When a charter school messes up its CalSTRS reporting or contribution payments, can the state Teachers' Retirement Board fine the county office of education that submits the reports on the charter school's behalf? And can the county recover the cost from the charter school?
Plain-English summary
California charter schools that participate in the California State Teachers' Retirement System (CalSTRS) don't report directly to the system. Instead, the county superintendent of schools serves as an intermediary, submitting member and employer contributions and monthly reports to CalSTRS on the charter school's behalf. If the contributions are late, missing, or wrong, or if the monthly report is late or unacceptable, the Education Code requires the Teachers' Retirement Board to assess penalties.
The Alameda County Office of Education (which acts as intermediary for 29 charter schools) raised three questions through Assemblymember Mia Bonta:
- Can the Board penalize the county for errors that the charter school caused?
- If so, does the county have a way to challenge the penalty administratively?
- Can the county recover what it paid from the charter school's funding?
The AG said yes to all three.
On penalties (Question 1): Education Code section 23001 makes the county superintendent statutorily responsible for submitting CalSTRS contributions and reports. Sections 23003, 23006, and 23008 require the Board to assess penalties when those obligations aren't met. The statutes don't say the penalty can flow only to the underlying employer; the obligation runs from the direct reporter to CalSTRS. So when a charter school error causes a late or wrong submission, the penalty hits the county, not the charter school directly.
On administrative appeal (Question 2): Education Code section 23010 says "[a] person or entity that reports directly to the system that is assessed penalties or interest pursuant to Section 23003, 23006, or 23008 may appeal." A county superintendent acting as intermediary fits that description. Title 5 California Code of Regulations section 27009 says the administrative hearing "shall be available." The AG read "shall be available" as mandatory. The county is therefore entitled to a formal administrative hearing under the Government Code's Administrative Procedure Act (Government Code section 11500 et seq.), with subsequent judicial review available via writ of mandate.
On recovery from the charter school (Question 3): Education Code section 23012, enacted in 2022, says the county superintendent "may, on an annual basis or as otherwise directed by the system, draw requisitions against the county school service fund and the funds of the county's respective employing agencies in amounts equal to the total required to be paid by the employing agency." The AG read this broadly to encompass not just routine contributions but also penalties and assessments. Subdivision (b) was added during the 2022 bill's passage to clarify that recovery includes overpayments under section 24616.2; that addition would have been unnecessary if subdivision (a) didn't already cover penalties under sections 23003, 23006, and 23008.
What this means for you
If you are a county superintendent of schools or county office of education staff member
You can be penalized by CalSTRS for charter school errors. Treat your charter-school CalSTRS reporting workflow as a controlled process, not a pass-through. Build in checks at intake, submission, and post-submission audit. Common error sources: misclassified compensation, late deposits to your treasury, formatting errors in the monthly upload, and missed adjustments after a discovered overpayment.
When you do get penalized, file your administrative appeal promptly. Section 23010 plus 5 CCR section 27009 give you the right; missing the appeal window forfeits both administrative and judicial review. Get the charter school to support your appeal: their records, witnesses, and admissions will be the facts you litigate. The opinion notes there's a built-in financial incentive for the charter school to help, since you can recover the penalty from their allotment if the appeal fails.
After the appeal (whether you win or lose), use section 23012 to recover any unpaid penalty from the charter school's funds. Build the recovery into your annual requisition cycle. Don't wait to make the charter school whole on a one-off basis; treat penalty recovery as a routine financial control.
Negotiate written agreements with your charter schools that mirror the statutory framework: charter school is responsible for accuracy and timeliness, county will report on their behalf, charter school will reimburse the county for any CalSTRS penalty arising from charter-side errors. Some county offices (Santa Clara, San Diego) have models you can adapt.
If you are a charter school business manager
Your CalSTRS reporting accuracy and timeliness is critical, even though the county sends the data on your behalf. When you make a mistake, the county absorbs the immediate penalty, then bills it back to you under section 23012. So:
- Reconcile compensation classifications carefully
- Submit data to your county office well before the county's CalSTRS deadline
- Respond promptly to county audit questions
- Cooperate fully with any administrative appeal the county files
If the county sends you an invoice or deduction notice for a penalty under section 23012, scrutinize it. Confirm the underlying error was actually charter-side, not a county processing issue. The AG opinion gives the county broad recovery authority, but the recovery has to track an actual section 23003, 23006, or 23008 penalty caused by your school.
Consider getting your own administrative recordkeeping audit before a penalty hits. If you're consistently submitting clean data to the county, the county's section 23012 invoice exposure goes away.
If you are a CalSTRS compliance officer
The opinion confirms your authority to penalize intermediary county superintendents for direct-reporter errors caused by underlying employer errors. The administrative hearing under regulation 27009 is mandatory. Build your hearing process around the standard administrative-adjudication framework in Government Code section 11500 et seq.
If you are an education attorney representing a county office or charter school
This opinion addresses an open question that had been argued for years. The legal framework: section 23001 creates direct-reporter obligation; section 23003/23006/23008 imposes penalty on direct reporter; section 23010 grants administrative appeal; section 23012 lets direct reporter recover from the underlying employer. Build your client's compliance program and inter-agency contracts around that flow.
