31699.1. This article shall apply to a board of retirement
established in a county of the seventh class.
31699.2. Unless the context otherwise requires, the definitions
contained in this section govern the construction of this article.
(a) "Board members" means the retirement system board and the
individual members of that board or the individual members of a
postemployment health benefits fund board, as applicable.
(b) "Employee," except as used in subdivision (g), means a former
or retired employee of a local public agency and his or her spouse
and dependents who are eligible for retiree health benefits provided
by that public agency.
(c) "Postemployment health benefits fund" means the fund
established by the retirement system board as a legal entity separate
from the retirement system that is used for the collective
investment of assets held solely for providing health benefits to
employees of a local public agency.
(d) "Postemployment health benefits fund board" means the
governing board of the postemployment health benefits fund.
(e) "Public agency" means any local public agency, as defined in
Section 53630.
(f) "Retirement system board" means the governing board of the
retirement system.
(g) "Staff" means the officers and employees of the retirement
system or of the postemployment health benefits fund, as applicable.
31699.3. The purpose of this article is to allow the retirement
system board to establish a postemployment health benefits fund for
public agencies that would enable the agencies to do all of the
following:
(a) Combine for investment the assets that the agencies set aside
to provide for retiree health benefits.
(b) Take advantage of economies of scale.
(c) Use existing investment expertise to reduce the cost of
funding for retiree health benefits and increase the security of
public retirees and their dependents in those benefits.
31699.4. (a) (1) The retirement system board may establish, by
resolution, a postemployment health benefits fund for the collective
investment of assets held in trust solely for the exclusive benefit
of providing health benefits to employees of any local public agency.
(2) The postemployment health benefits fund board shall be
composed of the same members that compose the retirement system
board. The postemployment health benefits fund board shall have the
sole and exclusive responsibility and discretion for administration
of the postemployment health benefits fund. However, the retirement
system board may terminate the fund in its discretion at any time.
(b) The postemployment health benefits fund shall be established
and administered to comply with the requirements of Governmental
Accounting Standards Board Statements No. 43 and No. 45 (GASB 43 and
45) for assets held by the postemployment health benefits fund to be
treated as plan assets, to the extent reasonably practicable.
(c) The assets in the postemployment health benefits fund shall be
irrevocably held for the exclusive purposes of providing health
benefits to employees of the participating public agencies, and to
defray the reasonable expenses of administering the fund. The
postemployment health benefits fund board may require that all assets
transferred to it on behalf of a participating public agency be
transferred from a trust fund that meets the requirements of GASB 43
and 45 for assets to be treated as plan assets, including that the
assets of the trust fund be held for the exclusive purpose of
providing health benefits to employees of a local public agency.
(d) The retirement system board shall determine, at its sole
discretion, the form of the postemployment health benefits fund,
which may be one or more trusts that are established under Section
115 of the Internal Revenue Code or any other form or forms chosen.
The retirement system board may take any and all actions necessary or
appropriate to implement the postemployment health benefits fund,
including, but not limited to, establishing one or more joint powers
authorities, partnerships, common trust funds, or other mechanisms in
order to combine or commingle the assets held by the fund for
investment purposes.
(e) A public agency, or the trustees of a trust fund that has
transferred assets to the postemployment health benefits fund, may,
in accordance with rules established by the postemployment health
benefits fund board, direct that all or part of the assets allocated
to the account of that agency or trust be transferred to another fund
that is maintained by the agency that holds those assets solely for
the exclusive purpose of providing health benefits to employees of
the agency. Upon termination of the postemployment health benefits
fund by the retirement system board, the postemployment health
benefits fund board shall retain an amount sufficient to pay
reasonable costs and expenses of operating and terminating the
postemployment health benefits fund, and thereafter shall transfer
any remaining assets allocated to the account of each participating
public agency only to another fund maintained by the agency that
holds those assets solely for the exclusive purpose of providing
health benefits to employees of the agency. If a participating agency
does not maintain a fund for that exclusive purpose, the
postemployment health benefits fund board shall transfer the assets
allocated to the public agency's account to a trust account
maintained by a bank for the exclusive purpose of providing health
benefits to employees of the agency. The bank shall have net assets
of at least five hundred million dollars ($500,000,000). The
postemployment health benefits fund board shall be reimbursed from
the assets of the postemployment health benefits fund allocated to
the public agency for all direct and indirect costs of establishing
and transferring fund assets to a bank trust account.
