The City of San Luis Obispo will make a $4.2 million payment to pay down California Public Employees’ Retirement System (CalPERS) pension costs.
The city council also approved placing $1.4 million in a pension trust fund to help manage any future changes to pension obligations.
Last year, the city was facing a nearly $9 million budget shortfall, which officials said was the result of increased pension costs.
The city has since created a three-year Fiscal Health Response Plan to reduce rising pension costs with operational cost reductions, employee concessions, and new revenue sources.
According to city officials, a mid-year review of the 2018-19 budget shows the city is mostly on track with estimates for the fiscal year and general fund revenues are expected to increase slightly.