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  #1041  
Old 07-01-2018, 08:45 PM
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Mary Pat Campbell
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KENTUCKY

http://www.bereaonline.com/2018/07/g...on-reform-law/

Quote:
GOV. BEVIN FILES MOTION URGING COURT TO FULLY DECIDE CONSTITUTIONALITY OF PENSION REFORM LAW

Spoiler:
Gov. Bevin’s legal team today filed a motion urging the court to resolve whether the 2018 pension reform legislation, Senate Bill 151, violates the inviolable contract and the Contracts Clause of the Kentucky Constitution. The motion follows the lawsuit filed by Attorney General Andy Beshear attacking the pension reform bill and the June 20, 2018, opinion in Franklin Circuit Court, which invalidated SB 151 on two legislative-process issues but failed to address the more substantive issues of the case, including any impact the bill could have on the inviolable contract.


The motion was filed to ensure that the constitutionality of Senate Bill 151 can be determined once and for all, rather than through a piecemeal approach that could potentially add many additional months to the litigation proceedings. Gov. Bevin’s team urged the court to rule now on the inviolable contract issue so that a single appeal, concerning both the legislative-process and constitutionality questions of SB 151, can be made to the Kentucky Supreme Court as soon as possible.

“No matter what side of this case you are on, we can all agree that Kentuckians deserve resolution on the validity of SB 151,” said Gov. Bevin’s General Counsel Steve Pitt. “We filed a motion today so that we can have a speedy and clear up-or-down ruling from the court on every issue at question with SB 151. If the bill is invalid based only on legislative-process issues, then these issues could be easily resolved by the General Assembly in an upcoming session. However, without a ruling from the court on the merits of SB 151, uncertainty surrounding the constitutionality of the bill will remain.”

In an April 19th hearing in the case, the court stated that it is “very important to have a full record for our Supreme Court to review when it gets…up there.” Acting on the court’s statement, the motion filed today hopes to ensure that the record will include a full ruling on all of the issues in the SB 151 case.

To view a copy of the motion, click here.
https://www.dropbox.com/s/52r4akd5pp...0Memo.pdf?dl=0



http://www.lex18.com/story/38545203/...ion-reform-law
Quote:
Gov. Bevin Motion Asks Court To Decide Constitutionality Of Pension Law

Spoiler:
FRANKFORT, Ky. (LEX 18) — On Friday, Gov. Matt Bevin's legal team filed a motion urging the court to resolve whether the 2018 pension legislation, Senate Bill 151, violates the inviolable contact and the Contracts Clause of the Kentucky Constitution.

His office said that the motion was filed to "ensure that the constitutionality of the bill can be determined."

A news release said "Gov. Bevin’s team urged the court to rule now on the inviolable contract issue so that a single appeal, concerning both the legislative-process and constitutionality questions of SB 151, can be made to the Kentucky Supreme Court as soon as possible."

“No matter what side of this case you are on, we can all agree that Kentuckians deserve resolution on the validity of SB 151,” said Gov. Bevin’s General Counsel Steve Pitt. “We filed a motion today so that we can have a speedy and clear up-or-down ruling from the court on every issue at question with SB 151. If the bill is invalid based only on legislative-process issues, then these issues could be easily resolved by the General Assembly in an upcoming session. However, without a ruling from the court on the merits of SB 151, uncertainty surrounding the constitutionality of the bill will remain.”

On Wednesday, June 20, a Franklin Circuit Court judge ruled that the pension law was unconstitutional, declaring the process that brought it forth a "legislative sleight-of-hand."

The ruling by Judge Phillip J. Shepherd found the law violated the Kentucky Constitution and therefore is "null and void." He found SB 151 failed to receive three readings as required by Section 46 of the state Constitution. Shepherd also found that the bill violated a Section 46 requirement that measures involving appropriation of money must "receive the votes of at least two-fifths of the members elected to each House."

Bevin released a statement that day slamming the ruling and vowed to appeal. The next day, June 21, Bevin went on CNBC and stated in an interview that Judge Shepherd was a "terrible judge."


http://wkms.org/post/bevins-lawyers-...pension-ruling
Quote:
Bevin's Lawyers Ask Judge To Amend Pension Ruling

Spoiler:
Gov. Matt Bevin's attorneys are asking a Kentucky judge to rule on lingering legal questions surrounding a new public pension law before the case goes to the state's highest court.

The Republican governor's attorneys filed a motion Friday asking a Franklin County Circuit judge to amend his recent ruling that struck down the law. The key unresolved issue is whether the law violates the state's "inviolable contract" with teachers and other public workers.

Judge Phillip Shepherd cited procedural issues in striking down the law. He ruled that the GOP-led legislature violated the state Constitution in part because of the accelerated way the law was enacted. The judge said lawmakers did not give the bill three readings on separate days in each chamber, and the measure failed to be approved by at least 51 House members as required for measures that appropriate money.

Lawmakers changed the state's woefully underfunded public retirement systems in the waning days of this year's legislative session. The measure required new teacher hires be put into a hybrid pension system, and changed how current teachers could use sick days to calculate retirement benefits.

The pension overhaul became a flashpoint for protests at the state Capitol in Frankfort, part of a national wave of demonstrations by teachers. The largest Kentucky rally drew thousands of teachers and closed dozens of school districts as teachers also called for increased education spending.

In their new motion, Bevin's lawyers also asked whether parts of the measure — Senate Bill 151 — that don't violate the 51-vote requirement can be separated from the rest of the law and stand on their own.

A lower-court ruling on those unresolved issues would allow the state's highest court to decide the case "as a whole" rather dragging out the case "piece by piece," the motion said.

"By resolving these issues now, the court will ensure that the Kentucky Supreme Court can settle the constitutionality of Senate Bill 151 once and for all," the motion said. "Kentuckians need and deserve resolution through a single appeal to the Kentucky Supreme Court."

Kentucky Attorney General Andy Beshear, who joined in challenging the pension law, did not immediately comment on the new motion. Beshear, a Democrat, called the judge's recent ruling a "win for open, honest government."

Bevin's general counsel, Steve Pitt, said the motion seeks a "clear up-or-down" ruling from the court on every legal issue surrounding the pension law.

"If the bill is invalid based only on legislative-process issues, then these issues could be easily resolved by the General Assembly in an upcoming session," Pitt said in a release from the governor's office.

"However, without a ruling from the court on the merits of SB151, uncertainty surrounding the constitutionality of the bill will remain."

