Copyright © 2003 School Services of California, Inc.

Volume 23                    For Publication Date: October 3, 2003                  No. 20

Ask SSC . . .  

Could You Provide More Clarification on AB 1207?  

Q1.      I have some more questions regarding AB 1207.  

One of your articles said that the payment to the State Teachers Retirement System (STRS) can be made over seven years. Would the district be allowed to calculate the savings over the same time period?  

The bill also says that a person who retires under the “2 plus 2” rule cannot work in the district for up to five years. Does this mean not work at all, or could he or she work up to the point he or she would be required to be reported to STRS? Also could he or she work in a different district? One of our superintendents thinks there is a one-year rule on other districts, but it appears to me that reference is to drawing disability or unemployment.  

A1.      Please see our article in the September 19, 2003 , Fiscal Report titled, “Now that the STRS Golden Handshake Bill has Been Signed by the Governor . . . ” I believe that all of your questions are answered in that article. The quick answers that follow are expanded in some detail in that article.  

The time limitation is placed on the payments to STRS. There are no express accommodations allowed for calculating the savings for more than one year  

            The person cannot work at all-even as a substitute-for any district.  

Q2.      Your recent article on AB 1207 (see “Now that the STRS Golden Handshake Bill Has Been Signed by the Governor” in the September 19, 2003, Fiscal Report, page 350) provides an estimated cost of $35,000 per retiree for the two years of service credit, and $105,000 for the two years of service credit plus two years of age credit. Are these one-time costs, or are they required payments for more than one year?  

A2.      These are one-time costs that must be paid to STRS, but they can be paid to STRS over a period of up to seven years.  

Q3.      I heard a rumor that AB 1207 reinstated the option to offer two years of service credit, with no sunset date. Is that correct?  

A3.      Yes. To clarify the effective dates of this new law, the program to offer two years of service credit-the old Golden Handshake program-has been reinstated, with no sunset date.  It's the 2 + 2 program (two years of service credit and two years of age) that has the sunset date of January 1, 2005 . We have yet to determine whether the board simply has to take action before that date or if the employee has to actually retire before that date. Stay tuned.

-Carol Berg and Sheila Bua