BILL ANALYSIS                                                                                                                                                                                                    






          SENATE PUBLIC EMPLOYMENT & RETIREMENT     BILL NO: AB 775
          Patricia Wiggins, Chair       Hearing date: June 25, 2007
          AB 775 (Niello)    as introduced  2/22/07    FISCAL:   NO

           '37 ACT COUNTIES:  PROHIBIT RETIRED COUNTY EMPLOYEES WHO  
          RETURN TO PART-TIME COUNTY EMPLOYMENT AFTER RETIREMENT AND  
          THEN CLAIM UNEMPLOYMENT INSURANCE BENEFITS FROM CONTINUING  
          THEIR PART-TIME COUNTY EMPLOYMENT AFTER RETIREMENT
           
           HISTORY  :

              Sponsor:  County of Sacramento

              Prior legislation:  SB 1439 (Speier)
                         Chapter 398 of 2004

           ASSEMBLY VOTES  :

              PER & SS             6-0       5/02/07
              Assembly Floor       72-0      5/10/07
           
          SUMMARY  : 

          Would prohibit a retiree of a county operating a retirement  
          system under the County Employees' Retirement Law of 1937  
          ('37 Act) from being hired by the same '37 Act county from  
          which they retired, if, during the 12-month period prior to  
          the appointment, the retiree received unemployment insurance  
          payments arising out of prior county employment as a retired  
          annuitant.


           BACKGROUND  :

          1)   Existing '37 Act law allows retired county employees to  
          work for their former employer up to 960 hours per year after  
          retirement  .

           Existing '37 Act law  authorizes a '37 Act county to employ a  
          retired annuitant in a position requiring special skills or  
          knowledge for up to 120 working days or 960 hours, whichever  
          is greater, in a fiscal year or any other designated 12-month  
          period, without reinstatement from retirement or loss or  
          interruption of retirement benefits, and
          David Felderstein
          Date: 5/22/07              Page 1 










          2)   Existing law provides Unemployment Insurance program  

           Existing law  also provides for the Unemployment Insurance  
          (UI) program, administered by the State Employment  
          Development Department, granting weekly UI payments for  
          workers who lose their job through no fault of their of own.   
          Eligibility for benefits requires that the claimant be able  
          to work, be seeking work, and be willing to accept a suitable  
          job.

































          David Felderstein
          Date: 5/22/07              Page 2 









          3)   Chapter 398 of 2004 prohibits PERS retired annuitants who  
          claim Unemployment Insurance from working for their former  
          employer  

           Existing PERS law  permits a retiree to work for in  
          PERS-covered employment, for up to 960 hours in a calendar  
          year, without reinstatement from retirement or loss or  
          interruption of PERS retirement benefits.

           Chapter 398 of 2004  prohibits a PERS retiree from being hired  
          by a state agency, if during the 12-month period prior to the  
          proposed appointment, the PERS retiree received any UI  
          payments arising out of prior post-retirement employment with  
          a PERS employer.


           ANALYSIS  :

           This bill  would prohibit a retiree of a county operating a  
          retirement system under the County Employees' Retirement Law  
          of 1937 ('37 Act) from being hired by the same '37 Act county  
          from which they retired, if, during the 12-month period prior  
          to the appointment, the retiree received unemployment  
          insurance payments arising out of prior county employment as  
          a retired annuitant.


           FISCAL EFFECT  :
          
          Unknown


           COMMENTS  :
          
          1)   Arguments in support  

          According to the sponsor, the County of Sacramento:

            "Employees who retire from county service and return to  
            work as retired annuitants on temporary assignments are  
            eligible to draw unemployment insurance in the event they  
            have worked the maximum 960 hours or are released from  
            their position due to lack of work.  This practice has been  
            referred to in the press as "triple dipping" (i.e.,  
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          Date: 5/22/07              Page 3 









            collecting retirement, retired annuitant salary and  
            unemployment insurance).  While this allowable practice has  
            not been prevalent in Sacramento County, the Board of  
            Supervisors believes that it is inappropriate.  Retired  
            state employees are allowed to collect unemployment  
            insurance after working 960 hours or being released due to  
            lack of work, but are prevented from being hired as a  
            retired annuitant by the employer from whom they earned  
            their retirement if the retirees have received unemployment  
            insurance benefits in a 12-month period."

































          David Felderstein
          Date: 5/22/07              Page 4 









          Supporters state:

            "AB 775 (Niello) states that 1937 Act counties cannot hire  
            a retired annuitant if they received any employment  
            insurance payments from their home county during the prior  
            year.  This change parallels current law for state  
            employees and conforms to federal law.  AB 775 (Niello)  
            will have no impact on the employee's retirement or retired  
            annuitant amounts."

          2)   SUPPORT  :

               California State Association of Counties (CSAC)

          3)   OPPOSITION  :

               None to date




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          David Felderstein
          Date: 5/22/07              Page 5