The bill that became the pension measure started out as an attempt to fix problems caused by abandoned private sewer systems. Lawmakers gutted the bill and replaced it with the pension changes. Because the bill had technically already passed the Senate, lawmakers were able to send it to the governor's desk in about six hours instead of the minimum five days the state Constitution requires to pass new legislation.


https://www.kentucky.com/news/politi...214105924.html
Quote:
Bevin asks judge to amend ruling striking down the Kentucky pension overhaul bill

Spoiler:
Attorneys for Gov. Matt Bevin are asking a Franklin County judge to amend his ruling in the lawsuit over the state's new public pension law.

Franklin Circuit Judge Phillip Shepherd issued a ruling June 20 striking down the law and enjoining Bevin from implementing it.

Shepherd ruled that the pension bill violated the Kentucky Constitution because legislators did not give it three readings on separate days in each chamber, and because it was not approved by 51 members of the House, which is required for bills that appropriate money. The Bevin administration has said it will appeal the ruling.

But first, Bevin is asking the judge to rule on a few other issues: whether the law violates the state's "inviolable contract" with teachers and other public workers and whether parts of the bill that are outside the "inviolable contract" and don't violate the 51-vote requirement can be separated from the rest of the law and stand on their own.

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A ruling on those issues, the governor argues, will allow the appeals court to decide the constitutionality of Senate Bill 151 all at once, rather than dragging out the litigation with a "piecemeal" approach.

"By resolving these issues now, the court will ensure that the Kentucky Supreme Court can settle the constitutionality of Senate Bill 151 once and for all," the motion states. "Kentuckians need and deserve resolution through a single appeal to the Kentucky Supreme Court."

The motion was filed Friday in Franklin Circuit Court.

“No matter what side of this case you are on, we can all agree that Kentuckians deserve resolution on the validity of SB 151,” Bevin's attorney, Steve Pitt, said in a news release. “We filed a motion today so that we can have a speedy and clear up-or-down ruling from the court on every issue at question with SB 151. If the bill is invalid based only on legislative-process issues, then these issues could be easily resolved by the General Assembly in an upcoming session. However, without a ruling from the court on the merits of SB 151, uncertainty surrounding the constitutionality of the bill will remain.”

Attorney General Andy Beshear challenged the law with the Kentucky Education Association and the Kentucky State Lodge Fraternal Order of Police.

“Gov. Bevin is determined to cut the promised retirements of Kentucky’s teachers, police officers, firefighters, EMS, social workers, and other public servants," Beshear said in a statement Saturday. "These hard working families beat him in court and voided the sewer bill. Gov. Bevin should stop his attacks on working Kentuckians.”

The new law places teachers hired after Jan. 1, 2019, in a hybrid cash-balance plan, which is similar to a 401(k), rather than a traditional pension, and requires those teachers to work longer before becoming eligible for retirement. It also caps the amount of accrued sick leave teachers may convert toward retirement to the amount accrued as of Dec. 31, 2019.


State employees hired between 2003 and 2008 also are required to pay 1 percent more for health care.

The bill, approved by the legislature just six hours after it was introduced, sparked thousands of angry teachers to march on the state Capitol.


https://www.forbes.com/sites/christo.../#4840bc5b299a
Quote:
Kentucky Retirement Systems: A Case Study Of Politicizing Pensions

Kentucky is in the midst of a financial crisis.
a 7.75% ARR, while kicking the can down the road towards a future crisis, solves the state’s budget problems for today only.
Spoiler:
Kentucky is in the midst of a financial crisis. The Kentucky Retirement System (KRS), which is responsible for the pensions of more than 365,000 current and retired state and local government employees, is facing an almost $50 billion shortfall, and at last one recent headline said it succinctly: “Unfunded Pensions Could Spell Disaster for Kentucky.” The KRS funds lost billions of dollars in the 2008 economic recession and have since struggled to recover. In 2010, the investment consultant to the KRS found that the largest pension fund in the system had just 38% of required funding. Since then the problem has only grown, with current estimates saying that it is now only 31% funded.

This is not new. The KRS Board of Trustees has been trying to deal with this looming pension crisis since the mid-2000s. In an effort to try and find higher returns, in 2006, the KRS Board of Trustees proposed riskier hedge fund investments. However, in the end, the KRS leadership and retirement board decided that hedge fund investing was just too risky. As their adviser said at the time, Kentucky cannot “invest their way out of crisis”, and went on to warn that such an aggressive approach to investing could lead to a completely depleted account in the near future. In the same report the State’s consultant warned, that even if the KRS hit their actuarial assumed rate of return of 7.75% for the next 20 years, the fund would still be grossly underfunded. It is important to remember that almost no state in the nation achieves so high an average yearly return—meaning that it in two decades, it will be even worse than “assumed.”

A higher assumed rate of return (ARR) equals less appropriated funds the Legislature needs to allocate to the pension system. Thus, a 7.75% ARR, while kicking the can down the road towards a future crisis, solves the state’s budget problems for today only.


Leaders of KRS are required through their fiduciary duty to provide “accurate and truthful information regarding KRS financial and actuarial condition.” Trustees instead took the moral low-ground and mislead pensioners - all for the sake of politics. By hiding the true status of the fund, these officials were able to hold their offices and coerce the public into believing that they were acting in the best interest of the people. In reality, KRS leadership acted only in self-interest, leaving future generations in the state to pay for their mistakes because of poor investment decisions.

This sort of irresponsible action must be stopped in American pension fund management. State treasurers and pension board officials must remember that their fiduciary duty to beneficiaries and taxpayers comes first. These members of state and local government hold an incredible amount of power - it is time citizens hold these officials responsible for their actions. The future of our American retirement security depends on it. Demand transparency, demand professionalism and above all demand responsibility from your state and local, pension fiduciaries.
https://www.bgdailynews.com/news/loc...4401675f8.html
Quote:
Local legislators mixed about revisiting pension reform bill

Spoiler:
While the future of a controversial pension reform bill remains in limbo, the Daily News reached out – with mixed results – to the four local legislators who voted for Senate Bill 151 to ask if they would vote for a new bill with the same provisions.

Two did not return messages seeking comment, one declined to speculate on a vote and one said he probably would vote for such a bill a second time.

Franklin Circuit Judge Phillip Shepherd ruled June 20 that SB 151, passed in the waning hours of the last General Assembly, was illegal as it was not given three readings as required by the state constitution.

After the bill was signed by Gov. Matt Bevin, state Attorney General Andy Beshear and other groups filed the successful lawsuit.

The bill would place new teachers into a hybrid retirement plan that mixes a 401(k)-style plan with a defined benefits plan.

Debate about pension reforms that would cut benefits for teachers and other public employees prompted massive protests in Frankfort this spring, led primarily by educators.

