2002 EDITION - Issue No. 11
May 10, 2002



We need your help in electing George Diehr - CFA's Contract
Development/Bargaining Strategy Committee Chair and San Marcos
Chapter President - to the CalPERS Board of Administration.  From
August 19, 2002-September 30, 2002, a mail ballot election will
be conducted to fill the "state active employees" seat currently
held by CalPERS President - and CFA member - Bill Crist.  Winning
this seat is important to ensuring that CFA will continue to have
a voice on this important body.  George is CFA's candidate for
this seat!

George needs our help TODAY in raising funds for him to win this
important seat.  We are asking our members to help raise at least
$500 per chapter to elect George.  Collectively, this would bring
over $11,000 to his campaign.  In just two days at the CFA
Delegate Assembly we collected nearly $1,300 in contributions.

Checks should be made payable to "George Diehr for CalPERS Board"
and mailed to the CFA Government Relations Office at 400 Capitol
Mall, Suite 1950, Sacramento, CA 95814.  Please indicate your
chapter on the envelope so that we may appropriately credit your
contribution to your chapter.  Below are some questions related
to this race.

Who is George Diehr?

George Diehr is a long-standing CFA member (San Marcos Chapter)
who has served CFA in many capacities.  In addition to serving as
chapter president and Chair of CFA's CD/BS Committee, George is
the "numbers person" on our bargaining team.  George's research
and analysis has helped uncover and document the systematic
diversion by the CSU administration of funds intended by the
state for support of instruction to non-instructional uses.  This
money contributes to further bureaucratic bloat and to a huge
software system development, CMS, which is of questionable need
or merit.

Why should I care about electing George to the CalPERS Board?
I'm not even a member of CalPERS!

Everyday decisions made by the CalPERS Board significantly impact
the delivery of health care in California and the pension
benefits enjoyed by CalPERS annuitants.  But in addition to
protecting pensions and fighting on health care issues, George's
election to the Board holds additional significance to CFA --
George's election to the Board is another opportunity to
demonstrate CFA's growing political strength in Sacramento.
Labor leaders, legislators and the entire political community
will look to what CFA does in this race as a testament to our
effectiveness in influencing the body politic.  While CFA will
make a substantial contribution to George's campaign, campaign
contribution limits imposed by Proposition 34 require that we
solicit additional support from individual faculty to ensure
George has all the resources he needs to win.

Who else is in the race?

George is facing two tough challengers in this race.  One is a
statewide vice-president of a large labor union with access to
significant resources to win; the other is a known CalPERS
activist who is a mid-level state manager.  We don't believe
either of these two candidates have comparable credentials to

How can I help?

CFA is looking at all of our options in terms of staff and
volunteers, but, of course, we need to help George raise money to
get his message out.  Therefore we are asking each chapter to
raise at least $500 for his campaign.

Checks should be made payable to "George Diehr for CalPERS Board"
and mailed to:

George Diehr for CalPERS Board
C/o CFA Government Relations Office
400 Capitol Mall, Suite 1950,
Sacramento, CA 95814

We'll keep you updated on each chapter's progress in the GRO
Weekly report.  Remember to send your check in as soon as
possible.  Early money is the best money!


Due to less state tax revenue than even skeptics predicted, the
state budget deficit is expected to exceed $20 billion - nearly
one-fourth of the state's entire general fund expenditures.
Governor Gray Davis will release his May Revise budget on Tuesday
next week based on the state's new revenue projections.  Revenues
have been depleted by over $8 billion since the Governor's budget
was first released in January.

Compounding the deficit problem is a recent analysis by the
Legislative Analyst's Office showing the state's budget woes will
likely continue for the next two to three years. It is
anticipated that serious budget decisions will be postponed until
after the November election, however, many Democrats are
concerned about the extent of cuts to education, health and
welfare, and children's programs, and may try to enact some sort
of revenue enhancements this year through increases in the
vehicle license fee or by reestablishing the top tier tax bracket
for the wealthiest one percent state wage earners.

In another budget related matter, SCR 49 carried by Senator Bruce
McPherson (R-Monterey Bay), was defeated in the Senate Education
Committee. This resolution, which CFA supported, called on the
legislature to refrain from increasing student fees at community
colleges, the CSU and UC systems. The measure failed by a 5-2


CFA has responded to Senator Dede Alpert (D-San Diego), regarding
her legislation, SB 1646, requiring CSU campuses to establish and
implement elementary education majors in colleges of education.
While CFA currently has a "watch" position on this measure,
further research is prompting the CFA Legislative Committee to
consider changing CFA's position to "oppose."  We appreciate the
faculty responses we received in helping us analyze the bill. CFA
especially appreciates the assistance of Jean Torcom at CSU
Sacramento and Rebecca Meyer from San Diego State University.

CFA forwarded the following concerns regarding SB 1646, and have
requested a meeting with Senator Alpert to discuss her bill:

* An elementary education major established at the CSU would
result in the denial of millions of dollars in Pell Grants that
currently are available to students participating in
post-baccalaureate (fifth-year) teacher credential programs.
California now receives a special exemption from federal law to
permit Pell grants for post-BA credential students, precisely
because we do not offer an undergraduate elementary education

* SB 1646 could delay CSU campus efforts to implement and expand
their "blended programs," established by all CSU campuses in
response to prompting from the legislature and the Commission on
Teacher Credentialing several years ago. These blended programs
are undergraduate elementary teacher preparation programs,
combining subject matter course work with professional teacher
preparation course work in four to four-and-a-half year programs.
These blended programs are expanding on CSU campuses, and in
coming years will graduate increasing numbers of beginning

* As approved by the Senate Education Committee on April 24, SB
1646 actually adds units to existing subject matter programs by
mandating "two areas of emphasis" and an additional special
course, the focus of which must be on children's brain
development. This would increase "time-to-degree" for an
undergraduate education degree by at least one semester.

* Finally, SB 1646 could inadvertently result in hundreds of
beginning teachers being placed on lower salary schedules by
school districts.  District pay scales normally provide higher
starting salaries for teachers based on post-graduate units
earned when completing a credential program.


CFA-endorsed legislation to conform state income and corporation
tax laws to recent federal changes has been signed into law by
Governor Davis. The bills, AB 1122 (Corbett) and SB 657 (Scott),
includes provisions allowing individuals to increase their IRA
and Roth IRA contributions from the current $2,000/year limit to
$5,000/year by 2008. Additionally, the maximum allowed
contribution to a deferred compensation plan [401(k) and 403(b)
plans] is increased from the currently allowed $10,500/year to
$11,000 in 2002 with the limit increasing by $1,000/year
increments until the maximum of $15,000/year is reached in 2006.

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