Reccsf bulletin 4 2011

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  • 1. Retirement Committee ReportBy Jean S. Thomas, until, from 7/2/2007–7/1/2010 Commissioners Makras andHerb Meiberger, CFA, and the “bank” stays f lat at 1%. Meiberger agreed that SFERS’Stephen Herold Newer retirees have no “bank” few, consistently underperform- at all. Obviously, if low inflation ing money managers on theSFERS Board Approves Basic persists, new retirees will have “watch list” should be termi-Cost of Living (COLA) on less opportunity than long- nated in a more timely manner.3/8/2011 time retirees for basic COLA Readers: Please try to attend All miscellaneous and new increases. SFERS Board meetings whensafety CCSF retirees (new safety you can! Usually, meetings areare police and fire who were hired Plan Performance on the second Tuesday of eachon or after 7/2/1976) will receive Preliminary figures show that month; beginning at 8:30 a.m.a basic COLA increase, effective for the eight months, fiscal- and ending about noon. Be-7/1/2011 through 6/30/2012. year-to-date ended 2/28/2011, ing present and hearing BoardThe monthly increase will be Plan value was $15.2B, earn- members’ discussion in person2% of the gross monthly benefit ings were 21.8%! (Compa re adds immeasurably to under-shown on the 6/30/2011 remit- these results to last year’s, or standing, and appreciating, howtance advice. eight months, fiscal-year-to-date our money is managed—and The basic COLA is 2/28/2010—when Plan value how the security of our pensionsbased upon how much i n- was $13.3B and earnings were is affected.f l at ion h a s i nc r e a s e d — or 13.7 %.) Figures for 2/28/2011decreased—according to the show all investment categories Other Items of InterestSan Francisco-Oakland-San as positive—even real estate. SFERS has just issued aJose Consumer Price Index (CPI) Yes, SFERS has climbed out of retiree newsletter, Milestones.in the previous December to De- the abyss! Contact SFERS if you didn’tcember. Charter Section A8.526 SFERS’ outside general con- receive it.mandates that the maximum sultants, Angeles, presented • The SFERS Annual Report forbasic COLA monthly increase is an in-depth review of SFERS’ the Fiscal Year Ended June2% of the preceding fiscal year’s performance for periods end- 30, 2010 will be posted ongross monthly benefit. Fractional ing 12/31/2010. The review the SFERS Web site—andincreases or decreases in infla- says that, in the main, SFERS probably finalized by the timetion are rounded to the nearest has had made good investment you receive this issue of Thewhole percentage. Inflation over decisions; and notes that, es- Bulletin.2% is added to the individual pecially, US equity values have • Deferred Comp, 457 Plan,COLA “banks”—which are like picked up. Commissioners Vic- investment as of 2/28/2011individual rainy day savings tor Makras (mayoral appointee) is over $2B—a pinnacle! Ex-that can be dipped into in years and Herb Meiberger (employee- pected soon are expandedwhen the CPI shows no, or nega- elected) questioned two policies reporting to help investors—tive, inflation. that, they felt, should be revised e sp e c i a l l y l i fet i me f u nd The San Francisco-Oakland- to add Fund value. Firstly, investors—plan for the fu-San Jose CPI for December 2009 Commissioner Meiberger said ture.to December 2010 showed a that active money managers • Dav id Chiu, P resident of1.52% inflation increase, or 2% have worked superbly well for the CCSF Board of Supervi-when raised to the nearest whole alternative, non-publicly traded sors, has re-appointed Seanpercent. Because inflation was investments but not for the Elsbernd as Supervisor rep-less than 2%, rounded, no in- regular equity portfolio. To prove resentative on the SFERScrease to the individual “banks” his point, Meiberger established Board; term ends in 2012.will occur. that in the past five years, A further point about basic SFERS’ equity portfolio perfor- Questions? Comments? Con-COLA “banks”: The longer we’re mance would have been $100M tact: Herb at herb.sf@gmail.com;retired, the greater is the indi- greater—and international eq- Jean at jeansthomas@yahoo.vidual inflation “bank.” If retired uities would have been $400M com, or (415) 665-4149; Stephen7/1/1983 or earlier, the indi- greater—with passive, bench- at stephenhome@att.net, or (415)vidual “bank” is 36%. As years mark investments rather than 664-1201.go by, the percentages decline; with active managers. Secondly, Page 3