If you are a state legislator considering reform
The AG noted that the structural problem (county superintendents can be penalized for errors they don't directly cause) might be questioned on policy grounds, and that "[a]ny change in current policy and the law that embodies it is a matter for the Legislature." If you want to shift the penalty burden directly to charter schools, or to add a formal indemnification mechanism, that's a statutory amendment.
Background and statutory framework
CalSTRS was established by the Teachers' Retirement Law (Education Code section 22000 et seq.) and provides retirement benefits to California's pre-K through community college teachers. The Teachers' Retirement Board has plenary authority and fiduciary responsibility for administering the system (California Constitution article XVI, section 17(b); Education Code sections 22201, 22213, 22250).
Charter schools, like other public schools, may participate in CalSTRS for their teachers (Education Code section 47611). Charter schools cannot report directly to CalSTRS. Instead, the county superintendent of schools acts as the direct reporter and intermediary (5 CCR section 27700). Education Code section 47611.3 requires the chartering authority (school district or county board of education) to create CalSTRS reports when requested and obligates the county superintendent or other authorized direct reporter to submit those reports.
The penalty framework runs from the direct reporter's obligations:
- Section 23000 requires the employer to deduct member contributions and remit them along with the employer's share.
- Section 23001 requires the county superintendent (and other direct reporters) to "draw requisitions for contributions" required by sections 22901, 22901.7, 22950, and 22950.5, and forward warrants to CalSTRS.
- Section 23002 sets remittance deadlines.
- Section 23003 mandates penalties for late remittance.
- Section 23004 requires monthly reports.
- Section 23005 sets report due dates.
- Section 23006 mandates penalties for late or unacceptable reports.
- Section 23008 requires adjustment within 60 days of error discovery and penalizes late adjustments.
Section 23010 provides the administrative appeal: a "person or entity that reports directly to the system" may appeal penalties or interest under sections 23003, 23006, or 23008 through the section 22219 hearing process (formal administrative adjudication under Government Code section 11500 et seq.).
Section 23012 authorizes recovery: the county superintendent may draw requisitions against the funds of the county's "respective employing agencies in amounts equal to the total required to be paid by the employing agency." The opinion read "amounts required to be paid" to include penalties and interest, not just routine contributions.
The legislative history of 2022's AB 1667 confirms this reading. The bill enacted both section 23012 and section 24616.2. The original draft of section 23012 was just what is now subdivision (a). Subdivision (b), with its express cross-reference to section 24616.2, was added later to clarify that recovery includes the section 24616.2 (overpayment recovery) context. That clarification would have been unnecessary if subdivision (a) didn't already cover penalty recovery.
Common questions
Why isn't the charter school directly responsible to CalSTRS?
The Teachers' Retirement Board has chosen to consolidate reporting through county superintendents (and approved school or community college districts) under 5 CCR section 27700. Direct reporting by charter schools is not authorized. The county superintendent intermediary structure is intended to provide consistency and oversight.
What if the county superintendent has limited visibility into the charter school's payroll?
That's a real practical problem the opinion acknowledges. The remedies are (a) contractual, by negotiating an information-sharing and reimbursement agreement with the charter school; (b) statutory, by using Education Code section 47604.3 inquiry powers (which require charter schools to respond promptly to financial inquiries); and (c) financial, by using section 23012 to recover any penalty.
How does the administrative appeal work?
Under section 22219, the Board may hold a hearing on questions about rights, benefits, or obligations under the Retirement Law. The hearing follows Government Code section 11500 et seq. (formal administrative adjudication, with administrative law judge, evidence rules, and a final agency decision). Judicial review is available via administrative mandamus under Code of Civil Procedure section 1094.5.
What's the recovery timeline under section 23012?
The county superintendent draws requisitions on an annual basis or as otherwise directed by CalSTRS. So recovery typically syncs with the county's annual financial cycle. For penalty amounts, that may mean a several-month lag between the county paying the penalty and recovering from the charter school.
Can a charter school refuse to reimburse the county?
The county draws the requisition directly against the charter school's funds. There's no requirement for the charter school's cooperation. If the charter school disputes the recovery, its remedy is to challenge the underlying penalty (which it would do by supporting the county's section 23010 administrative appeal) rather than to refuse to pay.
What if the county made the error, not the charter school?
Section 23012 limits recovery to amounts "required to be paid by the employing agency." If the county was the proximate cause of the error, the recovery from the charter school would be inappropriate. Document error causation carefully.
Can the Board withhold State School Fund payments under section 23007?
Yes. Section 23007 lets CalSTRS direct the Controller to withhold State School Fund payments from a county that fails to pay an assessment. The opinion confirms that this withholding is available even where the underlying error is charter-school-caused, because the assessment is properly against the intermediary county.
Does this affect direct-reporting school districts that aren't county offices?
Yes. Section 23010's "person or entity that reports directly to the system" covers any approved direct reporter, including school and community college districts that have been approved under 5 CCR section 27702. The same penalty, appeal, and recovery framework applies.
