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CalPERS staff outline five state bills that would alter pension rules, audits and health coverage
Summary
CalPERS legislative staff summarized five state bills under CalPERS review — including PEPRA changes in AB 1383, a CalPERS‑sponsored streamlining bill (SB 939), audit‑transparency requirements (SB 1038), a health coverage mandate that CalPERS says could raise premiums (SB 1089), and omnibus timing changes (SB 1444).
Andrea Peters, CalPERS legislative presenter, told the School Employer Advisory Committee on May 19 that staff are tracking five state bills that could affect retirement calculations, audit procedures and health plan requirements.
“Assembly bill 1383 includes several perspective changes to the Public Employees’ Pension Reform Act of 2013,” Peters said, describing provisions that would adjust the pensionable‑compensation limit for service earned on or after Jan. 1, 2027 and move several safety formulas to a lower eligibility age. She said the bill would also create a fourth PEPA safety formula at “3% at 55 with a 90% cap.” CalPERS has not yet taken a board position on AB 1383.
Peters said the board sponsored Senate Bill 939 to standardize service‑credit purchase payment options and to require unpaid balances at retirement to be paid within 90 days or have the purchased credit prorated. “The CalPERS board sponsored this bill because it aligns CalPERS’ service credit purchase payment options with all other public retirement systems,” she said.
On audit transparency, Peters summarized SB 1038 as requiring CalPERS to post on its website the employer under audit and the audit’s purpose and scope before initiating the audit, provide written notice to the affected employer, and furnish the employer with the final audit report. She said those provisions would codify existing CalPERS processes and also add new employer‑notification obligations.
Peters flagged SB 1089 — a bill that would require certain CalPERS‑contracted health plans to cover chronic weight‑management services including at least one FDA‑approved GLP‑1 anti‑obesity medication — and relayed CalPERS’ concern about cost. “CalPERS has raised concerns that mandating the coverage of the GLP‑1 will increase CalPERS premiums by 200 to 400 million in year 1 alone,” she said; the board will review the bill in June.
Finally, Peters summarized SB 1444 as an omnibus bill with many departmental provisions, and noted a provision extending some member election windows from 30 to 60 calendar days after issuance of the first retirement check.
None of the bills discussed had scheduled hearings at the time of the presentation; Peters identified the current committee or floor status for each and said the CalPERS board had not yet taken positions on most of them.
What happens next: CalPERS staff will follow bill actions and provide updated guidance to employers and members as positions and amendments evolve.
