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AB-757 Teachers: retirement and employment.(2007-2008)

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AB757:v94#DOCUMENT

Assembly Bill No. 757
CHAPTER 323

An act to amend Sections 22138.5, 22200, 22207, 22306, 22450, 22713, 22714, 22803, 23805, 23855, 24204, 24213, 24300.6, 24309, 24410.7, 24617, 24976, 25009, 44041, and 44830.3 of the Education Code, relating to teachers, and making an appropriation therefor.

[ Filed with Secretary of State  October 08, 2007. ]

LEGISLATIVE COUNSEL'S DIGEST


AB 757, Committee on Public Employees, Retirement and Social Security. Teachers: retirement and employment.
(1) The State Teachers’ Retirement Law specifies the days or hours of creditable service that equal “full time” for the purpose of calculating benefits under the Defined Benefit Program of the State Teachers’ Retirement System, with a minimum standard applied to employees providing kindergarten through grade 12 instruction, as specified.
This bill would apply that minimum standard to employees providing prekindergarten instruction.
(2) That law provides for the election of 3 members to the Teachers’ Retirement Board at elections conducted by the board. Two of those members are to be elected by active members of the Defined Benefit Program and active participants of the Cash Balance Benefit Program, subject to the requirement that the members, inclusive, and participants are employed by a school district that provides instruction for kindergarten and grades 1 to 12, inclusive.
This bill would also allow those members, inclusive, and participants to be persons employed by a school district that provides instruction for prekindergarten.
(3) That law allows the Teachers’ Retirement Board to perform any acts necessary for the administration of the State Teachers’ Retirement System. That law also requires each member or beneficiary of the system to furnish to the board any information affecting his or her status as a member or beneficiary of the Defined Benefit Program as the board requires.
This bill would clarify that the board has the authority to request, and that, upon request, a member, participant, or beneficiary is required to provide to the board, financial statements, certified copies of state and federal income tax records, evidence of financial status, and employment, legal, or medical documentation.
(4) That law provides that information filed with the State Teachers’ Retirement System by a member, participant, or beneficiary of the plan is confidential, to be released only upon specified circumstances.
This bill would allow the system to release that information to specified persons in relation to disability claims or if detrimental to the member, as specified.
(5) That law allows the governing board of a school district or a community college district or a county superintendent of schools to establish regulations that allow an employee who is a member of the Defined Benefit Program to reduce his or her workload from full time to part time and receive the service credit the member would have received had the member been employed on a full-time basis.
This bill would require workload reductions to commence at the beginning of the school year, thereby prohibiting midyear reductions.
(6) That law permits a member of the Defined Benefit Program to elect to purchase additional service credit if specified contributions are paid to the State Teachers’ Retirement System. That law permits the member to purchase as additional service credit time spent on approved maternity or paternity leave of 2 years or less in duration, as specified.
This bill would instead permit a member of the Defined Benefit Program to purchase as additional service credit time spent on leave approved by an employer in this state as maternity or paternity leave, not to exceed 24 consecutive months.
(7) That law provides when a member is granted a disability allowance and attains normal retirement age, his or her disability allowance is terminated and the member is eligible for a service retirement. That law prohibits the State Teachers’ Retirement System from calculating that service retirement based upon service credited for unused sick leave.
This bill would additionally prohibit the State Teachers’ Retirement System from calculating that service retirement based upon service credited for unused leave of absence for education.
(8) Under that law, any retired member who was unmarried or not in a registered domestic partnership at the time of retirement, may, after the effective date of retirement, name his or her new spouse or domestic partner as his or her option beneficiary, subject to specified requirements.
Upon that election, this bill would require the retired member to also submit a certified copy of his or her marriage certificate or certificate of registration of domestic partnership.
(9) Under that law, a member may cancel a preretirement election of an option on a properly executed form provided by the State Teachers’ Retirement System on or before the day preceding the effective date of retirement or during the period between termination of the retirement allowance, as specified.
This bill would instead allow a member to make changes to a preretirement election, subject to receipt within a specified 30-day period, and would provide that a change or cancellation of that election shall become effective as of the date of the member’s signature.
(10) Under that law, retired members and nonmember spouses, disabled members, and beneficiaries of the Defined Benefit Program receive monthly allowances that are subject to supplementary increases to preserve their purchasing power, and an increase according to a specified schedule, payable commencing on or before July 1, 2001.
This bill would provide that if the monthly allowance payable to these retired members and nonmember spouses, disabled members, and beneficiaries is adjusted after the effective date of these provisions, the increase according to the specified schedule applied on the effective date of these provisions, shall also be applied to the adjusted monthly allowance payable.
(11) That law establishes the Teachers’ Deferred Compensation Fund, a continuously appropriated fund, as a repository for funds received by the State Teachers’ Retirement System pursuant to administering funds received in administering specified deferred compensation plans. That law also requires the Teachers’ Retirement Board to establish a vendor registration process for the purposes of providing information about tax-deferred retirement investment products. That law requires the premium and fee revenues and compensation deferrals from specified annuity and custodial accounts and the vendor registration process to be deposited into trust accounts in the Teachers’ Deferred Compensation Fund.
This bill would require specified assets and fee revenue for administrative and compliance services to be deposited in the Deferred Compensation Administrative and Compliance Services Operating Account in the Teachers’ Deferred Compensation Fund. The bill would prohibit the expenditure of the assets and fee revenue for a purpose other than an expenditure used to carry out the purpose of those assets and fee revenue. By authorizing a new purpose for the expenditure of moneys in a continuously appropriated fund, this bill would make an appropriation.
(12) That law permits a member of the Defined Benefit Program to elect to purchase service in the uniformed services of the United States or out-of-state service as service credit in that program. That law also permits a person who had his or her accumulated contributions refunded and again becomes a member of the Defined Benefit Program to redeposit his or her accumulated contributions with interest, as specified. That law establishes the Defined Benefit Supplement Program to provide supplemental retirement benefits for members of the Defined Benefit Program. That law permits the member, as part of the Defined Benefit Supplement Program, to elect from among several forms of retirement benefit payments, including a lump-sum payment, an annuity payable in monthly installments, or a combination of the lump-sum payment and the annuity.
This bill would prohibit a member from using a lump-sum payment under these provisions to purchase additional service, out-of-state service, or service in the uniformed services of the United States as service credit, or to redeposit previously refunded retirement contributions, as specified.
(13) Existing law allows the governing board of any school district that maintains kindergarten or grades 1 to 12, inclusive, classes in bilingual education or special education programs to employ district interns to provide instruction to pupils in those grades or classes as classroom teachers, subject to specified requirements.
This bill would extend that authority to the governing board of any school district that maintains prekindergarten classes in bilingual education or special education programs.
(14) The bill would also make various technical and clarifying changes to the State Teachers’ Retirement Law.
Vote: MAJORITY   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 22138.5 of the Education Code is amended to read:

22138.5.
 (a) “Full time” means the days or hours of creditable service the employer requires to be performed by a class of employees in a school year in order to earn the compensation earnable as defined in Section 22115 and specified under the terms of a collective bargaining agreement or employment agreement. For the purpose of crediting service under this part, “full time” may not be less than the minimum standard specified in this section. Each collective bargaining agreement or employment agreement that applies to a member subject to the minimum standard specified in paragraph (5) of subdivision (c) shall specify the number of hours of creditable service that equal “full time” pursuant to this section, and shall make specific reference to this section.
(b) The minimum standard for full time in prekindergarten through grade 12 is as follows:
(1) One hundred seventy-five days per year or 1,050 hours per year, except as provided in paragraphs (2) and (3).
(2) (A) One hundred ninety days per year or 1,520 hours per year for all principals and program managers, including advisers, coordinators, consultants, and developers or planners of curricula, instructional materials, or programs, and for administrators, except as provided in subparagraph (B).
(B) Two hundred fifteen days per year or 1,720 hours per year including school and legal holidays pursuant to the policy adopted by the employer’s governing board for administrators at a county office of education.
(3) One thousand fifty hours per year for teachers in adult education programs.
(c) The minimum standard for full time in community colleges is as follows:
(1) One hundred seventy-five days per year or 1,050 hours per year, except as provided in paragraphs (2), (3), (4), (5), and (6). Full time includes time for duties the employer requires to be performed as part of the full-time assignment for a particular class of employees.
(2) One hundred ninety days per year or 1,520 hours per year for all program managers and for administrators, except as provided in paragraph (3).
(3) Two hundred fifteen days per year or 1,720 hours per year including school and legal holidays pursuant to the policy adopted by the employer’s governing board for administrators at a district office.
(4) One hundred seventy-five days per year or 1,050 hours per year for all counselors and librarians.
(5) Five hundred twenty-five instructional hours per school year for all instructors employed on a part-time basis, except instructors specified in paragraph (6). If an instructor receives compensation for office hours pursuant to Article 10 (commencing with Section 87880) of Chapter 3 of Part 51, the minimum standard shall be increased appropriately by the number of office hours required annually for the class of employees.
(6) Eight hundred seventy-five instructional hours per school year for all instructors employed in adult education programs. If an instructor receives compensation for office hours pursuant to Article 10 (commencing with Section 87880) of Chapter 3 of Part 51, the minimum standard shall be increased appropriately by the number of office hours required annually for the class of employees.
(d) The board has final authority to determine full time for purposes of crediting service under this part if full time is not otherwise specified in this section.

SEC. 2.

 Section 22200 of the Education Code is amended to read:

22200.
 (a) The plan and the system are administered by the Teachers’ Retirement Board. On and after January 1, 2004, the members of the board are as follows:
(1) The Superintendent of Public Instruction.
(2) The Controller.
(3) The Treasurer.
(4) The Director of Finance.
(5) Three persons who are either members of the Defined Benefit Program or participants in the Cash Balance Benefit Program, as follows:
(A) One person who, at the time of election, is an active member of the Defined Benefit Program or an active participant of the Cash Balance Benefit Program employed by a school district that provides instruction for prekindergarten, kindergarten, or grades 1 to 12, inclusive, or a county office of education, in a position other than a school administrator that requires a services credential with a specialization in administrative services. This member shall be elected by the active members of the Defined Benefit Program and active participants of the Cash Balance Benefit Program who are employed by a school district that provides instruction for prekindergarten, kindergarten, or grades 1 to 12, inclusive, or county office of education, pursuant to regulations adopted by the board, for a four-year term commencing on January 1, 2004.
(B) One person who, at the time of election, is an active member of the Defined Benefit Program or an active participant of the Cash Balance Benefit Program employed by a school district that provides instruction for prekindergarten, kindergarten, or grades 1 to 12, inclusive, or a county office of education. This member shall be elected by the active members of the Defined Benefit Program and active participants of the Cash Balance Benefit Program who are employed by a school district that provides instruction for prekindergarten, kindergarten, or grades 1 to 12, inclusive, or a county office of education, pursuant to regulations adopted by the board, for a four-year term commencing on January 1, 2004.
(C) One person who, at the time of election, is a community college instructor and an active member of the Defined Benefit Program or an active participant of the Cash Balance Benefit Program employed by a community college district, who shall be elected by the active community college members of the Defined Benefit Program and the active community college participants of the Cash Balance Benefit Program, pursuant to regulations adopted by the board, for a four-year term commencing on January 1, 2004.
(6) Five persons appointed by the Governor for a term of four years, subject to confirmation by the Senate, as follows:
(A) One person who, at the time of appointment, is a member of the governing board of a school district or a community college district.
(B) One person who is either a retired member under this part or a retired participant under Part 14 (commencing with Section 26000).
(C) Three persons representing the public, whose terms shall be staggered by varying the first terms of these members, as follows:
(i) One person to a term expiring December 31, 2005.
(ii) One person to a term expiring December 31, 2006.
(iii) One person to a term expiring December 31, 2007.
(b) A person who is employed to perform creditable service by a community college district and either a school district that provides instruction for prekindergarten, kindergarten, or grades 1 to 12, inclusive, or a county office of education, may only be elected to the position on the board that corresponds to the position in which he or she accrued the most service credit during the prior school year.
(c) The members of the board shall annually elect a chairperson and vice chairperson.

SEC. 3.

