In 2014, the Legislature and Governor approved a plan that aims to fully fund teacher pensions over the next 30 years. This online series will examine how the CalSTRS funding plan is being implemented.
Funding Plan Is a Major State Accomplishment. Prior to state action, CalSTRS projected that it would run out of assets in the mid-2040s, an alarming prospect for a pension system. The funding plan aims to fully fund CalSTRS by that time.
As we describe in our first post, the CalSTRS funding plan is a major state accomplishment.As we describe in our second post, however, the implementation of the law differs from our earlier understanding. Specifically, the plan now relies on a calculation that is complex even by pension standards.
While CalSTRS appears to be interpreting and implementing the law in good faith, we are concerned that some aspects of the funding plan may no longer reflect the intent of the Legislature when it passed the law. As we described in our concluding post, tweaks to the law may be necessary to ensure that the Legislature realizes its intent for CalSTRS.