AB 130

Bill Subjects

Abstract

(1) Existing law, the State Civil Service Act, regulates employment with the state and vests in the Department of Human Resources all powers, duties, and authorities necessary to operate the state civil service system in accordance with Article VII of the California Constitution, the Government Code, the merit principle, and applicable rules duly adopted by the State Personnel Board. Existing law requires, except as specified, that the Controller establish and maintain a payroll of all persons employed by every state agency. Existing law requires, unless otherwise provided by law, that the salaries of state officers be paid monthly out of the General Fund. This bill, instead, would require the salaries of state officers and employees to be paid out of the General Fund, or another recognized state fund which a respective employee's position is funded, on a uniform payroll cycle established by the department. Under existing law, if there is a conflict between the above-described state officer payment provision and a memorandum of understanding reached between the Governor and the recognized employee organization, the memorandum of understanding is controlling without further legislative action, except as specified. This bill would delete that provision. (2) Existing law requires the department to establish and adjust salary ranges for each class of position in the state civil service, as specified, and to submit a report containing its findings relating to the salaries of employees in comparable occupations in private industry and other governmental agencies at least 6 months before the end of the term of an existing memorandum of understanding or immediately upon the reopening of negotiations under an existing memorandum of understanding. This bill would instead require that the department submit this report biennially beginning on either February 1, 2025, or February 1, 2026, as specified based on the bargaining units included in the report. (3) The Public Employees' Retirement Law (PERL) creates the Public Employees' Retirement System (PERS) for the purpose of providing public employees pension and benefits to state employees and their beneficiaries and prescribes the rights and duties of employers participating in the system. Under PERL, benefits are funded by investment income and employer and employee contributions, which are deposited into the Public Employees' Retirement Fund, a continuously appropriated trust fund administered by the system's board of administration. The PERL and labor agreements prescribe different normal rates of contribution for employees depending on bargaining unit, employer, and inclusion of service in the federal social security system, among other factors. Existing laws that prescribe these normal rates of contribution for certain of these categories of employees also authorize the Director of the Department of Human Resources to exercise their discretion to establish the normal rate of contribution, as described above, for a state employee within the subject category who is excepted from a specific statutory definition of "state employee" or is an officer or employee of the executive branch of state government who is not a member of the civil service, subject to certain conditions. Some, but not all, of these authorizations require the director to exercise this discretion to set a normal contribution rate for these employees in a manner consistent with other state employees. This bill would require the director, when acting under all of these authorizations, to exercise discretion to establish retirement rates for excepted employees and employees who are not members of the civil service in a manner consistent with other state employees. Existing laws authorize the director to determine the effective date of these contribution rates but prohibit an effective date any earlier than the beginning of the pay period following notice of the contribution rates to the PERS board. This bill would authorize the director to determine the effective date of the contribution rate without being subject to these prohibitions. By authorizing the deposit of increased amounts into a continuously appropriated fund, this bill would make an appropriation. This bill would also make nonsubstantive changes to those provisions. (4) PERL prescribes methods for the calculation and payment of the state employer contribution for its employees who are PERS members. PERL provides for an annual adjustment of the state's contribution in the budget and quarterly appropriations to the Public Employees' Retirement Fund from the General Fund and other funds that are responsible for payment of the employer contribution. Existing law makes additional supplemental General Fund appropriations to the Public Employees' Retirement Fund for the 2020–21, 2021–22, and 2022–23 fiscal years. Supplemental payments connected with appropriations for the 2020–21, 2021–22, and 2022–23 fiscal years are to be apportioned to the state employee member categories generally, as directed by the Department of Finance, and to specified state employee member categories, including to the state miscellaneous member category, the industrial member category, the state safety member category, and the state peace officer/firefighter member category. The California Constitution establishes the Budget Stabilization Account in the General Fund and requires the Controller, in each fiscal year, to transfer from the General Fund to the Budget Stabilization Account amounts that include a sum equal to 1.5% of the estimated amount of General Fund revenues for that fiscal year. These provisions further require, until the 2029–30 fiscal year, that the Legislature appropriate a percentage of these moneys, the amount of which is generated pursuant to specified calculations, for certain obligations and purposes, including addressing unfunded liabilities for state-level pension plans. This bill would appropriate $1,657,000,000 from the General Fund for the purposes identified in the constitutional provisions described above, to supplement the state's appropriation to the Public Employees' Retirement Fund. The bill would specify that this appropriation represents a portion of the amount identified in a specific provision of the Budget Act of 2023. The bill would require the Department of Finance to provide the Controller with a schedule establishing the timing of specific transfers. The bill would require the supplemental payment to the Public Employees' Retirement Fund to be apportioned to specified state employee member categories, not to exceed $769,620,000 to the state miscellaneous member category, $44,500,000 to the state industrial member category, $99,924,000 to the state safety member category, and $742,956,000 to the state peace officer/firefighter member category. The bill would require the appropriation described above to be applied to the unfunded state liabilities for the state employee member categories that are in excess of the base amounts for the 2023–24 fiscal year. (5) Existing law requires the Division of Labor Standards Enforcement, upon appropriation of funding for this purpose, to establish and maintain an outreach and education program for the purpose of promoting awareness of, and compliance with, labor protections that affect the domestic work industry and fair and dignified labor standards in this industry and other low-wage industries. Under existing law, the program would continue until June 30, 2024, with an opportunity to expand or renew contingent on allocation of state funds or identification of other revenue sources. Under existing law, these provisions become inoperative on July 1, 2024, and