 Section 22207 of the Education Code is amended to read:

22207.
 The board shall perform any other acts necessary for the administration of the system and the plan in carrying into effect the provisions of this part and Part 14 (commencing with Section 26000), which may include, but shall not be limited to, requesting the following information from a member, participant, or beneficiary:
(a) Financial statements, certified copies of state and federal income tax records, or evidence of financial status.
(b) Employment, legal, or medical documentation.

SEC. 4.

 Section 22306 of the Education Code is amended to read:

22306.
 (a) Information filed with the system by a member, participant, or beneficiary of the plan is confidential and shall be used by the system for the sole purpose of carrying into effect the provisions of this part. No official or employee of the system who has access to the individual records of a member, participant, or beneficiary shall divulge any confidential information concerning those records to any person except in the following instances:
(1) To the member, participant, or beneficiary to whom the information relates.
(2) To the authorized representative of the member, participant, or beneficiary.
(3) To the governing board of the member’s or participant’s current or former employer.
(4) To any department, agency, or political subdivision of this state.
(5) To other individuals as necessary to locate a person to whom a benefit may be payable.
(6) Pursuant to subpoena.
(7) To an agent or a physician authorized by the board in the performance of duties pursuant to Section 24003, 24012, 24103, or 24111.
(8) To a physician or psychologist authorized by the member to receive medical information, if the system determines that the information may be detrimental to the member, as provided under Section 1798.40 of the Civil Code.
(b) Information filed with the system in a beneficiary designation form may be released after the death of the member or participant to those persons who may provide information necessary for the distribution of benefits.
(c) The information is not open to inspection by anyone except the board and its officers and employees of the system, and any person authorized by the Legislature to make inspections.

SEC. 5.

 Section 22450 of the Education Code is amended to read:

22450.
 (a) Each member and beneficiary shall furnish to the board any information affecting his or her status as a member or beneficiary of the Defined Benefit Program as the board requires, which may include, but shall not be limited to, the following:
(1) Financial statements, certified copies of state and federal income tax records, or evidence of financial status.
(2) Employment, legal, or medical documentation.
(b) A member who has not had any creditable service reported during the prior school year shall provide the system with his or her current mailing address and beneficiary information.

SEC. 6.

 Section 22713 of the Education Code is amended to read:

22713.
 (a) Notwithstanding any other provision of this chapter, the governing board of a school district or a community college district or a county superintendent of schools may establish regulations that allow an employee who is a member of the Defined Benefit Program to reduce his or her workload from full time to part time, and receive the service credit the member would have received if the member had been employed on a full-time basis and have his or her retirement allowance, as well as other benefits that the member is entitled to under this part, based, in part, on final compensation determined from the compensation earnable the member would have been entitled to if the member had been employed on a full-time basis.
(b) The regulations shall include, but may not be limited to, the following:
(1) The option to reduce the member’s workload shall be exercised at the request of the member and may be revoked only with the mutual consent of the employer and the member. The agreement to reduce a member’s workload shall be in effect at the beginning of the school year.
(2) The member shall have been employed on a full-time basis to perform creditable service subject to coverage under the Defined Benefit Program and have a minimum of 10 years of credited service, including five years of credited service for full-time employment immediately preceding the reduction in workload.
(3) The member may not have had a break in service during the five years immediately preceding the reduction in workload. For purposes of this subdivision, sabbaticals, other approved leaves of absence, and unpaid absences from the performance of creditable service for personal reasons do not constitute a break in service. For purposes of this subdivision, the period of time during which a member is retired for service shall constitute a break in service and a member who reinstates from retirement shall be required to be employed on a full-time basis to perform creditable service for at least five school years immediately preceding the reduction in workload.
(4) The member shall have reached 55 years of age prior to the reduction in workload.
(5) The reduced workload shall be performed for a period of time, as specified in the regulations, up to and including 10 years. The period of time specified in the regulations may not exceed 10 years.
(6) The reduced workload shall be equal to at least one-half of the time the employer requires for full-time employment in accordance with Section 22138.5 pursuant to the member’s contract of employment during his or her last school year of full-time employment preceding the reduction in workload.
(7) The member shall be paid creditable compensation that is the pro rata share of the creditable compensation the member would have been paid had the member not reduced his or her workload.
(c) Prior to the reduction of a member’s workload under this section, the employer, in conjunction with the administrative staff of the State Teachers’ Retirement Plan and the Public Employees’ Retirement System, shall verify the member’s eligibility for the reduced workload program.
(d) For each school year the member’s workload is reduced pursuant to this section, the member shall make contributions to the Teachers’ Retirement Fund in the amount that the member would have contributed if the member had performed creditable service on a full-time basis and if that service was subject to coverage under the Defined Benefit Program.
(e) For each school year the member’s workload is reduced pursuant to this section, the employer shall contribute to the Teachers’ Retirement Fund at a rate adopted by the board as a plan amendment with respect to the Defined Benefit Program an amount based upon the creditable compensation that would have been paid to the member if the member had performed creditable service on a full-time basis and if that service was subject to coverage under the Defined Benefit Program.
(f) The employer shall maintain the necessary records to separately identify each member who participates in the reduced workload program pursuant to this section.
(g) A member who retires or otherwise separates from service prior to the end of the school year shall be in violation of this section and the member’s service credit for that period of the contract shall be computed in accordance with Section 22701.

SEC. 7.