Bevin filed a motion Friday asking Shepherd to rule on other issues related to his ruling, which ultimately is expected to be challenged in the state Supreme Court by the governor. Even if that court affirms the ruling, Bevin could still try to get the pension reform passed in an upcoming session.

Four local lawmakers voted for SB 151: Sen. Mike Wilson, R-Bowling Green; Rep. Jim DeCesare, R-Bowling Green; Rep. Michael Meredith, R-Oakland; and Rep. Jason Petrie, R-Elkton.

Wilson declined to say how he would vote on a new pension bill with the same provisions as SB 151.

“We need to wait on the courts. ... At this point, it’s in the court’s hands,” he said.

Meredith said it was a hard question, but if the bill had the exact same provisions as SB 151, then his vote would “likely be yes.”

Meredith said to not do anything about the state’s troubled pension system would be just “digging the hole deeper.”

“Pensions will always be controversial,” he said, but if nothing is done, Kentuckians “in 15 or 20 years would look at us and say why didn’t you do something just to save yourself politically. We knew it would be unpopular and controversial (with) political ramifications, but it does no one any good to leave it alone – to let it continue on the trajectory it’s on. It will only get worse.”

Meredith said of the way SB 151 was passed, tacked onto a wastewater bill and pushed through at the last minute: “I won’t defend the process, but from a policy standpoint, we did as little to impact” people as possible. “We didn’t want to punish or hurt anyone ... hopefully cooler heads can prevail” and an even better solution to the pension issue will emerge, he said.

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DeCesare, who is not seeking re-election, and Petrie did not return messages seeking comment.

Kim Coomer, president of the Warren County Education Association, said if the legislation does come up for another vote “we’re going to fight the good fight” against what she termed “a terrible piece of legislation (that) will hurt so many people.”

She said she does expect the pension reform effort to resurface in some fashion if SB 151 is struck down by the state Supreme Court.

Some Republican legislators, however, have indicated they have no desire to revisit the contentious issue any time soon.

Senate Majority Leader Damon Thayer, R-Georgetown, told The Courier-Journal after the court ruling that “I don’t see much inclination out there to open this thing up and deal with it again. ... If this decision holds ... the defenders of the status quo can declare victory and watch while our pension systems collapse.”

SB 151 passed by a 49-46 margin in the House and 22-15 in the Senate.

Local legislators voting against SB 151 were Rep. Jody Richards, D-Bowling Green; Rep. Steve Riley, R-Glasgow; Rep. C.B. Embry, R-Morgantown; and Rep. Wilson Stone, D-Scottsville.


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  #1042  
Old 07-01-2018, 08:48 PM
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CHICAGO, ILLINOIS

https://capitolfax.com/2018/06/29/yo...-away-chicago/

Quote:
You can’t wish this pension funding problem away, Chicago
Spoiler:
* The Chicago mayor’s election is next February. Fiscal Year 2020 begins the following January 1st. The city’s pension contributions will rise $400 million (a 31 percent increase from the previous year) because of state statutes requiring minimum funding levels for various pension funds.

The city’s budget this year is $10 billion. So, $400 million is about a four percent budget increase.

Natural revenue growth ain’t gonna cover it and, remember, other spending pressures will increase as well.

* Amanda Kass, one of the most talented numbers people in the business, wondered what the mayoral candidates had to say about tax hikes and here’s some of what she found…

* Lori Lightfoot: In an interview with Sun-Times reporter Fran Spielman, Lightfoot stated, “Our taxes are way too high.” Spielman followed-up by asking Lightfoot what choice Mayor Emanuel had since without the tax increases the “pension funds were going belly up.” Lightfoot didn’t directly answer, but said she wanted to “reduce the tax burden on middle-and lower-income people.”

* Gary McCarthy: His campaign website states that, “After years of borrowing against our city’s future, Mayor Emanuel can no longer kick the can down the road. Chicago needs real reform. Shady accounting tricks and constant tax hikes will not help fund our municipal and teacher pensions.” It also states, “Our police, fire and teacher pensions have to not only be protected, but funded in full.”

* Paul Vallas: I haven’t seen anything that’s specific to the City’s four pension systems, but Vallas has explicitly critiqued the Chicago Public Schools’ pension holidays and cited past “failures to think and plan proactively” as a reason he’s running. (CPS is an especially hot topic for Vallas because he was its CEO from 1995-2001. CPS’s pension fund is a whole different topic though, so I’m largely tabling that issue for now.) He also pointed out how the pension holidays ended up costing the City more in the long-term.

As of June 2018, I didn’t see any campaign statements specifically about the City’s pensions and the upcoming pension payments from the other four declared candidates (Rahm Emanuel, Ja’Mal Green, Troy LaRaviere, and Neal Sales-Griffin).

So, the fiery progressive Lightfoot says taxes are way too high. Gary McCarthy is talking out of both sides of his mouth. The alleged fiscal geek Vallas has no plan. And nobody else has even addressed it yet.

* Here’s Phil Kadner with some context…

The lowest composite [property] tax rates in Cook County are in Hinsdale (6.5 percent), Burr Ridge (6.8 percent) and Barrington (7.2 percent), according to the Cook County clerk.

The tax rate in Chicago on residential homes is 7.2 percent, according to Orr’s office. The average tax rate in the north suburbs is 9.3 percent. The average in the south suburbs: 11.9 percent, actually a decrease from previous years.

The average tax bill on a single-family home increased 4.78 percent in the south suburbs (an increase of $247), 3 percent in the north suburbs ($213) and 2.75 percent in Chicago ($109), where there has been a lot of squawking about property tax increases.

So, even after the recent increases, Chicago is tied with Barrington for third lowest composite property tax rates in Cook County.

* Meanwhile, you may have seen this story…

Homeowners in Lakeview Township, upset by the big increases in assessments they received from Cook County Assessor Joe Berrios in May, have called a public meeting tonight with government officials.

“I’m alarmed by the size of the increases,” said Andrea Raila, who said the assessor’s estimate of her home’s taxable value went up by 57 percent since the last assessment, in 2015.

Raila, who ran for assessor this year, should know better…



Andrew Schneider
@ASchneider2008
I’m confused. Didn’t everyone argue during the election that places like Lakeview were underassessed? http://www.chicagobusiness.com/reale...oreUserAgent=1

9:07 AM - Jun 28, 2018
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Amanda Kass
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Replying to @Amanda_Kass
The increase in assessments also may not be due to an overall correction to the flawed assessment system. In other words, assessed values may increase even more when a new, improved assessment system is put in place

12:26 PM - Jun 28, 2018
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There goes Amanda with her pesky facts again.

