Retirement: AB1997 Impacts on STRS Documentation Requirements

Dear Schools Business Professionals,

As a reminder, the requirements of AB 1997 (McKinnor, 2024)<www.calstrs.com/ab-1997-mckinnor-creditable-compensation-simplification> become effective July 1, 2027. Now is the time to review your Publicly Available Pay Schedules (PAPS) and Publicly Available Agreements (PAA) to ensure your district is ready for the implementation deadline.

We encourage district leadership, Human Resources, and Payroll personnel to review the resources referenced in this email to ensure compliance by July 1, 2027. In addition, please see the Additional Resources/References section for upcoming training opportunities from CalSTRS.

Documenting Pay
1. All Salary must be paid in accordance with a Publicly Available Pay Schedule (PAPS). * Applies to every certificated position reported to CalSTRS, including superintendents (only in instances where an employee is in a valid class of one will CalSTRS accept a PAA in lieu of a PAPS as long as it meets all the requirements of a PAPS) and other positions where salary has historically been established by an employment contract. * Must include an Annualized Pay Rate. * Any additional work that is not a position subject to membership should not be reported as salary and does not need a PAPS. * See www.calstrs.com/publicly-available-pay-schedule for sample compliant PAPS and www.calstrs.com/publicly-available-pay-schedule-checklist for a checklist to ensure compliance. * In Escape, Salary may be entered as an Assignment or Addon. 2. All Special Pay and Base Days must be identified in a Publicly Available Agreement (PAA). * Special Pay only includes ongoing additional pay for education, experience, or classification. * Special Pay cannot include any limited-term payments. * See sample language for special pay and base days here: www.calstrs.com/publicly-available-agreement and compliance checklist here: www.calstrs.com/publicly-available-agreement-checklist * In Escape, Special Pay is Contribution Code 6 – Special Compensation. 3. Supplemental Pay is any pay that does not meet the definition of salary or special pay (including service above 1.0 FTE), but it cannot include any excluded types of pay (see page 5 of the attached AB 1997 Training Participation Guide). There is no specific STRS documentation requirement for Supplemental Pay. In Escape, Supplemental Pay is entered as an Addon. Note that STRS will consider any pay without an annualized pay rate as Supplemental Pay and the pay will only be reportable to the Defined Benefit Supplement (DBS) program.

Positions Subject to Membership
In addition, all districts and county offices must document the positions subject to membership in CalSTRS either in the collective bargaining agreement or in a resolution adopted at a public district board meeting. For charters, the positions subject to membership must be documented in either a collective bargaining agreement or be a position that requires the holding of a Commission on Teacher Credentialing certificate, permit, or other document pursuant to subdivision (I) of Section 47605. CalSTRS has provided sample language here: www.calstrs.com/position-subject-to-membership

Working After Retirement
Working after retirement includes any service performed by a retired member or participant as an employee, third party administrator or independent contractor within the California public school system and the earnings must be reported to CalSTRS.

Additional Resources/References:
1. CalSTRS Documentation Training Participant Guide (attached) 2. CalSTRS Documentation Compliance<www.calstrs.com/documentation-compliance> 3. Position Subject to Membership Job Aid (effective 7/1/27)<employersupport.calstrs.com/GetFile/f1029e54-c847-4d8b-8a0f-ee2d0dfceab5> 4. Position Subject to Membership Checklist (effective 7/1/27)<employersupport.calstrs.com/GetFile/63877765-b45a-40e2-8c3c-f1ee8ceaad33> 5. Revised Terminology Crosswalk<employersupport.calstrs.com/GetFile/74e03024-6ccb-47e4-91e9-538721179dc5> 6. For independent districts/charters: New Contribution File Specifications<employersupport.calstrs.com/GetFile/f540b952-c6ef-4f66-9414-b7a67be79dac> and New Employment File Specification<employersupport.calstrs.com/GetFile/deb65bb6-9a61-4d62-8bca-f7cd12ca1e56> 7. CalSTRS Training Website<training.calstrs.com/login/> 8. Lozano Smith Client News Briefing<www.lozanosmith.com/news-clientnewsbriefdetail.php?news_id=3363> 9. Upcoming STRS Trainings<training.calstrs.com/>: * Training Tips Forum: Positions Subject to Membership – November 5, 9:00 AM<calstrs.zoom.us/webinar/register/WN_yzwlSX1mRaiK4vrAqi0UBQ#/registration> or November 6, 9:00 AM<calstrs.zoom.us/webinar/register/WN_Xbg8rVspTcaQDC_DTWzkEA#/registration> * Training Tips Forum: Changes to Creditable Compensation – December 10, 9:00 AM<calstrs.zoom.us/webinar/register/WN_zrtEH3g5QGSetKSd1tFVyA#/registration> or December 17, 9:00 AM<calstrs.zoom.us/webinar/register/WN_nbp6uEoLSp6t-ZEvq0Tjew#/registration>

We encourage districts to send all PAPS and PAA’s to PAA-PAPSreview@CalSTRS.com<mailto:PAA-PAPSreview@CalSTRS.com> for review and to maintain correspondence with STRS on file in the district’s records in case of future audit.
Please contact PAA-PAPSreview@CalSTRS.com<mailto:PAA-PAPSreview@CalSTRS.com> with any questions or for assistance regarding these changes.
Regards,
School Business Advisory Services Team
Santa Barbara County Education Office
sbasweb.sbceo.org
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