SB 1425 Summary

• Prohibits any salary, compensation, or remuneration determined to be paid principally for enhancing a member's retirement benefits from being included in final compensation calculations for state and local public retirement systems.

• Limits final compensation increases for employees not in a group or class to match the average increase received by similarly situated employees in the same or related group during the final compensation period and preceding two years.

• Requires all retired persons retiring on or after January 1, 2012, to have a mandatory 180-day separation from service before performing any work for employers covered by state or local retirement systems, whether as an employee, through a third party, or as an independent contractor.

• Establishes ongoing audit processes and accountability provisions for retirement system boards to ensure compliance with anti-pension-spiking rules and authorizes monetary penalties for non-compliance by employers.

• Delays lump-sum distributions of retirement benefits under the Defined Benefit Supplement Program for members retiring on or after January 1, 2012, until 180 days have elapsed following retirement.