 Section 22714 of the Education Code is amended to read:

22714.
 (a) Whenever the governing board of a school district or a community college district or a county office of education, by formal action, determines pursuant to Section 44929 or 87488 that, because of impending curtailment of, or changes in, the manner of performing services, the best interests of the district or county office of education would be served by encouraging certificated employees or academic employees to retire for service and that the retirement will result in a net savings to the district or county office of education, an additional two years of service credit shall be granted under this part to a member of the Defined Benefit Program if all of the following conditions exist:
(1) The member is credited with five or more years of service credit and retires for service under Chapter 27 (commencing with Section 24201) during a period of not more than 120 days or less than 60 days, commencing no sooner than the effective date of the formal action of the employer that shall specify the period.
(2) The employer transfers to the retirement fund an amount determined by the Teachers’ Retirement Board to equal the actuarial equivalent of the difference between the allowance the member receives after receipt of service credit pursuant to this section and the amount the member would have received without the service credit and an amount determined by the Teachers’ Retirement Board to equal the actuarial equivalent of the difference between the purchasing power protection supplemental payment the member receives after receipt of service credit pursuant to this section and the amount the member would have received without the service credit. The payment for purchasing power shall be deposited in the Supplemental Benefit Maintenance Account established by Section 22400 and shall be subject to Section 24415. The transfer to the retirement fund shall be made in a manner and a time period, not to exceed eight years, that is acceptable to the Teachers’ Retirement Board. The employer shall transfer the required amount for all eligible employees who retire pursuant to this section.
(3) The employer transmits to the retirement fund the administrative costs incurred by the system in implementing this section, as determined by the Teachers’ Retirement Board.
(4) The employer has considered the availability of teachers or academic employees to fill the positions that would be vacated pursuant to this section.
(b) (1) The school district shall demonstrate and certify to the county superintendent that the formal action taken would result in a net savings to the district.
(2) The county superintendent shall certify to the Teachers’ Retirement Board that the result specified in paragraph (1) can be demonstrated. The certification shall include, but not be limited to, the information specified in subdivision (c) of Section 14502.1.
(3) The school district shall reimburse the county superintendent for all costs to the county superintendent that result from the certification.
(c) (1) The county office of education shall demonstrate and certify to the Superintendent of Public Instruction that the formal action taken would result in a net savings to the county office of education.
(2) The Superintendent of Public Instruction shall certify to the Teachers’ Retirement Board that the result specified in paragraph (1) can be demonstrated. The certification shall include, but not be limited to, the information specified in subdivision (c) of Section 14502.1.
(3) The Superintendent of Public Instruction may request reimbursement from the county office of education for all administrative costs that result from the certification.
(d) (1) The community college district shall demonstrate and certify to the chancellor’s office that the formal action taken would result in a net savings to the district.
(2) The chancellor shall certify to the Teachers’ Retirement Board that the result specified in paragraph (1) can be demonstrated. The certification shall include, but not be limited to, the information specified in subdivision (c) of Section 84040.5.
(3) The chancellor may request reimbursement from the community college district for all administrative costs that result from the certification.
(e) The opportunity to be granted service credit pursuant to this section shall be available to all members employed by the school district, community college district, or county office of education who meet the conditions set forth in this section.
(f) The amount of service credit shall be two years.
(g) Any member of the Defined Benefit Program who retires under this part for service under Chapter 27 (commencing with Section 24201) with service credit granted under this section and who subsequently reinstates shall forfeit the service credit granted under this section.
(h) Any member of the Defined Benefit Program who retires under this part for service under Chapter 27 (commencing with Section 24201) with service credit granted under this section and who takes any job with the school district, community college district, or county office of education that granted the member the service credit less than five years after receiving the credit shall forfeit the ongoing benefit he or she receives from the additional service credit granted under this section.
(i) This section does not apply to any member otherwise eligible if the member receives any unemployment insurance payments arising out of employment with an employer subject to this part within one year following the effective date of the formal action under subdivision (a), or if the member is not otherwise eligible to retire for service.

SEC. 8.

 Section 22803 of the Education Code is amended to read:

22803.
 (a) A member may elect to receive credit for any of the following:
(1) Service performed in a teaching position in a publicly supported and administered university or college in this state not covered by another public retirement system.
(2) Service performed in a certificated teaching position in a child care center operated by a county superintendent of schools or a school district in this state.
(3) Service performed in a teaching position in the California School for the Deaf or the California School for the Blind, or in special classes maintained by the public schools of this state for the instruction of the deaf, the hard of hearing, the blind, or the semisighted.
(4) Service performed in a certificated teaching position in a federally supported and administered Indian school in this state.
(5) Time served, not to exceed two years, in a certificated teaching position in a job corps center administered by the United States government in this state if the member was employed to perform creditable service subject to coverage under the Defined Benefit Program within one year prior to entering the job corps and returned to employment to perform creditable service subject to coverage under the Defined Benefit Program within six months following the date of termination of service in the job corps.
(6) Time served, not to exceed two years, in a teaching position as a member of the Peace Corps if the member was employed to perform creditable service subject to coverage under the Defined Benefit Program within one year prior to entering the Peace Corps and returned to employment to perform creditable service subject to coverage under the Defined Benefit Program within six months following the date of termination of service in the Peace Corps.
(7) Time spent on a sabbatical leave, approved by an employer in this state, after July 1, 1956.
(8) Time spent on an approved leave, approved by an employer in this state, to participate in any program under the federal Mutual Educational and Cultural Exchange Program.
(9) Time spent on leave approved by an employer in this state as maternity or paternity leave, not to exceed 24 consecutive months, regardless of whether or not the leave was taken before or after the addition of this subdivision.
(10) Time spent on an approved leave, up to four months in any 12-month period, for family care or medical leave purposes, as defined by Section 12945.2 of the Government Code, as it read on the date leave was granted, excluding maternity and paternity leave.
(11) Time spent employed by the Board of Governors of the California Community Colleges in a position subject to coverage by the Public Employees’ Retirement System between July 1, 1991, and December 31, 1997, provided the member has elected to return to coverage under the State Teachers’ Retirement System pursuant to Section 20309 of the Government Code.
(b) In no event shall the member receive credit for service or time described in paragraphs (1) to (11), inclusive, of subdivision (a) if the member has received or is eligible to receive credit for the same service or time in the Cash Balance Benefit Program under Part 14 (commencing with Section 26000) or another retirement system.

SEC. 9.

