Tag: Calpers

Controversy Still Follows CalPERS’ CIO Resignation

Mary Pat Campbell

Link: https://www.ai-cio.com/news/controversy-still-follows-calpers-cio-resignation/

Excerpt:

Now, a former CalPERS board member and investment officer has filed a lawsuit demanding that the pension system turn over transcripts, recordings, and notes from a closed-door board meeting held on August 17 allegedly to discuss the Meng affair. Meng resigned on August 5.

J.J. Jelincic’s lawsuit, filed on March 8 in Alameda County Superior Court in Northern California, said the board discussed Meng’s resignation at the meeting and violated the state’s open meetings law.

Meanwhile, on Tuesday, the CalPERS board’s Governance Committee is scheduled to discuss and possibly approve a plan that would require the full 13-member pension system board to be notified when a top system official is under internal investigation because of possible wrongdoing.

Author(s): Randy Diamond

Publication Date: 15 March 2021

Publication Site: ai-CIO

CalPERS and SBA Florida Vote FOR Effissimo’s Proposal to Toshiba

Mary Pat Campbell

Link: https://www.businesswire.com/news/home/20210314005038/en/CalPERS-and-SBA-Florida-Vote-FOR-Effissimo%E2%80%99s-Proposal-to-Toshiba

Excerpt:

California Public Employees’ Retirement System (CalPERS)1 and State Board of Administration (SBA) of Florida2, the largest and fifth-largest public pension funds in the US, have publicly disclosed that they have voted FOR Effissimo Capital Management’s shareholder proposal to conduct an independent investigation of Toshiba Corporation’s (TYO: 6502) 2020 Annual General Meeting (AGM).

SBA Florida cited three reasons for its supportive vote: “Conflicted review process; Insufficient resolution of outstanding concerns; Reasonably proportionate request.”

The votes by prominent institutional shareholders of Toshiba follow earlier disclosure by California State Teachers’ Retirement System (CalSTRS), the second-largest public pension fund in the US, that it was voting FOR Effissimo’s proposal.

Author(s): Effissimo Capital Management

Publication Date: 14 March 2021

Publication Site: Businesswire

Former Board Member JJ Jelincic Sues CalPERS Over Illegal Secret Board Discussion After CIO Ben Meng’s Abrupt Departure and Hiding of Records Related to $583 Million Overstatement of Real Estate Assets

Mary Pat Campbell
Former Board Member JJ Jelincic Sues CalPERS Over Illegal Secret Board Discussion After CIO Ben Meng’s Abrupt Departure and Hiding of Records Related to $583 Million Overstatement of Real Estate Assets

Excerpt:

We seem to be returning to a semblance of the old normal, including CalPERS getting well-deserved public attention for its bad behavior, highlighted in a new lawsuit filed by former board member JJ Jelicic, which we’ve embedded at the end of this post. It’s short and very readable; slightly more than half the pages of the PDF are exhibits.

CalPERS under its general counsel Matt Jacobs has more and more openly been taking the position that it is above the law. A slapdown is long overdue.

Both of the matters the lawsuit targets are strong on legal and public interest grounds. We’ll get into a bit more detail below. The short overview is that they come out of sweeping and highly dubious denials of two different Public Records Act requests that Jelinicic submitted. One focuses on to impermissible secret board discussions shortly after then Chief Investment Officer Ben Meng’s sudden resignation last August. The second involves CalPERS’ continuing efforts to hide records showing how it came to overvalue real estate assets by $583 million. Yet CalPERS not only has said nary a peep about bogus valuations are larger than the total amount it was slotted to invest in a mothballed solo development project, 301 Capitol Mall, but it continues to publish balance sheets that include the inflated results.

