CalPERS Moves To Start New Investment Fund
The CalPERS Board of Administration on Wednesday took steps to launch a new investment fund to which CalPERS members could contribute funds for future retiree health care costs, the Sacramento Business Journal reports. The board approved language for regulations that permit CalPERS to create the prefunding plan for the new investment fund (Sacramento Business Journal, 10/18).
New accounting rules require state and local governments to disclose future retiree health care liabilities. Most government entities fund these obligations annually rather than contributing to them in advance (Chan, Sacramento Bee, 10/19).
The Department of Finance in April authorized CalPERS to spend as much as $2.9 million to consider establishing the fund, according to CalPERS spokesperson Karen Perkins (Sacramento Business Journal, 10/18).
CalPERS will establish the new fund by February 2007. Officials cannot estimate the size of the fund because CalPERS members will participate on a voluntary basis.
CalPERS had sought to open the investment fund to public entities that are not CalPERS members, but Gov. Arnold Schwarzenegger (R) vetoed legislation that would have authorized the wider program (Sacramento Bee, 10/19).