are guaranteed by law. The percentage contributed above the monthly compensation breakpoint depends upon the benefit formula as shown in the “employee contributions” subsection of the summary of Plan Provisions in Appendix B of each public agency, state and schools annual valuation report. With the passage of Assembly Bill 340 (AB 340), the pension reform legislation by the California Legislature, CalPERS members hired after January 1, 2013, are expected to pay 50 percent of the Total Normal Cost of the benefit plan in which they participate. Employer contributions On average, schools and other public agencies contribute 12.7% of payroll for their employees' retirement benefits; however, the rates can increase if CalPERS' investments perform unfavorably and decrease if CalPERS' investments perform favorably. According to CalPERS, "The School Pool contribution rate is affected by the investment return of a given fiscal year in the second year that follows" and "Local public agency contribution rates are affected by the investment return of a given fiscal year in the third fiscal year that follows". CalPERS' earnings and losses are averaged over 15 years to prevent extreme changes in employers' contribution rates. Nevertheless, in 2008 "CalPERS warned that it might ask for more money from the state starting in July 2010 and from local-government employers starting in July 2011" if CalPERS' investments are performing poorly as of June 30, 2009. Employers’ contributions and stated unfunded liabilities are calculated using actuarial present value, which assumes the fund will continually grow at 7.5%. However, if an employer seeks to leave CalPERS, it will be required to immediately payoff the undisclosed current market value of the unfunded liabilities, which only assumes 2.56% growth. At a 2011 legislative hearing, Governor Jerry Brown called CalPERS asserted reliance on bringing in new members “a Ponzi scheme”. After the financial crisis of 2007–2008, many cities in California came under financial stress due to a combination of factors, which led to three high-profile municipal bankruptcy filings by Vallejo, Stockton, and San Bernardino that received nationwide attention. During the proceedings some creditors accused CalPERS's increased post-crisis employer payments and future unfunded liabilities as a cause of insolvency and sought to have CalPERS employer contributions reduced. This was vigorously opposed by CalPERS. According to 2011 state figures, the CalPERS system is 78% funded with unfunded future liabilities of $133 billion. Non-government estimates show a larger shortfall. Benefits CalPERS provides benefits to all state government employees