The Tribune sums up its series of property tax articles…

An unprecedented analysis reveals that Cook County’s unique property tax system created an unequal burden on residents, handing huge financial breaks to more affluent homeowners while punishing those who have the least, particularly people living in minority communities.

Translated: Lakeview homeowners had better brace themselves.

* Related…

* The Fiscal Firebomb Looming for Small Cities in Illinois: I would suggest that Illinois also create, as Virginia has, an independent state fiscal oversight commission to assess specific fiscal/budget issues and recommend, if warranted, further assistance to help stabilize areas of concern. It should implement, as Rhode Island did in the wake of Central Falls’ municipal bankruptcy, a quasi-SWAT team of city managers and legislators to provide technical assistance and potential state assistance to assess municipal operations and develop long-range financial forecasts for revenue. And finally, the state should adopt a revenue-sharing program, modeled after the one signed into law by former President Ronald Reagan, which assessed relative fiscal need, local tax effort and population.


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  #1043  
Old 07-01-2018, 08:49 PM
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https://citiesspeak.org/2018/06/29/p...s-bond-rating/
Quote:
Pensions, Retiree Health Benefits, and Your City’s Bond Rating

Spoiler:
This is a guest post by Les Richmond, Vice President and Actuary of Build America Mutual (BAM).

Credit ratings are the most visible (and sometimes only) independent assessment of the fiscal status of a city’s government – they have a direct impact on borrowing costs and the affordability of infrastructure investments, and they can also influence public opinion about the effectiveness of city leadership. Understanding how credit rating agencies think about liabilities from pensions and “other postemployment benefits” like retiree health benefits (OPEBs) can allow city leaders to be proactive in reducing benefits-related risks to taxpayers, improving credit ratings, and possibly lowering their city’s cost of borrowing.

The four major credit rating agencies are S&P Global Ratings, Moody’s Investors Service, Fitch Ratings and Kroll Bond Rating Agency, and each takes a unique and proprietary approach to factoring pension and OPEB obligations into their ratings. But three basic principles are embraced by all four agencies: predictability, stability and flexibility, and the concrete steps described below can address each one.

Some cities that manage their own pension systems can take action directly. Others who contribute to a statewide (cost-sharing) benefit fund will have less flexibility, but can still benefit from examining their state system’s performance and suggesting changes to its administrators where appropriate.

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Predictability

No one likes surprises, and this applies to ongoing pension and OPEB costs. Cities can build rating agency confidence in their pension and OPEB management by adopting policies that minimize cost volatility. Some examples of actions that enhance predictability are:

Lower the risk profile of pension (and, if applicable, OPEB) fund assets. There’s plenty of incentive to invest pension assets in risky investments, but risk implies performance volatility in good markets and bad. The performance of pension/OPEB investments often has a direct bearing on annual contribution requirements.
Make sure actuarial assumptions are up to date by reviewing them periodically — at least every five years (and more frequently is better). Letting actuarial assumptions get too out-of-date means that pension and OPEB actuarially determined contributions can change dramatically when they are finally updated.
When thinking about plan design changes, think “defined contribution.” Employer contributions to these 401(k)-type plans are generally much easier to budget for than defined benefit plans.
Consider reinsurance of retiree health claims, which make up the bulk of OPEB costs. This is particularly important for cities with relatively small workforces, where the cost of a single catastrophic health claim could be material to the budget. The issue of possible claim volatility should be addressed with the city’s health care coverage provider, who should be able to present plan design or financing options for review.
Consider pre-funding OPEB liabilities. Establishing a systematic funding policy for OPEB helps to smooth out the costs of paying health costs directly.
Stability

Stable pension and OPEB plans are characterized by:

The existence of one or more revenue sources that can reasonably and reliably be counted on to provide the funds needed for plan contributions each year, over a long period of time; and
A funding policy that is expected to pay off unfunded liabilities over a reasonable period of time (say, 30 years or less).
A pension plan’s “funding policy” refers to how cash contributions for pension and OPEB benefits are calculated each year. For pensions, there is a wide variety of cost calculation methods, and a great many ways to structure contributions to pay off unfunded liabilities. In general, though, plan contributions can be structured to either be relatively level over time, or be structured to rise over time. A city that can demonstrate that it has the revenue sources to pay for either cost pattern would be viewed favorably. However, the preferred approach would be a level cost pattern, because a cost pattern that is expected to rise depends on a corresponding increase in the revenues that will be the source of the contributed funds. If that scenario doesn’t happen – due to a recession or other unforeseen event – the city’s pension cost increases could outpace its revenue increases, resulting in a budget shortfall.

Flexibility

Flexibility with respect to pensions and OPEB refers to the ability to make benefit and/or funding changes in order to decrease current or future unfunded plan liabilities, usually by increasing the pension fund’s assets or reducing its expected costs. Generally, cities that have been most successful in decreasing unfunded liabilities have adopted a balanced approach of asset increases and benefit changes. In this way, the financial burden is not entirely on the taxpayers or the employees.

Increasing plan assets is often an easier approach to addressing unfunded plan liabilities, because there is less risk of litigation by plan members. Being able to demonstrate an existing or new source of revenue that can be directed as additional contributions to a pension or OPEB plan would be viewed favorably. For example, a sales tax increase, where proceeds are dedicated to additional pension contributions, can be an effective way to build up pension assets.

Decreasing plan liabilities requires an action that would decrease pension or OPEB plan benefits prospectively. City leaders’ ability to achieve these changes may be limited by the legal, regulatory, and collective bargaining environment in each community. While many cities argue they have the ability to reduce plan liabilities, rating agency analysts and other market participants generally want to see the city actually take such an action, and have it survive litigation, before they recognize it as a viable approach.

Reforms that immediately reduce plan liabilities are viewed more favorably than benefit changes that only affect future employees, because the latter may take many years before having a material impact on unfunded liabilities. For example, a reduction to retiree pension cost-of-living adjustments would be viewed more favorably than implementing a new, less generous pension formula for future hires.

Summary

Pension and OPEB liabilities generally build up over time, and the fiscal challenges they pose cannot be solved overnight. But city leaders can take steps that will be viewed favorably by credit rating agencies and build support for the hard choices necessary to achieve greater budgetary stability in the long term. These include:

Demonstrating predictability by taking steps to decrease the volatility of plan contributions;
Demonstrating stability by making sure that there are revenue sources available to pay off unfunded plan liabilities over a reasonable period of time; and
Demonstrating flexibility by enacting plan funding and/or benefit changes that decrease unfunded liabilities.

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Old 07-02-2018, 09:09 AM
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Mary Pat Campbell
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ILLINOIS
JANUS

https://www.washingtonpost.com/opini...=.75a4e0d68143

[quote]Why I took my case over forced union dues to the Supreme Court
Spoiler:
By Mark Janus
July 1 at 1:45 PM
Mark Janus was the plaintiff in Janus v. AFSCME.

