State's massive pension fund asks for $600 million

Facing massive investment losses, a key committee of California's giant pension fund voted Tuesday to make the state increase its contributions to employee retirement benefits by $600 million in the coming fiscal year. AP in the Daily News.

The demand comes as California grapples with a $19 billion budget deficit and a threat by Gov. Arnold Schwarzenegger to eliminate its welfare program.

The contribution increase would be for one year starting in July, but the California Public Employees Retirement System is likely to require similar increases in future years. Local school districts, facing their own budget struggles, also will see their pension contribution rates grow.