Citations
- Education Code sections 23001, 23003, 23006, 23008 (direct reporter obligations and penalties)
- Education Code section 23010 (administrative appeal of penalties)
- Education Code section 23012 (recovery from employing agency)
- Education Code section 22219 (administrative hearings)
- Education Code section 47611.3 (charter school CalSTRS reporting through county superintendent)
- 5 CCR section 27009 (administrative hearing)
- 5 CCR section 27700 et seq. (direct reporter approval)
- Government Code section 11500 et seq. (Administrative Procedure Act)
- California Constitution article XVI, section 17 (Board fiduciary authority)
Source
- Landing page: https://oag.ca.gov/opinions/yearly-index
- Original PDF: https://oag.ca.gov/system/files/opinions/pdfs/23-601_0.pdf
Original opinion text
TO BE PUBLISHED IN THE OFFICIAL REPORTS
OFFICE OF THE ATTORNEY GENERAL
State of California
FRANCESCA R. GESSNER
Acting Chief Deputy Attorney General
OPINION
of
FRANCESCA R. GESSNER
Acting Chief Deputy Attorney General 1
MANUEL M. MEDEIROS
Deputy Attorney General
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No. 23-601
June 3, 2025
The HONORABLE MIA BONTA, MEMBER OF THE STATE ASSEMBLY, has
requested an opinion on the following questions concerning the California State
Teachers’ Retirement System.
QUESTIONS PRESENTED AND CONCLUSIONS
1. May the Teachers’ Retirement Board assess penalties under Education Code
sections 23003, 23006, and 23008 against a county office of education for contribution
and reporting errors attributable to a charter school on whose behalf the county
superintendent of schools contributes and reports to the California State Teachers’
Retirement System (CalSTRS)?
Yes. The Teachers’ Retirement Board may assess penalties under Education Code
sections 23003, 23006, and 23008 against a county office of education for contribution
Attorney General Rob Bonta has recused himself from any personal involvement in the
Department of Justice’s response to this opinion request. Accordingly, the Acting Chief
Deputy Attorney General has exercised final authority over the Department’s handling of
this matter.
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and reporting errors attributable to a charter school on whose behalf the county
supervisor of schools contributes and reports to CalSTRS.
2. If the answer to Question 1 is yes, does the county office of education, through
its superintendent of schools, have an administrative remedy for contesting the
assessment of a penalty the superintendent believes to be incorrect?
Yes. The county office of education, through its superintendent of schools, may
seek and obtain an administrative appeal to contest the assessment of a penalty the
superintendent believes to be incorrect.
3. If the answer to Question 1 is yes, does Education Code section 23012
authorize the county superintendent of schools to recover funds used to pay the
assessment or penalty from the funds allotted to the charter school?
Yes. Education Code section 23012 authorizes the county superintendent of
schools to recover funds used to pay the assessment or penalty from the funds allotted to
the charter school.
BACKGROUND
This opinion request seeks clarification concerning the Teachers’ Retirement Law
based on concerns raised by the Alameda County Office of Education regarding
employer-reporting and contribution-remittance obligations to the California State
Teachers’ Retirement System (commonly known as CalSTRS). 2 As reflected in
applicable regulations, charter schools do not report directly to CalSTRS; instead, the
county superintendent of schools submits any required reports and contributions to the
system as an intermediary on the charter school’s behalf. 3
The Teachers’ Retirement Law is codified at Education Code section 22000 et seq.
Unless otherwise indicated, all statutory references in the text are to the Education Code.
2
The county superintendent of schools is typically the head of the county office of
education. (See Today’s Fresh Start, Inc. v. Los Angeles County Office of Education
(2013) 57 Cal.4th 197, 207 & fn. 4.) We use the terms “county superintendent” and
“county office of education” interchangeably as context warrants. Other than the county
office of education (or superintendent of schools), “direct reports” to CalSTRS are
limited to those specific school or community college districts—as opposed to individual
charter or non-charter schools—that the Teachers’ Retirement Board approves for direct
reporting. (Cal. Code Regs., tit. 5, § 27700, subd. (a)(4); see id. §§ 27702, 27703.)
3
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The Alameda County Superintendent of Schools acts as the intermediary for a
charter school in Alameda County. 4 If the county superintendent fails to timely forward
the required contributions, or timely submit complete reports, the Education Code
provides that the Teachers’ Retirement Board “shall, in accordance with regulations,
assess penalties.” 5
ANALYSIS
The Teachers’ Retirement Law established CalSTRS (sometimes referred to as the
“system” in the relevant statutes) to provide retirement benefits to California’s public
school educators who teach pre-kindergarten through community college. 6 The
Teachers’ Retirement Board has plenary authority and fiduciary responsibility for
administering the system, including regulating the duties of employers and other public
authorities, and requiring essential reports. 7
Teachers and other persons employed in connection with public schools, including
charter schools, may participate as members of CalSTRS. 8 Members and their employers
contribute a statutorily specified percentage of each member’s compensation to the
retirement plan. 9 Section 23000 requires employers to deduct the member’s contribution
from their creditable compensation and remit the correct amount, plus the employer’s
contribution, to CalSTRS in a timely fashion. 10 Section 23004 requires the county
superintendent of schools—or school or community college district directly reporting to
The charter school at issue is chartered by the Oakland Unified School District. The
requestor informs us that the Alameda County Superintendent of Schools serves as the
intermediary for 29 charter schools in Alameda County.