31699.5. The investment of the assets in the postemployment health
benefits fund shall be subject to the fiduciary standards governing
investments under Section 17 of Article XVI of the California
Constitution, as those standards apply to the management of
investments of the retirement system governed by the board,
notwithstanding that assets in the postemployment health benefits
fund will be used to provide retiree health benefits and not
retirement allowances. Each public agency and trust fund, and each
governing body and member thereof, that participates in the
postemployment health benefits fund shall be conclusively determined
to have accepted and approved the applicability of the investment
standards set forth in this article.
31699.6. (a) The postemployment health benefits fund board shall
determine the investments of the postemployment health benefits fund
and may delegate this function to the extent consistent with its
fiduciary responsibilities, including delegating this function to the
retirement system board.
(b) The postemployment health benefits fund board may offer
different investment pools to be chosen by the public agencies and
their trust funds that participate in the postemployment health
benefits fund.
(c) To the extent allowed by California law and federal law,
including, but not limited to, federal tax and securities law, the
postemployment health benefits fund board may invest the assets that
it holds, and the retirement system board may invest the assets that
it holds, in investment pools established under this article, and
each of those boards may combine or commingle, for investment
purposes only, the assets that it holds with the assets held by the
other board. The postemployment health benefits fund board and the
retirement system board may take any and all actions necessary or
appropriate to implement that combination or commingling, including,
but not limited to, unitizing the investments held for retirement
purposes.
(d) The retirement system board may invest the assets that it
holds for retirement purposes, and the postemployment health benefits
fund board may invest the assets held in the postemployment health
benefits fund in the same or similar investments by parallel
investing rather than commingling the assets for investment.
31699.7. (a) The postemployment health benefits fund board shall
establish the terms and conditions for a public agency and its trust
fund to participate in the postemployment health benefits fund,
including, but not limited to, eligibility to participate, amount of
assets transferred to the fund, investments, withdrawal, transfer of
assets to or from the fund, termination of participation, and
reporting to the public agency.
(b) The postemployment health benefits fund board shall account
separately for each public agency and its trust fund with respect to
contributions, withdrawals, earnings, losses, fees paid to
third-party vendors, expenses, and all other relevant items. Any
expenses charged to the postemployment health benefits fund by the
retirement system shall be reported at least monthly by the
postemployment health benefits board in its public records and shall
be reported at least annually to each agency or trust that
participates in the postemployment health benefits fund. The portion
of the postemployment health benefits fund that is attributable to
each public agency and its trust fund after the accounting, including
each agency's and trust fund's allocated share of expenses as
provided in this section, shall be used only for the exclusive
benefit of the employees of that agency.
(c) The postemployment health benefits fund board shall, by
resolution, establish all rules, regulations, or bylaws for the
administration of the postemployment health benefits fund, including
any revision that it deems appropriate, and shall have sole
discretion to interpret those rules, regulations, or bylaws.
31699.8. (a) The sole function of the postemployment health
benefits fund shall be to invest assets of participating public
agencies and their trust funds that are held for the exclusive
benefit of agency employees. The postemployment health benefits fund
shall not have any liability for benefits that are provided by any
agency or trust that transfers assets to the postemployment health
benefits fund for investment. Additionally, the retirement system
shall not have any liability for those benefits.
(b) The transfer of assets to or from the postemployment health
benefits fund, and the investment of assets by that fund, shall not
change the obligation of any agency for retiree health benefits,
shall not create any obligations on the part of the retirement
systems for retiree health benefits, and shall not create any
obligation on the part of a postemployment health benefits fund for
any pension or annuity benefits.
