Despite new legislation, thousands of California teachers are still paying for others’ mistakes

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For years, the state agency that oversees California’s teacher pensions has clawed money back from nearly 10,000 retirees after discovering school districts — or the agency itself — had been miscalculating their pension packages.

A new law signed on Sept. 25 by Gov. Gavin Newsom expands protections for retired teachers, and further shields them from having to repay for those mistakes in the future. But it does nothing for former educators who don’t qualify for relief because the errors in their pensions were discovered before the cut-off point of the bill: January 2023.

“We still don’t know what a solution looks like, but we’re very concerned about the issue,” said Jennifer Baker, a legislative advocate for the California Retired Teachers’ Association (CalRTA). “That’s a much more complicated conversation. And though we’re exploring it, there are a lot of legal roadblocks.”

Outrage over retired teachers’ overpayment debt was first reported in April, when the Bay Area News Group revealed that miscalculations in retired teachers’ pension packages had plunged thousands of former educators into debt. But legislative efforts to protect teachers are still falling short.

Baker said the new legislation — Senate Bill 432 — clarifies technical issues and builds upon a law passed earlier this year, Assembly Bill 1667. That law was the first to protect retirees from CalSTRS debt repayments: if a miscalculation in pension payments is discovered in January 2023 or later, AB 1667 takes the burden of repayment off the retired teacher. Though the retirees will still be at-risk of reduced pensions going forward, they won’t be on the hook for paying back the excess pension income they already received. Instead, that cost will be shared by that teachers’ district and CalSTRS, depending on which agency made the miscalculation in the first place.

“Caring for California’s students means taking care of all the people who work at our public schools,” said Sen. Dave Cortese (D-San Jose), who authored SB 432. “This legislation will bolster the teaching profession during a time when it’s needed most.”

But the new bills won’t help teachers like Rheta Thure, whose pension miscalculations were uncovered before 2023. Thure, who retired from a Salinas school in 2012 — and whose pension errors were uncovered in 2014 — is still on the hook to pay nearly $143,000 in “overpayment debt.”

From 2016 to 2022, 51,555 — or 5% — of the state’s retired teachers were notified of an adjustment in their pension packages. The vast majority saw their pensions increase, but 9,623 retired educators had their benefits slashed. Though the average monthly decrease was $144, many teachers are seeing reductions that are 10 times larger.

Cortese is reviewing what could close the loop for those left behind, according to a statement from his office. But with every month that passes, those retirees are continuing to pay for others’ mistakes.

“It makes you feel helpless, and like there’s nothing you can do except pay,” said Thure. “And of course, we pay and we pay and we pay.”

Retirees who have chosen to fight those decisions face even more financial costs. Many former educators have accumulated nearly $30,000 in legal fees while attempting to battle their pension adjustments over the last few years — including not only Thure, but John Boyett, a retired teacher in Napa.

Three years after Boyett retired in 2016, he received a notice that his pension had been miscalculated, and that as a result, his benefits would be reduced by $1,300 every month. Of that amount, $500 began going toward his “overpayment debt” of $67,000.

Boyett has been trying to earn the right to appeal the CalSTRS decision — but even getting the preliminary hearing to do so, he said, has been nearly impossible. It’s been stalled, canceled and rescheduled at least three times over the past four years. CalSTRS did not respond to requests for comment about SB 432, or why AB 1667 was not made retroactive.

“My attorney says this is a tactic that CalSTRS uses,” said Boyett. “They try to drag it out as long as they can. And in the meantime, I’m paying for it.”

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