CalSTRS reports 19.1 percent investment gain

01/16/2014 5:09 PM

01/16/2014 5:10 PM

CalSTRS said Thursday it earned a hefty 19.1 percent return on its investments in 2013 but repeated its plea for funding assistance from the Legislature.

The California State Teachers’ Retirement System said the gains were boosted by 28 percent returns on its stock portfolio. The pension fund earned 19 percent from private equity and 14 percent on its real estate holdings.

“It’s a very welcome performance,” said CalSTRS spokesman Ricardo Duran.

“But this doesn’t mean we can sit back and ride the Wall Street wave. We still need that funding plan,” Duran said.

CalSTRS officials have been warning for several years that they need higher contributions from the state, school districts and teachers to maintain the pension system’s long-term viability. Gov. Jerry Brown didn’t include any rescue plan in his just-released budget proposal, but he pledged to enact a program in fiscal 2015-16 that would boost CalSTRS’ finances.

Unlike its big-brother pension fund, CalPERS, the teachers’ system can’t raise rates unilaterally and has to get the Legislature’s permission first.

Both pension funds took a beating during the 2008 market crash and have been dealing with funding issues ever since. Though it has plenty of cash to meet its obligations for the foreseeable future, CalSTRS says it faces a long-term shortfall of around $70 billion and is on course to run out of money in around 30 years.

CalSTRS normally doesn’t report its calendar-year investment results, so it couldn’t compare the 2013 record with prior years.

Earlier this week, CalPERS said it earned 16.2 percent in 2013.

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