California Code, Government Code - GOV § 9359.02

(a) The amount of compensation used to compute benefits payable to any person who becomes a member of this system on or after July 1, 1996, may not exceed the limitations upon public retirement systems set forth in Section 401(a)(17) of Title 26 of the United States Code,  1 as that section may be amended from time to time and as that limit may be adjusted by the Commissioner of Internal Revenue for increases in the cost of living.

(b) The determination of compensation for each 12-month period shall be subject to the annual compensation limit in effect for the calendar year in which the 12-month period begins. In a determination of average annual compensation over more than one 12-month period, the amount of compensation taken into account for each 12-month period shall be subject to the applicable annual compensation limit.