CalSTRS Issues Letter in Response to Little Hoover Report
On Wednesday, March 8, CalSTRS sent a letter to the Little Hoover Commission in response to its report on public pensions. The letter outlines why the recommendations would likely weaken rather than strengthen retirement security for California’s public educators. In some cases, the Commission’s recommendations could actually increase the total cost of providing retirement benefits.
The report includes broad assumptions and generalizations that do not account for differences between CalSTRS and other public pensions. The report also does not consider the legal ramifications of its recommendations, such as the recommendation to reduce the accrual of future benefits for current active members.
The CalSTRS benefit structure, on a comparative basis with other plans, is not, as the report says, “overly generous,” but rather provides a moderate benefit that replaces approximately 60 percent of preretirement income for members – who receive no Social Security benefits for their decades of service.