(c) The retirement system and the postemployment health benefits
fund are separate legal entities, and they and their boards, board
members, and staffs, are liable only for their own actions or
failures to act. Any liability shall be determined in accordance with
Chapter 1 (commencing with Section 900) and Chapter 2 (commencing
with Section 910) of Part 3 of Division 3.6 of Title 1. Any of those
claims or causes of action shall accrue in accordance with Division
3.6 (commencing with Section 810) of Title 1.
31699.9. (a) Expenses of administration of this article shall be
allocated by the retirement system board, in its discretion and on a
reasonable basis, among the postemployment health benefits fund, the
retirement system, and the accounts of the public agencies and trust
funds that participate in the postemployment health benefits fund.
(b) The establishment of the postemployment health benefits fund
will enable the sharing of expenses of administration and investment,
bringing economies of scale and better use of investment expertise
to the retirement system. Consequently, the retirement system board
may pay the startup and initial administrative expenses for the fund
if the retirement system board determines that this expenditure is in
the long-term best interests of the members and beneficiaries of the
retirement system, and the employers that participate in that
system. The board may also assess participating agencies and trusts
for all or a portion of those expenses.
31699.10. The postemployment health benefits fund board shall act
as a separate governing board of the postemployment health benefits
fund, with separate rules, regulations, and bylaws, and shall meet
separately from the meetings of the retirement system. The
postemployment health benefits fund board shall have all of the
power, authority, and ability to act on behalf of the postemployment
health benefits fund that the retirement system board has with
respect to the retirement system, including, but not limited to, the
power to obtain fiduciary insurance.
31699.1. This article shall apply to a board of retirement
established in a county of the seventh class.
31699.2. Unless the context otherwise requires, the definitions
contained in this section govern the construction of this article.
(a) "Board members" means the retirement system board and the
individual members of that board or the individual members of a
postemployment health benefits fund board, as applicable.
(b) "Employee," except as used in subdivision (g), means a former
or retired employee of a local public agency and his or her spouse
and dependents who are eligible for retiree health benefits provided
by that public agency.
(c) "Postemployment health benefits fund" means the fund
established by the retirement system board as a legal entity separate
from the retirement system that is used for the collective
investment of assets held solely for providing health benefits to
employees of a local public agency.
(d) "Postemployment health benefits fund board" means the
governing board of the postemployment health benefits fund.
(e) "Public agency" means any local public agency, as defined in
Section 53630.
(f) "Retirement system board" means the governing board of the
retirement system.
(g) "Staff" means the officers and employees of the retirement
system or of the postemployment health benefits fund, as applicable.
31699.3. The purpose of this article is to allow the retirement
system board to establish a postemployment health benefits fund for
public agencies that would enable the agencies to do all of the
following:
(a) Combine for investment the assets that the agencies set aside
to provide for retiree health benefits.
(b) Take advantage of economies of scale.
(c) Use existing investment expertise to reduce the cost of
funding for retiree health benefits and increase the security of
public retirees and their dependents in those benefits.
31699.4. (a) (1) The retirement system board may establish, by
resolution, a postemployment health benefits fund for the collective
investment of assets held in trust solely for the exclusive benefit
of providing health benefits to employees of any local public agency.
(2) The postemployment health benefits fund board shall be
composed of the same members that compose the retirement system
board. The postemployment health benefits fund board shall have the
sole and exclusive responsibility and discretion for administration
of the postemployment health benefits fund. However, the retirement
system board may terminate the fund in its discretion at any time.
(b) The postemployment health benefits fund shall be established
and administered to comply with the requirements of Governmental
Accounting Standards Board Statements No. 43 and No. 45 (GASB 43 and
45) for assets held by the postemployment health benefits fund to be
treated as plan assets, to the extent reasonably practicable.
(c) The assets in the postemployment health benefits fund shall be
irrevocably held for the exclusive purposes of providing health
benefits to employees of the participating public agencies, and to
defray the reasonable expenses of administering the fund. The
postemployment health benefits fund board may require that all assets
transferred to it on behalf of a participating public agency be
transferred from a trust fund that meets the requirements of GASB 43
and 45 for assets to be treated as plan assets, including that the
assets of the trust fund be held for the exclusive purpose of
providing health benefits to employees of a local public agency.
