The California State Teachers’ Retirement System (Calstrs) is in a big hole–and they want the teachers, school districts and the state to cough up a lot more cash so they can continue paying off benefits.
Calstrs says it needs $4.5 billion more every year for the next thirty years in order to keep paying off all of the benefits it said it would give. Even though Calstrs took in $6 billion in 2012, it says the teachers, school districts and the state should increase their giving by 15 percent.
According to the Calstrs report,
The weak financial markets of the past decade, together with the fact that contribution rates were not adjusted in response to the low returns, have undermined the long-term funding… can only be effectively addressed by increasing the contributions paid by a combination of members, employers and the state.
Calstrs now has $158 billion in its coffers, but that is only 69 percent of what it will need to pay off the benefits. It will be broke by 2046.
From 1972 until now, teachers have paid 8 percent of their wages into the fund; school districts have paid 8.25 percent of payroll since the 1990’s. State taxpayers pay roughly 5.3 percent.