Local Blogs

A Civil Look At Civics

By Erin Glanville

E-mail Erin Glanville | Follow this Blog

About this blog: While state and federal politics dominate the headlines, local issues have an enormous impact on our everyday lives. This blog will attempt to shine a light on topics of public interest and facilitate greater participation in the ...  (More)

View all posts from Erin Glanville

What Will California Pension Contribution Increases Mean For Local Schools?

Uploaded: Jun 24, 2014


The new budget that Governor Jerry Brown signed last Friday will significantly increase how much money school districts have to set aside for teacher pensions. That is going to have a big impact on schools, including our local ones.

On the one hand, the new budget boosts student spending due to voters' passage of Proposition 30, back in 2012, which raised taxes on wealthy individuals and increased sales tax revenue from 7.25% to 7.5%. On the other hand, the new budget also takes steps to address a feared teacher pension shortfall by transferring more money out of school districts' budgets beginning this year. Under the new plan, school districts' contributions to the California State Teachers' Retirement System (CalSTRS) will rise from 8.25% to 9.5% of payroll. That is just the beginning, as those increases will grow to 19.1% of payroll over the next seven years.

What will this mean for our local schools? Local education leaders are still trying to figure that out. Scott Hinshaw, a board member of the Menlo Park City School District, confirms "the increase in pension contributions is certainly going to effect and cause us to make some changes to our budget." He adds that the bigger concern "is that this happens immediately." Hinshaw goes on to say "Our district is fortunate to have some reserves set aside for something just like this to cover the unexpected additional cost to our budget now, but that is not sustainable and we are going to have to discuss how we will need to adjust our budget in the coming years to address this."

Exactly how much more money local districts will need to transfer into teacher retirement pension plans over the next seven years – and how that will impact planned programming-- is yet to be determined. What is clear, however, is that pension costs will become more visible and relatable in the context of local school budgets.

Stay tuned.

Comments

 +  Like this comment
Posted by Shelby, a resident of Atherton: Lindenwood,
on Jun 25, 2014 at 1:55 pm

Give new teachers Social Security and a 401K like the rest of us.


 +  Like this comment
Posted by OneBDay, a resident of Woodside: Emerald Hills,
on Jun 29, 2014 at 8:24 pm

Name ONE, just ONE, U.S. corporation that has the same pension plan that we give our police, fire, teachers, politicians and all other public employees.

There is not ONE! The sole answer for this: they would go out of business!!!!



Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:

Follow this blogger (Receive an email when blogger makes a new post)

SUBMIT

Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: * Not sure?

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

It Can Wait
By Cheryl Bac | 4 comments | 2,752 views

Hit the Bus
By Paul Bendix | 3 comments | 328 views

“I live near Sunset”
By Stuart Soffer | 0 comments | 47 views