Author(s): Yves Smith

Publication Date: 10 March 2021

Publication Site: naked capitalism

California’s Pension Woes Are Made Worse By Moving Emergency Services In House

Mary Pat Campbell

Link: https://www.forbes.com/sites/ikebrannon/2021/02/28/californias-pension-woes-are-made-worse-by-moving-emergency-services-in-house/?sh=40f419203629

Excerpt:

However, there is no significant budgetary reform in the offing, and California’s cities and counties feel no compunction to address the issue. In fact, these days several municipalities are taking steps that will ultimately serve to exacerbate the shortfall by bringing in all of their emergency services “in house,” rather than contracting out emergency services to a private entity. 

The rationale typically given for such steps is that doing ambulance and fire services completely in house helps coordinate emergency responses and creates efficiencies, improving services and saving them money. 

However, such efforts rarely manage to help towns—or the state, for that matter—to save money. Contracting out ambulance services is typically done by smaller communities that don’t have the demand to support a full-time ambulance crew, which can be expensive—a tricked-out ambulance alone costs over $150,000. Combining with another nearby community generates economies of scale. 

Author(s): Ike Brannon

Publication Date: 28 February 2021

Publication Site: Forbes

State Employee Retirements at CalPERS Jump 15% in 2020

Mary Pat Campbell

Link: https://www.ai-cio.com/news/state-employee-retirements-calpers-jump-15-2020/

Excerpt:

California state employee retirements jumped 15% last year, as employees dealing with pandemic-related stress chose to leave the workforce, a pension fund spokesperson with the California Public Employees’ Retirement System (CalPERS) confirmed. 

About 12,300 state workers in the state retirement system retired last year, up from roughly 10,700 the year prior, according to CalPERS data, which was first reported on by the Sacramento Bee. It’s a major spike from the prior two-year period, when state retirements fell 1.8% from 2018 to 2019. 

Overall, retirements in the entire CalPERS system—which includes state workers, as well as public agency employees and non-teaching school personnel—increased just 4% in 2020, data shows. The prior year, the number of retirements in the whole pension fund fell 1.4%. 

Author(s): Sarah Min

Publication Date: 23 February 2021

Publication Site: ai-CIO

Push for pension reform rocks teachers

Mary Pat Campbell

Link: https://www.ptreyeslight.com/article/push-pension-reform-rocks-teachers

Excerpt:

Teachers are upset at the Marin County Board of Education for discussing pension reform in the middle of a pandemic without any feedback from labor unions. The county board considered a resolution last month that calls on state legislators to enact pension reform, proposing several possible solutions—including weakening pensions by reducing benefits and raising the retirement age. Teachers spoke out against the nonbinding resolution, which was tabled in response to their concerns.

…..

School districts and employees have no say in how much they pay. At Shoreline, about 10 percent of the general fund is paid to retirement funds. 

The required contribution from districts has steadily risen following the passage of A.B. 1469, which was intended to fully fund CalSTRS. When the bill passed in 2014, the state required districts to pay 8.88 percent of their payroll to the teachers’ retirement system. This year, they are required to pay 16.15 percent. Mandated CalPERS contributions have risen from 11.77 to 20.7 percent of payroll costs in the same timeframe, leaving less money within districts for direct education costs. 

The rising liability caught the eye of the Joint Legislative Advisory Committee, a countywide group of elected school board members and superintendents created to advocate on behalf of public education in Marin. Pension reform has been a priority for the committee since 2014, and it’s been the number-one goal since 2017. 

Author(s): Braden Cartwright

Publication Date: 3 February 2021

Publication Site: Point Reyes Light

CalPERS seen weighing proposal on rule changes for hiring, firing of CIO

Mary Pat Campbell

Link: https://www.pionline.com/pension-funds/calpers-seen-weighing-proposal-rule-changes-hiring-firing-cio

Excerpt:

The CalPERS board is looking at a change in the way it will decide who replaces Yu ‘Ben’ Meng as CIO of the fund.

CalPERS board is expected to weigh a move that would modify a recent governance change calling for the full board in conjunction with the CEO to hire, evaluate and terminate the pension fund’s CIO.

