►
Description
City of San José, California
Federated City Employees' Retirement Plan Board of November 18, 2021
This public meeting will be conducted via Zoom Webinar. For information on public participation via Zoom, please refer to the linked meeting agenda below.
Agenda https://sanjose.legistar.com/View.ashx?M=A&ID=905446&GUID=E305BB27-DA50-4EAC-B84D-C38F5AAC8917
A
A
A
B
B
B
C
Okay,
trustee
spencer,
horowitz.
D
E
He
is
president,
he
just
muted
he's
on
news.
C
B
B
Updates
have
been
made
to
the
breakout
rooms,
while
utilizing
zoom
staff
is
no
longer
able
to
put
trustees
in
the
breakout
room
the
night
before
the
meeting,
as
they
did
in
the
past
to
help
make
the
process
move
smoothly.
Staff
is
asking
for
your
patience
as
they
let
you
into
the
breakout
room
one
at
a
time.
Also,
if
you
plan
to
share
your
screen
in
closed
session,
please
let
staff
know
before
going
into
the
breakout
room
and
staff
will
make
you
co-host
before
you
enter
the
room.
This
will
take
a
few
minutes.
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
A
B
B
As
such,
all
votes
will
be
roll
call
votes.
If
you
are
not
speaking,
please
be
on
mute
to
cut
background
noise
for
discussion
items.
Each
trustee
will
have
a
turn
to
speak
in
roll
call
order
more
than
once
if
desired,
and
the
public
will
also
have
an
opportunity
to
speak
on
each
item
after
trustees.
B
We
need
to
wave
sunshine
on
a
number
of
attachments
that
were
received
late
and
they
include
item
5c
discussion
and
action
on
the
preliminary
pension
valuation
item,
5e
discussion
and
action
on
retiree
member
vacancy
municipal
code,
section
2.08.1070
and
item
63f
discussion
and
action
on
the
committee
recommendation
to
approve
the
federated
retirement
plan's
annual
comprehensive
financial
report
for
fiscal
year.
2020
2021.
D
Sorry
trustee
chairman
horowitz:
do
we
need
a
motion
to
waste
sunshine,
specifically
as
well
good
question?
Does
anyone
know
I
believe
so
I
was
about
to
offer.
I
was
about
to
offer
a
motion
to
wait
to
wake
sunshine
on
the
items
you
listed.
B
Okay,
well,
let's
do
that,
then
that
would
be
appropriate.
So
we
have
a
motion
from
trustee
chandra
to
wave
sunshine.
Is
there
a
second?
This
is
trustee
kelleher.
I
will
second
the
motion.
We
have
a
second
from
trustee
kelleher.
B
Is
there
any
discussion
hearing,
none
will
have
a
roll
call
vote,
trustee,
chandra,
aye,
trustee,
orr,
hi
trustee
keller.
I
vice
chair
jennings
aye,
and
I
vote.
I
as
well
passes
unanimously.
B
So
we
have
a
motion
from
trustee
chandra
to
approve
the
orders
of
the
day.
Do
we
have
a
second?
This
is
trustee
kelleher.
I
will
second
the
motion.
We
have
a
motion
and
a
second
any
discussion
hearing.
None.
We
will
have
a
vote
trustee
chandra,
aye
trustee,
orr,
aye
trustee
keller,
aye
vice
chair
jennings
hi,
and
I
vote
I
as
well
chair
horowitz.
It
passes
unanimously.
B
Mr
chairman,
yes,
at
this
point,
it
would
be
appropriate
to
report
out
of
closed.
C
Session
that,
if
I
may,
on
behalf
of
the
board,
that
they're
coming
out
of
closed
session,
there
was
no
reportable
action
taken.
B
B
B
And
I
believe
we
are
ready
for
the
next
item:
death
and
survivorship
notification.
We
will
observe
a
moment
of
silence
for
those
who
have
served
the
city
and
who
have
passed.
B
G
Thank
you,
mr
chairman,
good
morning,
trustees
couple
of
things
before
we
actually
get
to
the
one
agenda
item
that
we
have
today.
Last
tuesday,
I
did
present
to
the
city
council
our
annual
fee
report,
along
with
one
of
the
trustees
of
the
police
and
fire
board,
and
it
was
well
received
by
the
council.
I
think
we've
done
a
lot
of
education
in
the
last
three
years
on
our
approach
on
our
asset
allocation.
The
reason
we
pay
fees.
G
Fees
is
really
a
function
of
asset
allocation
and,
to
the
extent
that
we
can
we've
tried
to
reduce
costs
and
fees
by
you
know,
by
negotiating
with
managers
by
going
to
passive
investments
and
so
on.
So
that's
something
I
wanted
to
share
with
the
board.
G
Secondly,
fiscal
year
to
date:
performance
as
of
a
couple
of
days
ago.
These
are
estimates
from
makita.
These
are
by
no
means
final
numbers.
The
federated
plan
was
up
4.35
and
the
healthcare
trust
was
up
4.09
again.
These
are
estimates
with
that
I'm
actually
going
to
move
to
the
one
item.
G
We
have
there's
an
attachment
here
which,
in
a
in
a
few
minutes,
I'm
going
to
try
to
open
up,
but
before
that
some
background
here,
chairman
horowitz
and
I
had
a
our
meeting
or
our
one-on-one
meeting
recently
and
he
he
requested
that
we
talk
about
inflation
and
I
think
it
was
it's
very
timely
that
we
talk
about
inflation.
Obviously
it's
it's
on
in
the
headlines
every
day
we
feel
it.
You
know
when
we
go
to
try
to
fill
gas
in
our
cars.
G
I
just
read
yesterday
that
the
average
price
of
gasoline
in
california
is
now
468
a
gallon,
the
highest
it's
been
in
eight
years
and
every
time
I
go
to
whole
foods
or
sprouts
or
traded
juice.
I
do
feel
the
pinch.
It's
definitely
way
more
expensive
to
buy
groceries
now
than
it
was
even
two
or
three
years
ago,
and
also
my
my
favorite
cup
of
hot
chocolate
at
starbucks
is
four
dollars:
25
cents.
Now
it's
such
a
ripoff.
You
know-
and
you
know
at
some
point
you
know
this
is
called
demand
elasticity.
G
G
So
why?
Why
should
we
worry
about
inflation?
You
know
inflation
erodes.
You
know
the
purchasing
price
of
your
dollar
as
we've
seen
with
you
know
that
gallon
of
gas
or
the
cup
of
coffee
at
starbucks
it
has
an
impact
on
the
value
of
assets
in
our
portfolio,
so
equities
can
go
down
so
again
if
you
had
bought
starbucks
in
a
share
of
starbucks
in
july
when
it
hit
a
high
of
126.
G
Now
it's
at
112
dollars,
so
you
have
lost
over
10.
Clearly
starbucks
could
not
pass
on
those
extra
material
costs
to
its
consumers,
because
consumers
are
saying
I
can
live
without
that
right
now.
On
the
other
hand,
there
are
companies
like
nvidia
up
8
today
by
the
way
which
actually
makes
graphic
processing
units
for
chips
and
it's
able
to
pass
on
its
cost
to
its
customers.
G
So
had
you
bought
nvidia
on
january
1st,
it
was
132
today
it's
317
up
239,
so
it
would
have
actually
protected
you
against
inflation
right,
so
some
assets
will
do
well
in
an
inflationary
environment.
Other
assets
will
not
do
so
well.
So
it's
important
to
see
how
inflation
can
affect
our
portfolio
right.
So
so
I
I
asked
varys
to
actually
put
together
some
slides,
which
they
did
and
I
am
going
to
try
to
share
my
screen
now.
G
Okay,
I'm
gonna
try
this
again,
let's
see
share
screen.
Okay,
maybe
barbara
can
help
me
here.
So
it's
just
basic
advanced
and
files.
G
Okay,
all
right,
I
hate
to
do
this
to
staff.
My
apologies,
but
if
you
don't
mind
opening
up
that
file
there
we
go
perfect.
That
was
not
me
right.
No,
it
wasn't
just
curious
all
right,
so
so
so
going
back
in
history
right
I
mean
so
this
goes
back
several
decades
and
you
can
see
inflation
over
the
past
few
decades
and
obviously
there
have
been
inflation
inflationary
periods
in
the
last
100
years.
G
Now,
let's
go
and
but
you
can
see
the
trend
here
is
inflation
has
been
going
down
in
the
past
several
years
and
the
last
time
we
really
had
a
nasty
inflation
shock
of
any
consequence
was
30
years
ago,
but
that
doesn't
mean
it
won't
happen
again
and
you've
clearly
seen
the
headline
numbers
I
mean
recently.
Cpi
came
out
6.2
annual
number
preceding
12
months
and
we're
all
very
concerned
about
it.
So
this
is
something
that
could
happen
again,
but
in
the
last
several
decades
we've
not
had
any
meaningful
inflationary
shocks
can.
G
Can
we
go
to
the
next
slide
and
this
again
shows
inflationary
periods
over
time
and
next
slide.
Please,
and
by
the
way
we
have
eileen
neal
here,
danny
sullivan
from
varus,
we
also
have
laura
wyrick
from
makita
all
our
consultant
experts,
who
can
also
talk
to
this.
So
what
I
asked
varys
to
do
is
to
run
our
portfolio
through
various
inflationary
shocks.
You
know
had
we
held
this
portfolio,
the
portfolio
that
we
have
today,
how
would
it
have
performed
on
the
various
scenario
scenarios?
G
Historically
and
as
you
can
see,
this
is
today's
portfolio.
