Board Directions

The economic turmoil in Fiscal Year 2008-09 doubled our unfunded liability. Investment returns alone can’t address the shortfall. And it is for the current as well as future generations of teachers that the Board must exercise its fiduciary duty and develop sound funding solutions. If we do nothing, core benefits guaranteed by the U.S. and California constitutions would be paid by the state General Fund—at a greater cost than if we act sooner.

Since 2006, we have been talking to our stakeholder groups—active members, retired members, administrators, school districts and the Legislature—about the need for a contribution increase. Unlike other pension systems, the Legislature and the Governor determine CalSTRS pension contribution rates and local employers determine health benefit support.

Solving the unfunded actuarial obligation won’t be easy—but acting as a fiduciary isn’t easy. Teachers have been promised a reliable retirement. The Teachers’ Retirement Board cannot sit on the sidelines.

Board actions:

• Communicating the funding shortfall facts to members, employers, Legislature and the Governor.
• Raising the need to set predictable contribution rates within limits.
• Moved to a more diversified investment mix.
• Review CalSTRS investment assumptions in November 2010.

The Board invites member engagement on these important issues through this website.