(e) The amount paid to the federal Centers for Medicare and Medicaid Services or a successor agency pursuant to this section shall include any surcharges applicable to enrollment in Medicare Part A or Part B by members who retired prior to January 1, 2001, and who enrolled in Medicare Parts A and B after the age of 65 years and prior to July 1, 2001. If the system pays the Part A premium and Part B surcharges on behalf of a member and that member later becomes eligible for Part A coverage without payment of a premium, the system shall continue to pay any applicable Part B surcharges on behalf of that member. The board may require a member on whose behalf a surcharge would be paid pursuant to this subdivision to authorize the system to deduct the Part B premium from the member’s retirement allowance as a condition of having the system pay the Part A premium pursuant to this section.

(f) For the purposes of this section, if a retirement date is used to determine eligibility pursuant to subdivisions (b) and (c), the system shall use the member’s most recent retirement date for eligibility purposes.

history: (History: Amended by Stats. 2013, Ch. 558, Sec. 54. (AB 1379) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 4. Medicare Premium Payment Program

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 13.5. HEALTH CARE BENEFITS PROGRAM > 4. Medicare Premium Payment Program


text: On or before April 1, 2001, the board shall report to the Legislature on a prescription drug program and a program to provide health benefits to retired members. The report shall include an analysis of all potential methods of financing and administering the programs. These shall include, but are not limited to, (1) the system providing those health benefits under contracts with carriers or other entities that administer health benefits plans, (2) reimbursing employers for the costs of providing those health benefits to retired employees, and (3) crediting employers and employing agencies, against the amount contributed pursuant to Section 22950, a monthly amount, adjusted annually, for each retiree the employer or employing agency certifies is enrolled in one or more health care benefits programs administered or sponsored by the employer or employing agency. The report shall include an estimate of the fiscal impact of each program on the system, including administration and program costs, and recommended statutory language to implement each program.

history: (History: Added by Stats. 2000, Ch. 874, Sec. 1. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: To recover an amount overpaid under this part, the monthly allowance payable under the Defined Benefit Program may be reduced by the amount of the overpayment. If the overpayment is not due to fraud or intentional misrepresentation of facts by the recipient of the allowance or benefit, the monthly allowance may be reduced by no more than 5 percent if the overpayment was due to error by the system, the county superintendent of schools, a school district, or a community college district, and by no more than 15 percent if the error was due to inaccurate or omitted information from the recipient of the allowance or benefit.

history: (History: Added by Stats. 2002, Ch. 375, Sec. 36. Effective January 1, 2003.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
The Legislature hereby finds and declares that the State Teachers’ Retirement System Cash Balance Plan was created and established on July 1, 1996, to provide a retirement plan for persons employed by an employer offering the Cash Balance Plan, excluding a community college district, to perform creditable service for less than 50 percent of the full-time equivalent for the position, or employed by a community college district offering the Cash Balance Plan to perform creditable service on a temporary basis pursuant to Section 87474, 87478, 87480, 87481, 87482, or 87482.5, or employed by an employer offering the Cash Balance Plan to perform creditable service as a substitute employee. The persons eligible for the Cash Balance Plan were excluded from mandatory membership in the State Teachers’ Retirement System Defined Benefit Plan. Both plans are administered by the Teachers’ Retirement Board. Because both plans were intended to provide for the retirement of teachers and other persons employed in connection with the public schools of this state and schools supported by this state, a merger of these two plans is now hereby made for the purpose of establishing a single retirement plan that shall be known and may be cited as the State Teachers’ Retirement Plan consisting of the different benefit programs set forth in this part and Part 13 (commencing with Section 22000). The plan shall be administered by the Teachers’ Retirement Board as set forth in this part and Part 13 (commencing with Section 22000). As a result of this merger, a Cash Balance Benefit Program will be provided under the State Teachers’ Retirement Plan and that program is set forth in this part.

The governing board of a school district, community college district, or county office of education may, by formal action, elect to provide the benefits of the Cash Balance Benefit Program under this part for their employees.

history: (History: Amended by Stats. 2015, Ch. 123, Sec. 27. (AB 991) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 14. STATE TEACHERS’ RETIREMENT SYSTEM CASH BENEFIT PROGRAM > 1. General Provisions


text: An employer whose governing board has elected to provide the benefits of this part for its employees pursuant to Section 26000 shall enter into an agreement with the State Teachers’ Retirement System. The agreement shall specify the terms and conditions of the employer’s formal action to provide the Cash Balance Benefit Program and shall remain in effect unless or until the employer exercises the right to discontinue the program pursuant to Chapter 17 (commencing with Section 28100).

history: (History: Amended by Stats. 2006, Ch. 655, Sec. 62. Effective January 1, 2007.)

part: 14. STATE TEACHERS’ RETIREMENT SYSTEM CASH BENEFIT PROGRAM

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) An election by any employer to provide the benefits of the Cash Balance Plan for their employees prior to the merger described in Section 26000 shall be deemed to constitute an election to provide the Cash Balance Benefit Program under the State Teachers’ Retirement Plan.

(b) Participation in the Cash Balance Plan by any participant prior to the merger described in Section 26000 shall be deemed to constitute participation in the Cash Balance Benefit Program under the State Teachers’ Retirement Plan.

