California Gov. Arnold Schwarzenegger's proposed budget unveiled Monday would require school districts and teachers to assume the burden of making pension contributions to the $118.6 billion California State Teachers' Retirement System, Sacramento, saving the state $469 million for the 2005-'06 fiscal year. Currently those contributions are made by the state.
In addition, Mr. Schwarzenegger proposed requiring state employees to pay for one-half of their future retirement costs, instead of the current 25%, saving the state $206 million. Employees who opt out of the $182.3 billion California Public Employees' Retirement System, Sacramento, would receive half of the cost savings, resulting in an additional $90 million savings for the state.