are repealed January 1, 2025. This bill would remove the June 30, 2024, date on which the program would be discontinued. The bill would also remove the July 1, 2024, inoperative date and the January 1, 2025, repeal date, thereby making these provisions operative indefinitely. (6) Existing law requires that, except as specified, not less than the general prevailing rate of per diem wages be paid to workers employed on public works and imposes misdemeanor penalties for a willful violation of this requirement. Existing law defines "public works," for the purposes of regulating public works contracts, as, among other things, construction, alteration, demolition, installation, or repair work done under contract and paid for, in whole or in part, out of public funds. Existing law generally requires a contractor or subcontractor to be registered with the Department of Industrial Relations to be qualified to bid on, be listed in a bid proposal, or engage in the performance of any public work contract. Existing law requires a contractor or subcontractor to meet specific conditions to qualify for this registration, including that a contractor or subcontractor pay a $400 initial application fee and an annual renewal fee set by the Director of Industrial Relations and that the contractor or subcontractor has not bid on a public works contract, been listed in a bid proposal, or engaged in the performance of a contract for public works without being lawfully registered, as specified. This bill would require projects or developments undertaken pursuant to the Middle Class Housing Act of 2022, the Affordable Housing and High Road Job Act of 2022, and housing development approvals, as specified, to be subject to specified prevailing wage or skilled and trained workforce requirements. This bill would impose misdemeanor penalties for a willful violation of these provisions. The bill would impose separate requirements and fees on contractors and subcontractors in order to be qualified to be awarded contracts for, or engage in the performance of, these projects or developments. This bill would, after July 1, 2026, change the initial application fee to an unspecified amount. The bill would authorize the director to establish and adjust annual registration and renewal fees of up to $800 by publishing the fees on the department's internet website, but would subject the establishment or adjustment of registration and renewal fees in excess of $800 to the rulemaking provisions of the Administrative Procedure Act. The bill would, thereafter, require the director to publish those fees to the department's internet website. The bill would make conforming changes. (7) Existing law establishes the State Public Works Enforcement Fund and directs all registration fees and other moneys, such as fines, to be deposited into the fund for, among other purposes, the reasonable costs of administering the registration provisions described above. Existing law also requires that the annual contractor registration renewal fee and any adjusted application or renewal fee be set in amounts that are sufficient to support the annual appropriation approved by the Legislature and not result in a fund balance greater than 25% of the appropriation. Existing law requires any balance in the fund greater than 25% of the appropriation to be applied as a credit when determining any fee adjustments for the subsequent fiscal year. This bill would require the fees and other related fines associated with the new qualification requirements described above be deposited into the State Public Works Enforcement Fund. The bill would also require that the annual contractor registration renewal fees and any adjusted application or renewal fee, as specified, be set in amounts that are sufficient to support appropriations approved by the Legislature, the statewide general administrative costs assessed to the fund, and a prudent reserve fund of no less than 10% and no more than 20% of authorized expenditure levels. The bill would also require any year-end fund balance in excess of the prudent reserve fund be applied as a credit when determining any fee adjustments for the subsequent fiscal year. By creating a new crime, this bill would impose a state-mandated local program. (8) Existing law requires the Employment Development Department to submit to the Legislature in May and October of each year a report on the status of the Unemployment Fund and the Unemployment Compensation Disability Fund, containing actual and forecasted information on each fund, as specified. This bill would instead require the department to submit to the Legislature the report described above in January and May of each year. (9) Existing law establishes within the Workforce Services Branch of the Employment Development Department, the Community Economic Resilience Fund Program, to build an equitable and sustainable recovery from the impacts of COVID-19 on California's industries, workers, and communities, among other things, subject to an appropriation by the Legislature for these purposes. Existing law requires the branch to administer the program, along with an Inter-Agency Leadership Team consisting of the Labor and Workforce Development Agency, the Office of Planning and Research, and the Governor's Office of Business and Economic Development. Under existing law, the program is required to include a focus on regions and communities most affected by the economic impact of COVID-19, as authorized in federal guidance, and whose economic distress has been exacerbated by COVID-19. Existing law also requires the Inter-Agency Leadership Team, in creating the program, to include guidelines and evaluation metrics that, at a minimum, support federal reporting. This bill would revise and recast certain of the above provisions to, among other things, remove references to those regions and communities most affected by the economic impact of COVID-19, as authorized in federal guidance. The bill would also delete language referring to metrics that, at a minimum, support federal reporting. The bill would make related changes, including deleting other references to specified federal law and regulations within these provisions. (10) Existing law requires high road transition collaboratives supported by the program to work directly with community capacity-building programs to support active and equitable community engagement. This bill would revise and recast certain of the above provisions to, among other things, require the collaboratives to support other similar state-sponsored local and regional economic, workforce, and community development programs and initiatives, and to seek out and invite into the engagement process local and regional planning efforts whose mission is aligned with the program. The bill would also authorize a portion of grant funding to be reserved for making planning and implementation grants to Native American tribes under criteria and conditions determined by the Inter-Agency Leadership Team, consistent with the purposes of the program, as specified. (11) Existing law requires implementation grants under the program to be awarded on a rolling and competitive basis, with the majority of funds to be used to provide economic development grants, through June 30, 2024, and grant recipients required to demonstrate a plan to fully spend or obligate all funds received by December 31, 2024. This bill would extend the above-described timeframes for the award of those grants until June 30, 2025, and for recipients to fully spend or obligate funds received until December 31, 2025. (12) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. (13) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.