FROM: Amy McInerny, Chief Financial Officer
SUBJECT: Informational: Calendar Year 2027 Pensionable Compensation Limit for Tier 2 Members
RECOMMENDATION:
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Calendar Year 2027 Pensionable Compensation Limit for Tier 2 Members.
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BACKGROUND:
On October 16, 2026, the California Actuarial Advisory Panel (CAAP) issued their annual PEPRA Compensation Limit letter. The CAAP recommended the calendar year 2027 pensionable compensation limit, for Tier 2 members, be set at $165,643 for those included in the federal Social Security system and $198,771 for those not included. The increase is based on the Consumer Price Indices for All Urban Consumers, U.S. City Average (Exhibit A).
Pursuant to the Board’s Adjustment to the Pensionable Compensation Limit policy, the Chief Financial Officer and Chief Executive Officer (CEO) have reviewed the CAAP calculation. The CEO concurs with the CAAP calculation; therefore, the limits provided in the CAAP calculation will be used for all SBCERA Tier 2 Members for the calendar year 2027.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Prudent Fiscal Management
STAFF CONTACT:
Amy McInerny
ATTACHMENTS:
Exhibit A: California Actuarial Advisory Panel (CAAP) letter, dated October 16, 2026