CalSTRS Encouraged by Administration’s Commitment to a Funding Plan
WEST SACRAMENTO, Calif. – California State Teachers’ Retirement System (CalSTRS) Chief Executive Officer Jack Ehnes issued the following statement on the Administration’s commitment to a formal funding solution to close the $71 billion CalSTRS funding shortfall:
“Although no specific amount for CalSTRS funding was included in the proposed 2014-15 State Budget, language that commits the Administration to work with all parties toward a funding plan within 30 years brings promise that its adoption is on the horizon.
“The cost of a solution rises by $22 million with every day that a funding solution is not in place. Given that, the language included in the budget proposal affirms our assertion that the funding shortfall can be managed with appropriate and timely action. CalSTRS will work with the Administration, legislators, school districts and teachers to develop a plan of shared responsibility, as called for in the budget proposal language.
“Three noteworthy points of timing, funding level and shared responsibility, secured within a formal budget document, demonstrate a positive step in closing CalSTRS’ funding shortfall. Commitment at this level gives direction and energy to work with the Administration, legislators and stakeholders in the coming year to finalize a sustainable funding plan. CalSTRS remains ready to assist the Administration and all parties as they work to enact a formal funding solution.”
The California State Teachers’ Retirement System, with a portfolio valued at $181.1 billion as of December 31, 2013, is the largest educator-only pension fund in the world. CalSTRS administers a hybrid retirement system, consisting of traditional defined benefit, cash balance and voluntary defined contribution plans. CalSTRS also provides disability and survivor benefits. CalSTRS serves California’s 862,000 public school educators and their families from the state’s 1,600 school districts, county offices of education and community college districts.