CalSTRS proposes 15 new positions and $3.7M IT increase in FY 2025–26 budget concepts

Chief Financial Officer Julie Underwood presented the board with high‑level operating budget concepts for fiscal year 2025–26 on Sept. 24, describing requests that will be refined and returned in November as the formal budget.

Underwood said the concepts include 15 positions at an estimated cost of $2.6 million across seven business areas: 10 positions to support ongoing workload under AB 1667, two positions to support AB 2019‑related diversity, equity and inclusion outreach and reporting, one position to support a governor's executive order advancing equity, and two positions for innovation work tied to responsible Gen AI and efficiency objectives. She told the board those 10 AB 1667 positions were initially filled as temporary "blanket" positions and are now proposed as permanent funding based on expected ongoing workload.

The concepts also request $3.7 million to increase IT funding for software maintenance, additional circuits, increased licensing and higher SAP managed‑services costs. Underwood explained a major reversal from the prior year — a one‑time $205.8 million increase to finish the pension solution project — produces a net projected operating budget of $421.6 million for 2025–26, a 31% decrease from the prior year.

Underwood said the agency's authorized positions would total about 1,431 if the November budget is approved as proposed. Board members asked about vacancy fill rates and confirmed the plan to convert AB 1667 blanket positions to permanent roles; Underwood provided a vacancy rate of 12.6% for FY 23–24 and 10.7% as of July 31.