(d) The retirement system board shall determine, at its sole
discretion, the form of the postemployment health benefits fund,
which may be one or more trusts that are established under Section
115 of the Internal Revenue Code or any other form or forms chosen.
The retirement system board may take any and all actions necessary or
appropriate to implement the postemployment health benefits fund,
including, but not limited to, establishing one or more joint powers
authorities, partnerships, common trust funds, or other mechanisms in
order to combine or commingle the assets held by the fund for
investment purposes.
(e) A public agency, or the trustees of a trust fund that has
transferred assets to the postemployment health benefits fund, may,
in accordance with rules established by the postemployment health
benefits fund board, direct that all or part of the assets allocated
to the account of that agency or trust be transferred to another fund
that is maintained by the agency that holds those assets solely for
the exclusive purpose of providing health benefits to employees of
the agency. Upon termination of the postemployment health benefits
fund by the retirement system board, the postemployment health
benefits fund board shall retain an amount sufficient to pay
reasonable costs and expenses of operating and terminating the
postemployment health benefits fund, and thereafter shall transfer
any remaining assets allocated to the account of each participating
public agency only to another fund maintained by the agency that
holds those assets solely for the exclusive purpose of providing
health benefits to employees of the agency. If a participating agency
does not maintain a fund for that exclusive purpose, the
postemployment health benefits fund board shall transfer the assets
allocated to the public agency's account to a trust account
maintained by a bank for the exclusive purpose of providing health
benefits to employees of the agency. The bank shall have net assets
of at least five hundred million dollars ($500,000,000). The
postemployment health benefits fund board shall be reimbursed from
the assets of the postemployment health benefits fund allocated to
the public agency for all direct and indirect costs of establishing
and transferring fund assets to a bank trust account.
31699.5. The investment of the assets in the postemployment health
benefits fund shall be subject to the fiduciary standards governing
investments under Section 17 of Article XVI of the California
Constitution, as those standards apply to the management of
investments of the retirement system governed by the board,
notwithstanding that assets in the postemployment health benefits
fund will be used to provide retiree health benefits and not
retirement allowances. Each public agency and trust fund, and each
governing body and member thereof, that participates in the
postemployment health benefits fund shall be conclusively determined
to have accepted and approved the applicability of the investment
standards set forth in this article.
31699.6. (a) The postemployment health benefits fund board shall
determine the investments of the postemployment health benefits fund
and may delegate this function to the extent consistent with its
fiduciary responsibilities, including delegating this function to the
retirement system board.
(b) The postemployment health benefits fund board may offer
different investment pools to be chosen by the public agencies and
their trust funds that participate in the postemployment health
benefits fund.
(c) To the extent allowed by California law and federal law,
including, but not limited to, federal tax and securities law, the
postemployment health benefits fund board may invest the assets that
it holds, and the retirement system board may invest the assets that
it holds, in investment pools established under this article, and
each of those boards may combine or commingle, for investment
purposes only, the assets that it holds with the assets held by the
other board. The postemployment health benefits fund board and the
retirement system board may take any and all actions necessary or
appropriate to implement that combination or commingling, including,
but not limited to, unitizing the investments held for retirement
purposes.
(d) The retirement system board may invest the assets that it
holds for retirement purposes, and the postemployment health benefits
fund board may invest the assets held in the postemployment health
benefits fund in the same or similar investments by parallel
investing rather than commingling the assets for investment.
31699.7. (a) The postemployment health benefits fund board shall
establish the terms and conditions for a public agency and its trust
fund to participate in the postemployment health benefits fund,
including, but not limited to, eligibility to participate, amount of
assets transferred to the fund, investments, withdrawal, transfer of
assets to or from the fund, termination of participation, and
reporting to the public agency.
(b) The postemployment health benefits fund board shall account
separately for each public agency and its trust fund with respect to
contributions, withdrawals, earnings, losses, fees paid to
third-party vendors, expenses, and all other relevant items. Any
expenses charged to the postemployment health benefits fund by the
retirement system shall be reported at least monthly by the
postemployment health benefits board in its public records and shall
be reported at least annually to each agency or trust that
participates in the postemployment health benefits fund. The portion
of the postemployment health benefits fund that is attributable to
each public agency and its trust fund after the accounting, including
each agency's and trust fund's allocated share of expenses as
provided in this section, shall be used only for the exclusive
benefit of the employees of that agency.