(c) Any beneficiary under the Cash Balance Plan prior to the merger described in Section 26000 shall be deemed to be a beneficiary under the Cash Balance Benefit Program under the State Teachers’ Retirement Plan.

history: (History: Added by Stats. 1998, Ch. 1048, Sec. 13. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The design and administration of the plan, including the Cash Balance Benefit Program, shall comply with the applicable provisions of the Internal Revenue Code and the Revenue and Taxation Code. The Teachers’ Retirement Board may amend the plan to comply with the applicable federal laws and regulations to the extent permitted by law, to establish or revise the minimum interest rate, to declare additional earnings credit, to declare additional annuity credit, and to adopt and amend actuarial assumptions for all purposes under the plan.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 229. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The Cash Balance Benefit Program shall be administered by the Teachers’ Retirement Board with all of the powers, responsibilities and duties for administration of the plan set forth in Chapter 3 (commencing with Section 22200) through Chapter 7 (commencing with Section 22375) of Part 13. In administering the plan, the board and its officers and employees of the system shall exercise their fiduciary duties set forth in Chapter 4 (commencing with Section 22250) of Part 13.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 230. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Except as excluded in subdivision (d) of Section 26807.5 or subdivision (c) of Section 26906.5, a person who is the registered domestic partner of a member, as established pursuant to Section 297 or 299.2 of the Family Code, shall be treated in the same manner as a “spouse,” as defined in Section 26140.

history: (History: Amended by Stats. 2015, Ch. 123, Sec. 28. (AB 991) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: If any provision of this part or the application thereof to any person or circumstance is held invalid, that invalidity shall not affect other provisions or applications of this part that can be given effect without the invalid provision or application, and to this end the provisions of this part are severable.

history: (History: Added by Stats. 1995, Ch. 592, Sec. 16. Effective January 1, 1996.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
Notwithstanding any other provision of law:

(a) The benefits payable to any participant or beneficiary under this part shall be subject to the limitations imposed by Section 415 of Title 26 of the United States Code.

(b) The amount of compensation that is taken into account in computing benefits under this part for a plan year shall not exceed the annual compensation limit applicable to that plan year in accordance with Section 401(a)(17) of Title 26 of the United States Code as that section read on the effective date of this section and as that section may be amended after that date. The determination of compensation for a 12-month period shall be subject to the annual compensation limit in effect for the calendar year in which the 12-month period begins. In a determination of average compensation over more than one 12-month period, the amount of compensation taken into account for each 12-month period shall be subject to the respective annual compensation limit applicable to that period.

(c) Distributions from the plan under this part shall be made in accordance with Section 401(a)(9) of Title 26 of the United States Code, including the incidental death benefit requirements of Section 401(a)(9)(G) and the regulations thereunder. The required beginning date of benefit payments that represent the entire interest of the participant shall be as follows:

(1) In the case of a lump-sum distribution of a retirement benefit, disability benefit, or termination benefit, the lump-sum payment shall be made not later than April 1 of the calendar year following the later of (A) the calendar year in which the participant attains the age at which the Internal Revenue Code of 1986 requires a distribution of benefits or (B) the calendar year in which the participant terminates all employment subject to coverage by the plan.

(2) In the case of a retirement benefit or disability benefit that is to be paid in the form of an annuity, payment of the annuity shall begin not later than April 1 of the calendar year following the later of (A) the calendar year in which the participant attains the age at which the Internal Revenue Code of 1986 requires a distribution of benefits or (B) the calendar year in which the participant terminates employment in all positions subject to coverage by the plan, with the annuity to continue over the life of the participant or the life of the participant and the participant’s option beneficiary, or over a period not to exceed the life expectancy of the participant or the life expectancy of the participant and the participant’s option beneficiary.

(3) In the case of a death benefit, distributions shall commence as follows:

(A) The normal form of the benefit or other lump-sum distribution shall be paid in accordance with Section 401(a)(9) of Title 26 of the United States Code and the regulations thereunder.

(B) Annuity payments shall commence as follows:

(i) If the spouse is the sole beneficiary, not later than December 31 of the later of the calendar year in which the participant would have attained the age at which the Internal Revenue Code of 1986 requires a distribution of benefits or the calendar year following the calendar year of the participant’s death.

(ii) If the spouse is not the sole beneficiary, not later than December 31 of the calendar year following the calendar year of the participant’s death.

(d) If a person becomes entitled to a distribution from the plan under this part that constitutes an eligible rollover distribution within the meaning of Section 401(a)(31) of Title 26 of the United States Code, the person may elect under terms and conditions established by the board to have the distribution or a portion thereof paid directly to a plan that constitutes an eligible retirement plan within the meaning of Section 401(a)(31), as specified by that person. Upon the exercise of the election by a person with respect to a distribution or a portion thereof, the distribution from the plan of the amount so designated, once distributable under the terms of the plan, shall be made in the form of a direct rollover to the eligible retirement plan so specified.

(e) The amount of any benefit from the plan under this part that is determined on the basis of actuarial assumptions shall be based on actuarial assumptions adopted by the board pursuant to Section 26213 as a plan amendment with respect to the Cash Balance Benefit Program and those assumptions shall preclude employer discretion and comply with Section 401(a)(25) of Title 26 of the United States Code.

history: (History: Amended by Stats. 2024, Ch. 117, Sec. 6. (AB 2770) Effective January 1, 2025.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Unless otherwise specified, the definitions set forth in this chapter govern the construction of this part.

title: 1. GENERAL EDUCATION CODE PROVISIONS

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 14. STATE TEACHERS’ RETIREMENT SYSTEM CASH BENEFIT PROGRAM > 2. Definitions


text: “Actuarial equivalent” means a benefit that has the same present value as the benefit it replaces based on interest rates and mortality tables recommended by the actuary and adopted by the board as a plan amendment.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Actuary” means a person professionally trained in the technical and mathematical aspects of insurance, pensions, and related fields who has been appointed by the board for the purpose of actuarial services required under this part.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 231. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Additional earnings credit” means a percentage determined by the board for a plan year by means of a plan amendment and credited to employee accounts and employer accounts on a specified date.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Administrative costs” means the costs of administering the Cash Balance Benefit Program for the plan year as determined by the board.

history: (History: Amended by Stats. 2000, Ch. 1025, Sec. 38. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Annuitant Reserve” means the reserve account established by the board within the State Teachers’ Retirement Fund for the payment of monthly annuities with respect to the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 15. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Annuity” means an amount of money payable in monthly installments for a period determined by the option elected by the participant or beneficiary.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) For purposes of this part, “annuity beneficiary” means the person or trust designated by a participant pursuant to Section 26807, 26807.5, 26906, or 26906.5 to receive an annuity upon the participant’s death.

