AMENDED IN SENIOR SENATE OCTOBER 26, 2010

SENIOR SENATE FEDERAL PROPOSAL NO. 6

INTRODUCED BY SENIOR SENATOR EATON

(COAUTHOR: SENIOR ASSEMBLY MEMBER GLASMEIER)

LEGISLATIVE COUNSEL'S DIGEST

SFP 6: SOCIAL SECURITY AND MEDICARE PROGRAM FINANCING.

EXISTING LAW, THE FEDERAL SOCIAL SECURITY ACT, PROVIDES FOR BENEFITS FOR ELIGIBLE BENEFICIARIES, FUNDED PRIMARILY BY FEDERAL PAYROLL TAXES ON WORKERS AND EMPLOYERS. MEDICARE IS A FEDERAL HEALTH INSURANCE PROGRAM FOR, AMONG OTHERS, PEOPLE 65 YEARS OF AGE OR OLDER, AND PEOPLE UNDER 65 YEARS OF AGE WITH CERTAIN DISABILITIES.

THIS MEASURE WOULD MEMORIALIZE THE CONGRESS AND THE PRESIDENT TO ENACT LEGISLATION THAT WOULD ADDRESS THE SOLVENCY OF THE SOCIAL SECURITY AND MEDICARE PROGRAM TRUST FUNDS SO THAT PROGRAM COSTS ARE SUSTAINABLE.  THIS MEASURE WOULD ALSO ENCOURAGE THE LEGISLATURE OF THE STATE OF CALIFORNIA TO PASS A JOINT RESOLUTION ENCOURAGING THE CONGRESS AND PRESIDENT TO ENACT APPROPRIATE LEGISLATION THAT WOULD ADDRESS THESE CONCERNS.

VOTE: MAJORITY.

SFP 6: RELATING TO SOCIAL SECURITY AND MEDICARE PROGRAMS

WHEREAS, ACCORDING TO A 2009 REPORT ON THE STATUS OF THE SOCIAL SECURITY AND MEDICARE PROGRAMS BY THE TRUSTEES OF THE SOCIAL SECURITY AND MEDICARE TRUST FUNDS, THE FINANCIAL CONDITION OF THESE PROGRAMS REMAINS CHALLENGING AND PROJECTED PROGRAM COSTS IN THE LONG RUN ARE NOT SUSTAINABLE UNDER CURRENT PROGRAM PARAMETERS; AND

WHEREAS, SOCIAL SECURITY’S ANNUAL SURPLUSES OF TAX INCOME OVER EXPENDITURES WERE EXPECTED TO FALL SHARPLY IN 2009 AND TO STAY ABOUT CONSTANT THIS YEAR BECAUSE OF THE ECONOMIC RECESSION, AND TO RISE ONLY BRIEFLY BEFORE DECLINING AND TURNING TO CASHFLOW DEFICITS, BEGINNING IN 2016, THAT WILL GROW AS THE BABY BOOM GENERATION RETIRES; AND

WHEREAS, THE DEFICITS WILL BE MADE UP BY REDEEMING TRUST FUND ASSETS FROM THE UNITED STATES TREASURY UNTIL RESERVES ARE EXHAUSTED IN 2037, AT WHICH TIME TAX INCOME WOULD BE SUFFICIENT TO PAY ABOUT 3/4 OF THE SCHEDULED BENEFITS THROUGH 2083; AND

WHEREAS, THE DRAWING DOWN OF SOCIAL SECURITY AND MEDICARE HOSPITAL INSURANCE TRUST FUND RESERVES AND THE GENERAL REVENUE TRANSFERS INTO, THE MEDICARE SUPPLEMENTARY MEDICAL INSURANCE TRUST FUND WILL RESULT IN MOUNTING PRESSURE ON THE FEDERAL BUDGET. IN FACT, PRESSURE IS ALREADY EVIDENT; AND

WHEREAS, CONGRESS, IN THE PAST, HAS SEEN FIT TO TAKE THE NECESSARY STEPS TO GUARANTEE CONTINUATION OF BENEFITS BY, AMONG OTHER THINGS, INCREASING THE TAX RATES OR TAX BASE, ESTABLISHING RETIREMENT TESTS, AND EXTENDING THE RETIREMENT AGE; AND

WHEREAS, CONGRESS, IN A BIPARTISAN EFFORT, SHOULD ACT TO RESTORE CONFIDENCE IN THE SOCIAL SECURITY AND MEDICARE PROGRAMS IMMEDIATELY; NOW, THEREFORE, BE IT

RESOLVED, BY THE SENIOR SENATE AND THE SENIOR ASSEMBLY, JOINTLY, THAT THE SENIOR LEGISLATURE OF THE STATE OF CALIFORNIA AT ITS 2010 REGULAR SESSION, A MAJORITY OF THE MEMBERS VOTING THEREFOR, HEREBY PROPOSES THAT THE SOLVENCY OF THE SOCIAL SECURITY AND MEDICARE PROGRAM TRUST FUNDS BE ADDRESSED SO THAT PROGRAM COSTS ARE SUSTAINABLE; AND BE IT FURTHER

RESOLVED, THAT THE SENIOR LEGISLATURE OF THE STATE OF CALIFORNIA HEREBY ENCOURAGES THE LEGISLATURE OF THE STATE OF CALIFORNIA TO PASS A JOINT RESOLUTION ENCOURAGING THE CONGRESS AND PRESIDENT TO ENACT APPROPRIATE LEGISLATION THAT WOULD ADDRESS THE CONCERNS SET FORTH IN THIS MEASURE; AND BE IT FURTHER

RESOLVED, THAT THE SENIOR LEGISLATURE OF THE STATE OF CALIFORNIA RESPECTFULLY MEMORIALIZES THE CONGRESS AND THE PRESIDENT TO ENACT APPROPRIATE LEGISLATION THAT WOULD ADDRESS THE CONCERNS SET FORTH IN THIS MEASURE; AND BE IT FURTHER

RESOLVED, THAT A COPY OF THIS MEASURE BE TRANSMITTED TO THE PRESIDENT AND VICE PRESIDENT, THE SPEAKER OF THE HOUSE OF REPRESENTATIVES, THE CHAIRPERSONS OF THE HOUSE AND SENATE COMMITTEES ON AGING, AND TO EACH SENATOR AND REPRESENTATIVE FROM CALIFORNIA IN THE CONGRESS OF THE UNITED STATES.

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