California Educator

August 2014

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Page 36 of 73

Advocacy Legislation E D U C AT O R S M A Y N O T I C E a little extra going out of their paychecks into the California State Teachers' Retirement System (CalSTRS) this fall, but that's a good thing, since the money will come back to them at retirement, plus it will stabilize the retirement system going into the future. After years of attempts to close a shortfall that has mounted to $74 billion, the Legislature in June approved Gov. Jerr y Brown's pension plan, which provides increased contributions from educa- tors, school districts and the state. "For roughly the last 10 years, our highest priority and our members' most pressing concern has been to secure the long-term stability of the defined benefit program," says Harr y Keiley, chair of the Teachers' Retirement Board and member of the Santa Moni- ca-Malibu Classroom Teachers Association. The action calls for member contributions to increase from 8 to 10.25 percent over the next three years. School and community college district contributions will increase from 8.25 percent to 19.1 percent over seven years, while the state's portion would increase from the current 3.041 percent to 6.3 percent in the next three years. The action took effect July 1. "This does represent what seems like a hefty increase in our con- tributions, since members' rates have remained at 8 percent since 1972, but this increase will provide for an ongoing annual benefit in- crease post-retirement. This is a really good thing for our members," says Dana Dillon, CalSTRS Board member and CTA Board member. CTA has long recognized the importance of a secure retirement to attract and retain teachers, and its legislative advocates began working with the governor early on to come up with a fair plan. The governor's plan comes amid a number of threatened ballot initiatives that would damage a safe and secure retirement system. Although CalSTRS has historically been a sound system, it has faced a funding shortfall since the global financial recession hit in 2008. Absent any changes in contribution rates, the program would be depleted of its assets as early as 2046. CalSTRS officials asserted the funding shortfall of $74 billion could be managed, but required action. CTA President Dean Vogel says, "The CalSTRS shortfall did not happen overnight, and it cannot be addressed overnight. It is going to take time, commitment and collaboration from all stakeholders — the state, districts and educators — so we appreciate the governor's plan to fully fund the teachers' retirement defined benefit plan within 30 years." Planning ahead CalSTRS plan closes gaps, ensures future By Dina Martin 35 V O L U M E 1 9 I S S U E 1 ...but who's protecting you? Your loved ones depend on you, but would you still be able to provide for them if a disability prevented you from working? Take steps to maintain their way of life and yours with CTA-endorsed Disability Insurance from The Standard. It helps safeguard against loss of income due to an illness or injury. Start protecting what's important to you at 35 V O L U M E 1 9 I S S U E 1 For costs and further details of the coverage, including exclusions, any reductions or limitations and the terms under which the policy may be continued in force, please contact Standard Insurance Company at 800-522-0406 (TTY). Standard Insurance Company, 1100 SW Sixth Avenue, Portland, OR 97204 GP 190-LTD/S399/CTA.1 SI 16792-CTAvol

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