In
most
scenarios,
our
portfolio
has
done
well
would
have
done
well
and
I'll.
Tell
you
I'll
explain
why
in
a
little
bit,
but
there
are
some
in
some
scenarios
where,
obviously
our
portfolio
has
not
done
well,
one
is
stag
definition
and
we'll
get
to
stagflation
in
a
little
bit
right,
but
for
the
most
part,
it's
done
well,
there's.
Obviously
the
7374
oil
crisis.
F
Ask
a
question:
what
is
reflation
scenario.
G
Yeah,
so
reflation
is
so
if
we
are
getting
into
a
disinflationary
scenario
and
I'll
have
danny
actually
talk
about
the
actual
assumptions
behind
bara's
model
here
in
a
minute,
but
you
try
to
stimulate
the
economy
right
and
that's
what
a
reflationary
scenario
is
when
you
actually
have
prices
not
going
up
and
it's
stagnant,
that's
not
good
either
right,
you
don't
want
some
amount
of
healthy
price
increase.
So
when
you're
trying
to
stimulate
the
economy,
you
cut
rates,
for
example,
and
you
try
to
reflate
the
economy
danny
do
you
want
to
do?
C
Yeah,
so
we
included
a
few
of
their
more
more
recent
scenarios
that
they
included
for
reflation.
I
can
go
over
kind
of
the
the
details
there,
so
the
assumptions
that
are
made
here
and
apologies
if
this
is
too
in
the
weeds,
but
the
assumptions
that
that
are
made
there.
So
the
break-even
inflation
rate
at
two-year
the
two-year
tenure
is
going
up,
75
basis
points
and
the
10-year
would
go
up
40..
We
shoot,
we
assume
a
slight
shock
in
the
treasury
rate
curve.
C
Credit
spreads
actually
narrow
in
the
reflation
scenario,
so
we're
assuming
that
the
basically
the
fed
is
doing
a
good
job
of
of
managing
inflation
in
the
economy.
Equities
are
going
to
go
up,
so
u.s
equity
return
is
assumed
to
be
plus
18
in
the
reflation
scenario
and
then
the
euro
usd
so
there's
a
slight
shock
to
two
currencies
in
that
scenario
too.
So
that's
the
that's
the
reflation
scenario.
F
Okay,
so
this
is
when
the
fed's
in
there
trying
to
correct
or
make
adjustments
to
to
deal
with
inflation.
C
It's
basically
saying
that
fiscal
and
monetary
stimulus
are
sized
the
right
way
to
successfully
you
know,
bring
the
economy
back.
So
that's
the
idea
there.
Okay,
thank
you.
G
Thanks
thanks
danny,
so
on
slide.
Four
in
one
chart
you
can
see
in
various
inflationary
periods
how
the
equity
market
would
have
done,
how
the
commodity
index
would
have
done
and
how
tips
would
have
done
and
tips,
as
all
of
you
know,
are
treasury
inflation
protected
securities.
A
G
The
reason
I
show
this
in
one
chart
is
to
just
show
the
impact
of
inflation
on
various
asset
classes.
Now,
on
the
prior
slide,
you
saw
that
our
portfolio
would
have
done
well
under
most
scenarios,
not
all
scenarios
and
what's
the
reason
for
that
right.
The
reason
for
that
is
today.
Our
portfolio
has
about
60
exposure
to
public
and
private
equity
right,
that's
a
lot
of
exposure
to
equity
and
we've
seen.
It
depends
on
the
kind
of
equity
that
you
own,
but
there
are
equities.
G
Like
you
know,
I
give
the
example
to
make
it
very
simple
of
nvidia
right.
If
you
own
such
stocks,
they
will
actually
do
well,
even
in
an
inflationary
scenario.
So
there
are
types
certain
types
of
equities
that
will
do
well
right,
especially
when
you
can
pass
on
those
costs
to
consumers
and
as
long
as
there's
an
expanded,
expanding
economy
and
employment
is
good.
People
have
jobs,
you
can
actually
pass
on
those
costs
right
and
we
also
have
some
exposure
to
private
real
assets.
It's
about
five
percent.
G
G
So
roughly
I
would
say
about
70
to
75
percent
of
the
portfolio
today
has
offered
some
kind
of
buffer,
in
case
of
an
inflationary
scenario,
not
all
parts
of
the
portfolio,
but
the
majority
of
it.
Now
what
are
the
parts
of
the
portfolio
that
will
actually
get
affected
in
an
inflationary
scenario,
so
think
about
bonds
right?
If
there
is
an
inflationary
scenario,
the
fed
it's
it's
likely
that
this
fed
will
hike
rates
and
when
interest
rates
go
up,
bonds
won't
do
well.
Bond
values
will
come
down,
especially
long
beach.
G
What
do
we
have
in
the
portfolio?
We
have
about
two
percent
long-term
government
bonds?
They
will
not
do
well.
We
have
about
eight
percent
in
investment
grade
bonds
and
those
bonds
won't
do
well.
They
will
actually
decrease
in
value
because,
even
with
investment
grade
core
bonds
there's
some
duration
exposure.
We
also
have
five
percent
in
cash.
Now
they
won't
necessarily
go
down
in
value,
but
the
the
purchasing
power
of
that
cash
will
go
down.
G
G
You
know
it's
a
reasonable
hedge
against
inflation
that
we
have
in
our
portfolio.
Now,
the
the
other
point
I
want
to
make
about
inflation,
and
we
will.
We
will
have
extensive
discussions
surrounding
inflation
when
we
do
our
next
strategic
gas
allocation
exercise,
which
is
actually
due
to
kickoff
in
a
few
weeks
right
and-
and
this
will
be
top
most
in
our
minds
as
we
think
about
our
portfolio.
G
The
fact
is
what
the
market
does
not
like
is
surprises
and
shocks
right
now,
as
long
as
people
are
talking
about
inflation
and
it's
making
the
headlines,
there
is
some
kind
of
a
self-adjusting
mechanism
in
the
market.
So
to
the
extent
that
people
are
talking
about
inflation,
I'm
actually
less
concerned
about
inflation.
It
doesn't
mean
that
we'll
get
a
free
pass,
but
the
fact
is:
there's
more
of
a
gradual
adjustment
in
prices
that
takes
place
now.
G
We've
also,
you
know,
heard
about
the
supply
chain
shock
right
and
that
the
supply
chain
bottlenecks
and
that's
driving
up
prices,
which
means-
and
if
this
is
long
drawn
out
what's
going
to
happen-
is
eventually
there
will
be
more
suppliers
in
the
market
and
that
will
have
a
natural
downward
effect
on
prices
and
so
to
the
extent
that
this
is
dominating
headlines,
I'm
less
concerned
about
inflation,
but
that
doesn't
mean
that
we
don't
have
to
be
vigilant.
We
should
be
vigilant.
We
should
be
thinking
about
our
portfolio
at
all
times.
G
B
G
Or
with
the
ic
good
question,
mr
chairman,
what
what
it
means
is
really
that
the
the
first
step
of
the
process
is
our
consultant.
G
Makita
will
actually
come
up
with
capital
market
assumptions
and
they
revisit
their
assumptions
every
year,
given
what's
happened
in
the
market
in
the
past
12
months
in
the
current
environment,
so
makita
will
produce
its
cmas
sometime
in
january,
as
will
varus,
and
so
that
will
kick
off
the
process
and
then
staff
will
take
a
look
at
it,
and
makita
will
run
its
optimizer
and
staff
and
makita
will
go
back
and
forth
on
on
those
capital
market
assumptions
and-
and
then
this
will
be.
G
The
second
step
of
the
process
is
that
we
will
then
present
this
to
the
ic
to
the
investment
committee
and
we'll
discuss
various
scenarios
and
combinations
before
it's
brought
to
the
board.
Typically
in
march
or
april,.
H
And
every
year,
when
we
do
that
analysis,
we.
F
E
I'm
fine
I'll
just
have
coffee
yeah.
B
Next
item,
then,
is:
it
seems
to
be
no
old
business,
new
business
oral
update
from
the
ceo,
mr
payne.
Thank
you.
E
Thank
you,
mr
chair.
If
you
bear
with
me
for
a
few
minutes,
I
have
quite
a
few
updates
to
give
you.
Let
me
start
by
addressing
the
two
open
seats,
the
retiree
and
the
active
c
that
are
open.
The
retiree
update
I'm
going
to
delay
to
later
in
the
meeting
under
section
5e,
so
I'll
address
it.
At
that
point
I
have
some
comments
on
that
particular
issue.
E
In
terms
of
the
active
seed,
there
is
an
election
going
on
and
the
ballots
were
sent
out
and
they
were
due
back
to
the
clerk's
office
last
week
november,
8th
as
we
find
out
more
about
the
dates,
I
will
keep
you
posted,
but
usually
what
happens
is
the
city
clerk
then
goes
to
the
process
of
counting
the
votes
and
they'll
have
someone
they
will
indicate
who
have
the
most
votes,
and
then
they
will
go
to
the
city
council
with
the
tally
for
the
council
appointment.
E
So
again,
I
will
follow
up
with
the
city
with
the
city
clerk,
but
I
fully
expect
the
city
clerk
to
go
to
the
city
council
in
time
to
have
a
new
active
member
appointed
to
your
board.
For
your
december
meeting.
F
Is
it
on
the
agenda
for
the
city
council.
E
It
is
an
agenda
for
which
which
meeting.