(c) The postemployment health benefits fund board shall, by
resolution, establish all rules, regulations, or bylaws for the
administration of the postemployment health benefits fund, including
any revision that it deems appropriate, and shall have sole
discretion to interpret those rules, regulations, or bylaws.
31699.8. (a) The sole function of the postemployment health
benefits fund shall be to invest assets of participating public
agencies and their trust funds that are held for the exclusive
benefit of agency employees. The postemployment health benefits fund
shall not have any liability for benefits that are provided by any
agency or trust that transfers assets to the postemployment health
benefits fund for investment. Additionally, the retirement system
shall not have any liability for those benefits.
(b) The transfer of assets to or from the postemployment health
benefits fund, and the investment of assets by that fund, shall not
change the obligation of any agency for retiree health benefits,
shall not create any obligations on the part of the retirement
systems for retiree health benefits, and shall not create any
obligation on the part of a postemployment health benefits fund for
any pension or annuity benefits.
(c) The retirement system and the postemployment health benefits
fund are separate legal entities, and they and their boards, board
members, and staffs, are liable only for their own actions or
failures to act. Any liability shall be determined in accordance with
Chapter 1 (commencing with Section 900) and Chapter 2 (commencing
with Section 910) of Part 3 of Division 3.6 of Title 1. Any of those
claims or causes of action shall accrue in accordance with Division
3.6 (commencing with Section 810) of Title 1.
31699.9. (a) Expenses of administration of this article shall be
allocated by the retirement system board, in its discretion and on a
reasonable basis, among the postemployment health benefits fund, the
retirement system, and the accounts of the public agencies and trust
funds that participate in the postemployment health benefits fund.
(b) The establishment of the postemployment health benefits fund
will enable the sharing of expenses of administration and investment,
bringing economies of scale and better use of investment expertise
to the retirement system. Consequently, the retirement system board
may pay the startup and initial administrative expenses for the fund
if the retirement system board determines that this expenditure is in
the long-term best interests of the members and beneficiaries of the
retirement system, and the employers that participate in that
system. The board may also assess participating agencies and trusts
for all or a portion of those expenses.
31699.10. The postemployment health benefits fund board shall act
as a separate governing board of the postemployment health benefits
fund, with separate rules, regulations, and bylaws, and shall meet
separately from the meetings of the retirement system. The
postemployment health benefits fund board shall have all of the
power, authority, and ability to act on behalf of the postemployment
health benefits fund that the retirement system board has with
respect to the retirement system, including, but not limited to, the
power to obtain fiduciary insurance.
31699.1. This article shall apply to a board of retirement
established in a county of the seventh class.
31699.2. Unless the context otherwise requires, the definitions
contained in this section govern the construction of this article.
(a) "Board members" means the retirement system board and the
individual members of that board or the individual members of a
postemployment health benefits fund board, as applicable.
(b) "Employee," except as used in subdivision (g), means a former
or retired employee of a local public agency and his or her spouse
and dependents who are eligible for retiree health benefits provided
by that public agency.
(c) "Postemployment health benefits fund" means the fund
established by the retirement system board as a legal entity separate
from the retirement system that is used for the collective
investment of assets held solely for providing health benefits to
employees of a local public agency.
(d) "Postemployment health benefits fund board" means the
governing board of the postemployment health benefits fund.
(e) "Public agency" means any local public agency, as defined in
Section 53630.
(f) "Retirement system board" means the governing board of the
retirement system.
(g) "Staff" means the officers and employees of the retirement
system or of the postemployment health benefits fund, as applicable.
31699.3. The purpose of this article is to allow the retirement
system board to establish a postemployment health benefits fund for
public agencies that would enable the agencies to do all of the
following:
(a) Combine for investment the assets that the agencies set aside
to provide for retiree health benefits.
(b) Take advantage of economies of scale.
(c) Use existing investment expertise to reduce the cost of
funding for retiree health benefits and increase the security of
public retirees and their dependents in those benefits.
