The California State Teachers’ Retirement System will receive a final $15.6 million payment from the 1997 sale of the Elk Hills Naval Petroleum Reserve as part of the $1.1 trillion budget appropriation bill passed by Congress.
The action apparently closes the door on a decades-long dispute, with roots reaching back to the dawn of California statehood.
The money set aside for CalSTRS in the federal budget is the final installment of annual payments dating back to 1999. Over that time, the teachers’ fund has received $315 million.
CalSTRS CEO Jack Ehnes said in a statement that “state law directs any proceeds from state schools lands, on which the petroleum reserve sat, to support retired teachers’ pensions when they fall below 85 percent of their original purchasing power.”
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As of June 30, 2013, CalSTRS said more than 43,000 of its beneficiaries were receiving inflation protection through payments from the CalSTRS Supplemental Benefit Maintenance Account, which receives proceeds from the Elk Hills sale.
The federal government began making payments to CalSTRS under a settlement agreement two years after the Elk Hills land was sold to Occidental Petroleum in 1997. The petroleum reserve sits on 47,000 acres near Bakersfield. Two tracts of state school lands within the reserve were dedicated to California’s schools by the federal government upon statehood in 1850.
Call The Bee’s Mark Glover, (916) 321-1184.