May 18, 2018

The CSAC Government Finance and Administration (GF&A) Policy Committee met this week in Sacramento County and discussed a wide range of important topics. The agenda included presentations from both the CEO of CalPERS and the Director of the newly formed Department of Tax and Fee Administration (CDTFA), in addition to updates on state legislation, congressional activity, and collective bargaining for IHSS providers. Key highlights are provided below.

CalPERS Presentation –

Chief Executive Officer Marcie Frost presented an overview of recent Board decisions intended to counteract market volatility and strengthen the financial health of the system. Ms. Frost acknowledged that these decisions bring additional costs to employers, but reassured the Committee that her team is working with stakeholders to develop tools which will help lessen the burden on local governments. Overall, with the new financial policies in place, Ms. Frost believes CalPERS is on strong footing for the future and expects the funded status to continue increasing. Download her PowerPoint presentation here.

CDTFA Presentation –

CDTFA Director Nick Maduros provided an update on the transition of powers from the Board of Equalization (BOE) as well as the many reforms underway, such as the Centralized Revenue Opportunity System. Less than a year old, CDTFA has already made significant progress in promoting transparency and adopting customer-friendly policies, as reported by Mr. Maduros.

GF&A Legislative Update –

CSAC staff discussed several key bills the team has been working on thus far in the legislative session. See pages 18-25 in the GFA Committee Meeting Packet for the full list of bills GFA staff is actively tracking and taking positions on. At the meeting, staff noted two bills in particular which are detrimental to local governments and which CSAC is working hard to defeat.

· AB 1912 – Applies joint and several liability (both prospectively and retroactively) for all retirement-related obligations to any current or former member of a joint powers authority, thereby significantly increasing local government debt burden and potentially removing a highly effective service delivery tool. See CSAC’s joint opposition letter.

· SB 1085 – Requires public employers to provide “lost time” for employee representatives to participate in union activities. Employers would be required to provide “reasonable” leaves of absences without loss of compensation or other benefits. This would unwind current agreements and create conflict with state and federally funded positions in county Human Services and Child Services Departments. See CSAC’s joint opposition letter.

Federal Update –

Paragon Government Relations presented on two GF&A related issues gaining the attention of Congress. First, Paragon shared the latest insider news on the Federal Aviation Administration (FAA) reauthorization bill and connected attempts to amend the FAA rulemaking on aviation fuel tax. Secondly, they highlighted a pending Supreme Court case, South Dakota v. Wayfair, which is expected to clarify how and when online retailers must collect and remit sales and use taxes. The decision is due by the end of June, so stay tuned!

For more information on any of these items, please contact GF&A staff members, Dorothy Johnson or Tracy Sullivan.