(b) For purposes of this section, “trust” means an irrevocable trust with the following characteristics:

(1) The trust satisfies the requirements of subparagraph (A) or (C) of paragraph (4) of subdivision (d) of Section 1396p of Title 42 of the United States Code.

(2) The trust satisfies the requirements of Section 1.401(a)(9)-4 of Title 26 of the Code of Federal Regulations.

(3) The trust, or the account in a pooled trust, is for the sole benefit of a single beneficiary and other beneficiaries to the trust, if any, are successor beneficiaries.

(4) The beneficiary of the trust who is beneficiary with respect to the trust’s interest in the participant’s benefit shall be considered the designated beneficiary for the purpose of determining eligibility for, and the amount and duration of, benefits under the program.

history: (History: Added by Stats. 2016, Ch. 559, Sec. 13. (AB 1875) Effective January 1, 2017.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Basis of employment” means the standard of time over which the employer expects service to be performed by an employee in the position during the school term.

history: (History: Amended by Stats. 2018, Ch. 416, Sec. 26. (SB 1165) Effective January 1, 2019.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Beneficiary” means any person or persons or entity designated by the participant pursuant to this part or otherwise entitled by law to receive the death benefit under the plan.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Board” means the Teachers’ Retirement Board.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Cash Balance Benefit Program” means the benefit program set forth in this part of the State Teachers’ Retirement Law.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 17. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Class of employees” means a number of employees considered as a group because they are employed to perform similar duties, are employed in the same type of program, or share other similarities related to the nature of the work being performed.

(b) A class of employees may be comprised of one person if no other person employed by the employer performs similar duties, is employed in the same type of program, or shares other similarities related to the nature of the work being performed and that same class is in common use among other employers.

(c) The board shall have the right to override the determination by an employer as to whether or not a group or an individual constitutes a “class of employees” within the meaning of this section.

(d) This section shall be deemed to have become operative on July 1, 1996.

history: (History: Added by Stats. 1996, Ch. 1165, Sec. 37. Effective January 1, 1997.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Creditable service” means any of the activities described in subdivision (b) performed for any of the following employers:

(1) A prekindergarten through grade 12 employer in a position with certification qualifications authorized by the Commission on Teacher Credentialing pursuant to Section 44001.

(2) A community college employer by a faculty member, as defined in Section 87003, in an academic position, as defined in subdivision (b) of Section 87001, or by an educational administrator, as defined in subdivision (b) of Section 87002, subject to the appropriate minimum standards adopted by the Board of Governors of the California Community Colleges pursuant to Section 87356, or pursuant to a contract between a community college district and the United States Department of Defense to provide vocational training.

(3) A charter school employer under the provisions of an approved charter for the operation of a charter school for which the charter school is eligible to receive state apportionment.

(b) The types of activities are any of the following:

(1) The work of teachers, instructors, district interns, and academic employees employed in the instructional program for pupils, including special programs such as adult education, regional occupational programs, childcare centers, and prekindergarten programs pursuant to Section 22161.

(2) Education or vocational counseling, guidance, and placement services.

(3) The work of employees who plan courses of study to be used in California public schools, or research connected with the evaluation or efficiency of the instructional program.

(4) The selection, collection, preparation, classification, demonstration, or evaluation of instructional materials of any course of study for use in the development of the instructional program in California public schools, or other services related to California public school curriculum.

(5) The examination, selection, in-service training, mentoring, or assignment of teachers, principals, or other similar personnel involved in the instructional program.

(6) The work of nurses, physicians, speech therapists, psychologists, audiologists, and other California public school health professionals.

(7) Services as a California public school librarian.

(8) Activities connected with the enforcement of the laws relating to compulsory education, coordination of child welfare activities involving the school and the home, and the school adjustment of pupils.

(9) The work of employees who are responsible for the supervision of persons or administration of the duties described in this subdivision.

(c) “Creditable service” also means any of the activities described in subdivision (b) when they are performed for an employer by:

(1) Superintendents of California public schools, and presidents and chancellors of community college employers.

(2) Consulting teachers employed by an employer to participate in the California Peer Assistance and Review Program for Teachers pursuant to Article 4.5 (commencing with Section 44500) of Chapter 3 of Part 25 of Division 3 of Title 2.

(3) Audiometrists who hold a certificate of registration issued by the State Department of Health Care Services.

(d) “Creditable service” also means the performance of California public school activities related to, and an outgrowth of, the instructional and guidance program of the California public school when performed for the same employer for which the member is performing any of the activities described in subdivision (b) or (c).

(e) “Creditable service” also means trustee service as defined in Section 26144.5, if eligible pursuant to Section 26403.

