REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
April 29, 2025
FROM
DEBORAH CHERNEY, Chief Executive Officer, San Bernardino County Employees’ Retirement Association
SUBJECT
Title
Amended Board of Retirement By-Laws
End
RECOMMENDATION(S)
Recommendation
Approve and adopt amended Board of Retirement By-Laws as approved by the Board of Retirement on April 3, 2025.
(Presenter: Deborah Cherney, Chief Executive Officer, 885-7980)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
FINANCIAL IMPACT
Approval of this item will not result in the use of Discretionary General Funding (Net County Cost) as it is non-financial in nature.
BACKGROUND INFORMATION
California Government Code section 31525 requires the Board of Supervisors to approve the San Bernardino County Employees’ Retirement Association (SBCERA) By-Laws.
The current SBCERA By-Laws were approved by the SBCERA Board of Retirement on June 3, 2021, and by the Board of Supervisors on July 27, 2021 (Item No. 50). This item includes several amendments to the current SBCERA By-Laws, which were approved by the Board of Retirement on April 3, 2025.
The proposed amendments below refine and clarify the requirements for employee membership eligibility and participating employer obligations. These amendments will enhance compliance with federal tax laws and ensure the integrity of SBCERA membership criteria.
1. Article III. Membership.
a. Amend Section (1) - Required Reporting of Employees. In accordance with Government Code section 31526, SBCERA’s By-Laws permit SBCERA to require a SBCERA Participating Employer to submit employee/member information (personally identifiable information, including reported contributions) to SBCERA in a form prescribed by SBCERA. This employer requirement to provide the necessary information is already included in the current By-Laws. The proposed amendment removes the requirement to submit a membership enrollment affidavit and instead focuses on ensuring that an SBCERA Participating Employer furnishes this information to SBCERA. The amendment aligns with the SBCERA’s Employer Reporting Initiative, which aims to standardize the data reporting to ensure that employee/member information received from the employer is complete, timely, and accurate.
b. Add Section (2)(b) - Included in SBCERA Membership - Regular Members. The proposed amendment is necessary to ensure that SBCERA membership is limited to employees/members who meet the legal and Internal Revenue Service (IRS) regulatory requirements for participation. By clearly defining the eligibility criteria, the amendment helps prevent unauthorized enrollments, ensures compliance with SBCERA governing laws, and protects SBCERA tax-qualified status. The proposed amendment specifies that for an employee to qualify for SBCERA membership, they must:
i. Hold a regular position with an SBCERA participating employer.
ii. Perform services primarily for the SBCERA Participating Employer.
Thus, an SBCERA Participating Employer must certify these conditions before reporting the employee to SBCERA. If the conditions are not met, SBCERA may deny membership or require corrective actions, including refunding employee contributions. The amendment also clarifies that payment for services alone does not determine primary employment with an SBCERA Participating Employer.
c. Amend Section (2)(c) - Delayed Effective Date of Membership. Government Code section 31527 allows SBCERA By-Laws to include a provision that lets new employees postpone their SBCERA membership start date after the beginning of employment with an SBCERA Participating Employer. The proposed amendment seeks to reduce this deferral period from 12 weeks to 4 weeks. The amendment will reduce the delay period to ensure the member does not lose significant service credit while still providing a brief window for adjustments in employment status and minimizes gaps in retirement contributions.
2. Add Article IV. SBCERA Participating Employer. The proposed amendment is necessary to ensure SBCERA’s continued compliance to maintain its status as a tax-qualified plan under Internal Revenue Code sections 401(a) and 414(d). SBCERA must ensure that all Participating Employers meet the legal definitions of a governmental entity and adhere to strict reporting and administrative requirements. Specifically, all Participating Employers must be:
a. A governmental entity in accordance with IRS guidelines and the County Employees’ Retirement Law.
b. Be one of the following: San Bernardino County, Superior Court, or a District defined under Government Code section 31468.
c. Be formally approved by the Board of Retirement to participate in the retirement system.
To maintain their status as an SBCERA Participating Employer, entities must:
a. Adopt required resolutions and execute a Participating Employer Agreement, either upon joining SBCERA or at a later date if necessary for compliance.
b. Follow all SBCERA reporting requirements, including providing all information necessary to preserve SBCERA’s tax-qualified status.
3. Non Substantive Changes
a. Rename “County of San Bernardino” to “San Bernardino County.”
b. Renumber Article IV to Article V. Disability Retirement
c. Renumber Article V to Article VI. Amendment of By-Laws
PROCUREMENT
N/A
REVIEW BY OTHERS
This item has been reviewed by the San Bernardino County Employees’ Retirement Association Board of Retirement (Deborah Cherney, Chief Executive Officer, and Barbara Hannah, Chief Counsel, 885-7980) on April 7, 2025; County Counsel (Julie Surber, Principal Assistant County Counsel, 387-5455) on April 8, 2025; and County Finance (Matthew Erickson, County Chief Financial Officer, 387-5423) on April 8, 2025.