My home state of Illinois is in financial free fall. The state has billions of dollars in unpaid bills, has unbalanced budgets and is bleeding people and money.

A state doesn’t get into a mess like this overnight. It’s the result of many seemingly small decisions over many years. It’s for that reason that I fought to not be part of that mess — all the way up to the Supreme Court.

In 2017, as media pundits wondered whether Illinois would be the first state to have its credit rating downgraded to junk status, I watched the American Federation of State, County and Municipal Employees (AFSCME) union lobby for higher taxes to pay for higher salaries and benefits for government workers such as me. Certainly, my salary wasn’t the cause of the state’s financial woes, but when you consider that I have had a raise almost every year I have been working for the state — and that I work alongside more than 35,000 other state employees — you can begin to see how that might affect the state’s bottom line. That’s in addition to the incredibly generous, taxpayer-funded pension offered to state workers — an average of $1.6 million per state employee, according to a report from the Illinois Policy Institute.

ADVERTISING

Decisions about government workers’ salaries and pensions aren’t made independently by elected officials who are unaware of the state’s empty bank accounts. The raises and benefit increases are pushed by government labor unions that have lobbied for the authority to negotiate on behalf of government workers. In 22 states, government workers like me — as well as police officers, firefighters and teachers — are required to pay fees to these unions to negotiate on our behalf, even if we don’t want to be members or we don’t support what they negotiate.

Why don’t politicians just say no to the demands of the unions when they know the state can’t afford them? Because the unions bankroll into office the same people who ink their contracts. Unions are among the top spenders in elections, and they make sure that people who don’t support their demands lose their seats.

Since its contract expired in 2015, AFSCME, which I am required to fund even though I am not a member, had increasingly used the possibility of a strike to push the state toward accepting the union’s demands for higher salaries and benefits. I couldn’t stand by anymore while these policies were bankrupting the state. That’s why I asked the Liberty Justice Center to represent me and take my case to the Supreme Court.


I would gladly forgo my annual raise because it’s more important to me that the state get its financial house in order. I would happily have my pension converted into a 401(k), instead of piling more obligation onto the bankrupt pension fund. But I haven’t had a choice about either of these, and I have been forced to pay for a private organization that I don’t want to be a member of to negotiate for things I don’t believe in.

Union leaders said I did have a choice: Quit my job. Agree with the union or quit my job as a government worker. Think about that for a minute: To be a government worker, you have to agree with and fund a private organization?

Not only is it common sense that people should not have to fund a private organization that is advancing government policies they oppose, it also violates the First Amendment.


After many decades — and many millions of workers having to make this unfair bargain — the Supreme Court agreed. It said Wednesday that government workers can’t be forced to pay fees to unions as a condition of working in public service. Thanks to this ruling, workers such as me will no longer have to check our First Amendment rights at the door when we enter public service. We will no longer be required to fund unions that are negotiating policies that are bankrupting our states.

Government workers will still be free to join unions, and most will. Unions will also still negotiate on behalf of government workers, just as they do today in the 28 states where workers aren’t forced to pay unions fees. The change that the court made simply respects the rights of workers who don’t want to be forced to pay for policies they oppose. We can all agree that’s a fundamental right that American workers deserve.

/quote]

https://qctimes.com/opinion/editoria...6c8058e65.html
Quote:
Editorial: Welcome to the real world, AFSCME
Spoiler:
It was inevitable — at some point, the shameless gluttony of public employee unions couldn't last forever.

That reality manifested Wednesday as a devastating — if unsurprising — U.S. Supreme Court ruling that could finally force Big Labor to ditch the fantasy within which it has existed for too long. It was a reckoning that had been building for decades, as private sector wages stagnated and pensions went the way of the dodo.

Janus v. AFSCME was sired on the desk of Gov. Bruce Rauner, Illinois' Republican executive who's spent his entire first term trading shots with the American federation of State, County and Municipal Employees. State employee Mark Janus quickly became Rauner's proxy, claiming that unions are inherently political organizations and, as such, laws that force workers to pay dues, called "agency fees," violated his rights to free association and free speech.


This past week, the increasingly conservative high court concurred in a 5-4 decision.

Unions fund campaigns — in support of Democrats, more often than not — and actively lobby lawmakers. Simply offering dissenting members refunds for the organization's non-stop politicking doesn't change those facts. In Illinois, AFSCME in particular has waged a consistent anti-Rauner campaign. And, as justices noted during oral arguments, public employee unions, such as ASFCME, negotiate with government bodies, in itself a political act.

Yes, Rauner's successful bid to bleed money and, over time, membership from public unions is good for Republicans throughout the country. The political motivations behind Janus are undeniable. But that fact doesn't negate significance of the decision for individual rights.

Put bluntly, Mark Janus didn't approve of AFSCME's politics. No state law should force him to as a requirement for employment, regardless of who or what is negotiating his salary and benefit package.

It should surprise precisely no one that it was AFSCME — Illinois' largest public employee union — that grew so greedy that it forced agency fees to the Supreme Court. Illinois' state pension system — a taxpayer-subsidized endeavor — is perhaps the nation's worst from a financial perspective. A year ago, Illinois' pension debt topped a whopping $137 billion, $11,000 for every man, woman and child in the state. Local governments regularly spend more than 20 percent of their budgets on police and fire pensions while roads decay. Defined-benefit pensions in the private sector are all but extinct, replaced by defined-contribution plans, such as the 401k, which foist the risk onto the worker. And yet, any suggestion that AFSCME cave in a meaningful way amid the crisis is universally met with exploding heads and over-the-top rhetoric from Democrats.


Just 6.5 percent of American private sector workers are members of unions, says the U.S. Bureau of Labor statistics, a number that's plunged over the past two decades. More than 34 percent of public employees are members of unions — a number that's substantially higher in traditionally pro-union states, such as Illinois, New York and California. The public-private dichotomy has effectively segregated American workers into a class of haves and have nots. It's artificially propped up median income calculations. It remains a hindrance to any movement toward wholesale reform that would benefit all workers in an economy where wealth is increasingly siloed at the top.

Unions exist for their own promulgation. And public unions, without any semblance of shame, demand private-sector workers — trapped in incessant wage stagnation — to foot the bill for annual wage hikes and gold-plated benefits packages that haven't been available to most Americans for decades.

