Governor Continues to Seek Cuts in Special STRS Account
Despite intense efforts by CTA and its allies, Gov. Schwarzenegger is continuing to insist that the final state budget not contain $75 million in an annual contribution due to a special account in the California State Teachers’ Retirement System. Those funds are earmarked for the Supplemental Benefits Maintenance Account (SBMA), which helps protect some of the neediest retirees from the ravages of inflation.
The SBMA provides retired teachers with supplemental payments to help ensure that their pension’s purchasing power will never fall below 80% of its original value.
The average retired teacher receiving an SBMA payment is 83 years old, and nearly 65% are female and most are likely widowed.
If the final budget does not contain the additional $75 million this year and in following years, these teachers and future retirees will likely lose any chance of seeing their purchasing power guarantee move above the current 80% floor.
Should the governor prevail on this issue, CTA and other education supporters will likely have recourse in the court system.
Battles to protect CalSTRS funding are nothing new. In 2003, the legislature balked at appropriating $500 million to the SBMA. CalSTRS is in litigation over the repayment of the funds. A court ruling in the case could come as early as this fall.
• CTA Members:
Urge your Assembly Member and state Senator to oppose the $75 million annual reduction in state contributions to the SBMA.