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California teacher pension shortfall grows to $56B

Still reeling from 2008's financial meltdown, the nation's second largest public pension system is deep in debt.

By Adam Weintraub, Associated Press | Updated on March 31, 2011

SACRAMENTO, Calif. (AP) — The pension system for California’s teachers has $56 billion less than it needs to cover the benefits promised to its 852,000 members and their families, the fund reported Thursday, as big investment losses in 2008 continue to reverberate.

The drop in value was enough to trigger an automatic increase in the amount the state must pay into the California State Teachers’ Retirement System, which is the nation’s second largest public pension fund. That will boost the payment from California’s already strained general fund by 20 percent — from $573 million to $688 million — in the fiscal year starting July 1.

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