Los Angeles city pensions could soar by $800 million by 2015

A report says Los Angeles will need to spend another $800 million over the next five years for employee retirement benefits that could consume nearly a third of the general fund, which also pays for libraries, parks and other services.

City Administrative Officer Miguel Santana told the City Council on Tuesday that the cost of pensions and health benefits will top $2 billion in 2015.

The council voted to study the idea of using employee-managed 401 (k) investment plans to provide some pension funding.

The city's three pensions systems for police and other workers have faced soaring costs this decade because of investment losses, benefit hikes, a larger workforce and retirees living longer.

Information from: Los Angeles Times

Copyright 2010 The Associated Press.