(f) The board shall have final authority for determining creditable service to cover activities not already specified.

history: (History: Amended by Stats. 2022, Ch. 231, Sec. 2. (AB 1824) Effective January 1, 2023.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Death benefit” means the benefit payable under this part upon the death of the participant.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 18. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Defined Benefit Program” means the Defined Benefit Program of the State Teachers’ Retirement Plan as set forth in Part 13 (commencing with Section 22000).

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 19. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Disability benefit” means an amount payable under this part for permanent and total disability that is equal to the sum of the participant’s employee account and employer account as of the disability date and is payable pursuant to Section 26905, 26906, or 26906.5.

history: (History: Amended by Stats. 2006, Ch. 655, Sec. 65. Effective January 1, 2007.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Disability date” means the date the benefit becomes payable to a participant who has applied for a disability benefit from the plan under this part and has been determined to have a total and permanent disability.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 233. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employee” means a person engaged to perform creditable service.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employee account” means the nominal account of the participant to which employee contributions and interest and any additional earnings credits in respect thereof are credited under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 234. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employee contribution rate” means the percentage of the participant’s salary withheld by the employer as an employee contribution under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 235. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employee contribution” means the amount withheld from the participant’s salary by the employer as a contribution by the employee under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 236. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Employer” means a school district, community college district, or county office of education that has elected to provide the benefits of this part to persons employed to perform creditable service. “Employer” shall not include the state.

(b) The board shall have final authority for determining an “employer” for purposes of this part.

history: (History: Amended by Stats. 2025, Ch. 239, Sec. 9. (SB 853) Effective January 1, 2026.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employer account” means the nominal account of the participant in which employer contributions on behalf of the participant and interest and any additional earnings credits in respect thereof are credited under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 237. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employer contribution rate” means the percentage of salary that determines the amount the employer contributes to the Cash Balance Benefit Program with respect to each employee who is a participant.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 238. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employer contribution” means the amount contributed by the employer to the Cash Balance Benefit Program with respect to the participant.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 239. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Employed” or “employment” means employed to perform creditable service subject to coverage under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 240. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Full time equivalent” means the days or hours of creditable service that a person who is employed on a part-time basis would be required to perform in a school term if he or she were employed full time, as defined by Section 22138.5, in that position.

history: (History: Amended by Stats. 2018, Ch. 416, Sec. 27. (SB 1165) Effective January 1, 2019.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Fund” means the Teachers’ Retirement Fund.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 21. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Gain and Loss Reserve” means the reserve account established by the board within the fund with respect to the Cash Balance Benefit Program to be drawn upon to the extent necessary to credit interest to employee accounts and employer accounts at the minimum interest rate during years in which the plan’s investment earnings with respect to the Cash Balance Benefit Program are not sufficient for that purpose, and where necessary, to provide additions to the Annuitant Reserve for monthly annuity payments.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 22. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Investment earnings” means income received or receivable during the plan year by the plan from investment of employee contributions, employer contributions, and prior investment earnings.

history: (History: Added by Stats. 1995, Ch. 592, Sec. 16. Effective January 1, 1996.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Minimum interest rate” means the annual rate determined for the plan year by the board by means of an amendment to the plan with respect to the Cash Balance Benefit Program in accordance with applicable federal laws and regulations.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 242. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Participant” means a person who has performed creditable service subject to coverage by the Cash Balance Benefit Program and who has contributions credited under the Cash Balance Benefit Program or is receiving an annuity under the Cash Balance Benefit Program by reason of creditable service or has not yet met the conditions of subdivision (b) of Section 26806.

history: (History: Amended by Stats. 2015, Ch. 123, Sec. 29. (AB 991) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Participant subject to the California Public Employees’ Pension Reform Act of 2013” means, notwithstanding subdivision (f) of Section 7522.04 of the Government Code, a person who first becomes employed to perform creditable service subject to coverage under the Cash Balance Benefit Program on or after January 1, 2013.

(b) A participant as defined in subdivision (a) does not include a person who was a member on or before December 31, 2012, of the California Public Employees’ Retirement System, the Legislators’ Retirement System, the University of California Retirement System, county retirement systems established under Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of Title 3 of the Government Code, or the San Francisco Employees’ Retirement System, and the person performed service in the other retirement system within the six months prior to the commencement of creditable service under the Cash Balance Benefit Program.

(c) This section shall be deemed to have become operative on January 1, 2013.

history: (History: Added by Stats. 2013, Ch. 559, Sec. 33. (AB 1381) Effective January 1, 2014. Deemed operative January 1, 2013, by Sec. 1 of Ch. 559.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Pay period” means a payroll period specified by the employer but not more than 31 calendar days.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 244. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Plan” means the State Teachers’ Retirement Plan.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 23. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Plan year” means the calendar, policy, or fiscal year on which the records of the plan are kept, with respect to the Cash Balance Benefit Program. The board by means of plan amendment shall determine the plan year.

history: (History: Amended by Stats. 1999, Ch. 939, Sec. 77. Effective January 1, 2000.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Public employer” means a public employer as defined by subdivision (i) of Section 7522.04 of the Government Code.

history: (History: Added by Stats. 2013, Ch. 559, Sec. 34. (AB 1381) Effective January 1, 2014. Deemed operative January 1, 2013, by Sec. 1 of Ch. 559.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Retired participant activities” means one or more activities identified in subdivision (b), (c), or (d) of Section 22119.5 or (b), (c), or (d) of Section 26113 within the California public school system and performed by a participant retired for service under this part as one of the following:

(1) An employee of an employer.

(2) An employee of a third party, except as specified in subdivision (b).

(3) An independent contractor.

(b) The activities of an employee of a third party shall not be included in the definition of “retired participant activities” if all of the following conditions apply:

(1) The employee performs an assignment of 24 months or less.

