HARRISBURG - The Rendell administration wants to phase in higher payments into the state's two large public-sector retirement systems as a way to blunt a projected jump in costs.

Budget Secretary Michael Masch released a plan yesterday that would impose higher minimum payments by state government and school districts into the plans that provide pensions for their employees. He also suggested the state adopt a mechanism to react quickly to prolonged market downturns. The higher costs are expected to hit the State Employees' Retirement System and Public School Employees' Retirement System starting in 2012.

Masch warned that failing to act would result in a first-year increase of $1.6 billion in the cost to support the two systems. Nearly all of it would fall on taxpayers. In a letter to state lawmakers, Masch said his office would provide them with proposed legislation that his office developed with input from the two pension systems.

- AP