Welcome to the 21st century, union bosses. No, things aren't great. And they haven't been for most American workers for a long time.
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Old 07-02-2018, 09:10 AM
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ILLINOIS

http://www.news-gazette.com/opinion/...ms-100000-club

Quote:
Guest Commentary | The Teachers' Retirement System's $100,000 Club
Spoiler:
You can't educate children in the classroom when you're funding an expensive education administration. There's just not enough taxpayer money for both, as Illinois' property taxes, budget shortfalls and overdue bills clearly illustrate.

Let us introduce you to the Illinois $100,000 Club. It's made up of 30,000 superintendents, administrators, staffers and teachers. Our auditors at OpenTheBooks.com found more than 18,000 educators pulled in six-figure salaries last year, while nearly another 12,000 retirees received six-figure pensions.

Using data compiled from open-records requests of the Illinois Teachers' Retirement System, we built an interactive mapping tool, https://www.openthebooks.com/map/?Map=1803&MapType=Pin, on our government transparency website, OpenTheBooks.com. Now, every taxpayer can search the $100,000 Club by ZIP code.

Wouldn't you like to see which educators in your district make $150,000 salaries for teaching driver's ed or PE classes? What about the retired art teacher with a $120,000 lifetime pension annuity? Here are some examples of what you'll find in local school districts:

— In Calumet CSD155, Superintendent Troy Paraday made $407,145 last year. Meanwhile, the students are struggling, with nearly 70 percent coming from low-income families and just 16 percent considered ready for the next grade level. Paraday made $23,000 more than the $384,138 he made the previous year.

— Six retired educators received more than $300,000 in annual pension payouts last year, including Lawrence Wyllie from Lincoln Way CHSD 210 ($331,086); Henry Bangser from New Trier Township HSD 203 ($321,834); Gary Catalani from Community Unit SD 200 ($320,403); Laura Murray from Homewood-Flossmoor CHSD 233 ($315,221); Mary Curley from Hinsdale CCSD 181 ($306,151); and Larry Fleming from Lincolnshire-Prairie View 103 ($300,813).

— Joyce Carmine, former superintendent of Park Forest SD 163, retired on a first-year pension of $290,526 (2017). In 2016, Carmine earned the largest salary in the entire system with a massive salary increase from $81,382 (2000) to $398,229. She received this enormous paycheck even though less than 1 out of 4 students in her district were considered ready for the next grade level, and 88 percent of students were considered low-income.

These highly compensated public employees are bleeding the education and the pension systems dry. The top 18,394 educators with six-figure salaries collected $2.3 billion last year. They out-earned 65,800 hardworking, rank-and-file teachers at the bottom half of the pay scale.

Upon retirement, these well-paid educators expect a handsome reward. The top 11,765 six-figure retirees received more than the bottom 50,500 retired teachers. That means the top 11 percent of TRS retirees soaked up more annual pension payments ($1.4 billion) than the bottom 47 percent.

It's only getting worse. We forecast that by 2020, there will be 20,000 retired Illinois educators with taxpayer-guaranteed pensions exceeding $100,000. That's nearly twice as many as this year.

Last week, executives at the TRS sent an email to its members admitting our data was correct. Still, they tried to reframe the claims, arguing that just 11.4 percent of educators and retirees received six-figure payouts. The TRS pointed out the average salary for an active Illinois educator is $72,000, and the average pension is $54,000.

What the TRS conveniently ignored, however, is that windfall pay packages reward those at the top of an education system impervious to improvement or reform. Six-figure salaries are driving huge retirement pensions that already cost the equivalent of $1 out of every $3 collected from the state income tax.

The bloated Illinois education bureaucracy values high compensation for those who know how to play the pay and pension lottery. One $300,000 administrator salary could fund the salary of one new teacher with $200,000 left over to enhance student learning. But, as this spending illustrates, classroom learning is not the concern.

Perhaps it's time for a compensation cap for employees at the education patronage farm. After all, in 2017, there were 518 school district managers and administrators out-earning every governor of the 50 states at a threshold salary of $180,000. That's excessive.

In the absence of a pay cap, our data at OpenTheBooks.com shows that unwarranted pay for superintendents, administrators, staffers, and some educators is making a bad situation much worse.

Adam Andrzejewski is the chief executive officer of OpenTheBooks.com, based in Burr Ridge.
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Old 07-02-2018, 09:45 AM
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CALIFORNIA
PRIVATE EQUITY

https://www.ai-cio.com/in-focus/shop...ia-initiative/

Quote:
CalPERS Ends California Initiative
Plan, which has invested over $1 billion since 2001, was aimed at private equity investments in underserved areas of state.

Spoiler:
The nation’s largest retirement plan, the California Public Employees’ Retirement System (CalPERS), is winding down its targeted private equity investments programs largely directed at underserved areas in California.

The $355 billion retirement system is ending the California Initative, a 17-year effort to use private equity funds to invest in companies in underserved communities, and is also wrapping up a money-losing fund to invest in California companies using clean technology. It is also concluding that its strategy to invest in the mezzanine debt of California companies isn’t viable long-term.

The largest phaseout is the California Initiative, which has given more than $1 billion since 2001 to private equity firms. The firms then made investments in companies located in areas that had traditionally been bypassed from infusions of institutional equity capital.

The effort did create jobs.

A California Initative report released at the CalPERS Investment Committee meeting on June 18 shows that private equity investments in portfolio companies in those areas created more than 42,000 new jobs since 2001. California accounted for 16,000 of those jobs. The aim of the so-called California Initative was to invest in California, but investments in underserved areas in other states were also allowed.

The problem, according to CalPERS officials, is that the job creation was supposed to be an ancillary benefit of the effort. Strong risk-adjusted investment results, the primary benefit for CalPERS to meet its fiduciary duty, never materialized, Ted Eliopoulos, the retirement system’s chief Investment officer, said.

The second program, CalPERS’s private equity investments in California companies using clean technology, began in 2007 with the start of the $465 million Clean Energy & Technology Fund, managed by Pacific Corporate Group. After poor performance, CalPERS officials severed ties with the group in 2010, but a new manager, Capital Dynamics, has been unable to change the return profile. CalPERS released its most recent data on September 30, 2017, indicating an internal rate of return of -9.7% overall since the fund’s inception.

It’s unclear when the fund will end, as private equity funds normally have a life cycle of seven to 10 years. Clinton Stevenson, CalPERS’s director of investment management engagement programs, said at the June 18 meeting that there will be no follow-on investments for a California-focused clean energy effort. He did not explain why the CalPERS green energy program went sour.

A third in-state private equity effort, a mezzanine debt fund started in 2014, was part of an effort to revive the California Initiative. CalPERS committed an initial $80 million to buying the mezzanine debt of California companies. The debt is considered the riskiest form of debt financing, but can pay returns up to 20%, potentially making it an attractive return for the pension system.