(2) The third-party employer does not participate in a California public pension system.

(3) The activities performed by the individual are not normally performed by employees of an employer, as defined in Section 22131.

history: (History: Amended by Stats. 2015, Ch. 782, Sec. 11. (AB 963) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Retirement” means termination of employment and completion of all conditions precedent to receiving a retirement benefit under the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 245. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Retirement benefit” means an amount payable under this part in the event of the participant’s retirement for service that is equal to the sum of the participant’s employee account and employer account as of the retirement date and that is payable pursuant to Section 26806, 26807, or 26807.5.

history: (History: Amended by Stats. 2006, Ch. 655, Sec. 66. Effective January 1, 2007.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Retirement date” means the date the benefit under this part becomes payable to a participant who has applied for a retirement benefit from the plan under this part.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 246. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Salary” means remuneration paid in cash by an employer to a participant for creditable service performed in that position subject to coverage under the Cash Balance Benefit Program. Salary shall include:

(1) Money paid in accordance with a publicly available written contractual agreement, including, but not limited to, a salary schedule, based on years of training and years of experience as specified in Section 45028 for creditable service performed.

(2) For participants not paid according to a salary schedule, money paid for creditable service performed in accordance with a publicly available written contractual agreement, including, but not limited to, a collective bargaining agreement or an employment agreement.

(3) Money paid for the participant’s absence from performance of creditable service as approved by an employer, except as provided in paragraph (5) of subdivision (b).

(4) Employee contributions picked up by an employer pursuant to Section 26502.

(5) Amounts deducted by an employer from the participant’s salary, including, but not limited to, deductions for participation in a deferred compensation plan; deductions for the purchase of an annuity contract, tax-deferred retirement plan, or other insurance program; and deductions for participation in a plan that meets the requirements of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title 26 of the United States Code.

(6) Money paid by an employer in addition to salary paid under paragraph (1) or (2) if paid to all employees in a class in the same dollar amount, the same percentage of salary, or the same percentage of the amount being distributed.

(7) Any other payments the board determines by plan amendment to be “salary.”

(b) “Salary” does not mean and shall not include:

(1) Money paid for service that is not creditable service.

(2) Money paid by an employer in addition to salary paid under paragraph (1) or (2) if not paid to all employees in a class in the same dollar amount, the same percentage of salary, or the same percentage of the amount being distributed.

(3) Fringe benefits provided by an employer.

(4) Expenses paid or reimbursed by an employer.

(5) Money paid in exchange for the relinquishment of unused accumulated leave.

(6) Severance pay, including lump-sum and installment payments, or money paid in excess of salary or wages to a participant as compensatory damages or as a compromise settlement.

(7) Payments, including, but not limited to, those for participation in a deferred compensation plan; to purchase an annuity contract, tax-deferred retirement program, or other insurance program; and for participation in a plan that meets the requirements of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title 26 of the United States Code that are purchased by an employer for a participant.

(8) Any payments determined by the system to have been made by an employer to enhance a participant’s benefits.

(9) Any other payments the board determines by plan amendment not to be “salary.”

(c) Any employer or person who knowingly or willfully reports salary in a manner inconsistent with the provisions of subdivisions (a) or (b) may be subject to prosecution for fraud, theft, or embezzlement in accordance with provisions of the Penal Code. The system may establish procedures to ensure that salary reported by an employer is in compliance with this section.

(d) For purposes of this section, remuneration shall be considered paid if distributed to any person in the same class of employees who meets the qualifications or requirements specified in a publicly available written contractual agreement, including, but not limited to, a collective bargaining agreement or an employment agreement, as a condition of receiving the remuneration.

(e) This section shall be deemed to have become operative on July 1, 1996.

(f) This section shall not apply to a participant subject to the California Public Employees’ Pension Reform Act of 2013.

history: (History: Amended by Stats. 2013, Ch. 559, Sec. 36. (AB 1381) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Salary,” for participants subject to the California Public Employees’ Pension Reform Act of 2013, means remuneration paid each pay period in cash by an employer to a participant for creditable service performed in that position subject to coverage under the Cash Balance Benefit Program in accordance with a publicly available written contractual agreement, including, but not limited to, a salary schedule or employment agreement, based on years of training and years of experience as specified in Section 45028. Salary shall include:

(1) Money paid for the participant’s absence from performance of creditable service as approved by an employer, except as provided in paragraph (5) of subdivision (b).

(2) Employee contributions picked up by an employer pursuant to Section 26502.

(3) Amounts deducted by an employer from the participant’s salary, including, but not limited to, deductions for participation in a deferred compensation plan; deductions for the purchase of an annuity contract, tax-deferred retirement plan, or other insurance program; and deductions for participation in a plan that meets the requirements of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title 26 of the United States Code.

(4) Any other payments the board determines by plan amendment to be “salary.”

(b) “Salary” does not mean and shall not include:

(1) Money paid for service that is not creditable service.

(2) Money not paid each pay period in which creditable service is performed for that position.

(3) Fringe benefits provided by an employer.

(4) Expenses paid or reimbursed by an employer.

(5) Money paid in exchange for the relinquishment of unused accumulated leave.

(6) Severance pay, including lump-sum and installment payments, or money paid in excess of salary to a participant as compensatory damages or as a compromise settlement.

(7) Payments, including, but not limited to, those for participation in a deferred compensation plan; to purchase an annuity contract, tax-deferred retirement program, or other insurance program; and for participation in a plan that meets the requirements of Section 125, 401(a), 401(k), 403(b), 457(b), or 457(f) of Title 26 of the United States Code that are purchased by an employer for a participant.

