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The Pension Issues Resource Center is a source of information about pension issues facing CalSTRS
and its 755,000 active and retired members and their beneficiaries. Since late 2004, the following
changes to the CalSTRS pension system have been considered, but to date none have been enacted.
Latest Developments :
State Contribution to CalSTRS Sustained
A budget proposal would have eliminated the state contribution to the CalSTRS Defined Benefit
Program and would have effectively shifted the cost to the school districts and potentially to
CalSTRS members.
The proposal died on July 11, when the Governor signed a state budget that included funds to cover
the state's approximate $469 million in contributions to the Defined Benefit Program. State and school
districts will continue to make the same contributions to the Defined Benefit Program as in 2004.
Legislation to Change Pension Plans Idled
Assembly member Keith Richman introduced legislation in December 2004, in January 2005, and again in
April 2005 that would have changed public pension plans, including those administered by CalSTRS.
The legislative proposals would have closed public pension defined benefit plans in favor of 401(k)-style
defined contribution or hybrid plans.
The bills did not make it through the legislative process because they died in committee.
Ballot Initiative to Change Pension Plans Pulled Back
The Governor had proposed to place on the ballot an initiative that would have changed public
pension plans from the current defined benefit plan to a 401(k)-style defined contribution plan.
However, in April 2005, the Governor announced that he would delay the initiative. He stated that he
plans to seek changes to existing public pensions through the legislative process. But if an agreement
cannot be reached in the Legislature, the Governor stated that he would "improve the (initiative)
language and put our plan on the June 2006 ballot."
For more information:
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