E
E
Understood,
yes,
I
I
again,
I
fully
expect
that
to
be
in
one
of
the
meetings
early
in
in
december
for
the
for
the
city
council,
but
I'll,
follow
up
with
the
city
clerk
and
see
what
information
we
get.
Thank
you.
I
also
wanted
to
keep
you
posted.
The
city
is
continuing
the
process
they're
on
stage
two
right
now,
which
means
that
employees
were
supposed
to
provide
vaccination
approved
by
september
30th
and
if
they
didn't
then
obviously
either
file
an
exemption
under
either
medical
or
religious
or
probe
and
provide
twice
a
week.
E
Testing,
non-negative
testing,
and
so
the
the
city
has
continued
that
process.
They
are
working
on
implementing
a
hybrid
approach.
Their
goal
is
to
for
the
departments
to
to
sort
of
work
to
this
process
and
by
january
3
the
beginning
of
the
year.
They
fully
expect
the
the
departments
to
have
their
hybrid
approach
in
place
and,
to
that
extent
I
want
to
share
with
you
that
we
we
had
a
quarterly
staff
meeting
with
our
staff
as
we
do
again.
Every
quarter
we
do
the
first
months
of
every
quarter.
E
E
That's
aside
from
the
fact
that
the
pensions
grew,
he
does
have
a
benefit
staff,
one
benefit
staff.
Every
day
at
the
office.
We
do
have
staff
that
is
working
the
front
desk
to
answer
questions
from
members,
and
we
are
actually
in
fact
making
appointments
for
members
to
come
into
the
office.
So
the
office
is
not
open
yet,
but
when
member
call
members
call
the
office
and
they
request
an
appointment,
we
are
scheduling
about
three
to
five
appointments
a
week
with
the
benefit
analyst,
and
so
when
they
come
in,
they
knock
on
the
door.
E
E
I
think
that
what
we're
doing
is
trying
to
get
a
sense
of
how
these
weekly
appointments
is
working,
so
that
we
have
more
data
and
information
so
that
once
we
are
ready
in
december,
we
can
then
roll
this
out
not
only
through
the
website,
but
that
we
will
announce
it
to
the
members
in
our
quarterly
newsletter
and
through
our
various
communications
for
social
media
like
twitter
and
facebook.
E
So
the
office
is
still
closed,
but
we
are
accepting
physical
appointments
of
course
goes
without
saying
that
we
are
also
having
virtual
appointments
by
staff
with
remembers
when
they
request
one.
The
goal
is
to
eventually
migrate
from
one
day
a
week
to
potentially
two
days
a
week
starting
on
january
3rd.
E
E
Again,
I
haven't
seen
any
of
that
in
the
u.s
so
in
the
bay
area,
but
the
only
reason
I'm
mentioning
that
is
obviously
the
situation
is
still
fluid
and
those
plans.
Obviously,
if
cases
in
the
u.s
and
the
bay
area
start
coming
up
again,
we
may
have
to
reconsider
those
steps.
But
at
this
point
again
we
fully
support
remote
work.
We
are
fully
engaged.
E
We
do
have
staff
that
comes
to
the
office
from
time
to
time
to
do
work
that
have
to
be
done
at
the
office.
We
are,
to
the
extent
possible,
obviously
taking
care
of
our
members
and
we
will
keep
you
posted
of
any
any
changes
to
that
extent.
Lastly,
I
wanted
to
give
you
an
update.
E
I
mentioned
last
month
that
the
open
enrollment
for
health
for
retirees
goes
to
the
full
month
of
november
staff
actually
made
a
presentation
to
the
san
jose
secretary
association
earlier
in
the
month
of
november,
and
so
it
is
going.
The
presentation
went
very
well
and
in
terms
of
the
open
enrollment
we
have
received
about
350
change
forms
today
about
90
of
those
have
been
submitted
electronically,
the
bulk
of
those
changes.
So
the
bulk
of
those
forms
are
really
information
to
us
to.
E
Let
us
know
that
they
will
continue
in
low
coverage,
meaning
that
they're
not
making
any
changes
they
have
coverage
in
in
other
situations,
not
under
the
city
they're,
just
letting
us
know
the
front
desk
is
handling
about
80
calls
per
day
again.
The
bulk
of
those
calls
are
for
open
enrollment
about
50
of
them.
E
The
rest
are
for
other
kind
of
questions,
and
then
we
have
healthcare
staff
that
is
handling
in
addition
to
the
front
desk,
handling
calls
on
a
daily
basis,
not
only
calls
for
emails,
and
I
just
want
to
take
it
is
challenging
especially
doing
it
virtually,
and
so
I
want
to
take
this
opportunity
to
publicly
shout
out
the
the
desk
team
that
is
doing
a
fantastic
job
and
fielding
all
the
questions,
whether
they're,
either
by
phone
or
by
email
and
to
the
health
healthcare
staff,
also
because
of
the
open,
enrollment
and
and
fielding
all
those
questions
and
everything
else
and
in
general,
to
staff
making
the
self
available.
E
We
really
haven't
have
any
issues
with
making
sure
that
we
have
a
benefit
analyst
here
on
a
daily
basis.
Every
day
is
a
different
benefit
analyst,
but
we
always
have
someone
on
board
so
that
we
can
take
those
appointments
that
we
are
scheduling
week
in
and
without
mr
shea.
That
actually
concludes
my
comments.
I'm
happy
to
oh
one.
E
Apparently
I
don't
know
the
reason
for
it,
but
they
actually
reissue
they
mail
out
the
newsletter
from
the
prior
quarter.
So
some
of
you
get
the
the
newsletter
by
e
by
mail.
You
did
receive
the
last
quarter
newsletter
again
and
they
quickly
notified
us.
E
That
was
the
situation
and
they
re-issued
the
new
newsletter,
which
should
be
in
most
people's
houses
by
now,
but
just
wanted
to
mention
in
case
you
heard
from
a
member
indicating
that
they
got
two
separate
newsletters
this
time
around
and
with
that
I'm
happy
to
entertain
any
any
questions
that
you
may
have.
Thank
you,
mr
chair.
F
I
have
a
question,
I'm
just
curious.
You
mentioned.
I
assume
this
is
the
active
retirees
who
are
changing
their
health
care,
yes
options.
So
if
they
go
and
choose
in
lieu,
I
assume
they
can
do
that,
but
they're
they
don't
lose
their
option
to
come
back.
E
That's
right:
they
they
they.
This
the
in-law
is
a
process
by
which
you,
let
us
know
that
you're
not
using
the
coverage,
and
so
we
keep
track
of
that.
There
is
a
credit
that
they
gain
every
year
so
that,
when
they're
ready
to
use
it,
then
they
can
use
that
credit
for
the
costs
associated
with
the
coverage.
Yes,
they
are
required
to
keep
it
a
surprise
and
that's
the
reason
why
they
need
to.
Let
us
know.
F
Okay,
interesting
and
and
also
with
just
yeah,
I've
been
staying
abreast
of
the
whole
what's
happening
in
europe,
also
what's
happening
in
the
u.s
right
now.
California
looks
pretty
reasonable
in
cases.
However,
it
is
running
rampant.
You
know
in
in
the
north
a
bit
and
you
know
some
of
the
other
areas.
So
it's
quite
possible.
F
We
tend
to
do
that.
As
a
you
know,
we
want
to
bring
back
the
office
and
people
coming
in
and
having
those
options.
It
seems
like
over
the
years
as
we've
done,
that
we
keep
on
pulling
back
because
then
that's
when
the
virus
takes
off
again
so
it'll
be
interesting
to
see
what
transpires
as
we
get
closer
to
january.
B
E
E
What
I'm
missing
is
the
actual
the
deadline
to
return
the
battle
was,
I
believe,
november
8th.
I
just
haven't
heard
from
the
city
clear
as
to
when
she
plans
to.
I
think
the
word
is
to
make
it
official
the
election
and
bringing
the
results
to
the
city
council
for
the
appointment,
and
I
need
to
follow
up
on
that.
E
Oh
well,
I
they
could
always
reject
the
candidate.
Usually
I
would
say
I
mean
I
will
defer
to
obviously
council
member
davis,
but
that's
always
a
possibility,
but
I
would
say
especially
because
of
an
active
member
election
unlikely
as
the
person
will
be
elected.
But
that's
always
that's
why
it
goes
back
to
the
city
council
right
because
they
have
the
the
authority
to
appoint
the
person.
Yes,
I
said:
okay.
B
If
not,
thank
you,
ceo
pena
and
we'll
move
to
item
5b
oral
update
from
councilmember
davis.
B
See:
okay.
B
So
well
I
see
it's
about
10
to
10
five
to
ten.
Maybe
at
this
juncture
it
would
be
a
good
time
to
take
a
five
minute
break
and
reconvene
at
ten
o'clock.
A
A
B
Assume
our
proceedings,
I'm
just
wondering
if
council
liaison
davis,
is
present
for
item
5b.
B
Not
okay,
so
let
us
move
on
then
to
item
5c
discussion,
action
on
preliminary
pension
evaluation
and
economic
assumptions
by
chiron.
I
I
just
wanted
to
remind
people
where
we
are
in
our
schedule
of
actuarial
presentations,
we're
a
little
bit
ahead
of
our
normal
schedule,
because
we're
trying
to
accommodate
the
actuarial
audit
here
and
make
sure
that
there's
time
for
everything
so
last
month
the
board
approved
the
economic
assumptions
for
the
pension
plan,
and
so
this
month
we've
got
our
draft
pension
valuation
results.
I
I
In
december
we
will
come
back
with
the
final
pension
valuation
report
and
an
updated
presentation
with
more
projections.