 Section 23805 of the Education Code is amended to read:

23805.
 A family allowance is payable in the amount and to the specified persons in the following order of priority:
(a) To the deceased member’s surviving spouse who has financial responsibility for at least one dependent child, an amount equal to 40 percent of the member’s final compensation or the disabled member’s projected final compensation plus 10 percent of the member’s final compensation or the disabled member’s projected final compensation for each child, up to a maximum allowance of 90 percent.
(b) If there is no surviving spouse or upon the death of the surviving spouse, to each dependent child, an amount equal to 10 percent of the deceased member’s final compensation or the disabled member’s projected final compensation, up to a maximum allowance of 50 percent. If there are more than five dependent children, they shall share equally in the maximum allowance of 50 percent.
(c) To the surviving spouse at 60 years of age or over if there is no dependent child, a monthly allowance equal to the amount that would have been payable to the spouse as beneficiary under Option 3 pursuant to Section 24300, as that section read on December 31, 2006, that provides an allowance equal to one-half of the modified retirement allowance the member would have received at 60 years of age, computed on the member’s projected final compensation and projected service to normal retirement age. The allowance payable under this subdivision shall be increased by application of the benefit improvement factor for time that elapses between the date the member would have attained normal retirement age and the date the family allowance under this subdivision begins to accrue. The allowance calculation shall include service credit for the unused sick leave that had accrued to the member as of the date of his or her death. Eligibility for the inclusion of service credit for unused sick leave credit and the calculation of that service credit shall be determined pursuant to Section 22717.
(d) If there is no surviving spouse or dependent child, to the dependent parent, 60 years of age or over, a monthly allowance equal to the amount that would have been payable to the dependent parent as beneficiary under Option 3 pursuant to Section 24300, as that section read on December 31, 2006, that provides an allowance equal to one-half of the modified retirement allowance the member would have received at 60 years of age, computed on the member’s projected final compensation and projected service to normal retirement age. The allowance calculation shall include service credit for the unused sick leave that had accrued to the member as of the date of his or her death. Eligibility for the inclusion of service credit for unused sick leave and the calculation of that service credit shall be determined pursuant to Section 22717. If there are two dependent parents, only one family allowance shall be payable under this subdivision and that allowance shall be computed on the assumption that the younger parent is the option beneficiary and the allowance shall be divided equally for as long as there are two dependent parents. Thereafter, the full allowance shall be payable to the surviving dependent parent.
(e) The surviving spouse or dependent parent may elect to begin receiving the family allowance payable under subdivision (c) or (d) immediately upon the later of the death of the member or when there is no dependent child, or to defer receipt of the allowance to the date the surviving spouse or dependent parent attains 60 years of age. If allowance payments commence prior to the date the surviving spouse or dependent parent attains 60 years of age, the allowance payable shall be actuarially reduced.
(f) If there is no dependent child, a surviving spouse or dependent parent or parents may elect, prior to receipt of the first payment under subdivision (c) or (d), to receive the member’s accumulated retirement contributions in a lump sum subject to a reduction for any disability allowance or family allowance payments previously made.
(g) (1) The allowance calculated under this section shall not include either of the following:
(A) The increase in the percentage of final compensation pursuant to Section 24203.5.
(B) The increase in the monthly allowance pursuant to Section 24203.6.
(2) This subdivision does not constitute a change in, but is declaratory of, the existing law.

SEC. 10.

 Section 23855 of the Education Code is amended to read:

23855.
 (a) The survivor benefit allowance is a monthly allowance equal to one-half of the modified retirement allowance the member would have received at 60 years of age, if the member had retired and elected Option 3 pursuant to Section 24300, as that section read on December 31, 2006, naming the spouse as the option beneficiary.
(b) The allowance payable under this subdivision shall be based on the member’s actual service credit and final compensation as of the date of his or her death, the retirement factor at 60 years of age, and the member’s and spouse’s ages as of the date the member would have attained 60 years of age. If the member’s death occurs after he or she attains 60 years of age, his or her actual final compensation, the retirement factor at 60 years of age, and the member’s and spouse’s ages as of the date of the member’s death shall be used in the allowance calculation.
(c) The allowance calculation shall include service credit for the unused sick leave that had accrued to the member as of the date of his or her death. Eligibility for the inclusion of unused sick leave service credit and the calculation of that service credit shall be determined pursuant to Section 22717.
(d) (1) The allowance calculation shall not include either of the following:
(A) The increase in the percentage of final compensation pursuant to Section 24203.5.
(B) The increase of the monthly allowance pursuant to Section 24203.6.
(2) The amendments to this section made by the act adding this paragraph do not constitute a change in, but are declaratory of, existing law.
(e) The surviving spouse may elect to begin receiving the survivor benefit allowance immediately as of the date of the member’s death or to defer receipt of the allowance to the date the member would have attained 60 years of age. If allowance payments to the surviving spouse commence prior to the date the member would have attained 60 years of age, the allowance payable shall be actuarially reduced.
(f) If the spouse elects, pursuant to Section 23852, to receive the survivor benefit allowance, an additional 10 percent of final compensation shall be payable for each dependent child who is under 21 years of age, up to a maximum of 50 percent of final compensation. The child’s portion shall begin to accrue on the day following the member’s date of death and shall be payable even if the spouse elects to postpone receipt of the spouse’s survivor benefit allowance until the date the member would have attained 60 years of age.
(g) If there is no surviving spouse, an allowance in an amount equal to 10 percent of the deceased member’s final compensation shall be paid to each dependent child who is under 21 years of age, up to a maximum of 50 percent of final compensation. If there are more than five dependent children, they shall receive allowances in equal shares of the 50 percent of final compensation. A child’s portion of the survivor benefit allowance shall begin to accrue on the day following the member’s date of death.

SEC. 11.

 Section 24204 of the Education Code is amended to read:

24204.
 A service retirement allowance under this part shall become effective upon any date designated by the member, provided all of the following conditions are met:
(a) An application for service retirement allowance is filed on a form provided by the system, which is executed no earlier than six months before the effective date of retirement allowance.
(b) The effective date is later than the last day of creditable service for which compensation is payable to the member.
(c) The effective date is no earlier than the first day of the month in which the application is received at the system’s headquarters office, as established pursuant to Section 22375.
(d) The effective date is no earlier than one year following the date on which the retirement allowance was terminated under Section 24208, or subdivision (a) of Section 24117.
(e) The effective date is no earlier than the date upon and continuously after which the member is determined to the satisfaction of the board to have been mentally incompetent.
(f) A member who files an application for service retirement may change or cancel his or her retirement application, as long as the form provided by the system is received in the system’s headquarters office, established pursuant to Section 22375, no later than the last day of the month in which the retirement date is effective.

SEC. 12.

