University Of Calif. Faces Mounting Pension Costs

Wednesday, June 20, 2012

The cost of pensions and retiree health benefits are soaring at the University of California, increasing pressure to raise tuition and cut academic programs at one of the nation's leading public college systems.

The 10-campus system is confronting mounting bills for employee retirement benefits even as it grapples with unprecedented cuts in state funding that have led to sharp tuition hikes, staff reductions and angry student protests.

The UC system, including medical centers and national laboratories, is scrambling to shore up its pension fund as it prepares for a wave of retirements and tackles a roughly $10 billion unfunded liability.

The UC Retirement Plan's huge deficit was created by investment losses during the global economic crisis -- and the nearly two decades when campuses, employees and the state did not contribute any money toward pensions.

Read more »