I
We'll
also
have
the
draft
open
valuation
results
and
then,
in
january
we
understand
seagull
will
present
their
audit
results
on
the
pension
plan.
At
the
same
time,
we
will
present
the
final
opeb
valuation
report
and
then,
finally,
the
february
board
meeting
we
understand
seal
will
present
their
audit
of
the
open
value
which
so
it's
the
beginning
of
a
multi-month
process
here
and
just
wanted
to
keep
everyone
on
track
with
what
we're.
What's
on
the
schedule.
I
For
the
for
a
pension
plan
and
pension
valuation,
it
there
are
adjustments
that
go
on
constantly
in
the
system.
The
benefits
change
as
people
retire,
depending
on
how
people,
how
long
people
live,
salary
increases
and
so
forth.
I
The
investment
returns
are
constantly
changing
and,
as
prabhu
was
just
talking,
the
board
reviews
the
investment
allocation
annually.
So
there
are
tweaks
that
happen
there
all
the
time.
The
valuation
is
really
focused
on
the
contributions.
It's
our
annual
time
to
check
the
contributions,
make
sure
they're
sufficient
and
make
adjustments
as
necessary.
I
This
valuation
will
set
the
contributions
for
the
2023
fiscal
year,
so
there
is
a
delay
between
the
valuation
date
and
when
the
contributions
change
and
we
go
through
the
process
by
first
projecting
out
what
benefits
we
expect
to
be
paid
in
the
future.
I
I
I
The
other
thing
to
note
here
is
that
about
70
of
the
liability
is
for
members
who
are
currently
receiving
benefits,
and
only
about
30
or
less
than
30
percent
is
for
people
currently
working
for
the
city.
I
The
teal
line
represents
the
smooth
actuarial
value
of
assets,
and
the
green
line
represents
the
market
value.
So
you
can
see
that
the
market
value
started
out
below
the
actuarial
value
in
2020
and
then
the
exceptional
returns
we
had
this
year.
I
increased
it
substantially,
but
the
actuarial
value
goes
up
more
slowly
and
stephen
will
go
through
that
calculation.
A
little
bit
later
in
our
presentation
we're
showing
the
funded
status
for
the
system
at
the
top
increasing
from
52
to
55.
I
That's
based
on
the
actuarial
value
of
assets
on
the
market
value
we're
about
62
percent
funded
the
chart
on
the
right
breaks.
The
numbers
out
between
tier
one
and
tier
two
ava
stands
for
the
actuarial
value
of
assets
and
mba
the
market
value.
So
I
you
can
read
both
of
those
numbers
based
on
the
actuarial
value,
there's
still
about
a
two
billion
dollar
unfunded
liability
in
tier
one.
It's
1.7
billion
based
on
the
market
value
in
tier
2.
I
This
chart
shows
the
contributions
both
as
rates
as
a
percentage
of
payroll
on
the
left
and
amounts
on
the
right.
We
break
the
contributions
into
some
different
components,
so
the
light
purple
is
the
member
contribution,
and
this
combines
tier
one
and
tier
two
and
then
the
dark
purple
is
the
city's
normal
cost.
I
So
the
normal
cost
is
the
cost
of
benefits
attributed
to
the
next
year
of
service,
and
so
those
are
the
benefits
that
are
being
earned
today
by
active
members,
and
the
total
normal
cost
is
the
combination
of
the
the
two
purple
bars
and
you
can
see
it
has
declined
slightly
as
a
percent
of
pay
increased
a
little
bit
as
a
dollar
amount,
it's
declining
as
a
percent
of
pay,
as
we
shift
from
tier
one
to
tier
two
members
in
the
active
population,
because
tier
two
members
have
a
lower
normal
cost.
I
I
In
principle,
we
calculate
the
interest
based
on
the
unfunded
liability
using
the
market
value
of
assets,
so
the
interest
on
the
ual
dropped
significantly
this
year
with
the
exceptional
investment
returns
that
allows
more
of
the
contribution
to
go
towards
paying
off
the
principal
as
a
rate,
the
city's
contribution
rate
has
dropped
a
little
over
two
percent
pay,
but
as
a
dollar
amount,
it's
going
up
about
two
million
dollars,
and
this
is
a
little
higher
than
what
we
showed
in
our
earlier
projections.
I
We
did
have
some
actuarial
losses
in
the
demographic
experience
that
we'll
go
through
shortly.
So
with
that,
I'm
going
to
turn
it
to
stephen
to
take
the
next
section.
J
Good
morning,
everyone
so
on
slide.
Six,
we
show
a
history
of
membership
counts
and
you
can
see
the
green
at
the
top.
Is
members
in
pay
so
currently
receiving
benefits?
There
are
deferred
members,
so
members
that
no
longer
work
for
the
city,
but
are
due
a
benefit
later
and
will
commence
at
some
point.
J
And
then
there
are
two
shades
of
blue
for
active
members,
with
the
light
blue
being
the
tier
two
actives
that
that
come
in
on
you
know
later
in
the
in
the
progression
here,
but
that
one
thing
to
note
well
before
I
go
there,
there's
also
a
red,
a
red
line,
the
support
ratio
and
what
what
that
is.
J
Is
that
the
number
of
inactive
members,
the
ratio
of
inactive
members
to
active
members
and
what
you
can
see
is
that
really
jumped
around
the
time
of
the
great
recession
and
what
caused
that
was
a
large
reduction
in
active
membership,
which
you
can
see
in
the
blue
at
the
bottom
and
in
addition,
tier
two
came
in
and
shortly
after
that
time
and
and
you
can
see
that
the
light
blue,
how
the
tier
two
membership
has
grown,
but
that
the
total
active
membership
level
is
not
quite
back
to
where
it
was
at
the
you
know
the
start
of
the
great
recession,
and
so
so,
if
we
look
at
the
far
right
2021
the
total
total
membership,
as
folks
have
retired
and
new
employees
have
come
on.
J
A
total
membership
is
right.
Around
10
000
with
you
know,
4
500
of
that
being
in
pay,
1,
600
being
being
deferred,
and
then
the
the
rest
being
active
with
roughly
60
of
those
are
actives
are
tier.
Two
now
we'll
see
later
with
with
jackie's,
slides
that
the
liabilities
don't
look.
J
The
liabilities
are
very
different
for
those
two
groups,
but
now
there
are
roughly
60
of
the
active
population
is
under
tier
two,
and
this
support
ratio
again
has
gone
up
over
the
years
as
more
folks
have
retired.
But
it
has
stabilized
since
since
leaping
up
around
the
great
recession.
F
If
I
might
add
a
point,
is
that
okay,
sure,
okay
and
looking
at
this,
it
just
occurred
to
me
that
I
mean
so
we're
counting
the
people
that
are
actually
paying
into
the
system.
Is
that
correct
those
for
the
actives.
J
F
Okay,
because
we
have,
in
the
city
a
large
vacancy
right
right,
so
these
are
positions
that
are
budgeted
and
there
is
a
budget,
but
we
don't
have
people
in
those
positions
so
thus
they're
not
paying
into
the
system
right
right,
and
so,
if
those,
if,
if
the
city
were
able
to
get
to
a
two
percent
vacancy
rate,
which
is
kind
of
what
they
budget,
we
might
see
the
support
ratio
get
better
or
become
less.
A
F
And
it
just
might
be
an
interesting
thing.
You
know
it's
just
interesting
to
keep
in
mind.
It
truly
is
based
on
the
ability
to
hire,
which
has
been
kind
of
a
challenge
that
our
sponsor
has
had
for
quite
some
time.
J
J
So,
moving
on
to
slide
seven,
we
thought
we
would
run
through
a
bit
of
the
actuarial
the
development
of
the
factorial
value
of
assets
this
year
and
on
on
the
left
side,
we're
showing
that
the
pieces
that
sort
of
the
underlying
mechanics
of
how
the
smoothing
process
works
and
what
we
show
on
on
the
right
side
is
the
actual
return
on
assets
versus
the
expected
return
on
assets.
So
the
the
expected
return
is
based
on
you
know.
J
The
plans
assumed
rate
of
return
is
also
used
for
discounting
future
benefit
payments,
and
that
is
currently
6.625
percent,
and
you
can
see
in
the
in
the
blue.
The
blue
bars
are
the
expected
return.
So
that's
that's
based
on
again
that
expected
return
and
you
can
see
those
are
fairly
stable.
You
know
130
million
250
million
and
what
fluctuates
is
the
actual
return
on
assets,
the
the
green
bars
and
and
those
you
know,
the
returns
come
in
either
higher
or
lower,
but
what
you
can
see
is
is
dominating
this.
J
This
chart
here
is
the
699
million
actual
return
for
fiscal
year,
ending
2021.,
so
that-
and
you
know
the
scale's
from
zero
here,
but
it
really
stands
out.
So
that's
you
know.
Obviously
exceptional
returns
as
as
bill
mentioned,
and
what
that
does
is
it
creates
a
large
defer,
large
deferred
gains
and
we
can
sort.
J
So
that's
your
your
gain
or
loss,
and
then
a
portion
of
that
is
recognized
each
year,
so
so
20
each
year
with
the
five
year
smoothing.
So
if
we
look
at
2017,
the
entire
15
million,
which
was
a
gain,
has
been
recognized
and
then
2018
80
of
that
23
million
dollar
loss
has
been
recognized,
2019,
the
60
of
the
68
million
loss
and
so
on.
