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OBJECTIVE: In order to protect the governments ability to: a) provide essential services to the public, and b) maintain retirement

plans that are sustainable, fiscally-sound and able to meet the commitments to its employees, this initiative empowers the people of California to take the actions necessary to control the escalating costs of public employee retirement benefits. INITIATIVE PROVISIONS: This initiative defines that a government employees vested rights only applies to pension and retiree healthcare benefits earned for service already rendered, and explicitly empowers government employers and the voters to amend pension and retiree healthcare benefits for an employees future years of service. These provisions would apply to all future government employees. These provisions would apply to all current government employees, unless there is clear and convincing evidence that his/her employer intended to create a vested right to a particular level of retirement benefits for future years of service. The initiative would also allow all government employers to temporarily amend its retirement benefits for all employees future years of service if: a) they are facing a fiscal emergency or b) their retirement plan is at-risk according to the standards established by the federal government for private pension plans. [Note: this provision remains subject to further refinement and discussion] For any public employee plan that is at-risk as defined by federal laws governing private pension plans, the government employer will be required to prospectively modify its employee pension benefits in such a way that will lift the plan out of at-risk status within XX years. If such action is not taken within two years, the government employer would be required to (Potential Options: require employees to pay 50% of all pension costs, increase employee and/or employer contributions into the plan by XX, etc.) Nothing in this initiative affects the retirement benefits that a government employee has earned and accrued for prior years of service. Government employers and/or the voters would be required to wait until current labor contracts expire before adopting any changes to employee retirement benefits. This initiative prohibits the State of California, CalPERS, and other government boards from interfering with elected leaders or voters ability to amend their public employee pension plans for employee future years of service (this includes prohibiting CalPERS from char ging exorbitant termination fees to government employers who wish to amend their pension plans). This initiative would apply to the State of California and all political subdivisions of the state, including, but not limited to, counties, cities, school districts, special districts, boards, commissions, the University of California, and California State University.