Len Feldman
A CTA-backed bill that would have restored more than $500 million to the State Teachers' Retirement System has died in the Senate Appropriations Committee.
AB 265 by Assembly Member Gene Mullin (D-South San Francisco) and Assembly Member Gloria Negrete McLeod (D-Chino) would have required the state to reimburse STRS for money withheld from the Supplemental Benefits Maintenance Account (SBMA) last year to help fill a $38.2 billion hole in the 2003-04 budget.
The SBMA account provides an inflation adjustment for about 62,000 long-term retirees who left teaching prior to 1986 and whose average age is 82. Inflation has reduced their pensions by more than 20 percent. The account maintains the purchasing power of their payments at 80 percent of the original value. Over time, other current and future retirees will see their own pensions shored up to the 80 percent floor.
As a fiscal measure, AB 265 would have required a two-thirds majority for passage. It would have allowed the state to repay the money over time as a way to minimize its impact on the state treasury.