Financially struggling California will likely have to pay $600 million more in contributions.
A key committee of the CalPERS board Tuesday approved increasing the state contribution to the $200.3 billion California Public Employees’ Retirement System, Sacramento, starting July 1 to $3.9 billion from $3.3 billion.
The recommendation by the CalPERS benefits and program administration committee — first made in May — is scheduled to go to the full board for final action on Wednesday.
In a statement, CalPERS officials attributed the increase to two factors: a 24% investment decline for the 12-month period ended Dec. 31, 2009, and a recent demographic study that found CalPERS workers are living longer and retiring earlier.
“The increase is equivalent to about two-tenths of one percent of the state’s general fund budget,” said Alan Milligan, CalPERS interim chief actuary, in the statement. “While any increase is difficult during these challenging economic times, this amount is relatively small in comparison to total state spending.”