4
Ed. Code, §§ 23003, 23008 (failure to remit timely contributions); Ed. Code, § 23006
(failure to submit timely reporting); see also Cal. Code Regs., tit. 5, §§ 27003, 27007.
5
Ed. Code, § 22000 et seq.; Blaser v. State Teachers’ Retirement System (2019)
37 Cal.App.5th 349, 356.
6
Cal. Const., art. XVI, § 17, subd. (b); Ed. Code, §§ 22201, subd. (a), 22213, 22250; see
Duarte v. State Teachers’ Retirement System (2014) 232 Cal.App.4th 370, 384
(discussing statutory scheme governing Retirement Board).
7
Ed. Code, §§ 22146 (defining “member”), 22119.5, subd. (a)(3) (creditable service
performed for a charter school).
8
Ed. Code, §§ 22901, 22950, 22950.5, 22951, 23001; 89 Ops.Cal.Atty.Gen. 248, 248249 (2006).
9
Ed. Code, §§ 23000, 23002. “Creditable compensation” includes salaries or wages and
other remuneration for creditable service. (Ed. Code, § 22119.2.)
10
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the Board with the Board’s approval—to “submit a report monthly to the system
containing information as the board may require in the administration of the plan.” 11
The Teachers’ Retirement Law defines “employer” or “employing agency” to
include the county superintendent of schools, school districts, and participating charter
schools. 12 A charter school may elect to make the state retirement plan available to its
employees who perform creditable service on the same terms and conditions applicable to
non-charter public schools in the chartering district. 13
As mentioned above, charter schools are not authorized to report directly to
CalSTRS. 14 For this reason, the Retirement Law holds the county superintendent
responsible for submitting all required contributions and monthly reports to CalSTRS on
behalf of participating charter schools (as well as those school districts within the county
that are not approved as CalSTRS “direct reports”). 15
1. CalSTRS May Properly Assess Penalties under Education Code Sections
23003, 23006, and 23008 Against an Intermediary Superintendent for a
Charter School’s Contribution or Reporting Errors
a. Penalties imposed under section 23003 for contribution errors
Our requestor first asks whether CalSTRS may lawfully assess penalties against a
county superintendent for violating the employer contribution requirements of section
23000, inasmuch as that statute imposes on an employer only the obligation to deduct and
remit the contributions “of members employed by the employer.” 16 The request notes
that, in the case of charter schools, the county superintendent is not the employer of the
11
Ed. Code, § 23004.
12
See Ed. Code, § 22131, subd. (a).
13
Ed. Code, § 47611, subd. (a).
See Cal. Code Regs., tit. 5, §§ 27700, subd. (a)(4) (limiting “direct report” to an
elementary, high school, or unified school district, or a community college district, that is
approved to report directly), 27702, subd. (a) (Retirement Board authorized to approve or
deny a district as a direct report based upon specified criteria), 27703 (required
documentation for district’s approval).
14
Ed. Code, §§ 23001, 23004, 47611.3; see CalSTRS Employer Directive 200101 (Jan. 19, 2001), p. 2, available at https://resources.finalsite.net/images/v1637354371/s
dcoenet/cjr1mtalgysj9vqbre8h/ed01-01.pdf (as of June 3, 2025).
15
16
Ed. Code, § 23000, italics added.
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member employees whose contributions are at issue; rather, the charter school is the
employer for purposes of section 23000. 17
But even if a county superintendent is not the employer of employees whose
contributions are at issue, the superintendent is nevertheless obliged to remit
contributions on behalf of the charter school employer based on independent statutory
obligations as a direct report under sections 23001 and 47611.3. Section 23001 mandates
that “[e]ach county superintendent . . . that reports directly to the system shall draw
requisitions for contributions required by Sections 22901, 22901.7, 22950, and 22950.5
in favor of the State Teachers’ Retirement System.” 18 Section 47611.3 requires the
county superintendent to submit reports on behalf of charter schools. 19 Do these statutes
support CalSTRS’s practice of penalizing the county superintendent for charter school
errors? Reading them in the context of other provisions of the Teachers’ Retirement
Law, we conclude that they do.
Our task in construing a statutory scheme is to ascertain the intent of the
Legislature so as to effectuate the purpose of the law. 20 CalSTRS’s practice of imposing
penalties on a county superintendent for delinquent payment of member or employer
contributions is supported by the plain language of the Teachers’ Retirement Law.
As we have noted, section 23001 requires the county superintendent (among other
“direct reports”) to make monthly contributions to CalSTRs on behalf of employers and
members within the county. Specifically, it states that a direct report “shall draw
requisitions for contributions required” to be paid by members and employers under the
Retirement Law “in favor of the State Teachers’ Retirement System.” 21 Those
requisitions become warrants against the county treasury when allowed and signed by the
county auditor. 22 Section 23001 also requires the county superintendent to “forward the
See CalSTRS Employer Directive 2001-01, note 15, ante (“Charter schools are
reminded that, as an employer, they are responsible for the accuracy and timeliness of
CalSTRS monthly report information and contributions for their employees”).
17
Ed. Code, § 23001. Sections 22901 and 22901.7 concern calculation of member
contributions; sections 22950 and 22950.5 concern calculation of employer contributions.
