The increase is fueled by major investment losses at CalPERS in recent years, and the increases in benefits and salaries that the City Council approved during a stock market boom that meant little or no contribution to the state system.
Glendale — which has already seen pension payments on behalf of city employees add up to more than $100 million in the last five years — is not alone.
Local governments statewide have seen their forecasted rates skyrocket as CalPERS struggles to backfill its losses. In fact, Glendale will fare better than others across California that don’t require employee contributions, or also pay for retirees’ health-care benefits.
And last year, the Glendale City Council approved landmark two-tier retirement systems with reduced benefits for new hires in the city’s fire, management and general employee unions, which officials say will make future pension obligations more sustainable.
“I think that Glendale has been more aggressive, in my analysis, than any city I know of,” said Councilwoman Laura Friedman.
But that won’t make paying the looming pension bills much easier.
“We are doing what we can to address it,” Elliot said. “But that doesn’t diminish the fact it’s going to be a huge hurdle that we have to get over. And there will be impacts to the services we provide.”
The skyrocketing pension costs come as the local economy continues to struggle.
With revenues — ranging from sales and property tax returns to construction-related permits and other fees — remaining low, Glendale officials are bracing for a General Fund budget deficit of roughly $10 million next year. Finance officials say increased pension costs make up about a third of that gap.