31699.4. (a) (1) The retirement system board may establish, by
resolution, a postemployment health benefits fund for the collective
investment of assets held in trust solely for the exclusive benefit
of providing health benefits to employees of any local public agency.
(2) The postemployment health benefits fund board shall be
composed of the same members that compose the retirement system
board. The postemployment health benefits fund board shall have the
sole and exclusive responsibility and discretion for administration
of the postemployment health benefits fund. However, the retirement
system board may terminate the fund in its discretion at any time.
(b) The postemployment health benefits fund shall be established
and administered to comply with the requirements of Governmental
Accounting Standards Board Statements No. 43 and No. 45 (GASB 43 and
45) for assets held by the postemployment health benefits fund to be
treated as plan assets, to the extent reasonably practicable.
(c) The assets in the postemployment health benefits fund shall be
irrevocably held for the exclusive purposes of providing health
benefits to employees of the participating public agencies, and to
defray the reasonable expenses of administering the fund. The
postemployment health benefits fund board may require that all assets
transferred to it on behalf of a participating public agency be
transferred from a trust fund that meets the requirements of GASB 43
and 45 for assets to be treated as plan assets, including that the
assets of the trust fund be held for the exclusive purpose of
providing health benefits to employees of a local public agency.
(d) The retirement system board shall determine, at its sole
discretion, the form of the postemployment health benefits fund,
which may be one or more trusts that are established under Section
115 of the Internal Revenue Code or any other form or forms chosen.
The retirement system board may take any and all actions necessary or
appropriate to implement the postemployment health benefits fund,
including, but not limited to, establishing one or more joint powers
authorities, partnerships, common trust funds, or other mechanisms in
order to combine or commingle the assets held by the fund for
investment purposes.
(e) A public agency, or the trustees of a trust fund that has
transferred assets to the postemployment health benefits fund, may,
in accordance with rules established by the postemployment health
benefits fund board, direct that all or part of the assets allocated
to the account of that agency or trust be transferred to another fund
that is maintained by the agency that holds those assets solely for
the exclusive purpose of providing health benefits to employees of
the agency. Upon termination of the postemployment health benefits
fund by the retirement system board, the postemployment health
benefits fund board shall retain an amount sufficient to pay
reasonable costs and expenses of operating and terminating the
postemployment health benefits fund, and thereafter shall transfer
any remaining assets allocated to the account of each participating
public agency only to another fund maintained by the agency that
holds those assets solely for the exclusive purpose of providing
health benefits to employees of the agency. If a participating agency
does not maintain a fund for that exclusive purpose, the
postemployment health benefits fund board shall transfer the assets
allocated to the public agency's account to a trust account
maintained by a bank for the exclusive purpose of providing health
benefits to employees of the agency. The bank shall have net assets
of at least five hundred million dollars ($500,000,000). The
postemployment health benefits fund board shall be reimbursed from
the assets of the postemployment health benefits fund allocated to
the public agency for all direct and indirect costs of establishing
and transferring fund assets to a bank trust account.
31699.5. The investment of the assets in the postemployment health
benefits fund shall be subject to the fiduciary standards governing
investments under Section 17 of Article XVI of the California
Constitution, as those standards apply to the management of
investments of the retirement system governed by the board,
notwithstanding that assets in the postemployment health benefits
fund will be used to provide retiree health benefits and not
retirement allowances. Each public agency and trust fund, and each
governing body and member thereof, that participates in the
postemployment health benefits fund shall be conclusively determined
to have accepted and approved the applicability of the investment
standards set forth in this article.
31699.6. (a) The postemployment health benefits fund board shall
determine the investments of the postemployment health benefits fund
and may delegate this function to the extent consistent with its
fiduciary responsibilities, including delegating this function to the
retirement system board.
(b) The postemployment health benefits fund board may offer
different investment pools to be chosen by the public agencies and
their trust funds that participate in the postemployment health
benefits fund.