(8) Any payments determined by the system to have been made by an employer to enhance a participant’s benefits under the plan.

(9) Money paid to the participant in lieu of benefits provided to the participant by the employer or paid directly by the employer to a third party other than the system for the benefit of the participant.

(10) Any one-time or ad hoc payments made to a participant.

(11) Any employer-provided allowance, reimbursement, or payment, including, but not limited to, one made for housing, vehicle, or uniform.

(12) Any bonus paid in addition to compensation described in subdivision (a).

(13) Any other payments the board determines by plan amendment not to be “salary.”

(c) (1) Salary in any fiscal year shall not exceed:

(A) One hundred twenty percent of the “contribution and benefit base,” as determined under Section 430(b) of the Social Security Act (42 U.S.C. Sec. 430(b)), on January 1, 2013, for a participant whose service is not included in the federal system.

(B) One hundred percent of the “contribution and benefit base,” as determined under Section 430(b) of the Social Security Act (42 U.S.C. Sec. 430(b)), on January 1, 2013, for a participant whose service is included in the federal system pursuant to any changes in state or federal law enacted on or after January 1, 2013.

(2) The system shall adjust the limit based on the annual changes to the Consumer Price Index for All Urban Consumers: U.S. City Average, calculated by dividing the Consumer Price Index for All Urban Consumers: U.S. City Average for the month of February in the fiscal year preceding the adjustment by the Consumer Price Index for All Urban Consumers: U.S. City Average for the month of February of the previous year rounded to the nearest thousandth. Notwithstanding paragraph (1) of subdivision (d) of Section 7522.10 of the Government Code, the adjustment shall be effective annually on July 1, beginning July 1, 2014.

(3) The Legislature reserves the right to modify the requirements of this subdivision with regard to all participants subject to this subdivision, except that the Legislature may not modify these provisions in a manner that would result in a decrease in benefits accrued prior to the effective date of the modification.

(d) Any employer or person who knowingly or willfully reports salary in a manner inconsistent with the provisions of subdivisions (a) or (b) may be subject to prosecution for fraud, theft, or embezzlement in accordance with provisions of the Penal Code. The system may establish procedures to ensure that salary reported by an employer is in compliance with this section.

(e) For purposes of this section, remuneration shall be considered paid if distributed to any person in the same class of employees who meets the qualifications or requirements specified in a publicly available written contractual agreement, including, but not limited to, a collective bargaining agreement or an employment agreement, as a condition of receiving the remuneration.

history: (History: Amended by Stats. 2015, Ch. 123, Sec. 30. (AB 991) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) “Spouse” means the person married to the participant on the date the participant files a beneficiary designation, or an application for a benefit, or on the date of the participant’s death.

(b) Except as excluded in Sections 26004 and 27406, a person who is the registered domestic partner of the participant, as established pursuant to Section 297 or 299.2 of the Family Code, on the date the participant files a beneficiary designation or an application for a benefit, or on the date of the participant’s death, shall be treated in the same manner as a spouse.

history: (History: Amended by Stats. 2005, Ch. 418, Sec. 10. Effective January 1, 2006.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “System” means the State Teachers’ Retirement System.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “System’s headquarters office” means the office building established as the permanent headquarters facility for the system, pursuant to Section 22375.

history: (History: Added by Stats. 2015, Ch. 123, Sec. 31. (AB 991) Effective January 1, 2016.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Termination benefit” means a benefit that is an amount equal to the sum of the participant’s employee account and employer account payable under this part pursuant to the provisions of Chapter 13 (commencing with Section 27200).

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 248. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Total and permanent disability” means any medically determinable physical or mental incapacity that is expected to prevent the participant from performing creditable service under this part for the employer for a continuous period of at least one year.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 249. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Trustee service” means duties performed by a member of the governing body of an employer.

history: (History: Added by Stats. 2000, Ch. 1020, Sec. 11. Effective January 1, 2001.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: “Unfunded actuarial obligation” means any negative balance in the Gain and Loss Reserve.

history: (History: Added by Stats. 1995, Ch. 592, Sec. 16. Effective January 1, 1996.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Employee contributions, employer contributions, investment earnings, and any other amounts provided under this part shall be deposited into the Teachers’ Retirement Fund. Disbursement of money from the fund shall be made upon claims made pursuant to Section 26209 and duly audited in the manner prescribed for the disbursement of other public funds. Notwithstanding Section 13340 of the Government Code, the Teachers’ Retirement Fund is continuously appropriated for the payment of benefits and investment transactions pursuant to this part. Disbursements may be made to return funds deposited in the fund in error.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 25. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 3. Plan Administration

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 14. STATE TEACHERS’ RETIREMENT SYSTEM CASH BENEFIT PROGRAM > 3. Plan Administration


text: Investment earnings shall be collected by the Treasurer, and together with any other moneys received in connection with the Cash Balance Benefit Program, shall be immediately deposited to the credit of the Teachers’ Retirement Fund and reported to the system.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 26. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) The board shall establish a Gain and Loss Reserve within the Teachers’ Retirement Fund for the Cash Balance Benefit Program. The board has sole authority to administer the Gain and Loss Reserve to be drawn upon to the extent necessary to credit interest to employee accounts and employer accounts at the minimum interest rate during years in which the investment earnings of the plan with respect to the Cash Balance Benefit Program are not sufficient for that purpose, and, where necessary, to provide additions to the Annuitant Reserve for monthly annuity payments.

(b) The board shall establish and periodically review goals regarding the sufficiency of the Gain and Loss Reserve based on the recommendation of the actuary.

