LA Unified must come up with $16 million this year to pay an unexpected bill as a result of legislation signed by Governor Jerry Brown aimed at rescuing the state’s teachers retirement pension system known as CalSTRS, but the district’s total increase is much higher, estimated to reach an extra $1.1 billion over the next seven years.
While teachers and school districts across the state will see their contribution rates increase, LAUSD, the largest school district in the state, will pay the lions-share.
The rescue, which will help address a $74 billion shortfall in the teachers pension fund, requires school districts to radically raise their contributions to the fund from the current rate of 8.25 percent, to a rate of 19.1 percent by 2020. Teachers will see a more modest step up, from 8.15 percent to an eventual 10.25 percent of their salary, over the same seven year period. The state’s contribution will rise from 3 percent to 6.3 percent.
But In real dollar terms, the pension contribution price tag for LAUSD is steep: it will eventually more than double by the end of the phase-in period, from its current payment of $213 million per year, to $493 million per year by 2020.