$500M Waiting in Appropriations:
A CTA-sponsored measure that would guarantee the State Teachers' Retirement System (STRS) the repayment - with interest - of a $500 million state deferred payment gained the approval of the Senate Public Employment and Retirement (PER) Committee on June 23.
AB 265 by Assembly Member Gene Mullin (D-South San Francisco) and Assembly Member Gloria Negrete McLeod (D-Chino) moved quickly to the Senate Appropriations Committee, where it was first heard on June 26.
While the PER panel moved the bill quickly on a 3-2 vote, the bill became mired in partisan budget wrangling before the Appropriations panel.
The committee did not vote on AB 265, agreeing instead to hold the measure over for further consideration. That hearing could come soon.
The measure contains an "urgency clause" that will make it effective as soon as it becomes law. That provision requires the measure to gain a two-thirds super-majority for passage. Without the provision, the bill would become effective on January 1, 2004. The earlier effective date would help the state save another $58 million, while still protecting the retirement system's funds.
Securing the funding for STRS is important because the appropriations go into the Supplemental Benefits Maintenance Account or SBMA. The SBMA is used to fund retirees' purchasing power guarantee, which protects the pensions from the ravages of inflation. At worst, the pensions will retain at least 80% of their original value, because of the SBMA moneys.
CTA Members:
Urge your Senators to vote yes on AB 265 (Mullin/Negrete).