(c) In the event that the total amount of investment earnings of the plan with respect to the Cash Balance Benefit Program for any plan year exceeds the sum of the total amount required to credit all employee and employer accounts at the minimum interest rate for the plan year plus the administrative costs of the plan with respect to the Cash Balance Benefit Program for the plan year, the board shall determine the amount, if any, that is to be credited to the Gain and Loss Reserve for the plan year. That determination shall be made upon recommendation of the actuary based on the actuarial valuation undertaken following the plan year pursuant to Section 26211 but no later than June 30 following the end of the plan year. In determining whether an amount is to be credited to the Gain and Loss Reserve, the board shall consider the sufficiency of the reserve in light of the goal established for the sufficiency and the recommendations of the actuary.

history: (History: Amended by Stats. 2016, Ch. 218, Sec. 40. (SB 1352) Effective January 1, 2017.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board may amortize any unfunded actuarial obligation in accordance with standards established by the Actuarial Standards Board and Governmental Accounting Standards Board.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall establish an Annuitant Reserve within the Teachers’ Retirement Fund for the Cash Balance Benefit Program. The board has sole authority to administer the Annuitant Reserve for the payment of annuities. The board may transfer the credits from a participant’s employee account and employer account to the Annuitant Reserve upon election of an annuity by the participant or beneficiary of the participant.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 28. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board may transfer amounts between the Gain and Loss Reserve and the Annuitant Reserve upon the recommendation of the actuary.

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: All administrative costs of the board and system for the plan with respect to the Cash Balance Benefit Program shall be paid from the Teachers’ Retirement Fund.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 29. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: In no event shall the funding of the Cash Balance Benefit Program be a liability of the state or the General Fund, nor shall the General Fund be used to offset or fund any liabilities attributed to the operation of the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 31. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall establish and maintain records and accounts following recognized accounting principles and controls with respect to the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 250. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board may authorize the transfer and disbursement of funds from the Teachers’ Retirement Fund for the purpose of carrying into effect the Cash Balance Benefit Program upon the signature of its chairperson, vice chairperson, the chief executive officer, or any employee of the system designated by the chief executive officer.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 32. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board has exclusive control of the investment of the Retirement Fund with respect to assets attributed to the Cash Balance Benefit Program. In investing the fund, the board and its officers and employees shall exercise their fiduciary duties set forth in Chapter 4 (commencing with Section 22250) and Chapter 6 (commencing with Section 22350) of Part 13.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 251. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
The board shall acquire the services of an actuary to:

(a) Perform an actuarial investigation of the demographic and economic experience of the Cash Balance Benefit Program at least once every four years and make recommendations to the board for the adoption of actuarial assumptions for the program that are, in the aggregate, reasonably related to the past experience of the program and the actuary’s best estimate of the future experience of the program.

(b) Perform an annual actuarial valuation of the assets and liabilities of the plan with respect to the Cash Balance Benefit Program, using the actuarial assumptions adopted by the board.

(c) Recommend to the board all rates and factors necessary to administer the Cash Balance Benefit Program, including, but not limited to, mortality tables, annuity factors, interest rates, additional earnings credits, and employer contribution rates.

(d) Recommend to the board the goal for maintaining a sufficient Gain and Loss Reserve with respect to the Cash Balance Benefit Program, the amount to be transferred to the Gain and Loss Reserve from investment earnings of the plan each year with respect to the Cash Balance Benefit Program, and a strategy for the amortization of any unfunded actuarial obligation.

(e) Recommend to the board transfers of amounts between the Gain and Loss Reserve and the Annuitant Reserve with respect to the Cash Balance Benefit Program.

(f) Perform any other actuarial services that may be required for the administration of the plan with respect to the Cash Balance Benefit Program, as requested by the board.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 252. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall maintain all data necessary for the actuarial investigation of the demographic and economic experience of the Cash Balance Benefit Program, and for the actuarial valuation of the assets and liabilities of the plan with respect to the Cash Balance Benefit Program.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 253. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board shall adopt actuarial assumptions, rates, factors and tables necessary to administer the Cash Balance Benefit Program as an amendment to the plan.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 254. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) Except as provided in subdivision (b), the system shall make available, after the end of the plan year, to each participant having a balance in his or her employee account or employer account, a statement setting forth the balance as of the close of the plan year and amounts credited for the year. The system shall mail a copy of the participant’s statement, provided that the employer or participant has informed the system of the participant’s current mailing address and the participant has not requested to receive that statement electronically, in lieu of mailing.

(b) The mode of issuance described in subdivision (a) is subject to Section 22337.

history: (History: Amended by Stats. 2013, Ch. 459, Sec. 10. (AB 989) Effective January 1, 2014.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: The board may administer the Cash Balance Benefit Program through an agreement with a qualified third-party administrator that shall provide custodial, recordkeeping, or other administrative services specified under the agreement.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 255. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) Within 10 working days following the later of the first day of employment, the date of the employer’s governing board’s action to provide the Cash Balance Benefit Program, or the effective date of the employer’s governing board’s action to provide the Cash Balance Benefit Program, the employer shall make available to the employee the following information:

(1) The employee’s rights and responsibilities as a participant in the program, the employer’s responsibilities under the program, and the benefits payable under the program.

(2) The employee’s right to elect membership in the Defined Benefit Program in lieu of participation in the Cash Balance Benefit Program, the rights and responsibilities of a member and the employer under the Defined Benefit Program, and benefits payable under the Defined Benefit Program.

(b) Written acknowledgment by the employee that he or she has received the information specified in subdivision (a) shall be retained in the employer’s files on a form prescribed by the system.

