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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2025-02-21</ns0:ActionDate>
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<ns0:ActionText>AMENDED_ASSEMBLY</ns0:ActionText>
<ns0:ActionDate>2025-03-24</ns0:ActionDate>
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<ns0:ActionText>AMENDED_ASSEMBLY</ns0:ActionText>
<ns0:ActionDate>2026-01-22</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Garcia</ns0:AuthorText>
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<ns0:Name>Garcia</ns0:Name>
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<ns0:Title> An act to add Section 7513.77 to the Government Code, relating to public retirement systems.</ns0:Title>
<ns0:RelatingClause>public retirement systems</ns0:RelatingClause>
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<ns0:Subject>Public retirement systems: development projects: labor standards.</ns0:Subject>
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<html:p>The California Constitution grants the retirement board of a public employee retirement system plenary authority and fiduciary responsibility for investment of moneys and administration of the retirement fund and system. These provisions qualify this grant of powers by reserving to the Legislature the authority to prohibit investments if it is in the public interest and the prohibition satisfies standards of fiduciary care and loyalty required of a retirement board.</html:p>
<html:p>Existing law prohibits the boards of the Public Employees’ Retirement System (PERS) and the State Teachers’ Retirement System (STRS) from making
certain new investments or renewing existing investments of public employee retirement funds, including in a thermal coal company, as defined. Existing law provides that a board is not required to take any action regarding those investments unless the board determines in good faith that the action is consistent with the board’s fiduciary responsibilities established in the California Constitution.</html:p>
<html:p>This bill would state that its purpose is to require the boards of PERS and STRS to contract with the University of California Labor Centers to conduct an independent study to determine the impacts on public employee retirement funds of prohibiting the
board of a public pension or retirement system, as defined, from investing in development projects in California that do not provide labor standards protections for workers. The bill would require the study and a report of its findings to be completed and provided to the Legislature and the Department of Finance by January 1, 2028, as specified.
The bill would provide that a board is not required to take action pursuant to this provision unless it determines in good faith that the action is consistent with the board’s fiduciary responsibilities established in the California Constitution.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Section 7513.77 is added to the
<ns0:DocName>Government Code</ns0:DocName>
, to read:
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(a)
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The Legislature finds and declares all of the following:
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(1)
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The development of projects in California that do not involve strong labor standards protections for workers is not in the public interest or the interests of the participants in and beneficiaries of public pension and retirement systems.
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(2)
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The purpose of this section is to require the Board of Administration of the Public Employees’ Retirement System and the Teachers’ Retirement Board of the State
Teachers’ Retirement System, to contract with the University of California Labor Centers to conduct an independent study to determine the impacts on public employee retirement funds of prohibiting the boards of public pension and retirement systems from investing in development projects in California that do not provide labor standards protections for workers. The study and a report of its findings shall be completed and provided to the Legislature, in compliance with Section 9795, and to the Department of Finance, by January 1, 2028. If additional expertise is needed, the University of
California is authorized to subcontract with additional entities to perform individual components of the study.
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(b)
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As used in this section, the following definitions apply:
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(1)
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“Board” means the Board of Administration of the Public Employees’ Retirement System, consistent with Section 20021, and the Teachers’ Retirement Board of the State Teachers’ Retirement System, consistent with Section 22109 of the Education Code.
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(2)
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“Labor standards protections” means all of the following:
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(A)
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Construction work performed to carry out and maintain the development project will be subject to the same prevailing wage and apprenticeship requirements that apply to public projects pursuant to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
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(B)
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(i)
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All construction and maintenance work for the development project will be performed only by contractors and subcontractors that have provided an enforceable commitment to
use a skilled and trained workforce, as defined in Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code, to perform all work that falls within an apprenticeable occupation in the building and construction trades.
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(ii)
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This subparagraph shall not apply if the work is covered by a project labor agreement that requires the use of a skilled and trained workforce. For purposes of this subparagraph, “project labor agreement” means a prehire collective bargaining agreement that establishes terms and conditions of employment for a specific construction project or projects and is an agreement described in Section 158(f) of Title 29 of the United States Code.
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(C)
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The developer has provided commitments designed to provide labor peace during
union organizing campaigns for workers who will be employed upon completion of the project.
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(c)
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Nothing in this section shall require a board to take action as described in this section unless the board determines in good faith that the action described in this section is consistent with the fiduciary responsibilities of the board described in Section 17 of Article XVI of the California Constitution.
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