Two Key Pension Proposals
CTA has won a major victory that has sent a key retirement measure to Gov. Gray Davis for his signature. The governor was expected to sign the bill sometime in September, prior to the end of the legislative session.
The CTA-sponsored measure, AB 1207 by Assembly Member Ellen Corbett (D-San Leandro), would empower K-12 and community college districts to offer senior teachers up to two years of additional service and age credit with the State Teachers' Retirement System. That additional credit could provide teachers with thousands of additional dollars during their retirement years.
The measure will provide an important benefit to senior teachers. By providing a retirement incentive to senior teachers, AB 1207 will help protect the jobs of less senior teachers in districts needing to pare down their teaching force.
Under terms of AB 1207, local chapters can bargain the benefit. Persons taking advantage of the program would be limited on their options to returning to teaching after retirement.
None of the incentive time purchased in either bill counts toward enhancements and bonuses, including longevity, career, or highest year compensation retirement bonuses, CTA retirement experts point out.
Meanwhile, another important CTA-sponsored measure retirement measure was still seeking legislative approval.
AB 265, by Assembly Member Gene Mullin (D-S. San Francisco), would ensure that the state will repay, with interest, $500 million to the STRS that was withheld to help balance the state budget.
The $500 million was earmarked for a special the STRS' Supplemental Benefits Maintenance Account (SBMA). This account helps offset the impact of inflation on the pensions of more than 63,000 elderly, long-time retired teachers.
The fund underwrites the cost of the purchasing power guarantee that provides inflation adjustments so that retirees' pensions always retain at least 80% of their original value.
Recipients of this account are mostly elderly women who retired prior to 1986. Their average age is 82, according to CalSTRS, which is co-sponsoring the bill with CTA.
The measure is in the Senate Appropriations Committee's suspense or hold file. Lawmakers could act on the bill as early as next week.
CTA Members:
Urge Gov. Gray Davis to sign AB 1207 (Corbett). Then contact your own Steate Senator ask her/him to approve AB 265 (Mullin).