 Section 24213 of the Education Code is amended to read:

24213.
 (a) When a member who has been granted a disability allowance under this part after June 30, 1972, attains normal retirement age, or at a later date when there is no dependent child, the disability allowance shall be terminated and the member shall be eligible for service retirement. The retirement allowance shall be calculated on the projected final compensation and projected service to normal retirement age, excluding service credited pursuant to Section 22717 or 22717.5, or Chapter 14 (commencing with Section 22800) or Chapter 14.2 (commencing with Section 22820). The allowance payable under this section, excluding annuities payable from accumulated annuity deposit contributions, shall not be greater than the terminated disability allowance. The allowance shall be increased by an amount based on any service credited pursuant to Section 22714, 22714.5, 22715, 22717, or 22717.5, or Chapter 14 (commencing with Section 22800), Chapter 14.2 (commencing with Section 22820), or Chapter 19 (commencing with Section 23200) and projected final compensation to normal retirement age.
(b) Upon retirement, the member may elect to modify the service retirement allowance payable in accordance with any option provided under this part.

SEC. 13.

 Section 24300.6 of the Education Code is amended to read:

24300.6.
 (a) Any retired member who was unmarried and not in a registered domestic partnership on the effective date of retirement who did not elect an option pursuant to Section 24300 or 24300.1, and who thereafter marries or registers in a domestic partnership, may, after the effective date of the member’s retirement under this part, elect an option described in paragraph (1), (2), or (3) of subdivision (a) of Section 24300.1, naming his or her new spouse or registered domestic partner as the option beneficiary, subject to all of the following:
(1) The retired member shall have been married or registered in a domestic partnership for at least one year prior to making the election of the option.
(2) The retired member shall notify the board, in writing on a properly executed form provided by the system, of the election of the option and the designation of the member’s new spouse or registered domestic partner as the option beneficiary. That notice shall include a certified copy of the marriage certificate or the certificate of registration of domestic partnership.
(3) The election of an option under this section is subject to approval by the board. A retired member may not elect a joint and survivor option that would result in any additional liability to the retirement fund. A retired member may not elect the compound option described in paragraph (4) of subdivision (a) of Section 24300.1.
(4) The election shall be effective six months after the date the notification is received by the board, provided that both the retired member and the retired member’s designated spouse or registered domestic partner are then living. If the effective date of the new option election is on or after January 1, 2007, at the time of the new election the retired member shall elect an option from the options described in Section 24300.1.
(b) The election of the option and designation of the option beneficiary under this section shall result in an actuarial modification of the member’s retirement allowance that shall be payable through the life of the member and the member’s new spouse or registered domestic partner. Modification of the member’s retirement allowance pursuant to this section shall be based on the ages of the retired member and the retired member’s new spouse or registered domestic partner as of the effective date of the election.

SEC. 14.

 Section 24309 of the Education Code is amended to read:

24309.
 (a) A member may change or cancel the election of an option made pursuant to Section 24307. The change or cancellation shall be on a properly executed form provided by the system and received at the system’s headquarters office, as established pursuant to Section 22375, within 30 days of the date of the member’s signature and on or before the effective date of retirement under this part or during the period between termination of the retirement allowance pursuant to Section 24208 or 24117 and the effective date of the subsequent retirement under this part. The change or cancellation shall become effective as of the date of the member’s signature.
(1) Any change to an election of an option shall be made according to Section 24307 and shall be considered a new preretirement election of an option.
(2) Regardless of how the member elects to receive his or her retirement allowance, a change made to an election of an option or a cancellation of an option shall result in the reduction of that allowance by an amount determined by the board to be the actuarial equivalent of the coverage the member received as a result of the preretirement election and that does not result in any adverse funding to the plan.
(b) If the option beneficiary designated in the preretirement election of an option pursuant to Section 24307 dies prior to the member’s retirement, the preretirement election shall be canceled as of the day following the date of death and the member’s subsequent retirement allowance under this part shall be subject to the allowance reduction prescribed in this section.
(c) If the option elected pursuant to Section 24307 is Option 8 as described in paragraph (7) of subdivision (a) of Section 24300 or the compound option as described in paragraph (4) of subdivision (a) of Section 24300.1, a member may cancel the designation of an option beneficiary. If the member cancels the designation of the option beneficiary or the option beneficiary predeceases the member prior to the member’s retirement, the member may elect to receive that portion of the retirement allowance without modification for the option or elect one or multiple new or existing option beneficiaries as described in Section 24307. Any change or cancellation of the designation of the option beneficiary under this subdivision shall result in the allowance reduction prescribed in this section.

SEC. 15.

 Section 24410.7 of the Education Code is amended to read:

24410.7.
 (a) The monthly allowance payable on the effective date of this section, excluding annuities payable from accumulated annuity deposit contributions and tax-sheltered annuity contributions and benefits payable pursuant to Sections 24410.5 and 24410.6, to retired members and nonmember spouses, disabled members, and beneficiaries, including option beneficiaries, shall be increased by the percentage set forth opposite the applicable period during which retirement, disability, or death occurred set forth in the following schedule:
Period during which retirement,
disability, or death occurred:
Percentage:
36 months ending Dec. 31, 2000
0.0%
12 months ending Dec. 31, 1997
1.0%
24 months ending Dec. 31, 1996
2.0%
60 months ending Dec. 31, 1994
3.0%
60 months ending Dec. 31, 1989
4.0%
120 months ending Dec. 31, 1984
5.0%
Dec. 31, 1974 or earlier
6.0%
(b) The increase provided pursuant to this section is in addition to any payments received by a retired member or nonmember spouse, disabled member, or beneficiary, including an option beneficiary, under Section 24415.
(c) If the monthly allowance payable is adjusted after the effective date of this section, the percentage increase applied on the effective date of this section shall be applied to the adjusted monthly allowance payable.
(d) Benefits payable under this section shall be initially payable by the system on or before July 1, 2001.

SEC. 16.

 Section 24617 of the Education Code is amended to read:

24617.
 (a) To recover an amount overpaid under this part or Part 14 (commencing with Section 26000), the corrected monthly allowance payable under the Defined Benefit Program or benefit payable under the Defined Benefit Supplement Program or the Cash Balance Benefit Program 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 information or nonsubmission of information by the recipient of the allowance or benefit.
(b) This section does not apply to the collection of overpayments due to fraud or intentional misrepresentation of facts by the recipient of the allowance or benefit.