Unfortunately for CalPERS, the returns haven’t been there; the fund had a -1.6% internal rate of return, as of September 30, 2017.

CalPERS officials had high hopes for the fund, which is managed by Grosvenor Capital Management.

“It’s great to have a hand in stimulating job creation and economic growth in our home state as we seek the best risk-adjusted returns for the portfolio,” Eliopoulos said in a press release in November 2014 announcing the start of the fund.

CalPERS officials did not discuss why the fund has had poor performance at the June 18 meeting, but Stevenson told the Investment Committee that the strategy was not scalable.

“So, we won’t pursue that going forward,” he said. Stevenson did not state what would happen to the current fund.

Eliopoulos also said at the Investment Committee meeting that CalPERS was moving away from smaller initiatives not only in private equity, but across all asset class.

The biggest part of the California Initative was the effort at proving funding for companies in underserved areas. CalPERS gave more than $1 billion to more than four dozen private equity firms who made investments in more than 550 portfolio companies in underserved areas.

Eliopoulos told the CalPERS Investment Committee that the private equity firms overall didn’t perform as CalPERS had hoped.

It’s unclear why the performance of most private equty managers was disappointing and Eliopoulos wasn’t available for an interview. But he stated at the Investment Committee meeting that investing in private equity is risky.

“I just wanted to underscore this is a domain of quite a bit of risk, active risk to the program and huge variability between managers and huge variability between each individual (portfolio company),” he told the Investment Committee. “That’s the domain for private equity as a whole, not in terms of California versus New York or undeserved areas versus regular areas.”

CalPERS’s $27 billion private equity program has been the retirement system’s best-producing asset class over the long-term with investment results of 12.1% over the five-year period ending April 30, 2018, 8.7% over the 10-year period and 10.7% over the 20-year period.

Eliopoulos said in Phase I of the underserved and disadvantaged private equity program, which began in 2001, nine of 10 private equity managers “underperformed quite significantly from a return standpoint,” leading to an overall -5% investment return. CalPERS statistics show that $475 million was invested in nine managers and a 10th fund of funds, managed by an overall manager who then hired 15 separate fund managers.

He said one of the 10 managers had exceptional performance, which brought up the overall return of Phase I. Megan White, a CalPERS spokeswoman, said in an email that overall the return for Phase I was 12% when the one manager’s results are calculated with the other nine managers.

CalPERS statistics show that manager, GCP Capital Partners of New York, which managed the GCP California Fund, had an internal rate of return of 94% in its now liquidated fund. Eliopoulos said the fund had strong performance because of investments in one particular portfolio company, which he did not name.

All of the funds in Phase I have all been liquidated except two, said White.

Still active is the California Community Venture Fund, the fund of funds managed by HarbourVest Horizon, consisting of 15 separate private equity funds. A second single private equty managed by private equity firm Yucapia Companies is also still active, she said.

CalPERS statistics show that the California Community Venture fund of funds had an internal rate of return of -0.8% for a 14-year period between 2003 and Sept. 30, 2017.

The Yucapia fund, The Yucapia Corporate Initiatives Fund I, had an internal rate of return of -5% from its founding in 2001 through September 30, 2017, the statistics show.

Eliopoulos said Phase II of the program, which began in 2006, used a fund of funds approach entirely. The Golden State Investment Fund was made up of 16 private equity funds and 17 co-investments which received a total of $560 million for investments. The fund is managed by alternative investment firm, Hamilton Lane.

Eliopoulos said at the June meeting that overall performance was improved from Phase I, an internal rate of return of 8.2 % as of Sept. 30, 2017, but the second-quartile performance still did not meet performance expectations of the overall private equity program. Some of CalPERS private equity managers in the system’s top quartile have IRR’s of 20% or more.

With many funds in Phase II also wrapping up, CalPERS official said the 13th annual California Initative report that was released at the June 18 meeting will be the last.

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Old 07-03-2018, 11:32 AM
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CALIFORNIA
CALPERS
PRIVATE EQUITY

https://www.ai-cio.com/news/calpers-...ampaignId=4022

Quote:
CalPERS Comptroller Concerned over Capital for Underserved Areas
Board questions how CalPERS can still help areas after end of California Initiative.


Spoiler:
CalPERS Investment Committee members have expressed concern that underserved communities will no longer receive an economic stimulus from the pension fund with the ending of the California Initative, a 17-year effort to infuse private equity funds into underserved areas.

“There’s just an unending appetite, as you know…with respect to wanting capital to be deployed in different parts of the state, and unfortunately, a shortage of it,” said Betty Yee, the state comptroller who serves on the CalPERS board, at a June 18 meeting.

Other investment Committee members expressed similar thoughts questioning how CalPERS could still focus on investments in underserved areas, despite the fact that investment returns for the $1 billion plus program never met expectations.

CalPERS Chief Investment Officer Ted Eliopoulos said at the June 18 meeting that CalPERS investment staff is still open to private equity investments in underserved areas, but investments will be looked at on an overall basis in terms of the private equity program, not specifically targeted efforts at those areas.

CalPERS is currently looking for a fund of funds manager to launch a new private equity initative that would pick emerging managers who are considered newer private equity managers or women and minority-owned firms, but there is a key difference between the planned program and the California Initative. The managers will not be given a mandate to invest in underserved area, but to find the best possible investment opportunities anywhere in the world.

Eliopoulos said it’s unclear as to whether the selection of more diverse private equity firms will lead to investments in portfolio companies in underserved areas.

Public pension system investments in a retirement system’s home state can be a touchy issue and many state pension plans have in-state investment programs in place partly because of political pressure. California legislators have pushed the system in the past to make investments in underserved areas and to hire more minority and women managers.

CalPERS officials maintain overall that their investments affect the state in a major way. A separate CalPERS report on California investments, also released at the June meeting, shows that 9% of the system’s more than $350 billion in assets under management is invested in California. But those investments are heavily concentrated in the San Francisco and Los Angeles areas, the report shows.

The assets invested in California is not because of a self-directed effort by CalPERS investment staff; it is a by-product of the more than $350 billion invested by CalPERS. For example, California is home to some of the world’s largest public companies, such as Apple, Google, and Facebook, in which CalPERS invests through its equity index funds.

The ending of the California Initiative comes as Eliopoulos is attempting a restructuring of CalPERS’s $27 billion private equity program. Proposed changes include the launching of an independent investment organization that would make billions of dollars of direct investments in later-stage venture capital companies as well as in established companies in a buy-and-hold strategy.

CalPERS board member David Miller said at the June 18 meeting that he hopes CalPERS investment staff could explore how the new investment program could incorporate investing in underserved areas of California.