(c) If an employer’s governing board’s action to provide the Cash Balance Benefit Program gives employees the right to elect other coverage in lieu of the Cash Balance Benefit Program pursuant to Section 26400, the employer shall, within 10 working days following the later of the first day on which creditable service is performed, the date of the employer’s governing board’s action to provide the program or the effective date of the employer’s governing board’s action to provide the program, notify existing employees of the following:

(1) The employee’s right to elect other coverage if offered by the employer in lieu of participation in the Cash Balance Benefit Program.

(2) The rights and responsibilities of the employer and a participant in an alternative retirement plan if offered by the employer.

(3) The benefits payable under an alternative retirement plan if offered by the employer.

history: (History: Amended by Stats. 1998, Ch. 1048, Sec. 33. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

path: 1. GENERAL EDUCATION CODE PROVISIONS > 1. GENERAL EDUCATION CODE PROVISIONS > 14. STATE TEACHERS’ RETIREMENT SYSTEM CASH BENEFIT PROGRAM > 4. Employer and Participant Responsibilities


text:
(a) Employers shall report contributions paid on behalf of each participant in each pay period, along with all other information required by the system no later than 10 working days following the last day of the pay period in which the salary was earned, and the report shall be delinquent immediately thereafter. That report shall be submitted electronically in an encrypted format provided by the system that ensures the security of the transmitted participant data.

(b) The board shall, in accordance with regulations, assess a penalty against the employer for a report submitted late or in an unacceptable form. The penalty shall be based upon the sum of the employee and employer contributions required to be reported under this part at a rate of interest equal to the regular interest rate, accruing on the balance for the period between the time the report was due and the time an acceptable report is actually received by the system.

history: (History: Amended by Stats. 2011, Ch. 703, Sec. 32. (SB 349) Effective January 1, 2012.)

title: 1. GENERAL EDUCATION CODE PROVISIONS

chapter: 4. Employer and Participant Responsibilities


text: Each employer shall deduct from the salary of participants employed by the employer the participant contributions required by this part and shall remit to the system those contributions plus the employer contributions required by this part and Section 44987.

history: (History: Added by Stats. 1998, Ch. 965, Sec. 257. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) All contributions due to the system by an employer under this part shall be paid by an electronic funds transfer method through an automated clearinghouse as prescribed by the board. This payment requirement is effective upon authorization by the board.

(b) For purposes of this section, “automated clearinghouse” means any federal reserve bank, or an organization established in agreement with the National Automated Clearing House Association, that operates as a clearinghouse for transmitting or receiving entries between banks or bank accounts and which authorizes an electronic transfer of funds between these banks or bank accounts.

(c) An employer that is unable, for good cause, to comply with subdivision (a) may apply to the board for a waiver that allows the employer to pay in an alternate manner as prescribed by the board.

history: (History: Added by Stats. 2018, Ch. 125, Sec. 2. (AB 2052) Effective January 1, 2019.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) If more or less than the contributions required by this part are paid to the plan based on salary paid to a participant, proper adjustment shall be made by the employer within 60 days of discovery or of notification by the system, and any contributions deducted in error from the participant’s salary shall be returned to the participant by the employer within the same time period.

(b) The board shall, in accordance with regulations, assess penalties for late or improper adjustments pursuant to Section 26301. These penalties shall be assessed at a rate equal to the penalties imposed under subdivision (b) of Section 26301 and shall be deemed to be interest earned in the year in which the penalty is received.

history: (History: Amended by Stats. 2011, Ch. 703, Sec. 33. (SB 349) Effective January 1, 2012.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text:
(a) Employers shall transmit to the plan the employee contributions and employer contributions with respect to the Cash Balance Benefit Program for salary paid to each participant during the pay period no later than 10 working days following the last day of the pay period in which the salary was earned.

(b) Payments shall be delinquent on the 11th working day thereafter, and interest shall begin to accrue at the regular interest rate from that day until payment for the contributions and interest is received in full by the system. The board, in accordance with regulations, shall collect interest for late payment from the employer under this subdivision.

history: (History: Amended by Stats. 2011, Ch. 703, Sec. 34. (SB 349) Effective January 1, 2012.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: A person or entity that reports directly to the system that is assessed a penalty or interest pursuant to Section 26301 or 26303 may appeal the assessed penalty or interest using the appeals process established pursuant to Section 22219.

history: (History: Added by Stats. 2009, Ch. 249, Sec. 11. (AB 654) Effective January 1, 2010.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Penalties and interest due to the system pursuant to Section 26301 or 26303 are additional required contributions that, when received, shall be deposited to the Teachers’ Retirement Fund and treated in the same manner as other contributions.

history: (History: Added by Stats. 2020, Ch. 275, Sec. 17. (AB 2101) Effective January 1, 2021.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: An employer shall provide timely notice to the system of the employment, death, or termination of employment of a participant.

history: (History: Amended by Stats. 1996, Ch. 608, Sec. 17. Effective September 19, 1996. Applicable from July 1, 1996, pursuant to Sec. 58 of Ch. 608.)

title: 1. GENERAL EDUCATION CODE PROVISIONS


text: Upon request of the system, an employer shall provide the system with information regarding the salary paid or to be paid to employees subject to coverage by the Cash Balance Benefit Program in a plan year. The information may include, but shall not be limited to, employment contracts, salary schedules, and minutes from meetings conducted by the governing board of the employer.

history: (History: Amended by Stats. 1998, Ch. 965, Sec. 260. Effective January 1, 1999.)

title: 1. GENERAL EDUCATION CODE PROVISIONS