The pension reforms passed in June, paring back the benefits for new teachers and administrators, will knock off $189 million per year from the additional payments taxpayers must make to keep the California State Teachers’ Retirement System solvent over the next 30 years.
That’s the good news. The bad news is that this represents only about 6 percent of the extra $3.25 billion annually that CalSTRS actuaries are saying is needed to erase the system’s current $65 billion unfunded liability. That liability is the debt that taxpayers owe to future pensioners to compensate for shortfalls in CalSTRS’ income on investments following the Wall Street implosion in 2008. CalSTRS is still recovering from that with $152 billion in assets in July, still $20 billion below a high of $172 billion in 2007.