Posted In: California, Educator Voices, Retired Educators, Uncategorized

California Teacher: Don’t Play Politics With Our Pensions

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By Cynthia McCabe

Dana Dillon is an intermediate grade school teacher from Weed, Calif., who knows first-hand that educators earn their pensions in long, dedicated careers. They don’t deserve to lose the benefits they’ve earned to satisfy political whims.

Take a look at a letter she recently wrote about what’s happening with her state’s retirement system. Sound familiar? Let us know in the comments below.

Dana Dillon writes:

As a public school teacher, I am often gratified by the show of support that parents and others throughout California show for members of my profession. Everyone I talk with says they value education and the need to inspire and engage our youth to lead our nation’s future.

But I’m offended when I hear grumblings over teacher salaries and pensions.

News reports of rich public pensions paid to local government officials lead many to reason that CalSTRS (the California pension system for teachers) and its members are also to blame.

I take those criticisms personally. After all, given my education, training, and service, I’ve earned the pension I’ve spent a career in building.

Most educators do not retire into a life of luxury. Ours is a modest pension, secured over nearly three decades of service.

The median pension replaces about 60 percent of our working income. Unlike most workers, teachers in California do not earn any Social Security benefits for their classroom service.

As such, the pension represents the only source of reliable monthly income a retired teacher receives. Moreover, most public school educators in the state retire without employer-sponsored health care after age 65.

Nor is it a taxpayer giveaway.

Over the life of their careers, the teachers pension fund members contribute 8 percent of their monthly pay to help finance their retirement. Employers kick in another 8.25 percent of monthly pay (75 percent of which is offset by not having to pay Social Security taxes), the state contributes a little more than 2 percent, and the returns garnered by CalSTRS investments do the rest.

That means these taxpayer contributions represented less than 28 percent of the resources used in the past 15 years to pay benefits.

In the past decade, the financial health of public pension funds, including ours, has been undermined by the dot-com bust and global recession. However, our situation is not as dire as many would have you think.

As of June 2009, CalSTRS benefits were 78 percent funded and the system had sufficient assets and projected contributions to pay benefits until 2044.

Public pension funds like this one are not in crisis. Our long-term rate investment return of 8.2 percent for the past 20 years exceeds our assumptions. Our benefits are paid for and funded over decades.

Local and state governments, including California, must make hard decisions to ensure the solvency of their public pension systems.

Changes must be made to our pension system and CalSTRS is working with affected stakeholders to develop a responsible strategy to address the system’s projected long-term funding shortfall. While a fix is not immediately needed, the longer we wait to address funding issues, the costlier a solution will be.

But we can manage our funding problems without eliminating the defined benefit pensions that California’s public educators have worked for and deserve.

Click here to learn more about NEA’s fight to protect educators pensions.

Reader Comments

  1. Greg Allen

    Curious; at what point will you folks come to terms with the fact that you’ve exceeded the limits of this country? Nearly all of you tend to be Democratic, further liberal; however, and whenever countless special interest programs that you have for years supported serve to diminish the system, you never come to terms with the fact that your idealisms were the reason.

    All things financial are circular. And quite frankly, so is karma…

    Reply
  2. David Mead

    A retired teacher from Wisconsin (the last 12 years of my total teaching career) and Illinois (the initial 23 years of my teaching career), I’ve watched both local news and some recent national coverage of Gov. Walker’s proposal to deal with the state’s budget shortfall. So many have realized that his main agenda is bogus–that he’s using the financial woes of the state to eliminate collective bargaining and break unions. My question is this: I’ve neither seen nor heard any reference from WEA about the state’s on-going negotiation caps of 3.1 % annually on ALL public school districts for the last 18 years. Because of the QEO, salary concessions were commonly conceded by school districts year after years so that districts employees could preserve their pension and medical benefits. Walker presupposes that these concessions were never made. The Walker proposal illogically concludes that all negotiation of state remuneration began at the time of his inaguration. Please! This is absurd! BUT THEN, WHY HASN’T WEA-NEA MADE THIS FACT CLEAR TO THE PUBLIC? I know any reduction to salary, or freezes are hurtful to the individual teacher, but a two-teacher family complaining about a reduction of $13,000 dollars annually does not resonate with the other ordinary tax-payers in the state. Emotional appeals and complaints are not the ways and means to convince the populace during this economic downturn. We’re just like a whole of others in this regard. OUR FOCUS MUST INCLUDE THE FACT THAT MOST TEACHERS’ SALARIES IN THIS STATE HAVE NOT EXCEEDED THE COST OF LIVING SINCE 1993 . . . THE DATE THE QEO WAS INSTITUTED BY GOV. TOMMY THOMPSON AND THE THEN REPUBLICAN-CONTROLLED WISCONSIN CONGRESS . . . NO SURPRISE THAT THE CORPORATE LOBBY FROM THE “WISCONSIN MANUFACTURERS AND COMMERCE”.

    Reply
  3. Leonard Bumbaca

    A truly excellent description of what we’re fighting for – thank you Dana! Those who seek to undermine public education are going after the very professionals who dedicate a career of service to our schools.
    They seek to separate us from our community. Sadly, these “grumblings over teacher salaries and pensions” are being accepted in our communities by some of our neighbors who are hearing only part of the story. Every experience has shown that the facts are on our side.
    When we share these facts with people, they come to see the value and importance of retirement security, not just because it’s the right thing to do, but because it makes good sense economically, socially and as a matter of public policy.

    Reply
  4. Alice Helton

    How would you like to work in the cafeteria of a college for 50 plus years and have them mess with your retirement ??
    This happen in Arkadelphia, Ar at the college their !!
    Now think about that !!!

    Reply

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