The signing ceremony took place in Los Angeles and included Speaker John Pérez (D-Los Angeles), Senate President Pro Tem Darrell Steinberg (D-Sacramento) and Assembly Member Cameron Smyth (R-Santa Clarita).
CalPERS estimates that the reforms, which apply to all public employers and pension plans with the exception of University of California as well as charter cities and charter counties that do not participate in CalPERS or the 37 Act System, will save $42 – 55 billion over the next 30 years.
Moody’s Investment Service issued a report on Monday, Sept. 10, stating that the reforms would be positive for both the state and local governments that are in CalPERS.
AB 340, which goes into effect on Jan. 1, makes changes to public employee pensions including establishing a cap on the amount of salary that can be used to calculate retirement benefit, raising the retirement age for both public safety and miscellaneous employees, implementing cost-sharing, using the average of the final three years to calculate final compensation, implementing a 180 day sit-out period for retired persons to return to work in the retirement system in which they receive a pension, defines “pension compensation,” a pension forfeiture requirement for public employees convicted of committing a felony in connection with their job, the elimination of airtime, pension holidays and pension spiking.
The League has prepared a side-by-side analysis of the plan and the pension reform plan adopted by the League board of directors in July 2011.
Moody’s report is available online.