Overview
- A leaked Legislative Analyst’s Office memo confirmed two CalPERS-related mistakes totaling about $2 billion in the January budget, which would make the projected $2.9 billion shortfall smaller.
- The LAO identified a $1.6 billion double count of pension contribution rates and about $450 million from using incorrect rates for future CalPERS payments.
- Gov. Gavin Newsom’s Department of Finance rejected the term error and said it updated its method for estimating pension payments and will reflect the change in the May Revision.
- Legislative leaders received the LAO memo in February but did not disclose it publicly, drawing Republican criticism over secrecy and demands for a full timeline.
- CalPERS costs are a large, complex budget line, so even small changes in contribution rates can shift multi-year plans and could ease cuts or change spending choices in final negotiations next month.