CalPERS state worker rate increase: $487 million

The Calpensions blog – one of the best sources for accurate, comprehensive info on California’s pension systems – explains the nearly $500 million CalPERS rate hike that may take effect next year.

Calpensions

Actuaries recommend a $487.2 million annual increase in state payments to CalPERS in the new fiscal year that begins in July, an increase for state worker pensions of about 10 percent to $4.9 billion.

Most of the increase is the result of expecting retirees to live longer and a change of actuarial methods aimed at getting to full funding sooner. More rate increases are expected for another four years.

The proposed rates that the California Public Employees Retirement System board will be asked to adopt next week are a little lower than expected in the new state budget proposed by Gov. Brown in January.

His Finance department expected the annual payment to CalPERS for state workers to be $5 billion ($2.9 billion from the general fund) in the new fiscal year, up from $4.5 billion this year.

The five state worker retirement plans as of June 30, 2014, had an…

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