(c) To the extent allowed by California law and federal law,
including, but not limited to, federal tax and securities law, the
postemployment health benefits fund board may invest the assets that
it holds, and the retirement system board may invest the assets that
it holds, in investment pools established under this article, and
each of those boards may combine or commingle, for investment
purposes only, the assets that it holds with the assets held by the
other board. The postemployment health benefits fund board and the
retirement system board may take any and all actions necessary or
appropriate to implement that combination or commingling, including,
but not limited to, unitizing the investments held for retirement
purposes.
(d) The retirement system board may invest the assets that it
holds for retirement purposes, and the postemployment health benefits
fund board may invest the assets held in the postemployment health
benefits fund in the same or similar investments by parallel
investing rather than commingling the assets for investment.
31699.7. (a) The postemployment health benefits fund board shall
establish the terms and conditions for a public agency and its trust
fund to participate in the postemployment health benefits fund,
including, but not limited to, eligibility to participate, amount of
assets transferred to the fund, investments, withdrawal, transfer of
assets to or from the fund, termination of participation, and
reporting to the public agency.
(b) The postemployment health benefits fund board shall account
separately for each public agency and its trust fund with respect to
contributions, withdrawals, earnings, losses, fees paid to
third-party vendors, expenses, and all other relevant items. Any
expenses charged to the postemployment health benefits fund by the
retirement system shall be reported at least monthly by the
postemployment health benefits board in its public records and shall
be reported at least annually to each agency or trust that
participates in the postemployment health benefits fund. The portion
of the postemployment health benefits fund that is attributable to
each public agency and its trust fund after the accounting, including
each agency's and trust fund's allocated share of expenses as
provided in this section, shall be used only for the exclusive
benefit of the employees of that agency.
(c) The postemployment health benefits fund board shall, by
resolution, establish all rules, regulations, or bylaws for the
administration of the postemployment health benefits fund, including
any revision that it deems appropriate, and shall have sole
discretion to interpret those rules, regulations, or bylaws.
31699.8. (a) The sole function of the postemployment health
benefits fund shall be to invest assets of participating public
agencies and their trust funds that are held for the exclusive
benefit of agency employees. The postemployment health benefits fund
shall not have any liability for benefits that are provided by any
agency or trust that transfers assets to the postemployment health
benefits fund for investment. Additionally, the retirement system
shall not have any liability for those benefits.
(b) The transfer of assets to or from the postemployment health
benefits fund, and the investment of assets by that fund, shall not
change the obligation of any agency for retiree health benefits,
shall not create any obligations on the part of the retirement
systems for retiree health benefits, and shall not create any
obligation on the part of a postemployment health benefits fund for
any pension or annuity benefits.
(c) The retirement system and the postemployment health benefits
fund are separate legal entities, and they and their boards, board
members, and staffs, are liable only for their own actions or
failures to act. Any liability shall be determined in accordance with
Chapter 1 (commencing with Section 900) and Chapter 2 (commencing
with Section 910) of Part 3 of Division 3.6 of Title 1. Any of those
claims or causes of action shall accrue in accordance with Division
3.6 (commencing with Section 810) of Title 1.
31699.9. (a) Expenses of administration of this article shall be
allocated by the retirement system board, in its discretion and on a
reasonable basis, among the postemployment health benefits fund, the
retirement system, and the accounts of the public agencies and trust
funds that participate in the postemployment health benefits fund.
(b) The establishment of the postemployment health benefits fund
will enable the sharing of expenses of administration and investment,
bringing economies of scale and better use of investment expertise
to the retirement system. Consequently, the retirement system board
may pay the startup and initial administrative expenses for the fund
if the retirement system board determines that this expenditure is in
the long-term best interests of the members and beneficiaries of the
retirement system, and the employers that participate in that
system. The board may also assess participating agencies and trusts
for all or a portion of those expenses.
31699.10. The postemployment health benefits fund board shall act
as a separate governing board of the postemployment health benefits
fund, with separate rules, regulations, and bylaws, and shall meet
separately from the meetings of the retirement system. The
postemployment health benefits fund board shall have all of the
power, authority, and ability to act on behalf of the postemployment
health benefits fund that the retirement system board has with
respect to the retirement system, including, but not limited to, the
power to obtain fiduciary insurance.