Author(s): ARLEEN JACOBIUS

Publication Date: 23 February 2021

Publication Site: Pensions & Investments

California pension funds learning from experience; Flexibility is key lesson from plans’ pandemic struggles

Mary Pat Campbell

Link: https://www.pionline.com/pension-funds/california-pension-funds-learning-experience

Excerpt:

Marcie Frost said CalPERS got an early warning about the coronavirus from its outgoing CIO.


CalPERS and CalSTRS have been working to keep their plans upright and positioned to attain their expected rate of returns in unprecedented economic, social and political conditions.

Author(s): Arleen Jacobius

Publication Date: 25 January 2021

Publication Site: Pensions & Investments

Report: Riverside County’s pension liabilities high, but gap gradually closing

Mary Pat Campbell

Link: https://www.desertsun.com/story/news/politics/2021/02/09/report-riverside-countys-pension-liabilities-high-but-gap-gradually-closing/4457794001/

Excerpt:

According to the report, the county’s retirement apparatus is now 71% funded, compared to 70% in January 2020.

Although the unfunded pension gap increased from $3.5 billion to $3.6 billion in that time, the total market value of the county’s assets also grew, from $8.1 billion to $8.8 billion, according to PARC.

….

If investment growth remains positive, and the county’s financial condition does not suffer from additional financial shocks like the one stemming from coronavirus, PARC estimated that the 80% funded status could be attained by 2027.

Author(s): City News Service

Publication Date: 9 February 2021

Publication Site: Desert Sun

Pension Funds Are Mixed or Mum on More Cash for Apollo

Mary Pat Campbell
https://www.nytimes.com/2021/02/03/business/apollo-pension-funds.html

Excerpt:

California’s huge public retirement system, for one, offered only cautious support after new disclosures of financial ties between the firm’s chief, Leon Black, and Jeffrey Epstein.

When investors in Apollo Global Management learned last week that the firm’s chief executive had paid $158 million to the registered sex offender Jeffrey Epstein, they hardly blinked.

After the private equity firm announced the figure, revealed by an outside investigation, its stock rose nearly 7 percent. That was a far different response from three months ago, when shares plunged over concerns about the financial ties between Mr. Epstein and the chief executive, Leon Black.

…..

A more important test could come the next time Apollo seeks to raise money from the 1,500 pension plans, foundations, sovereign wealth funds and other institutions that invest with it. These limited partners fuel its ability to carry out corporate buyouts, extend loans to companies and make other investments.

So far, their response has been mixed. One of the biggest public pension plans in the United States — the California Public Employees’ Retirement System, or CalPERS — offered only cautious support.

Author: Matthew Goldstein

Publication Date: 3 February 2021

Publication Site: NY Times

CalPERS expecting to announce new CIO this quarter

Mary Pat Campbell

Link: https://www.pionline.com/pension-funds/calpers-expecting-announce-new-cio-quarter

Excerpt:

Even as CalPERS officials were facing the dual challenges of managing investments and remote work during a pandemic, it was moving ahead with hiring a new CIO and expects to name one in the first quarter, a top official said.

Author: Arleen Jacobius

Publication Date: 25 January 2021

Publication Site: Pensions & Investments

CalPERS’ Former CIO on Saving America’s Public Pensions

Mary Pat Campbell

Link: http://pensionpulse.blogspot.com/2021/01/calpers-former-cio-on-saving-americas.html

Excerpt:

Gordon thinks very highly of Ben Meng and so do I. I’ve had the pleasure of talking with him a few times since he was appointed CIO at CalPERS and not only is he brilliant, he was always very nice and generous with his time.

The last time I spoke with Ben was in the summer via a webcast where he explained that CalPERS is not leveraging its portfolio by $80 billion. We spoke about a few things and I recommend you read my comment here to gain an appreciation of everything he was tying to do at CalPERS.

That was before his crucifixion In August where he was forced to resign.  

I’m on record stating the way Ben Meng was treated was absolutely shameful and disgusting.

I don’t need to expand on this, suffice it to say CalPERS lost one of the best CIOs in the world and they still haven’t replaced him.

Author: Leo Kolivakis

Publication Date: 19 January 2021

Publication Site: Pension Pulse