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Jerry Brown Wants to Shift School Pension Costs to Local Government

Image: Jerry Brown Wants to Shift School Pension Costs to Local Government

By    |   Sunday, 25 May 2014 10:00 AM

Gov. Jerry Brown wants to close a $74-billion deficit in the California State Teachers' Retirement System by having local school authorities take on greater funding responsibility, The Los Angeles Times reported.

The share of pension contributions from the districts would incrementally rise over seven years from the current 8.25 percent to 19.1 percent.

The agency that oversees the pension system backs the governor's approach, according to the Times. So do Republicans, Breitbart reported.

"I am glad to see the governor is continuing to prioritize fiscal responsibility," said Senate Republican Minority Leader Bob Huff.

Under the California constitution, the state's general fund pays teacher pensions. Brown is proposing restructuring how the costs are borne with districts assuming responsibility for 80 percent of the extra costs.

There are over 868,000 teachers in the retirement system with about 253,000 now receiving pensions. There is some variation in teachers' salaries with high-school teachers in Berkeley earning a median salary of about $63,000 a year while elementary school teachers in Los Angeles earn $58,500. The pension system is kept afloat by contributions from employees, districts, local counties, investment, and Sacramento's general fund.

However, "net pension liability" is set to rise dramatically to $166.9 billion from $71 billion based on new Government Accounting Standards Board rules, according to Breitbart. Over seven years the districts will pick up $11.4 billion of the tab from the present $4.9 million, under Brown's plan.

San Francisco Superintendent of Schools Richard Carranza said, "Quite frankly, we are stunned" that the districts will need to shoulder such heavy pension costs rather than "serve our most disadvantaged students."

According to Carranza, "This will take a huge portion of the very same revenues school districts are counting on to provide services for our students and salary increases for our teachers. It undermines what the governor said just six months ago he intended to do, which was to increase funding for underserved students," the San Francisco Chronicle reported.

The bulk of the education budget does not go toward teachers in the classroom but to staffing and various welfare initiatives, according to Breitbart.

For Brown's proposal to take effect it would have to be passed by California's Democratic controlled legislature.

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Gov. Jerry Brown wants to close a $74-billion deficit in the California State Teachers' Retirement System by having local school authorities take on greater funding responsibility, The Los Angeles Times reported. The share of pension contributions from the districts would...
jerry brown, california, state, teachers
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2014-00-25
Sunday, 25 May 2014 10:00 AM
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