Teachers Association of Long Beach

CalSTRS Contribution Rates – AB1469/SB864

CalSTRS Contribution Rates AB1469/SB864

Meeting its constitutional obligation, the State legislature passed the 2014-15 State Budget on June 15, 2014. As was stated in the May revision, the 2014-15 State Budget contains provisions to address the CalSTRS unfunded liability in Assembly Bill 1469 that was signed into law by the Governor on June 24, 2014. The final legislation differs in several ways from what was proposed in the May revision. The overview of the changes include:

1) a lower initial employer contribution to reflect the concerns expressed by management groups;

2) a periodic review of the CalSTRS Defined Benefit funding status on or before July 1, 2019, and every 5 years moving forward

3) an ability for the CalSTRS Board to increase or decrease the employer and State contribution (see details below).

 

Fiscal Year State Contribution Employer Contribution Employee

(2% @ 60)

Employee

(2% @ 62)

2014-15 3.45% 8.88% 8.15% 8.15%
2015-16 4.89% 10.73% 9.20% 8.56%
2016-17 6.33% 12.58% 10.25% 9.205%
2017-18 6.33% 14.43% 10.25% 9.205%
2018-19 6.33% 16.28% 10.25% 9.205%
2019-20 6.33% 18.13% 10.25% 9.205%
2020-21 6.33% 19.10% 10.25% 9.205%

The 2014-15 State Budget provides a plan to fully fund the CalSTRS Defined Benefit Program by July 1, 2046, that is based on shared responsibility among all parties with increased contributions from the State, the employers, and the employees.

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