J
You
know
80
in
2020
and
then
2021
there's
a
very
large
deferred
gain,
because
only
20
of
that
gain
has
that
you
know
the
difference
between
the
699
and
the
151
has
been
recognized
so
only
20
and
on
the
next
slide
we
show
some
some
numbers,
but
that's
graphically
what's
happening
so
so
here
on
the
left
side,
we're
showing
that
the
numbers
behind
that-
and
I
guess
what
I'd
like
to
focus
on
is
you
know
at
the
top.
J
We
show
the
market
value
for
both
tier
one
and
tier
two
and
then
in
total,
and
you
know
the
the
rows
there
show
that
the
different
pieces
and
the
amount
that's
deferred.
J
Obviously
the
at
the
top
the
fiscal
year
end
2021,
those
are
the
large
items,
so
518
million
loss,
eighty
percent
deferred
415
million
on
tier
one,
22.9
million
deferred
on
tier
two
and
and
so
on
on
down.
If
we
look
at
the
bottom
two
rows
there,
the
total
of
the
deferred
amounts
is
the
total
is
350
million
on
tier
1
and
20
million
on
tier
2..
So
the
difference
between
the
top
right,
your
market
value
of
assets,
as
as
of
the
valuation
date
and
in
the
bottom
right.
J
J
You
can
see
that
the
smooth
value
is
shown
in
green.
The
market
value
fluctuates
a
lot
more
market
value
is
shown
in
blue,
and
you
know
this
is
a
good
illustration
of
the
the
smoothing
mechanism
doing
its
job
right.
So
there's
a
smoother
curve
there,
which
you
know
the
purpose,
is
to
have
more.
You
know
more
predictable
and
smoother
contributions,
but
you
see
there's
quite
a
jump
there
and
we
have
zoomed
in
a
bit.
J
So
you
know
this
exaggerates
to
jump
a
little
bit
right
because
we're
starting
the
scale
at
1
billion,
but
but
there
is
again
370
million
that
is
going
to
flow
into
the
actuarial
value
of
assets
over
the
next.
You
know
four
more
years
so
so
so
even
you
know
you
would
expect
asset
gains,
even
if
the
return
was
exactly
met
right
on
the
actuarial
value.
J
F
Just
want
to
add
a
point,
I
think
that's
a
good
chart.
I
like
that
chart,
so
it
kind
of
capsulates.
The
piece
just
wanted
to
say.
J
Okay,
thank
you
so
now
that
we've
covered
the
assets,
we're
also
going
to
look
at
the
liabilities
and
on
on
the
left
side
we're
looking
at
the
unfunded
actuarial
liabilities.
So
that's
that's
the
gap
between
the
assets
and
the
liabilities,
and
this
this
is
on
a
an
actuarial
basis.
J
So
and
again
we
we've
zoomed
in
on
the
scale
here
right,
because
these
these
items
are
pretty
small
compared
to
the
the
total
liability
and
even
the
unfunded
actual
reliability.
J
But
we
do
want
to
show
you
know
what
what
took
place
during
the
year
so
that
the
the
unfunded
reliability
started
out
at
2.1
billion
the
prior
year
and
then
we're
showing
the
components
here,
the
first
being
in
red
contributions,
so
that
that
is
contributions
in
excess
of
the
what
we
call
the
the
tread
water
amount
which,
which
is
basically
your
normal
cost
of
the
benefits
accruing
during
the
year
and
the
interest
on
your
unfunded.
J
The
second
item
is
the
largest:
that's
investment
gains
and
again
this
is
on
an
actuarial
basis.
So
so
there's
76
million
there
in
investment
gains
decreasing
the
unfunded.
J
After
that
there
is
a
20
million
or
28
million
dollar
increase
due
to
liability
experience.
That
includes,
you
know
several
components:
retirement
mortality.
You
know
different
pieces
that
we'll
look
at
on
the
next
chart,
but
there
was
also
an
assumption
change
in
of
10
million
and
you
might
be
thinking
well
hold
on.
We
didn't
change
any
assumptions,
but
there
is
a
policy
to
use
the
the
latest.
J
The
latest
mortality
projection
scale
from
the
society
of
actuaries,
so
that
gets
released
each
year
and
and
this
year
it
actually
resulted
in
a
small
increase
in
liability
so
about
10
million
there,
whereas
in
most
well
in
prior
years,
that's
typically
been
a
small
reduction,
because
the
initial
the
initial
mp
scale
was
a
bit
conservative.
It
turns
out,
but
10
million
is
you
know
not
not
a
large
increase
in
liability
relative
to
the
plan
for
the
new
scale.
C
So
stephen,
that
kind
of
surprises
me
that
mortality
rates
would
have
decreased.
Given
the
health
issues
to
face
the
nation
in
the
world
this
year.
J
Yes,
that
that
is
an
insightful
comment.
Now
there
is
a
lag
so
so
next
year,
when
mp
2022
comes
out,
we
might
see
some
some
some
difference
there
because
of
the
code
side.
I
don't
think
the
covid
would
yet
be
having
an
impact
in
in
the
data.
So.
I
Yeah,
so
the
the
mp
the
projection
scale
model
is
based
on
actual
mortality,
improvements
up
to
a
certain
point
and
their
latest
data
is
2019
data,
so
it
doesn't
yet
reflect
the
impact
of
covid.
I
They
did
comment
that
they
don't
know
how
they
are
going
to
reflect
covid
when
they
issue
the
scale
next
year,
because
the
question
is:
do
we
think
that
is
a
long-term
impact
on
mortality
or
a
short-term
impact?
And
so
how
should
that
affect
our
projection
scale?
I
J
So
so
the
sum
of
these
pieces
overall
is
a
reduction
in
the
ual,
from
2.1
billion
to
2.047
and
again
part
of
that
was
liability,
changes
in
liability
and
so
on
on
the
right
side,
we're
showing
liability
gains
and
losses,
and
that
this
is
over.
This
is
we're
showing
five
years
and
you'll
see
the
line
shows
the
aggregate
impact
each
year
with
there's
the
center
line
being
zero.
So
anything
above
zero
is
increasing
liability
and
anything
below
zero.
J
J
Termination
has
increased
in
in
most
years,
so
that
would
be
yeah
so
that
that's
you
know
the
rate
of
people
leaving
being
different
than
expected
and
then
more
mortality
is
has
sort
of
gone,
both
directions
that
that's
the
actual
experience
and
we'll
talk
a
little
bit
about
the
most
recent
here's
mortality
experience
in
a
couple
slides
and
then
disability
is
sort
of
pretty
pretty
negligible
hard
to
see
there.
But
that's
in
in
dark,
blue,
so
and
and
other
you
might
notice,
there's
a
fairly
large
other
in
2019.
J
That
was
a
one-time
data
cleanup
project
that
the
main
item
that
reduced
liability
was
cleaning
up.
Some
of
the
the
data
in
terms
of
retirees
currently
in
pay,
whether
their
spouses
were
deceased
or
not.
So
if
someone's
currently
in
pay
and
their
spouse
is
actually
deceased,
then
you
you,
you
can
treat
them
as
a
single
life
annuity,
rather
than
a
joint
survivor
annuities
of
that
so
cleaning
that
up
reduce
there's
a
significant
reduction
in
liability
from
that.
F
How
does
office
of
retirement
services
receive
this
information?
You
know
if
a
spouse
were
to
die.
I
mean:
is
that
the
responsibility
of
the
retiree,
I'm
just.
E
Curious,
yes,
it
is
the
responsibility
of
the
of
the
retiree,
although
that
does
not
mean
that
we
do
our
own
checkup.
We
do
have
a
vendor
that,
through
social
security
information
provide
us
information.
If
I'm
mistaken
here
barbara,
please
correct
me
whether
it's
monthly
or
quarterly,
so
we
do
have
some
ability
to
sort
of
check
on
that,
but
it
is
ultimately
yeah
the
the
responsibility
of
the
retiree
to
let
us
know
that
the
person
has
passed
away.
E
I
just
wanted
to
also
mention
two
things
number
one:
the
cleanup.
You
may
recall
that
we
were
the
implementation
of
the
new
administrator
system
and
that
require
a
lot
of
data
cleanup,
so
I'm
not
suggesting
that
that's
related
to
that,
but
I
will
assume
that
part
of
it
related
to
that
cleanup.
And
lastly,
I
don't
want
to
confuse
the
shirt
on
the
left
with
the
shirt
on
the
right,
because
you
know
your
liability
can
be
going
up,
but
your
funding
can
be
going
down.
E
So
if
you
look
at
it
initially,
you
could
be
looking
at
it
like.
Why
is
the
liability
going
up
on
the
right
when
the
fund
the
liability
is
going
down?
But
that's
because
you
know
your
assets
went
up
too,
so
your
unfunded
liability
can
be
can
be
decreasing,
even
if
your
total
liability
is
actually
increasing.
Does
that
make
sense
bill.
I
Yeah,
the
the
chart
on
the
right
is
just
zooming
in
on
this
liability.
I
E
And-
and
so
I
guess
we
do
just
that
because
as
they
want
to
have
the
different
impact
right,
investment
gains,
it's
very
straightforward:
either
you
meet,
you
assume
great
return.
You
do
not
and
there's
some
change.
Obviously
it
was
explained
which
have
to
do
with
the
table.
So
the
only
one
that
really
has
the
different
variables
is
the
liability
experience,
which
is
why
you're
showing
that,
on
the
right-hand
side.
I
Right
and
that
really
drives,
or
it's
an
indication
of
how
well
we're
doing
with
our
assumptions
and
what
we
might
need
to
change
in
the
future.
