The State Worker

Chronicling civil-service life for California state workers

May 14, 2010
Column Extra: More on state's pension payment to CalPERS

Hold on: Maybe the state isn't going to have to come up with another $600 million for pensions next year.

That's the word from Jason Sisney, state administration director for the Legislative Analyst's Office.

After reading our column Thursday on CalPERS actuaries' proposal that the state boost employer pension contributions to $3.9 billion, Sisney says the final amount might be lower. Here's what he said in an e-mail Thursday afternoon to The State Worker:

It is unclear to us if the 2010-11 state contribution dollar amounts listed in the CalPERS agenda will prove to be accurate. That is because the payroll assumptions that underlie those calculations are estimates. In effect, they appear to assume state payroll growth in 2010-11 when, in fact, that growth seems unlikely. Determining for budgetary purposes the exact changes in state pension contributions (that is, the dollar amount contributed) is very difficult now because the furloughs complicate year-to-year comparisons.

Bottom line: we are unsure if the year-over-year change actually will be $600 million, less, or more. (The better comparison, in fact, for budgeting purposes may be comparing 2010-11 pension costs to 2008-09 or even 2007-08 costs, before the furloughs.)

We will be working with the Legislature, CalPERS, and the administration to calculate, as best we can, a real dollar amount estimate based on the percentage rates CalPERS will adopt.

No doubt, the likely increase in employer contribution rates (that is, the percentages of payroll contributed) is real and significant and meaningful. My point would be that the dollar amount to be contributed in 2010-11 may well be less than indicated in CalPERS' agenda.

Also important to note that only about half of the dollar amount increase, whatever it is, will fall upon the General Fund. Because of this and the fact that the administration already assumed some of this rate increase in its January budget, this decision likely will result in a new increase in the 2010-11 General Fund budget problem of much less than $600 million.

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at


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