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The Truth about Teachers' Retirement


    CTA believes all public employees and education employees in particular deserve secure retirement benefits with defined and equitable benefits. Both the California State Teachers’ Retirement System (CalSTRS) and the Public Employees’ Retirement System (CalPERS) should remain autonomous contributory systems providing a single tier of benefits to all employees.

    Two Distinct Public Employee Retirement Systems

    California must maintain and keep strong its two defined benefit systems, the California State Teachers Retirement System (CalSTRS) and the California Public Employees’ Retirement System (CalPERS) for employees from pre-kindergarten through higher education. Both systems should offer equal benefit structures and equal costs.  All future members of CalSTRS and CalPERS are entitled to the same basic benefit structure provided for current members.

    Defined Benefit Systems

    Defined benefit retirement plans offer a moderate but secure retirement based upon a formula that will last for the members’ lifetime.  Efforts to eliminate defined benefit retirement plans in favor of 401(k) style retirement plans should strongly be resisted.

    Benefit Improvements

    Benefit improvements must be applied on an equitable basis to all members and beneficiaries of CalSTRS/CalPERS.  Ad hoc benefit increases, which aid one group of members to the disadvantage of another group of members, should be resisted.

    Contributory Retirement Systems

    The two public retirement systems must be contributory systems with costs shared by the employer, employees and the state.  The Retirement Fund must be an inviolate trust fund solely for the benefit of members, retirees or survivors, without special consideration for any person or agency, including the state.  The actuarial integrity of the CalSTRS/CalPERS Defined Benefit Program must be retained with full benefits maintained in any proposals to modify or create an alternate retirement system.

    Retirement, Disability and Family Benefit Allowances

    Retirement, Disability and Family Benefit Allowances must include adequate protection against inflation, either indexed to the California Consumer Price Index (CCPI) or realistic replacement value of the original allowance.

    The Independence of CalSTRS

    The California State Teachers Retirement System should be an independent state agency headed by an independent teacher-majority board and administered by an executive officer not subject to political control.

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