CalSTRS Releases Statement of Findings from City College of San Francisco Audit
CalSTRS Releases Statement of Findings from City College of San Francisco Audit

Statement Ricardo Duran

WEST SACRAMENTO, CA – The California State Teachers’ Retirement System (CalSTRS) today released a statement on the findings of its audit of the City College of San Francisco (CCSF), covering the period from July 1, 2006 to June 20, 2011.

The primary finding is that CCSF did not consistently comply with the Teachers’ Retirement Law regarding eligible membership and creditable compensation reported to CalSTRS. As a result, CalSTRS is in the process of recovering benefits inappropriately paid to CCSF employees totaling approximately $385,500.

Among the more significant findings of the audit are that CCSF:

  • Erroneously reported at least ten administrative employees who are ineligible for CalSTRS membership. Thirteen other positions have been identified which may not qualify for CalSTRS membership. CalSTRS has requested that the District conduct a further investigation to justify those additional positions.
  • Reported contributions in error for those ten employees totaling $1,489,000. Inappropriate benefit payments to three retired administrators in that group totaled $289,920.
  • Incorrectly credited ten employees’ compensation toward the Defined Benefit Program rather than the Defined Benefit Supplement. The errors caused pension overpayments to six of the 10 employees amounting to approximately $73,400.
  • Reported the earnings of 19 CalSTRS members incorrectly as non- members. Those members did not receive proper service credit and CalSTRS did not receive employee and employer contributions amounting to $31,540 on earnings totaling $194,090.
  • Incorrectly reported to CalSTRS one member’s non-creditable compensation as creditable, resulting in a pension overpayment of approximately $15,300.

CalSTRS relies on the state’s nearly 1,600 school employers’ accurate reporting of compensation and service data. Employer reporting errors potentially and negatively impact CalSTRS members’ accurate pension calculations. To further strengthen employer audits, in 2011, the CalSTRS Audit Services team began conducting all audits in-house thereby ensuring a complete and thorough review of school employers. As a result of CalSTRS implementing various enhanced online employer reporting features, employer reporting errors have been reduced by 97 percent.

CalSTRS is focused on ensuring members receive secure retirement incomes that appropriately reflect the service they provide to the state’s students. When employer reporting errors or pension abuses are identified, CalSTRS conducts a thorough and deliberate review before correcting benefits and collecting overpayments in a manner consistent with the law.

The California State Teachers’ Retirement System, with a portfolio valued at $150.6 billion as of June 30, 2012, is the largest teacher pension fund and second largest public pension fund in the United States. CalSTRS administers a hybrid retirement system, consisting of traditional defined benefit, cash balance and defined contribution plans, as well as disability and survivor benefits. CalSTRS serves California’s 856,000 public school educators and their families from the state’s 1,600 school districts, county offices of education and community college districts.

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