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Alert 06/01/07

Urgent! Protect Teachers' Retirement
(Contact Conferees on Purchasing Power Protection)
Six members of a special budget committee are now considering whether to continue fully funding the state’s obligation to our most elderly retired teachers. If you contact these lawmakers and your state Senator and Assembly Member, you can help end the crisis.

As part of their efforts to craft a final state budget, members of the Joint Budget Conference Committee have begun looking at the governor’s proposal to reduce funding to the Supplemental Benefit Maintenance Account (SBMA). The SBMA makes separate payments to our oldest and neediest retired teachers. These payments are used to help guarantee that the pensions of CalSTRS retirees will always have at least 80% of their original value. The conferees have the power to reject the governor’s plan by excluding it from the legislature’s final spending bill.

The Schwarzenegger administration has proposed to permanently reduce the contribution to the SBMA by $78 million annually. While the state’s reduction of the funds won’t immediately put the pension purchasing power guarantee in jeopardy, the holdback will make it difficult -- if not impossible -- to boost the guarantee floor above the current 80% level. CTA aims to defeat the Governor’s unfair proposal.

Background:

Over the years, inflation has eroded the value of the pensions of dedicated retirees who spent their professional lives helping California’s students succeed. To help retirees most harmed by inflation, CTA spearheaded measures that implemented a purchasing power guarantee and boosted it to the current 80% of original value.

The average retired teacher receiving SBMA payments is 83 years old. Nearly 65% are female. On average, SBMA payments are between $250 and $300 per month.

Key Points:

  • The state‘s annual funding for the Supplemental Benefit Maintenance Account (SBMA) is vital to providing future funding to protect CalSTRS retirees against the ravages of inflation.
  • To attract and retain all the highly qualified instructional personnel California needs, the state must honor its commitment to provide a stable and equitable retirement for all retirees.
  • Not continuing state contributions to the SBMA will most directly harm a group of elderly, dedicated female retired teachers whose ability to buy food, prescription drugs, and other necessities will be jeopardized. They would benefit most from any future boosts in the guarantee above 80%.
  • In the future, current and future retirees will benefit from an increase in the purchasing power guarantee.

 

Coordinators:

Mobilize CTA members and other education supporters to contact the members of the Budget Conference Committee: Assembly Members John Laird (D-Santa Cruz), chair; Mark Leno (D-San Francisco); and Roger Niello (R-Sacramento) and Senators Denise Ducheny (D-San Diego), Dennis Hollingsworth (R-Murrietta) and Mike Machado (D-Linden). Urge them – and your own state Senator and Assembly Member – to vote for a budget provision that keeps the state honoring its promise to provide ongoing funding to the SBMA.

Help end this crisis. Go to the Legislative Action Center and send e-mails directly to these officials.

For more information, contact CTA Legislative Advocate Lori Easterling or GR Communications Consultant Len Feldman at 916.325.1500.

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