Every year the legislature gets an report on the unfunded liability of the retirement systems. every year they kick the can and pretend it will go away by the following year.  It has not mattered if the state was flush in the past or now with  the state's current financial status;  the legislature not the retirees, has not taken the responsibility since the first years these plans were put in place.  

Your post is true for general funds not those in the retirement funds are partially invested in the market.  

The municipalities are forced to increase their contribution due to the state reducing its contribution rate.