Educators may notice a little extra going out of their paychecks into to the California State Retirement System (CalSTRS) beginning this month, but that’s a good thing since the money will not only come back to them at retirement, it will stabilize the retirement system into the future.
After years of attempts to close a shortfall in the teachers retirement system that has mounted to $74 billion, the Legislature in June approved Gov. Jerry Brown’s pension plan that provides increased contributions from educators, school districts and the state.
“For roughly the last 10 years our highest priority and our members’ most pressing concern has been to secure the long-term stability of the Defined Benefit Program,” said Harry Keiley, chair of the Teachers’ Retirement Board and member of the Santa Monica-Malibu Classroom Teachers Association.
The historic action calls for member contributions to increase from 8 to 10.25 percent over the next three years. School and community college district contributions will increase from 8.25 percent to 19.1 percent over seven years while the state’s portion would increase from the current 3.041 percent to 6.3 percent in the next three years. The increases began to take effect July 1.
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