18
19
Ed. Code, § 47611.3, subd. (a).
Dyna-Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379, 13871388 (hereafter, Dyna-Med, Inc.); Rodriguez v. Workers’ Comp. Appeals Bd. (2019)
39 Cal.App.5th 195, 203-204 (construing Public Employees Retirement Law);
89 Ops.Cal.Atty.Gen., supra, at p. 250 (Teachers’ Retirement Law).
20
21
Ed. Code, § 23001.
22
Id. Although the Retirement Law does not expressly define the term “requisition,” its
(continued…)
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warrants to the board in the system’s headquarters office.” 23 Section 23002 specifies the
deadlines for submitting member and employer contributions. And section 23003
requires the Board to assess penalties “if a county superintendent of schools . . . fails to
make payment of contributions as provided in Section 23002.” 24 Section 23003 thus
mandates the assessment of penalties on a county superintendent of schools who fails to
timely submit county treasury warrants to CalSTRS in payment of member and employer
contributions.
b. Penalties imposed under sections 23006 and 23008 for reporting errors
In a similar vein, section 23004 requires the county superintendent of schools
(among other “direct reports”) to submit a monthly report to CalSTRS
“containing information as the [B]oard may require in the administration of the plan” in
an encrypted format “that ensures the security of the transmitted member data.” 25
Section 23005 specifies the due date for those monthly reports. 26 The consequences for
reporting errors appear in sections 23006 and 23008.
Section 23006 requires the Board to assess penalties “if a county superintendent of
schools submits monthly reports, as specified by Section 23004, late, as defined in
Section 23005, or in unacceptable form.” 27 Section 23008 requires the county
superintendent or other CalSTRS direct report to make adjustments on its monthly
reporting for any underpayments or overpayments of contributions within 60 days of
learning of the error, and states that the Board “shall assess penalties for late or improper
adjustments pursuant to Section 23006.” 28
The penalty provisions of sections 23003, 23006, and 23008 require the Board to
assess penalties “if ” the county superintendent (or other direct report) fails to make the
required contribution, reporting, or adjustment. The statutes do not expressly direct that
the penalties shall be assessed against the direct report. But we believe that the best
use in this context corresponds to the dictionary definition of “requiring something to be
furnished,”—here, requiring payment to be furnished from the county treasury to
CalSTRS. (Merriam-Webster’s Collegiate Dict. (11th ed. 2003), pp. 1058-1059;
Merriam Webster’s Online Dictionary, available at https://www.merriamwebster.com/dictionary/requisition (as of June 3, 2025)).
23
Ed. Code, § 23001.
24
Ed. Code, § 23003.
25
Ed. Code, § 23004; see Cal. Code Regs., tit. 5, §§ 27000, 27001.
26
Ed. Code, § 23005.
27
Ed. Code, § 23006.
28
Ed. Code, § 23008.
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reading is that the penalties may be assessed against the party (i.e., the direct report) who
has failed to perform, or inadequately or insufficiently performed, the duties that the
statute requires of that party. This reading draws further support from section 23010—
discussed below in response to the requestor’s second question—which assumes as much
by providing that “[a] person or entity that reports directly to the system that is assessed
penalties or interest pursuant to Section 23003, 23006, or 23008 may appeal the assessed
penalties or interest subject to the appeals process established pursuant to Section
22219.” 29
c. Historical practice
Our understanding of this statutory scheme accords with historical practice. The
Legislature has long imposed responsibility on the county superintendent for submitting
employer and employee retirement contributions and reports to CalSTRS on behalf of
local school districts. 30 Delinquencies in contributions or reporting would result in a
withholding of subsequent State School Fund payments to the county school service fund
until the error was rectified. 31 The Legislature further provided that:
Such county superintendent of schools may in turn assess and collect from
any reporting school district, reporting to such county superintendent of
schools, any amount assessed by the board, including said interest, against
the county superintendent of schools, where the reporting school district
caused the county superintendent of schools to fail to report or to pay. 32
As we have shown, successor statutes similarly provide for assessment of penalties
on the county superintendent. 33 CalSTRS’s consistent application of these statutes over a
29
Ed. Code, § 23010, italics added.
See, e.g., Stats. 1969, ch. 896, § 2, pp. 1768, 1770 (former Ed. Code, §§ 14105,
14109), subd. (a) [“For members whose compensation is paid by the school districts, the
county superintendent shall draw requisitions against the funds of the respective school
districts within the county . . . .”]); see also, id., pp. 1763 (former Ed. Code, § 14056
[requiring superintendent to file annual report of members and contributions]) and 1770
(former Ed. Code, § 14109 [requiring county superintendent to draw requisitions against
school district funds for employer contributions and remit to the system, “along with such
reports relating thereto as the board may require”]); see Ed. Code, §§ 23001, 23004.
30
Stats. 1969, ch. 896, § 2, pp. 1763-1764 (former Ed. Code, § 14056). The county
school services fund is used by the county superintendent of schools to pay expenses as
authorized by law. (See Ed. Code, §§ 1600-1606.)
31
32
Stats. 1971, ch. 906, § 6, p. 1754 (former Ed. Code, § 14056).
Stats. 1976, ch. 1010, § 2, pp. 2952 (former Ed. Code, § 23003), 2953 (former Ed.
