The retirement age for new teachers will be pushed back two years; they’ll have to fork over about another 1 percent of their pay into the retirement system. And their bosses – principals and administrators – will see a ceiling of $132,120 as the portion of their pay used to calculate retirement pay. Those in the highest-paid jobs, earning $200,000 plus, may see pensions reduced by tens of thousands of dollars.
These are the primary changes specifically to members of the California State Teachers’ Retirement System, or CalSTRS, from pension reforms negotiated between Gov. Jerry Brown and Democratic leaders. The package, which will affect every state and local public employee to various degrees, was unloaded on lawmakers Tuesday, four days before the end of the legislative session.
via Pension reform: top-paid administrators to take biggest hit – by John Fensterwald.
What happened within minutes Monday may just be coincidence, but if so, it’s a cosmically foreboding one.
In Sacramento, Gov. Jerry Brown released the first online ad of his campaign to persuade California voters to endorse his sales and income tax increase measure. One snippet declared that under Brown, “California’s bond rating is now positive.”
It was, to put it charitably, misleading. In fact, California has the lowest bond rating of any state now and, according to a recent survey by Pew’s Center on the States, the worst credit rating record over the past 11 years.
In Pennsylvania, state officials were told by Moody’s, a major bond rating agency, that the state is being downgraded because of “large and growing pension fund liabilities.”
via Dan Walters: Will California go the way of Pennsylvania?.
It’s been more than eight months since State Controller John Chiang announced he was launching an audit “to test the California State Teachers’ Retirement System’s efforts at identifying and preventing pension spiking.”
Chiang said “the audit should take approximately two months and that the full results will be made public once the investigation is complete.”
That was in November. It’s now July and no results have been announced. So, what happened?
via Editorial: CalSTRS audit must dig into spiking claims.
What a difference a quarter of 1 percent makes.
The decision last week by the board of the California State Teachers Retirement System to lower the expected rate of return on investments from 7.75 percent to 7.50 percent equates to an additional $475 million that school districts and the State Legislature must eventually contribute annually to make up for the shortfall and keep the pension fund healthy. That’s on top of the $4 billion extra per year that CalSTRS says contributors should already start paying to compensate for the big hit that investments took when the market tanked in 2008.
via More CalSTRS pressure on lawmakers – by John Fensterwald – Educated Guess.
By Melody Gutierrez
The former executive director of the California School Boards Association who retired amid a financial scandal involving his pay and bonuses will have his pension reduced by 65 percent, the state pension fund said.
via Bee exclusive: Former CSBA exec’s pension slashed after audit.
Someone watching State Sen. Joe Simitian’s annual education presentation in Palo Alto from an adjoining room last week passed along a comment. “I’m for more money for schools; I support the governor’s tax initiative,” the person wrote, “but I won’t vote for it unless the Legislature passes pension reform.”
via Brown renews call for pension reform – by John Fensterwald – Educated Guess.