The County Employees Retirement Law of 1937 (CERL) authorizes counties and districts to establish retirement systems, overseen by a board of retirement, in order to provide pension benefits to their employees and their beneficiaries and prescribes the rights, benefits, and duties of members in this regard. Under CERL, a board of retirement is required to comply with a retired member’s, or beneficiary of a retired member’s revocable written authorization to deliver their monthly warrant, check, or electronic fund transfer (EFT) for the retirement allowance or benefit to a specified bank, savings and loan institution, or credit union to be credited to the account of the retired member or survivor of a deceased member.
Assembly Bill 2474 (AB 2474) adds an account held in a living trust or an income-only trust to the list of accounts that may receive the members monthly warrant, check, or EFT. Additionally, AB 2474, until January 1, 2028, will authorize the Board of Retirement for the County of Los Angeles to have the monthly warrant, check, or EFT for the retirement allowance or benefit be delivered to a prepaid account.
Existing law permits a person to authorize the payment of the benefits they are entitled to directly into the person’s account at the financial institution of the person’s choice by EFT. AB 2474, until January 1, 2028, will permit the board of retirement to allow a person to have benefit payments they are entitled to deposited into a prepaid account.
Under CERL, a retired member may be employed and paid in a position requiring special skills or knowledge for a period of time not to exceed the greater of 90 working days or 720 hours in any year or any other designated 12-month period.
Under the Public Employee Pension Reform Act of 2013 (PEPRA), a retired person is prohibited from serving or being employed by, a public employer in the same public retirement system from which the retiree receives the benefit without reinstatement from retirement, unless an exception applies. One exception allows a retired person to serve without reinstatement if appointed by the public employer during an emergency to prevent stoppage of public business or because the retired person has skills needed to perform work of limited duration, which is limited to 960 hours in a year.
AB 2474 prohibits a person who has been retired under CERL from being employed in any capacity thereafter by a county or district of the retirement system unless the person has first been reinstated from retirement or is authorized under CERL or PEPRA, and prohibits a person whose employment without reinstatement is authorized from acquiring service credit or retirement rights under CERL with respect to that employment. AB 2474 also requires a retired member employed in violation of specified provisions of CERL and PEPRA to reimburse the retirement system for any allowance received during the period in violation and to pay other related amounts, as specified. A public employer that employs a retired member in violation of CERL or PEPRA, if the retired member is reinstated, will also be required to pay the retirement system an amount of money equal to the employer contributions that would otherwise have been paid, plus interest, for the period of time that the member was employed in violation of these provisions, and to contribute toward reimbursement for reasonable administrative expenses of the system.
(AB 2474 amends section 31452.6 of the Government Code and adds section 31452.61, 31589.2, and 31680.9 to the Government Code.)