Code, § 23006); see Ed. Code, §§ 23003, 23006.
33
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period of time is an indication that the Legislature intended this settled administrative
construction to establish a normative practice. 34
In 2000, the Legislature enacted Education Code section 47611.3, which
references and further specifies the county superintendent’s reporting responsibility to
include charter schools participating in CalSTRS. 35 This statute requires the chartering
authority of a charter school—either a school district or the county board of education—
to create any reports required by CalSTRS when requested by the charter school to do so.
But regardless of which chartering authority creates the reports, the statute mandates that
“[t]he county superintendent of schools, employing agency, or school district that reports
to those systems . . . shall submit the required reports on behalf of the charter school.” 36
The statute thus confirms the Legislature’s expectation that the county superintendent (or,
in some cases, an authorized chartering school district) reports on behalf of charter
schools. Considering the plain language of the relevant statutes, and the history of their
application, we are satisfied that CalSTRS’s practice of assessing penalties against a
county superintendent who reports on behalf of an errant charter school comports with
the Legislature’s expectations.
We recognize that an intermediary county superintendent who is not the chartering
authority of an errant charter school may have limited ability to supervise the charter
school’s administrative practices. 37 Some county offices of education have attempted to
See, e.g., Industrial Welfare Com. v. Superior Court (1980) 27 Cal.3d 690, 708-709;
Wotton v. Bush (1953) 41 Cal.2d 460, 468; 64 Ops.Cal.Atty.Gen. 776, 779-780 (1981).
34
Ed. Code, § 47611.3; Stats. 2000, ch. 466, § 1. The Legislature enacted the Charter
Schools Act in 1992. (Stats. 1992, ch. 781, § 1.) At that time, the county
superintendent’s responsibility for submitting member and employer contributions on
behalf of charter-school teachers was already encompassed by section 23001—whether
those teachers are employed by the school’s chartering school district or by the charter
school itself as the employer for purposes of sections 22901, 22901.7, 22950, and
22950.5.
35
Ed. Code, § 47611.3, subd. (a); see CalSTRS Employer Directive 200101 (Jan. 19, 2001), note 15, ante.
36
But see Ed. Code, §§ 47604.3 (“A charter school shall promptly respond to all
reasonable inquiries, including, but not limited to, inquiries regarding its financial
records, from . . . the county office of education that has jurisdiction over the school’s
chartering authority . . . and shall consult with . . . the county office of education . . .
regarding any inquiries”); 47604.4, subd. (a) (“[A] county superintendent of schools may,
based upon written complaints by parents or other information that justifies the
investigation, monitor the operations of a charter school located within that county and
conduct an investigation into the operations of that charter school”).
37
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address this problem by contract with the charter school. 38 In any event, our task is not to
judge the wisdom of legislation, but rather “to ascertain the Legislature’s intent so as to
effectuate the purpose of the law.” 39 Education Code section 22213 mandates that the
Board regulate the duties imposed by the Teachers’ Retirement Law on employers and
other public authorities, and section 22214 authorizes the Board to “take any action it
deems necessary to ensure the continued right of members or beneficiaries to receive
monthly payments.” 40 We believe that our construction of sections 23003, 23006, and
23008 effectuates the Legislature’s purpose. 41
2. An Intermediary County Superintendent May Seek and Obtain
Administrative Review of CalSTRS Penalty Assessments
Given our conclusion that CalSTRS may assess penalties against an intermediary
county superintendent based on contribution or reporting errors attributable to a charter
school on whose behalf the superintendent was acting, we now address the question
whether that county superintendent may appeal a CalSTRS penalty imposed on account
of such errors. We conclude that the superintendent does have a right of appeal in this
circumstance.
As mentioned above, Education Code section 23010 provides that “[a] person or
entity that reports directly to the system that is assessed penalties or interest pursuant to
Section 23003, 23006, or 23008 may appeal the assessed penalties or interest subject to
See, e.g., Santa Clara County Office of Education, Direct Funded Charter School Retir
ement Reporting Agreement for Fiscal Year 2021- 2, available at https://tinyurl.com/377f
axab (as of June 3, 2025); San Diego County Office of Education, “Agreement For Chart
er School Retirement Reporting Services,” available at https://tinyurl.com/mw3cvbt7 (as
of June 3, 2025).
38
Dyna-Med, Inc., supra, 43 Cal.3d at p. 1386; see also Wells Fargo Bank v. Superior
Court (1991) 53 Cal.3d 1082, 1099; 96 Ops.Cal.Atty.Gen. 29, 34 & fn. 32 (2013).
39
40
Ed. Code, §§ 22213, 22214.
The requestor notes that it is “likewise unclear” whether the Board can properly
withhold a county office of education’s funding under Education Code section 23007 if
that office fails to pay a penalty that the Board assesses. (See Ed. Code, § 23007 [“If any
county superintendent, . . . , or other employing agency that reports directly to the system
fails to make payment of any assessment by the board, the Controller shall, upon order of
the board, withhold subsequent payments from the State School Fund to the county for
deposit in the county school service fund . . . .”].) That concern was premised on an
asserted lack of clarity as to whether the Board could lawfully assess penalties against an
intermediary school superintendent in the first instance. Given our conclusion that it may
indeed do so, it follows that the Board is authorized to withhold funding under section
23007 when faced with a superintendent’s failure to pay lawfully assessed penalties.
