Analyst: California Faces $340 Billion In Debt
Don't Miss This
- Sketch Released Of Suspect Wanted For 2 Stabbings Near Downtown Sacramento
- Roseville Woman Run Over By Own SUV, Dies
- U-Haul Crashes Into Citrus Heights Home, Hitting Baby’s Room
- Davis Police MRAP Just One Of Hundreds Of Items Acquired From Military Surplus In Yolo County
- East Porterville Residents Without Water As Wells Go Dry During California Drought
Get Breaking News First
SACRAMENTO (AP) – California faces $340 billion in debts, or more than $8,500 for each of its 38 million residents, the nonpartisan Legislative Analyst’s Office said Wednesday in recommending that the state set priorities for paying down its key long-term liabilities.
The state should first address the $73.7 billion shortfall in the teachers’ retirement system, a debt that could cost the state, teachers and school districts a combined $5 billion a year to resolve over 30 years. Without changes, the system serving 868,000 members is projected to run out of money by 2046.
Paying down the $64.6 billion shortfall in health benefits for 277,000 retired state employees and their dependents should come next. That could cost the state $1.8 billion a year over 30 years, the analyst said, but getting started sooner would dramatically reduce costs over the long run.
The report comes a month before the state’s budget is due and feeds legislative debates over whether the state should spend or save its budget surplus and how to create a rainy day fund that would go before voters in November for their approval. It was released a week before Gov. Jerry Brown unveils his revised budget recommendations.
“I think it underscores what the governor has said for quite some time, which is that we have significant liabilities that we need to address,” said H.D. Palmer, a spokesman for the state Department of Finance.
Copyright 2014 The Associated Press.