Eliopoulos said that will be explored, particularly through co-investments, in which CalPERS makes a separate investment in a portfolio company outside of the investment it has made with other investors as limited partners in private equity fund.

The new investment program still must be approved by the CalPERS board, which
Eliopoulos hopes the retirement system board will do by the end of the year. However, CalPERS will still keep its traditional private equity program, in which it invests with private equity firms in co-mingled funds, even with the launch of the independent private equity investment organization.
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Old 07-03-2018, 01:45 PM
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ILLINOIS
TEACHERS

http://nprillinois.org/post/unions-p...n-cap#stream/0

Quote:
Unions Petition To Reverse Pension Cap
Spoiler:
When school districts outside of Chicago negotiate contracts, they do so with the assurance that the state will pick up the tab on pensions. To control growing pension costs, lawmakers capped salary bumps at 6 percent in 2005. This year, the cap tightened to 3 percent.

Illinois' teachers unions have collected more than 15,000 signatures on petitions urging state lawmakers to reverse that measure.

State Rep. Will Davis (D-Homewood) chairs the House K-12 appropriations committee, and was involved in budget negotiations.

"I mean, things like this are tough conversations. But you know there's also a manner in which we also have to look at the long-term viability of our state,” he says. “Not everybody's in favor of raising taxes for the things we want to pay for. Sometimes we do have to make relatively tough decisions, and this fits into that category."

Senator Elgie Sims (D-Chicago) says districts are free to offer bigger raises, but will have to kick in pension costs for any amount that exceeds the cap.

"If the school district still wants to negotiate those increases, they certainly can. And it would just be a matter of the resources having to be paid locally as opposed to being paid at the state level,” Sims says.

Education unions are gathering petition signatures in hopes of getting that provision reversed. They say it effectively limits salary increases to an amount that barely covers inflation, and will discourage teachers from taking on extracurricular jobs like coaching athletic teams or directing plays.

"There's always the statement that someone won't do something,” Davis says. “I mean, we don't know what the district will do if somebody makes over the 3 percent. It depends how much over the 3 percent they're making."

Davis and Sims both support another measure, now awaiting Gov. Bruce Rauner's signature, that would raise the minimum salary for teachers from $9,000 to $40,000 over the next four years. If enacted, it could remove some of the need to boost teachers' pay at retirement time.

"The plan and the goal for us has always been in making sure that we are providing for investments in teacher salaries and educator salaries during the entirety of their service, not just at the end," Sims says.



Rauner had proposed shifting all pension costs to local districts over the next four years, or tightening the cap to 2 percen
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Old 07-03-2018, 01:47 PM
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CALIFORNIA
OPEBs

https://medium.com/@DavidGCrane/redu...a-454444d1ccaa

Quote:
Reducing OPEB Debt In California
Spoiler:
OPEB (“Other Post Employment Benefits”) debt largely consists of subsidies to retired employees for medical insurance premiums. OPEB debt owed by the state doubled in the last decade to more than $90 billion and state spending in the 2018–19 California state budget on OPEB will be >80 percent higher than a decade ago. The burden of that spending disproportionately falls on discretionary General Fund programs, as explained here.

OPEB debt can be reduced by transitioning retired employees to Covered California or other health insurance exchanges and delinking the medical insurance premium rates paid by active and retired employees. By taking that action in 2015, the City of Glendale reduced OPEB debt by >90 percent (see page vii of 2017 Glendale CAFR.) Applied to the state’s 2017 OPEB liability of $91 billion, that implies the state could reduce its OPEB debt by $80 billion.

Few steps could better protect public services for the vulnerable than elimination of OPEB debt. The same is true in school districts and local governments. Every dollar employed to service OPEB debt is a dollar that cannot be used for classrooms or local services.
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NEW YORK CITY
DIVERSITY
GOVERNANCE
http://www.pionline.com/article/2018...03#cci_r=73393
Quote:
NYC comptroller engages with more than half of companies in board diversity campaign

Spoiler:
New York City Comptroller Scott M. Stringer and the New York City Retirement Systems have so far engaged with more than half of the 151 U.S. companies targeted in the comptroller's boardroom quality and diversity campaign, which was launched in September, Mr. Stringer's office announced Wednesday.

Mr. Stringer is the fiduciary for the five public pension funds within the $194 billion New York City Retirement Systems.

Last fall, Mr. Stringer and the New York City pension funds wrote to the 151 corporations requesting they disclose the race, gender and skills of their directors and provide information about their policies for insuring board diversity and independence.

Since that time, more than 85 companies have "adopted improved processes and increased transparency regarding board quality, diversity and refreshment, and (more) than 35 companies are now disclosing not only the qualifications of their board members, but also details on boardroom gender and racial/ethnic diversity — information which up-to-now was rarely made public," Mr. Stringer's office said in a news release. Those companies include Duke Energy Corp., Honeywell International Inc., Occidental Petroleum Corp. and PepsiCo Inc.

Other achievements include:

49 of the targeted companies elected 59 new female or minority directors. Those companies include eBay Inc., NRG Energy Inc. and Wells Fargo & Co.
24 companies committed to include women and minority director candidates in every board search moving forward. Examples include Intel Corp. and Union Pacific Corp.
More than 25 companies provided meaningful information about their board evaluation processes to ensure they have the highest quality directors and their boards are refreshed regularly. Those companies include Exelon Corp., Occidental Petroleum Corp., and International Business Machines Corp.
Five of six shareholder proposals Mr. Stringer filed seeking information on companies' board composition were withdrawn after the companies agreed to provide meaningful disclosure. ExxonMobil was the only company that refused to provide this information. The proposal was rejected by 83.5% of shareholders at Exxon's annual meeting May 30. In its proxy statement, Exxon recommended shareholders vote against the proposal, arguing that its current disclosures on board composition meaningfully addressed the comptroller's proposal and that diversity in terms of skills, gender and ethnicity have been important considerations in director searches and assessments. An Exxon spokesman declined to comment beyond the proxy statement.
"This is not just about changing the who's who on corporate boards; this is about setting the best foundation for future generations and enshrining the highest standards for our investments," Mr. Stringer said in the news release. "Diverse, climate-competent and independent boards are best positioned to protect our retirees' pensions for the long term and that's why we'll keep the pressure on for real change in corporate boardrooms."
Mr. Stringer added that his office "will continue to demand these changes, because they create sustainable long-term value for our pension funds and for all investors."

The comptroller's boardroom diversity campaign is an expansion of his boardroom accountability project, which was launched in 2014 and designed to improve proxy access by allowing large, long-term investors to nominate candidates for company board positions.

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