41
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the appeals process established pursuant to Section 22219.” 42 The descriptor “person or
entity that reports directly to the system” includes an intermediary county superintendent,
but not the charter school on whose behalf the superintendent reports. Education Code
section 22219 vests the Board with discretion to “hold a hearing for the purpose of
determining any question presented to it involving any right, benefit, or obligation of a
person under [Part 13, pertaining to the State Teachers’ Retirement System].” 43 Any
such hearing must be conducted pursuant to statutes governing formal administrative
adjudications. 44
Teachers’ Retirement Board regulation 27009—which implements section
23010—provides that an administrative hearing “shall be available” for disagreements
over the Board’s assessment of penalties. 45 The phrase “shall be available” has been
construed to refer to “a mandatory requirement, not a conditional one.” 46 And the word
“shall” is generally used in laws, regulations, or directives to express what is mandatory;
“may,” on the other hand, is usually permissive. 47 Thus, we may readily conclude that an
42
Ed. Code, § 23010, italics added.
43
Ed. Code, § 22219, subd. (a); see id. §§ 22000-25115 [Part 13].
44
Ed. Code, § 22219, subd. (b); see Gov. Code, § 11500 et seq.
Cal. Code Regs., tit. 5, § 27009, italics added (“An administrative hearing shall be
available to an employer that reports directly to the system when there is disagreement
over the assessment of penalties, interest, or both, pursuant to this article. . . .”); see
generally Cal. Code Regs., tit. 5, div. 3, ch. 1, art. 15.5 (“Penalties and Interest for Late
Remittances and Late and Unacceptable Reporting by Employers”), § 27000 et seq.
Although regulation 27009 uses the term “employer that reports directly to the system,”
and a county superintendent is usually not the employer of the charter school’s
employees, the county superintendent is nevertheless both an “employer” as defined by
Education Code section 22131 with respect to its own employees and a direct report to
CalSTRS on behalf of charter school employers. (See Ed. Code, § 47611.3; see also
CalSTRS Employer Directive 2001-01, note 15, ante.) In any case, the controlling
statute—Education Code section 23010—makes clear that “the person or entity that
reports directly to the system” may appeal from penalties assessed under section 23003,
23006, or 23008. That phrasing plainly encompasses an intermediary county
superintendent. Administrative regulations must be construed in a manner consistent
with the legislative purpose and may not conflict with the statute under which they are
promulgated. (See Transworld Systems, Inc. v. County of Sonoma (2000) 78 Cal.App.4th
713, 717; see also Gov. Code, § 11342.2.)
45
See, e.g., Alameda County Waste Management Authority v. Waste Connections US,
Inc. (2021) 67 Cal.App.5th 1162, 1180.
46
47
Ed. Code, §§ 10 (“Unless the provisions or the context otherwise requires these general
(continued…)
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intermediary county superintendent is entitled to seek and obtain an adjudicative
administrative hearing in a case of disagreement with CalSTRS concerning the
assessment of penalties or interest under section 23003, 23006, or 23008, arising from
errors attributable to a charter school for which the county superintendent is reporting. 48
Before turning to the next question, however, we note that the requestor expresses
some concern over how an intermediary county superintendent could sufficiently “defend
itself” in an appeal from a penalty assessed due to an employer charter school’s
contribution or reporting error. The requestor observes that a superintendent may lack
sufficient knowledge of the charter’s “reporting practices, employment relationships, job
duties, or contribution data,” and the charter school may have “little incentive” to help the
superintendent litigate the appeal.
We appreciate the requestor’s concern, but as discussed immediately below, an
intermediary county superintendent ultimately has the authority to recover funds used to
pay penalties assessed due to the charter school’s errors from the funds allotted to the
errant charter school. So there is an apparent financial incentive for the charter school to
provide relevant information, evidence, and explanations, and otherwise to cooperate
with the county superintendent in any appeal that the superintendent takes on the
charter’s behalf. The Legislature has crafted a penalty assessment and appeal scheme in
which an intermediary county superintendent is charged with representing the interests of
an errant charter school in an appeal taken under these circumstances. No other
administrative remedies are prescribed. We understand that some may question the
provisions, rules of construction, and definitions shall govern the construction of this
code”), 75 (“ʻShall’ is mandatory and ‘may’ is permissive”); see also People v. Standish
(2006) 38 Cal.4th 858, 869-870 (presumption is that the word “shall” in a statute is
ordinarily deemed mandatory); Hogya v. Superior Court (1977) 75 Cal.App.3d 122, 133
(same). We also note that, with respect to forfeiture of an administrative hearing for lack
of a timely request, regulation section 27009 is similarly cast in mandatory terms: “If no
request for an administrative hearing is made within the time prescribed, the penalties,
interest, or both assessed shall be final and any right to an administrative hearing or
judicial review shall be deemed forfeit and waived.” In this case, we have no basis for
concluding that the Board intended “shall” to mean discretionary with respect to the grant
of a hearing but mandatory with respect to its forfeiture.