SEC. 17.

 Section 24976 of the Education Code is amended to read:

24976.
 (a) (1) The Teachers’ Deferred Compensation Fund is hereby established to serve as the repository of funds received by the system pursuant to this chapter, Chapter 36 (commencing with Section 24950) or Chapter 39 (commencing with Section 25100).
(2) Except as described in paragraph (6), premium and fee revenues received by the system pursuant to Chapter 36 (commencing with Section 24950) shall be deposited into the 403(b) Services Operating Account within the Teachers’ Deferred Compensation Fund, and shall only be used to carry out the purposes of that chapter.
(3) Premium and fee revenues received by the system pursuant to this chapter shall be deposited into the Deferred Compensation Services Operating Account within the Teachers’ Deferred Compensation Fund, and shall only be used to carry out the purposes of this chapter.
(4) Compensation deferrals received by the system pursuant to this chapter shall be deposited into the Deferred Compensation Investment Account within the Teachers’ Deferred Compensation Fund, and shall only be used to carry out the purposes of this chapter.
(5) Fee revenues received by the system pursuant to Chapter 39 (commencing with Section 25100) shall be deposited into the 403(b) Vendor Registry Operating Account within the Teachers’ Deferred Compensation Fund, and shall only be used to carry out the purposes of that chapter.
(6) Fee revenues received by the system pursuant to Sections 24953 and 24977, and any assets in the Teachers’ Retirement Program Development Fund pursuant to Section 22307.5 as of January 1, 2008, shall be deposited into the Deferred Compensation Administrative and Compliance Services Operating Account within the Teachers’ Deferred Compensation Fund, and shall only be used to carry out the purposes of Sections 24953 and 24977.
(7) Notwithstanding Section 13340 of the Government Code, all moneys in the Teachers’ Deferred Compensation Fund shall be continuously appropriated without regard to fiscal year to carry out the purposes of this chapter, Chapter 36 (commencing with Section 24950), and Chapter 39 (commencing with Section 25100).
(b) With respect to deferred compensation plans administered pursuant to this chapter, and notwithstanding any other provision of law, the system may retain a bank or trust company, or a credit union, to serve as custodian of the moneys of the Teachers’ Deferred Compensation Fund and to provide for safekeeping, recordkeeping, delivery, securities valuation, or investment performance reporting services, or services in connection with investment of the Teachers’ Deferred Compensation Fund.
(c) With respect to deferred compensation plans administered pursuant to this chapter, the Teachers’ Deferred Compensation Fund shall consist of the following sources and receipts, and disbursements shall be accounted for as set forth below:
(1) Premiums determined by the system and paid by participating employers and employees for the cost of administering the deferred compensation plan.
(2) Asset management fees as determined by the system assessed against investment earnings of investment option or of other investment funds. These fees shall be disclosed to employees participating in the deferred compensation plan.
(3) Compensation deferrals to be paid in monthly installments by employers sponsoring deferred compensation plans described in Section 24975 for investment by the system. The moneys shall be deposited in the investment corpus account within the Teachers’ Deferred Compensation Fund and invested in accordance with the investment options selected by the participating employee.
(4) Disbursements to participating employees shall be paid from a disbursement account within the Teachers’ Deferred Compensation Fund in accordance with applicable federal law pertaining to deferred compensation plans.
(5) Income, of whatever nature, earned on the Teachers’ Deferred Compensation Fund shall be credited to the appropriate account. The accounts of participating employees of the employer shall be individually posted to reflect amounts of compensation deferred and investment gains and losses. A periodic statement shall be given to each participating employee.
(6) The system shall have exclusive control of the administration and investment of the Teachers’ Deferred Compensation Fund.
(7) All of the system’s costs of administering the deferred compensation plans pursuant to this chapter shall be recovered from the employees who participate in the plans or assets of the Teachers’ Deferred Compensation Fund in a manner acceptable to the board.

SEC. 18.

 Section 25009 of the Education Code is amended to read:

25009.
 (a) A member’s retirement benefit under the Defined Benefit Supplement Program shall be an amount equal to the balance of credits in the member’s Defined Benefit Supplement account on the date the retirement benefit becomes payable.
(b) A retirement benefit shall be a lump-sum payment, or an annuity payable in monthly installments, or a combination of both a lump-sum payment and an annuity, as elected by the member on the application for a retirement benefit. Any retirement benefit paid as an annuity under this chapter shall be subject to Section 25011 or 25011.1.
(c) Upon distribution of the entire retirement benefit in a lump-sum payment, no other benefit shall be payable to the member or the member’s beneficiary under the Defined Benefit Supplement Program.
(d) A member may not apply a lump-sum payment made to the member pursuant to this section for any of the following purposes:
(1) Purchasing service credit pursuant to Chapter 14 (commencing with Section 22800), Chapter 14.2 (commencing with Section 22820), or Chapter 14.5 (commencing with Section 22850).
(2) Redepositing previously refunded retirement contributions pursuant to Chapter 19 (commencing with Section 23200).

SEC. 19.

 Section 44041 of the Education Code is amended to read:

