Local governments and school districts across New York State are enjoying huge savings on employee pension costs, thanks to the returns on the state pension fund's stock and other investments, Comptroller H. Carl McCall reported.

State taxpayers have saved $583 million, and local taxpayers $609 million, on cumulative pension contributions by government employers over the past three years, the Comptroller said.

"Twenty years ago, local governments paid almost 19 percent of their payroll for pension costs," he said.

"For the coming year, they will pay almost nothing for the pension costs of their employees."

Albany County, for instance, will save more than $3 million this year, and the City of Buffalo $10 million, as a result of decreased pension contributions, according to the Comptroller's report.

Those savings could be applied to tax reductions or other uses.

The state Common Retirement Fund, the pension fund for most state and local government employees in New York, reported overall investment return of 8.8 percent for the year ending March 31, 1999.

Fund assets grew by more than $6 billion over the year, the report noted.

The 8.8 percent return was the lowest in four years, and down sharply from 30.4 percent in 1998.

Domestic stock investments, the largest group of holdings, returned 11.7 percent, compared to 18.5 percent for the Standard & Poor's 500, according to the Comptroller's report.