I
You
know
stephen
mentioned
how
salaries
have
been
higher,
but
then
they
were
lower
in
18,
higher
and
17..
What
we
we
don't
expect
to
be
right
every
single
year.
What
we
want
to
see
is
kind
of
a
balanced
pattern,
and
then,
when
we
do
an
experience
study,
which
I
think
is
two
years
away,
then
we
revisit
these
assumptions
and
adjust,
and
so
this
just
gives
you
kind
of
an
early
indication
of
what
we
might
be
looking
at
with
the
next
experience.
I
Okay,
so
because
of
the
pandemic,
we
get
a
lot
of
questions
about
mortality,
and
so
we
thought
we
would
look
at
sort
of
what's
happened
in
the
us
and
then
look
at
what
happened
in
the
federated
plan
specifically
this
year.
I
So
on.
The
left
here
is
an
analysis
done
by
the
society
of
actuaries
on
data
in
2020,
looking
at
mortality
rates
and
how
they
changed
during
the
pandemic,
and
so
the
red
area
shows
the
increase
in
deaths
due
to
coving.
I
Now
the
younger
groups
there's
a
lot
fewer
deaths,
so
an
increase
in
rates
still
doesn't
produce
the
same
increase
in
the
number
of
deaths,
but
it
was
interesting
to
see
this
and
that
when
you
combine
the
covid
excess
covades
and
the
excess
non-coded
does
the
group
that
was
most
affected
was
the
35
to
64
year
old
group.
I
So
the
society
didn't
delve
into
what's
driving
these
excess
non-coded
deaths,
but
there
was
a
presentation
in
an
actuarial
meeting
that
referenced
a
study
that
was
published
in
the
journal
of
the
american
medical
association,
and
so
I
pulled
up
that
study
just
to
get
a
sense
of
what's
going
on
and
and
keep
in
mind.
Both
of
these
are
only
looking
at
2020,
not
2021,
so
the
story
is
a
little
incomplete
here,
but
we
saw
increases
in
deaths
for
a
variety
of
causes.
I
Heart
disease
is
one
of
the
largest,
so
largest
causes
of
death,
so
5.6
increase.
That
is
a
a
lot
of
people,
the
others
we
saw
increases
in
sort
of
chronic
conditions,
except
for
lower
respiratory.
I
So
I
think,
that's
probably
a
significant
portion
of
that,
but
I
think
it's
too
early
to
draw
too
many
conclusions
from
this
data,
but
I
thought
it
was
interesting
both
that
were
experiencing
a
lot
of
non-coded
deaths
and
then
what
those
those
may
be
when
the
society
of
x-rays
published
the
the
new
2021
mortality
improvement
scale,
they
provided
this
table
showing
weekly
access
tests
in
2021,
which
clearly
follows
the
pattern
and
the
pandemic,
where
we
had
very
high
rates
of
coven
in
the
winter
last
year
in
spring
and
those
came
down
and
then
returned
again,
this
fall.
I
So
here
we're
showing
the
black
squares
represent
the
expected
number
of
deaths
for
each
of
these
populations.
Active
employees,
retirees,
disabled
retirees
and
beneficiaries
and
the
gold
diamond
represents
the
actual
number
and
then
the
gray
bar
is
our
90
confidence
interval,
and
so
it
would
only
be
if
actual
deaths
were
outside
that
gray
bar
that
we
could
conclude
conclusively
that
there
was
an
effect
during
the
year.
But
in
fact
the
actual
number
of
deaths
almost
hit
exactly
as
expected
for
the
federated
system.
I
So
there
could
have
been
a
covet
effect,
but
we're
really
not
seeing
a
covet
effect
in
the
data
for
the
federated
system.
I
Which,
which
is
good
but.
I
Well
for
larger
populations,
we
tend
to
be
more
spot
on
when
I've
looked
at
it
for
smaller
plans.
It
varies
a
lot,
but
this
was
really
spot
on.
I
And
I
I
would
say
for
most
of
the
plans
I've
seen
on
the
west
coast
so
far,
we're
not
seeing
a
dramatic
impact
from
covid
some
of
the
plans
that
I
don't
work
on
many
plans
on
the
east
coast,
although
I
did
one
in
the
one
large
one
in
new
york
state
where
we
didn't
on
it,
but
it
only
covered
2020
and
not
2021,
and
so
there
was
not
a
large
impact
there.
I
H
H
So
this
is
historical,
so
each
bar
each
color
of
the
bar
represents
a
different
portion
of
it
and
the
line
represents
the
net
change,
so
the
actual
change
to
the
ual
for
that
year.
H
So,
if
you
look
at
it,
what's
pretty
significant
is
out
of
the
last
10
years
nine
of
them,
you
saw
an
increase
in
your
unfunded,
actual
liability,
but
with
the
great
investments
over
the
last
year.
Finally,
in
2021
you
saw
a
decrease
in
that
it's
finally
below
zero.
H
If
you
look
at
that
negative
53.3
million
so
also
looking
at
the
different
chunks
of
it,
the
biggest
portion-
that's
added
to
your
ual
over
the
last
10
years,
has
been
assumption,
changes
so
discount
rate
changes
that
that's
been
a
big
driving
force
of
it,
lowering
your
discount
rate.
So
in
total
over
the
last
10
years,
you
can
see
that
the
assumption
changes
have
added
500,
501
million
dollars
to
the
ual.
So
that's
almost
half
of
the
total
increase
of
1.1
billion
dollars.
H
The
next
biggest
driver
is
your
investment
gains
and
losses
so
investments
they
have
accounted
for
about
416
million
of
that
increase.
So
you
can
see
those
are
your
two
big
driving
factors
in
that
are
affecting
your
url
from
each
year
to
each
year,
but
the
great
returns
over
last
year.
H
So
there's
no
questions
on
that,
we'll
move
to
looking
at
tier
one
versus
tier
two.
So
if
you
remember
tier
two
got
added
in
2012
implants,
so
it's
been
around
for
about
nine
years
now,
and
so
your
tier
two
population
in
the
plan
there's
a
couple
people
that
have
been
hired
since
there
and
it's
actually
quite
a
big
population
of
your
plan.
Now.
So,
if
you
look
the
green
parts
of
these
two
pie,
charts
those
are
attributable
to
tier
two.
Those
are
your
actives
and
your
vista
terms.
H
You've
got
one
retiree
right
now
in
tier
two
and
then
the
blue
parts
are
for
tier
one,
so
you
can
see
as
far
as
counts
go
tier
two
accounts
for
about
a
third
of
your
population
now,
but
regarding
pop
payroll
they're,
actually,
almost
two-thirds
they're
they're
accounting
for
58
of
the
total
payroll
for
active
member
population.
H
But
in
the
next
chart
you
can
see
how
what
portion
of
the
liabilities
and
assets
are
attributable
to
tier
two,
and
you
can
see
that
it
takes
a
much
longer
time
to
build
up
the
liabilities
and
the
assets
for
that
group.
So
even
though
they're
a
big
portion
of
your
total
population
at
your
active
population,
you
have
to
remember
that
in
tier
one
you
still
have
all
your
inactive
population
so
for
tier
two
they're,
only
accounting
for
about
three
percent
of
the
total
liability
right
now
and
only
six
percent
of
the
assets.
H
The
next
slide
we
look
at
the
contributions
and
the
breakdown
of
them
between
the
two
tiers,
so
you
can
see
that
your
tier
one
contributions
are
far
higher
than
your
tier
2
contributions
right
now
and
the
biggest
part
of
the
tier
one
contribution
is
that
a
ual
that
the
city
is
paying
down,
so
you
can
see
that
still
accounts
for
about
over
162
million
dollars
right
now,
but
as
far
as
tier
two
goes,
which
of
those
two
smaller
bars,
you
can
see
that
the
ual
payment
is
very
very
that
city
ual
payment
is
very
small,
and
the
majority
of
those
tier
two
payments
are
coming
from
your
normal
cost
contributions.
H
This
shows
the
five-year
contribution
projections
of
the
plan.
You
can
see
that
it's
actually
a
very
good
outlook
over
the
next
five
years,
you're
expecting
your
aggregate
city
contributions
to
decrease,
as
well
as
the
aggregate
contribution
rate.
So
this
is
this
is
pretty
significant.
It's
really
attributable
to
those
great
investment
returns
that
have
paid
off
a
whole
bunch
of
the
ual
excuse
the
noise
in
the
background,
or
if
he's
law,
it's
always
going
to
happen.
H
So
I
just
wanted
to
point
out.
You
know
in
comparison
to
last
year's
projections.
You
know
when
we
showed
this
to
you.
Last
year
in
2026
we
had
expected
the
contract,
the
aggregate
city
contribution
to
be
over
230
million
dollars
and
close
to
59
percent
contribution
rate,
and
it's
gone
all
the
way
down
to
48.66.
H
So
it's
a
great
change
in
the
in
the
projected
contribution
rates.
So
the
only
thing
that
could
really
have
a
huge
impact
now
is
any
significant
losses
from
liabilities
or
investments.
I
Yeah,
so
are
there
any
questions?
We
will
be
coming
back
next
month
and
show
some
sensitivity
in
different
scenarios
for
contributions
going
forward
so
that
you
can
get
a
sense
of
those
risks.
I
B
E
Mr
chair,
I
think,
may
be
helpful
if
the
boar
actually
take
action
on
approving
the
evaluation
results
for
the
june
30th
20.
E
I
E
C
C
I
I
I
So
the
opeb
plan
is
mostly
a
closed
plan.
