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JBC introduces Proposition 130 implementation bill; creates $1M death benefit, law‑enforcement fund and PERA financing plan
Summary
The Joint Budget Committee introduced the implementation bill for Proposition 130 6-0, creating a $1,000,000 death benefit for surviving families of covered first responders, establishing a peace‑officer training and support fund funded via a $500 million warrant to PERA and a capped annual transfer, and adding audit and tax‑exemption provisions.
The Joint Budget Committee voted 6-0 to introduce a draft implementing Proposition 130, which sets up a $1,000,000 lump‑sum death benefit for surviving family members of covered first responders, establishes a recurring distribution to local law‑enforcement agencies, and creates the financing mechanics tied to PERA investments.
OLLS attorney Pierce Lively summarized the proposal and financing. The bill creates a death‑benefit fund, initially funded with $5,000,000 on enactment and topped to $10,000,000 the following July, from which $1,000,000 payments would be made to surviving families in covered circumstances. Lively also explained tax treatment: where a federal deduction is not available, the bill creates a state income tax deduction to prevent state income tax on the payment.
For the local law enforcement distributions (the $350,000,000 component in Proposition 130), the bill instructs the state to send a $500,000,000 warrant to PERA; PERA would invest the funds and the state would use PERA’s investment earnings (capped at $35,000,000 per year and with a $15,000,000 floor) to fund a “peace officer training and support fund” that will distribute money by formula to law enforcement agencies. The bill reduces the state’s statutorily required direct distribution to PERA by the amount deposited into the peace officer fund so PERA retains the investment earnings. The bill also contains anti‑supplanting language intended to prevent local jurisdictions from replacing existing local funds with these new revenues.
“From a purely budgetary perspective, there is a strict prohibition on using these funds to supplant existing existing money,” Mr. Lively told the committee when describing the anti‑supplanting enforcement approach.
Committee members questioned the breadth of the definitions (for example, emergency medical service providers and “occupational disease”), the potential long‑term reliance on ongoing earnings and the interaction with the state reserve. The committee inserted an audit requirement: local governments that receive distributions must include evidence of compliance with permissible‑use and non‑supplanting rules in their annual audit, which will be reviewed by the Department of Public Safety.
Committee members also authorized staff to accept technical changes requested by PERA prior to introduction. The motion to introduce the Proposition 130 implementation bill passed 6-0; sponsors and cosponsors were named for both chambers.
