This year we are giving out 10 $1,000 scholarships. Scholarship application, information and resources can be found via the member portal on the website.

Scholarship Deadline: June 15, 2023

17 people, 1 dog rescued from raging floodwaters in California

TULARE COUNTY, Calif. (KMPH) — 17 people and one dog were rescued in a California county as the latest storm to hit the state causes more problems for residents already struggling with flooding.

The Cal Fire Butte County division said Wednesday in a tweet that shift water rescue crews have been busy as of late.

Read More HERE

Next Board Meeting: July 24-27, 2023

No One Left Behind Golf Tournament

Message from State Retiree Director, Brian Burger

CalPERS & Your Cost-of-Living Adjustments (COLA)

All State retirees are eligible for an annual cost-of-living increase that begins the second calendar year after retirement. Eligible retirees, including survivors and beneficiaries, receive COLA on their May 1 retirement check.

COLA is dependent on three factors:

1. The Consumer Price Index for All Urban Consumers (CPI, 1967), published by the Bureau of Labor Statistics (BLS) annually.
2. All State and School employees have a maximum COLA of 2% compounded on your retirement first retirement amount.
3. The year you retired.

Consumer Price Index (CPI)

CPI determines the rate of inflation and is compared annually. CalPERS uses the CPI at the time of retirement to calculate your value of money when CalPERS adjusts for COLA. The BLS determines CPI, and by law, it's the official measure CalPERS uses to calculate COLA.

The 2022 annual CPI is 876.664, and the inflation rate is 8.00%.

The CPI represents the cost of an item compared to the cost in 1967. For example, in 1967, an item cost 100.000, or $1.00. In 2022, the same item would cost $8.77.

To calculate the rate of inflation for 2022, CalPERS:

(Use the Current Year Annual CPI – Previous Year Annual CPI) / Previous Year Annual CPI = Current Year Rate of Inflation

(876.664 – 811.705)/811.705 = 8.00%

How Much Will My COLA Be?

The chart below provides the percent allowance increase a retiree will receive based on their employer's contracted COLA percentage and retirement year. There are select retirement years that also include Purchasing Power Protection Allowance (PPPA) benefits. Multiplying your current gross allowance by the chart's COLA and PPPA (if applicable) allowance increase percent, will provide an estimate of your 2023 COLA increase.

How Does CalPERS Determine the COLA Percentage to Pay Retirees?

CalPERS determines the COLA amount to be paid to retirees by first comparing the compounded rate of inflation to the compounded at your 2% COLA percentage. The COLA percentage you receive is lower than the two compounded amounts. CalPERS then uses your base allowance, which is the amount you received when you first retired and before any cost-of-living adjustments.

Recent Higher inflation has Many Retirees worried

Anytime the inflation rate is higher than your COLA percentage, the difference is lessening the value of your pension. When the purchasing power of your pension reaches 75%, CalPERS will keep your purchasing power at 75% of what your original pension could be. These increases are not COLA increases but raises due to the Purchasing Power Protection Allowance (PPPA). It usually takes 30 years for most retirees to receive raises to keep them at 75%.

An example of a 2% COLA calculation

Year 1: COLA factor is 0.0200 (or 2.00%)

Year 2: 1.0200 x 1.02 = 1.0404 – 1 = 0.0404 (or 4.04%)

Year 3: 1.0404 x 1.02 = 1.0612 – 1 = 0.0612 (or 6.12%)

Year 4: 1.0612 x 1.02 = 1.0824 – 1 = 0.0824 (or 8.24%)

Year 5: 1.0824 x 1.02 = 1.1040 – 1 = 0.1040 (or 10.40%)

Why do some Retirees get more than 2%

Retirees after 2006 never got their complete 2% raises for many years when inflation was lower than 2%, and now that inflation has been so high the last two years, they are receiving 2% for this year plus an amount for the years they did not get the complete 2%. No one is getting more than 2% compounded since the year they retired.

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