Technically,
it's
not
closed
because
members,
all
members
can
get
benefits
if
they
qualify
for
a
catastrophic
disability,
but
only
the
tier
one
members
who
did
not
elect
to
join
the
viba
can
get
the
full
health
care,
retiree,
health
care
benefits,
and
so
it's
mostly
closed
to
those
members
and
those
members
pay
a
fixed
contribution
of
seven
and
a
half
percent
of
pay.
I
I
City
contributions
are
set
by
the
board,
and
so
that's
the
piece
that
that
we
will
be
adjusting
in
the
valuation.
But
there
is
a
slight
twist
to
it
here
in
that
the
city
has
the
option
to
cap
their
contributions.
At
14
of
pay,
that
has
not
been
an
issue.
The
contributions
are
well
below
14
of
pay,
but
there
is
that
cap
going
forward
again.
We
use
this
valuation
to
set
the
city's
contribution
for
the
2023
fiscal
year.
I
F
Bill,
I
have
a
question
sure
the
city
can
cap
contributions
of
14
of
pay.
If
it
was,
you
know,
15
or
16,
and
the
members
contributions
are
fixed
at
7.5,
then
what
happens.
I
I
Does
it
may
be
that
the
difference
between
14
and
15
is
not
a
big
deal,
but
if
it
if
it
grows
over
time,
that
could
be
an
issue
we
aren't
projecting
it
to
be
an
issue
at
all
for
this
plan.
I
Now,
with
the
opeb
plan,
it
also
gets
confusing
because
there
are
two
separate
subsidies
going
on
here.
There's
the
explicit
subsidy,
which
we
pre-fund
or
the
city
pre-funds
and
is
in
the
115
trust
through
the
115
trust,
and
that's
really
what
we
are
focused
on
in
terms
of
setting
the
contributions
to
fund
that
explicit
subsidy,
that
the
explicit
subsidy
is
based
on
the
premium
for
health
coverage
that
a
retiree
selects
up
to
100
of
the
premium
for
the
lowest
cost
plan
offered
to
active
employees.
I
So
it's
really
based
on
the
the
lowest
cost
plan
offered
to
active
employees
and
and
that's
the
subsidy,
that's
provided
to
retirees
that
we
are
focusing
on
funding.
Now.
The
implicit
subsidy
is
funded
on
a
pay-as-you-go
basis
and
the
implicit
subsidy
is
the
difference
between
what
we
expect
for
retiree
claims
costs
and
what
the
premiums
are,
and
so
health
care
costs
vary
by
age
and
the
premiums
are
set
uniformly
across
for
pre-medicare
retirees
across
actives
and
pre-medicare
retirees.
I
So
it's
you
can
think
of
that.
Premium
is
kind
of
representing
the
average
claims
cuts,
but
for
the
retiree
group
that
claims
cost
would
be
higher
than
the
average
because
they
tend
to
be
older
than
average
when
you
include
the
actives,
so
the
city
effectively
pays
for
that
subsidy
as
a
part
of
the
premiums.
I
So
we
develop
an
expected
claims
costs
using
combined
data
for
federated
police
and
fire.
We
disclose
the
value
of
that
implicit
subsidy
in
the
funding
valuation
and
in
the
financial
reporting
valuation.
It's
a
critical
part
of
all
of
the
the
financial
reporting,
but
because
we're
not
trying
to
pre-fund
it.
The
funding
valuation
mainly
just
focuses
on
the
explicit
subsidy
piece.
I
I
The
members
are
contributing
about
nine
million
and
that
actually
is
covering
more
than
the
total
normal
cost.
The
total
normal
cost
is
around
6
million,
and
so
members
are
helping
to
pay
part
of
the
unfunded
liability
with
their
contributions.
I
So
again,
most
of
the
liability
is
for
current
retirees
and
because
the
plan
is
primarily
closed,
we
would
expect
that
to
that
proportion
to
increase
over
time
as
people
retire,
we
just
use
a
market
value
of
assets
for
this
plan.
We
don't
use
any
actuarial
value
and
instead
we
have
built
in
a
smoothing
mechanism
in
the
amortization
method
and
that's
partly
because
for
an
oped
plan
in
addition
to
the
assets
being
volatile,
the
liabilities
are
somewhat
vulnerable.
I
I
But
as
of
2020,
we
were
54
funded
for
the
opeb,
which
is
about
the
same
as
we
were
for
the
pension
and
that's
that's
pretty
unusual.
I
F
One
more
question
bill,
sorry
sure,
when
you're
talking
about
member
contributions,
are
you
talking
about
active
members
or
in
pay
members?
I
mean
good
question
good.
I
C
I
I
These
were
the
projections
from
the
2020
valuation,
so
you
can
see
we
were
expected
to
get
to
a
hundred
percent
in
2038.
I
I
expect
with
the
investment
returns.
This
will
have
changed.
I
On
the
bottom
chart
you
can
see
we
had
from
2012
through
2018
before
the
viva
was
set
up.
We
had
substantial
contributions
both
from
employees
in
the
city
that
were
increasing
and
and
with
the
changes,
the
contributions
dropped,
the
liabilities
dropped
and
we're
looking
at
fairly
level
projection
of
contributions
for
the
city,
increasing
from
about
20
million
to
23
million
until
they
reach
full
funding
and
because
it's
closed,
the
member
contributions
are
are
declining.
It's
the
same
percentage
of
payroll
but
expected
to
decline.
I
In
the
background
here,
the
the
gray
is
the
expected
subsidy
payments
for
retirees.
I
So
we
are
expecting
those
to
grow
over
time,
and
you
can
even
see
here
that
the
is
expected
to
peak
in
around
10
years
and
then
start
gradually
declining
over
time
and
that's
again
because
the
system
is
closed.
I
Yeah
on
the
liability
side,
the
key
driver
of
the
liability
and
fluctuations
in
the
lab
entity
are
health
care
costs
and
especially
the
premium
for
the
lowest
cost
health
plan.
That's
offered
to
active
employees,
and
so
this
shows
that
the
history
of
that
that
premium,
depending
on
the
type
of
coverage
elected
and
then
that
increase
now
we
have
built
in
an
assumption
about
increases
into
the
valuation.
I
But
you
can
see
how
volatile
that
has
been
over
time
and
this
year
we're
actually
seeing
about
a
point.
Eight
percent
decrease
for
the
single
member
coverage
and
and
that's
partly
because
the
lowest
cost
health
plan
for
single
coverage
is
changing
from
the
kaiser
three
thousand
dollar
deductible
plan
to
the
anthem,
fifteen
hundred
dollar
deductible
plan.
I
But
it's
remaining
the
kaiser
plan
if
any
dependents
are
covered.
So
it's
only
for
single
coverage
that
it
it
changed
plans.
So,
for
most
of
the
other
plans,
it's
about
a
0.5
percent
decrease
in
the
explicit
subsidy,
the
maximum,
explicit
subsidy.
I
We
had
assumed
that
that
would
increase
about
8.
So
that's
a
significant
gain
that
we
will
expect
to
realize
in
this
valuation.
On
the
liability
side,
all
the
pre-medicare
plans
are
affected
by
that
directly
the
medicare
eligible
plans.
The
premiums
are
below
the
maximum
subsidy,
so
the
system
here
is
affected
by
those
actual
increases
and
medicare
eligible
plan.
Premiums
decreased
between
0.5
and
3.1.
I
So
with
that
background,
I
wanted
to
look
at
the
assumptions
and
just
give
you
a
quick
summary.
I
think
the
most
significant
one
for
us
to
look
at
is
really
the
discount
rate
this
year
and
we're
suggesting
that
the
current
assumption
of
six
and
a
quarter
is
still
reasonable,
but
it's
at
the
high
end
of
our
range,
and
so
you
may
want
to
consider
a
reduction
healthcare
trend
rates,
we're
not
making
any
substantial
changes.
I
Just
update,
near-term
trends
to
reflect
what's
going
on
in
the
market,
no
changes
to
dependent
coverage
elections
so
that
slides
actually
in
the
appendix
we're
not
even
going
to
go
through
it.
Unless
you
have
questions
the
health
or
dental
plan
elections,
there
is
a
new
health
plan,
so
we
are
making
just
a
minor
change
to
accommodate
that
in
lieu
elections,
there's
some
minor
adjustments
and
then
the
administrative
expenses
there's
a
change.
C
I
It's
a
separate
trust
and
it's
smaller
and
doesn't
have
as
many
private
asset
classes,
and
so
the
expected
returns
are
different
and
they
are
lower,
and
so
we
compared
makita's
10
and
20-year
assumptions
to
the
horizons
survey
of
the
average
capital
market
assumptions
in
the
horizon
survey
they're
very
consistent.
I
We're
showing
the
range
of
the
gray
bar
is
the
range
from
makita's
10-year
to
20-year
expected
return
on
the
assets
and
the
gold
diamond
is
the
discount
rate
that
we
used
for
that
year,
and
so
you
can
see
just
like
we
had
on
pension
2019
was
an
outlier,
because
when
makita
sets
their
assumptions
in
december
december
of
2018,
the
stock
market
had
dropped
significantly
and
interest
rates
had
spiked,
and
so
everyone's
capital
market
assumptions
based
on
those
market
conditions
changed.
I
The
current
assumptions
range
from
5.3
to
6.3,
so
6
and
a
quarter
is
just
inside
the
20-year
expectation
about
40
of
the
present
value
of
our
benefits
is
paid
over
the
next
10
years
and
70
over
20..
