SECTIONS 22940-22944.3

22940.  There is in the State Treasury the Annuitants' Health CareCoverage Fund that is a trust fund and a retirement fund, within themeaning of Section 17 of Article XVI of the California Constitution.Notwithstanding Section 13340, all moneys in the fund arecontinuously appropriated without regard to fiscal years to the boardfor expenditure for the prefunding of health care coverage forannuitants pursuant to this part, including administrative costs. Theboard has sole and exclusive control and power over theadministration and investment of the Annuitants' Health Care CoverageFund and shall make investments pursuant to Part 3 (commencing withSection 20000).22942.  For purposes of this article, the following definitionsshall apply: (a) "Annuitant" means any of the following: (1) An annuitant described in Section 22760. (2) A person who retires from employment with an employerdescribed in paragraph (2) of subdivision (c) and who receivespostemployment health care benefits or other postemployment benefitsfrom the prefunding plan provided by that employer. (3) A surviving family member who receives postemployment healthcare benefits or other postemployment benefits as a beneficiary of adeceased person described in paragraph (2). (b) "Employee" means an employee described in Section 22772."Employee" also means an officer or employee of an employer describedin paragraph (2) of subdivision (c). (c) "Employer" means either of the following: (1) An employer described in Section 22773. (2) An entity described in Section 22920 that has one or moreemployees and that entity provides postemployment health carebenefits or other postemployment benefits to annuitants.22943.  An employer authorized by the board may elect to participatein the prefunding plan established by this article.22944.  The board may, in its discretion and upon terms andconditions set by the board, authorize an employer to participate inthe prefunding plan established by this article. The governing bodyof a participating employer shall enter into a contract with theboard, setting forth the terms and conditions of that employer'sparticipation in the prefunding plan, including, but not limited to,funding, expenditures, and actuarial, accounting, reporting, andinvestment considerations.22944.2.  (a) A contract entered into between an employer and theboard pursuant to Section 22944 shall not create, change, or vest theobligations of an employer or the board that were created under anyother contract, law, ordinance, regulation, or similar actions toprovide benefits for employees or annuitants of a participatingemployer. (b) A contract between an employer and the board entered intopursuant to Section 22944, in and of itself, shall not create,change, or vest an obligation for either party to the contract toprovide a specific level of postemployment health care benefits orother postemployment benefits to employees or annuitants of aparticipating employer. (c) A contract between an employer and the board entered intopursuant to Section 22944, in and of itself, shall not preclude or inany way affect the authority of the employer to create, change, orvest the specific postemployment health care benefits or otherpostemployment benefits that the employer may choose to provide toits employees or annuitants.22944.3.  (a) Any amount that would otherwise be used to permanentlyincrease compensation pursuant to Section 19827, effective on July1, 2009, and on July 1, 2010, shall instead be used to permanentlyprefund postemployment health care benefits for patrol members. Theamount used to prefund benefits relative to any increases under thesurvey methodology effective July 1, 2010, shall not exceed 2percent. The state shall take credit for these prefundingcontributions in the survey methodology established in Section 19827in the same manner as it would for an increase to the base salary forpatrol members. (b) Patrol members shall contribute an additional 0.5 percent ofbase pay toward prefunding retiree health benefit obligationseffective on the first day of the pay period following the effectivedate of the act adding this section and the ratification of theaddendum by the members of State Bargaining Unit 5. This contributionshall not reduce the base salary of patrol members under the surveymethodology established by Section 19827. (c) Effective July 1, 2012, the state shall contribute towardprefunding retiree health benefits, on a prospective basis, an amountat least equal to the combined contribution rate establishedpursuant to subdivisions (a) and (b). These contributions may be usedin the survey methodology established by Section 19827 if mutuallyagreed in a memorandum of understanding. (d) Contributions paid pursuant to this section shall be usedexclusively for the cost of providing postemployment health care toeligible enrolled patrol member annuitants and their eligibleenrolled dependents, beneficiaries, and survivors. (e) Contributions paid pursuant to this section shall not berefundable under any circumstances to a patrol member or his or herbeneficiary or survivor. (f) Any amount used to prefund postemployment health care forpatrol members pursuant to subdivision (a) shall not be included inany calculation for benefits using final compensation. (g) If the provisions of this section are in conflict with theprovisions of a memorandum of understanding reached pursuant toSection 3517.5, the memorandum of understanding shall be controllingwithout further legislative action, except that if those provisionsof a memorandum of understanding require the expenditure of funds,the provisions shall not become effective unless approved by theLegislature in the annual Budget Act. (h) For purposes of this section, "patrol member" has the samemeaning as in Section 20390. This section shall not apply to anemployee of a county.