See Cal. Code Regs., tit. 5, § 27009. An administrative agency’s adjudicative decision
is judicially reviewable via a petition for administrative mandamus under Code of Civil
Procedure section 1094.5, while a denial of an adjudicative hearing is ordinarily subject
to judicial review via traditional mandamus under Code of Civil Procedure section 1085.
(See Gov. Code, § 11523 [“Judicial review may be had by filing a petition for a writ of
mandate in accordance with the provisions of the Code of Civil Procedure, . . .”]; see also
Morton v. Hollywood Park (1977) 73 Cal.App.3d 248, 254 [Section 1085 “anticipates an
arbitrary . . . refusal of a duly constituted board to hold a hearing.”].)
48
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wisdom of the policy embodied by this scheme. But it is not our role to consider what
may be the most desirable or effective policy, only to determine what the law provides. 49
Any change in current policy and the law that embodies it is a matter for the Legislature.
3. An Intermediary County Superintendent May Recover Funds Used to Pay
an Assessment or Penalty Imposed by CalSTRS as a Result of a Charter
School’s Contribution or Reporting Error from the Funds Allotted to the
Errant Charter School
Finally, we consider whether the county superintendent may recover funds used to
pay penalties assessed as a result of a charter school’s contribution or reporting error
from the funds allotted to the errant charter school. We conclude that a county
superintendent may do so.
As we noted earlier, the Legislature described its theory for allocating
responsibility between an intermediary county superintendent of schools and the
employers for whom the county superintendent directly reports in 1971. 50 It restated that
theory in Education Code section 24616.2(a)(3), in connection with recovery of benefit
overpayments. That statute provides that if overpayments are made due to errors of the
county superintendent, the overpayments must be recovered “from that county
superintendent”; but “if an overpayment resulted from an error of an employer, the
county superintendent of schools may recover the amounts required from that employer
pursuant to Section 23012.” 51
The Legislature enacted section 23012 at the same time as section 24616.2. 52 But
section 23012 is not limited to recovery of benefit overpayments. To the contrary,
subdivision (a) grants broad authority to the county superintendent to recover the cost of
penalties from errant employing agencies:
For the purpose of remitting contributions, assessments, or any other
payment required by the system, the county superintendent of schools that
reports directly to the system may, on an annual basis or as otherwise
directed by the system, draw requisitions against the county school service
fund and the funds of the county’s respective employing agencies in
amounts equal to the total required to be paid by the employing agency. 53
49
See Dyna-Med, Inc., supra, 43 Cal.3d at p. 1386.
50
See note 32, ante, and accompanying text.
51
Ed. Code, § 24616.2, subd. (a)(3); Stats. 2022, ch. 754, § 11.
52
Stats. 2022, ch. 754, § 9.
53
Ed. Code, § 23012, subd. (a).
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We have little difficulty construing section 23012(a) to encompass assessments
imposed pursuant to section 23003, 23006, or 23008. On its face, section 23012(a)
defines its purpose as “remitting contributions, assessments, or any other payment
required by the system.” 54 The word “assessment” is used frequently in connection with
penalties imposed by the Board. 55 The statutory language itself is the best indicator of
legislative intent. 56 Moreover, unlike section 24616.2, section 23012 was deliberately
situated in Chapter 17 of the Retirement Law, relating to “Employer Collection and
Reporting Procedures.” 57 This placement is further evidence that the Legislature
intended subdivision (a) to encompass payments or penalties owing under chapter 17. 58
Indeed, an early version of the bill that enacted section 23012 read in its entirety as
subdivision (a) reads today, which might have been construed to limit the statute’s
application only to assessments made under chapter 17. 59 To eliminate any confusion,
the bill was later amended to add subdivision (b), with its express cross-reference to
section 24616.2:
(b) Additionally, the county superintendent of schools may draw
requisitions against the county school service fund and the funds of the
county’s respective employing agencies, as applicable, in amounts
necessary for recovering payments made pursuant to Section 24616.2. 60
We are persuaded that the Legislature intended section 23012 to permit an intermediary
county superintendent to recover from an errant charter school employer, for whom the
county superintendent reports, penalties and assessments imposed by CalSTRS on the
superintendent because of errors committed by that charter school.
54
Ed. Code, § 23012, subd. (a), italics added.
55
See Ed. Code, §§ 23003, 23006, 23008.
Khajavi v. Feather River Anesthesia Medical Group (2000) 84 Cal.App.4th 32, 45-46;
91 Ops.Cal.Atty.Gen. 19, 20 (2008).
56
Ed. Code, tit. 1, div. 1, pt. 13, ch. 17, § 23000 et seq.; see official heading, Stats. 1993,
ch. 893, § 2, p. 4930.
57
Ed. Code, tit. 1, div. 1, pt. 13, ch. 17, § 23000 et seq. For purposes of discerning
legislative intent, courts may consider statute headings that are official and not merely
added by the publisher. (See 99 Ops.Cal.Atty.Gen. 56, 57, fn. 10 (2016), and authorities
collected there.)
58
59
See Assem. Bill No. 1667 (2021-2022 Reg. Sess.), as amended March 24, 2022, § 8.
60
Assem. Bill No. 1667 (2021-2022 Reg. Sess.) as amended Aug. 1, 2022, § 9.
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