Lower Forecast Rejected For Calif. Pension Fund
SACRAMENTO (AP) — Board members of the nation's largest public pension fund have rejected a proposal to lower the fund's estimated future investment returns.
Tuesday's decision by a committee of the California Public Employees' Retirement System, if upheld by the full board, will avoid the politically sensitive move of demanding more money from state or local governments this year.
Staff members proposed that the board reduce the annualized forecast of investment returns from 7.75 percent to 7.5 percent. Had that been approved, it would have increased payments required from state and local governments by roughly $400 million.
Board members say government cannot afford higher costs at a time of steep budget deficits. They say leaving the rate unchanged still meets accounting guidelines, but some critics say the 7.75 percent projection is too rosy.
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