44041.
 (a) (1) The governing board of each school district when drawing an order for the salary payment due to employees of the district shall, without charge, reduce the order by the amount which it has been requested in a revocable written authorization by the employee to deduct for any or all of the following purposes:
(A) Paying premiums on any policy or certificate of group life insurance for the benefit of the employee or for group disability insurance, or legal expense insurance, or any of them, for the benefit of the employee or his or her dependents issued by an admitted insurer on a form of policy or certificate approved by the Insurance Commissioner.
(B) Paying rates, dues, fees, or other periodic charges on any hospital service contract for the benefit of the employee, or his or her dependents, issued by a nonprofit hospital service corporation on a form approved by the Insurance Commissioner pursuant to the former provisions of Chapter 11A (commencing with Section 11491) of Part 2 of Division 2 of the Insurance Code.
(C) Paying periodic charges on any medical and hospital service agreement or contract for the benefit of the employee, or his or her dependents, issued by a nonprofit corporation subject to Part 2 (commencing with Section 5110) of, Part 3 (commencing with Section 7110) of, or Part 11 (commencing with Section 10810) of, Division 2 of Title 1 of the Corporations Code.
(D) Paying periodic charges on any legal services contract for the benefit of the employee, or his or her dependents issued by a nonprofit corporation subject to Part 3 (commencing with Section 7110) of, or Part 11 (commencing with Section 10810) of, Division 2 of Title 1 of the Corporations Code.
(2) The requirements of this subdivision shall not apply to subdivision (b).
(b) For purposes of a deferred compensation plan authorized by Section 403(b) or 457 of the Internal Revenue Code or an annuity program authorized by Section 403(b) of the Internal Revenue Code that is offered by the school district which provides for investments in corporate stocks, bonds, securities, mutual funds, or annuities, except as prohibited by the California Constitution, the governing board of each school district when drawing an order for the salary payment due to an employee of the district shall, with or without charge, reduce the order by the amount which it has been requested in a revocable written authorization by the employee to deduct for participating in a deferred compensation plan or annuity program offered by the school district. The governing board shall determine the cost of performing the requested deduction and may collect that cost from the organization, entity, or employee requesting or authorizing the deduction. For purposes of this subdivision, the governing board of a school district is entitled to include in the amounts reducing the order the costs of any compliance or administrative services that are required to perform the requested deduction in compliance with federal or state law, and may collect these costs from the participating employee, the employee’s participant account, or the organization or entity authorizing the deduction.
(c) The governing board of the district shall, beginning with the month designated by the employee and each month thereafter until authorization for the deduction is revoked, draw its order upon the funds of the district in favor of the insurer which has issued the policies or certificates or in favor of the nonprofit hospital service corporation which has issued hospital service contracts, or in favor of the nonprofit corporation which has issued medical and hospital service or legal service agreements or contracts, for an amount equal to the total of the respective deductions therefor made during the month. The governing board may require that the employee submit his or her authorization for the deduction up to one month in advance of the effective date of coverage.
(d) “Group insurance” as used in this section shall mean only a bona fide group program of life or disability or life and disability insurance where a master contract is held by the school district or an employee organization but it shall, nevertheless, include annuity programs authorized by Section 403(b) of the Internal Revenue Code when approved by the governing board.

SEC. 20.

 Section 44830.3 of the Education Code is amended to read:

44830.3.
 (a) The governing board of any school district that maintains prekindergarten, kindergarten, or grades 1 to 12, inclusive, classes in bilingual education, or special education programs for pupils with mild and moderate disabilities, may, in consultation with an accredited institution of higher education offering an approved program of pedagogical teacher preparation, employ persons authorized by the Commission on Teacher Credentialing to provide service as district interns to provide instruction to pupils in those grades or classes as a classroom teacher. The governing board shall require that each district intern be assisted and guided by a certificated employee selected through a competitive process adopted by the governing board after consultation with the exclusive teacher representative unit or by personnel employed by institutions of higher education to supervise student teachers. These certificated employees shall possess valid certification at the same level, or of the same type of credential, as the district interns they serve.
(b) The governing board of each school district employing district interns shall develop and implement a professional development plan for district interns in consultation with an accredited institution of higher education offering an approved program of pedagogical preparation. The professional development plan shall include all of the following:
(1) Provisions for an annual evaluation of the district intern.
(2) As the governing board determines necessary, a description of courses to be completed by the district intern, if any, and a plan for the completion of preservice or other clinical training, if any, including student teaching.
(3) Mandatory preservice training for district interns tailored to the grade level or class to be taught, through either of the following options:
(A) One hundred twenty clock hours of preservice training and orientation in the aspects of child development, classroom organization and management, pedagogy, and methods of teaching the subject field or fields in which the district intern will be assigned, which training and orientation period shall be under the direct supervision of an experienced permanent teacher. In addition, persons holding district intern certificates issued by the commission pursuant to Section 44325 shall receive orientation in methods of teaching pupils with mild and moderate disabilities. At the conclusion of the preservice training period, the permanent teacher shall provide the district with information regarding the area that should be emphasized in the future training of the district intern.
(B) The successful completion, prior to service by the intern in any classroom, of six semester units of coursework from a regionally accredited college or university, designed in cooperation with the school district to provide instruction and orientation in the aspects of child development and the methods of teaching the subject matter or matters in which the district intern will be assigned.
(4) Instruction in child development and the methods of teaching during the first semester of service for district interns teaching in prekindergarten, kindergarten, or grades 1 to 6, inclusive, including bilingual education classes and, for persons holding district intern certificates issued by the commission pursuant to Section 44325, special education programs for pupils with mild and moderate disabilities at those levels.
(5) Instruction in the culture and methods of teaching bilingual pupils during the first year of service for district interns teaching pupils in bilingual classes and, for persons holding district intern certificates issued by the commission pursuant to Section 44325, instruction in the etiology and methods of teaching pupils with mild and moderate disabilities.
(6) Any other criteria that may be required by the governing board.
(7) In addition to the requirements set forth in paragraphs (1) to (6), inclusive, the professional development plan for district interns teaching in special education programs for pupils with mild and moderate disabilities shall also include 120 clock hours of mandatory training and supervised fieldwork that shall include, but not be limited to, instructional practices, and the procedures and pedagogy of both general education programs and special education programs that teach pupils with disabilities.
(8) In addition to the requirements set forth in paragraphs (1) to (6), inclusive, the professional development plan for district interns teaching bilingual classes shall also include 120 clock hours of mandatory training and orientation, which shall include, but not be limited to, instruction in subject matter relating to bilingual-crosscultural language and academic development.
(9) The professional development plan for district interns teaching in special education programs for pupils with mild and moderate disabilities shall be based on the standards adopted by the commission as provided in subdivision (a) of Section 44327.
(c) Each district intern and each district teacher assigned to supervise the district intern during the preservice period shall be compensated for the preservice period required pursuant to subparagraph (A) or (B) of paragraph (3) of subdivision (b). The compensation shall be that which is normally provided by each district for staff development or in-service activity.
(d) Upon completion of service sufficient to meet program standards and performance assessments, the governing board may recommend to the Commission on Teacher Credentialing that the district intern be credentialed in the manner prescribed by Section 44328.