California Teachers Will See Paycheck Impact Soon Of Pension Shortfall Plan


The Los Angeles Times (6/28, Megerian) reports that California teachers are about to receive paychecks that “a bit lighter,” as the state’s plan to address a $74-billion shortfall in its teacher retirement system goes into effect Tuesday. It “phases in higher contributions from employees, schools and the state over the next several years,” and could be a model for other states if it helps solve “one of the state’s most difficult financial problems.” The plan is designed to erase the shortfall over 30 years. The Times notes that “Texas and New Mexico have already taken similar steps, requiring higher contributions into their teacher pension funds. Both states also reduced retirement benefits, something California did two years ago for newly hired educators.”