I
So
we
typically
would
like
to
see
this
closer
to
the
the
middle
of
the
range,
and
so
the
current
rate
still
is
within
that
range.
But
it's
at
the
very
high
end,
and
so
we
think
you
should
consider
a
drop.
We
don't
like
to
move
the
discount
rate
by
a
huge
step
at
any
one
time,
and
so
you
may
want
to
just
consider
a
reduction
to
6
percent,
but
the
data
would
also
support
going
lower.
K
Rates
right
and
so
from
the
liability
point
of
view,
in
addition
to
the
premium
changes,
the
trend
really
is
the
other
big
drivers
to
what
the
expected
liability
is
and
what
we
use
to
do.
That
is
something
called
the
gets
model
by
society
actuaries
and
it
really
focuses
on
your
initial
trends-
are
what
your
short
term
expectations
are
over
the
next
four
or
five
years.
K
The
short
term
last
year
is
around
six
percent
grading
down
we're
bringing
it
down
to
four,
and
it's
really
we've
been
seeing
some
changes
and
what
medicare
is
doing
on
the
medicare
advantage
side.
That's
really
keeping
those
premiums
a
lot
lower
than
they
have
been
historically
and
that's
expected
to
continue
and,
and
then
the
non-medicare
eligible
is
a
little
bit
less
than
last
year.
K
So
we
really
think
it's
a
really
short-term
thing
that
it's
going
to
bounce
back,
so
we
don't
want
to
overestimate
the
impact
of
that
and
then
the
trend
for
dental
remains
unchanged,
and
you
can
really
see
it's
really.
The
variations
are
in
the
short
term
for
the
first,
you
know
four
or
five
years,
it's
slightly
higher
for
the
medicare
eligible
that
it's
really
the
same
after
that
and
for
the
non
medicare
eligible.
It's
actually
slightly
lower,
and
so,
since
more
of
the
experience
for
a
member
is
going
to
be
in
their
medicare
eligible
years.
K
K
We're
recommending
that
we
just
keep
everything
unchanged
from
what
we
did
last
year,
with
one
exception
is
that
they
did
add
a
new
anthem,
hmo,
it's
the
anthem,
traditional
20
copay,
the
difference
between
that
and
the
one
above
it
benefit-wise
they're.
The
same
is
the
select
has
a
much
smaller
provider
network
than
traditional
does,
and
so
we're
gonna
estimate
that
some
people
will
join
that
plan.
So
we
did
one
percent.
K
Is
the
inlu
x
elections-
and
this
is
one
where
you
know-
measure
added
the
ability,
that's
retiring
wave
coverage
and
they
get
a
credit
equal
to
25
of
the
explicit
subsidy
for
the
tier
that
they
qualified
for
that
they
can.
Then,
when
they
come
back
in
the
plan,
they
can
actually
use
that
to
help
pay
down
their
premium,
that
they're
paying
over
above
the
low
cost
plan,
and
since
this
is
a
new
addition,
the
experience
is
really
limited.
K
K
The
blue
box
shows
what
the
actual
observed
rate
was
the
gray
box
around.
It
is
our
90
confidence
interval
and
then
the
line
shows
what
our
historic
assumptions
have
been
and
what
we're
proposing
is
that,
historically,
we've
kept
it
at
20.
You
can
see
it's
really
varying
right
around
that
20
mark
so
for
the
actives
we're
just
recommending
that
that
just
remain
unchanged.
K
The
big
variation
we
see
is
in
the
vested
term
members
in
that
again
the
same
type
of
chart,
but
it
varies
all
over
the
board.
Part
of
it
to
remember
is
this
is
a
really
small
number
of
people
so
for
each
year,
you're
only
talking
adding
another
10
or
15
people.
So
it's
not
a
huge
number,
which
is
probably
one
of
the
reasons
for
the
variations,
but
you
see
the
first
year
it
was
a
significant
amount
of
individuals
actually
went
in
lou
and
in
2020
it
dropped
down
to
20
percent.
K
Now
it's
slowly
increasing
over
time,
and
so
our
initial
assumptions
were
at
30
and
given
that
it
continues
to
kind
of
increase
over
and
now
it's
averaging
over
40
we're
recommending,
we
take
kind
of
a
first
step
adjustment
from
30
to
40
percent,
of
an
assumption
to
kind
of
take
that
into
account
that
it
looks
like
it
is
actually
increasing.
But
changing
this
assumption
has
very
little
impact
on
the
liability,
because
this
is
such
a
small
number
of
people
that
this
actually
impacts.
K
The
next
slide
is
the
next
piece
of
it
is
okay,
they're
electing
to
defer
coverage,
but
what
coverage
chair
are
they
deferring
from
again
it's
the
same
kind
of
thing?
We
have
very
limited
data,
and
but
what
we
have
been
seeing
is
that
more
and
more
people
that
are
thinking
in
lieu
actually
are
eligible
to
cover
a
spouse
of
their
full
family.
As
we
can
see
our
assumption
for
the
pre-medicare,
the
last
valuation
was
40
would
be
retiree
only
15
retirees
spouse
and
45
percent.
K
Sorry
family,
the
actual
is
only
32
percent
are
retiree,
only
almost
26,
almost
27
percent
of
the
clubs
faster
than
41
family.
So
we're
proposing
with
this
is
to
start
moving
towards
that
direction,
so
decreasing
the
retiree
only
to
35
percent
and
taking
that
extra
five
percent
and
putting
it
retiree
spouse
and
keeping
me
arrested
in
the
retiree
family
and
then
we're
seeing
a
similar
adjustment
from
medicare
eligible
so
closing
a
similar
five
percent
just
moving
five
percent
from
retirement
retirees
spouse.
F
Why
would
medicare
eligible
you
know
do
in
lieu
unless
they
were
still
working,
I
mean?
Is
there
any
other
reason
why
they
would
choose
that?
Why
would
they
go
in?
What's
the
benefit
to
them?.
K
G
G
K
F
K
That's
the
cost
of
the
retirement
system
doing
what
they
need
to
do
so
it's
the
cost
to
actually
do
all
of
the
investments.
That's
the
investment
expenses.
It's
the
cost
of
roberto's
staff
allocated
between
the
pension
committee,
administrative
pension
plan
versus
administering
the
health
care
plan.
That's
all
of
those
expenses.
K
F
And
so
we
do
that,
for
both
trust
to
the
pension
as
well.
Is
that
so
roberto?
Is
that
a
a
total
allocation
out
of
your
department
to
the
two
trusts
or.
E
E
I
realized
I
was
mean
this
particular
one
is
related
to
the
health
care
and
I
think,
as
mike
indicated,
I
think
he
does
a
much
better
job
now
to
really
account
for
the
costs
associated
by
our
staff.
This
one
is
specifically
to
health
care.
We
do
have
another
one
that
is
included
for
the
patient.
You
are
correct.
F
The
office
office
of
retirees
services.
E
Well,
actually
that
I
don't
know
that
benji
is
here,
she
will
be
the
accountant
with
the
detailed
information.
I
wouldn't
think
that
we
have
the
whole
office
attached
to
it.
I
know
on
the
pension
side,
yes
on
the
health
care,
I
suppose
that's
the
case
as
well,
but
you
know
the
bulk
of
that.
Work
is
done
by
the
accounting
group,
but
I'm
assuming
that
it
does
account
for
costs
associated
with
the
you
know,
the
work
by
the
whole
office,
in
both
cases,
pension
and
health
care.
E
I
Okay,
so
those
are
the
the
opeb
assumptions
that
we
need
the
board
to
adopt.
We
summarize
the
changes
back
on
slide.
Eight,
I
think
the
the
key
piece
that
well
it
we
would
like
you
to
adopt
the
assumption
changes,
we've
recommended,
but
then
the
discount
rate
we
left
open
as
some
options
for
the
board
to
consider.
B
I
It
will
have
an
increase,
I
don't
have
the
specific
amounts
it,
because
the
baseline
contribution
is
only
20
million.
It
does
not.
Increase
dollar
amount
wise
anywhere
near
what
the
impact
is
on
the
pension
percentage-wise.
I
It's
a
it's
a
similar
increase,
although
we
phase
in
the
impact
over
three
years,
so
it
takes
a
three
years
to
feel
the
full
effect.
F
B
Well
I'll,
second,
it
for
the
sake
of
discussion,
and
now
we
have
discussion.
Is
there
a
strong
feeling
to
lower
this
or
to
to
keep
it
the
same?
B
We
saw
from
mr
hallmark
that
we
are
currently
at
the
north
end
of
a
range
at
six
and
a
quarter
percent
and
that
our
current
asset
allocation
per
makeda-
I
don't
know
if
we
can
go
back
to
that
slide-
is
probably
in
the
six
percent
range
for
our
20-year
return.
F
B
B
D
Can
I
ask
a
question,
can
someone
please
remind
me,
I
think
calpers
recently
changed
their
discount
rate?
Am
I
correct
and
they.
B
E
C
D
B
B
Okay,
so
even
even
smaller
impact
than
I
just
stated,
but
a
fairly
minimal
impact
on
the
city
contribution.
D
Yeah
chair
horowitz,
before
trustee
jennings
motion
and
her
commentary
and
yours,
I
was
sort
of
paying
attention
a
little
bit
ambivalent,
but
I
think
I'm
persuaded
by
your
reasoning,
so
I'm
comfortable
supporting
moving
to
six.
F
B
Would
support
that
as
well?
This
is
trustee
keller.
All
right,
then,
let's
have
a
formal
roll
call
vote
then,
and
we'll
we'll
go
in
order
of
seniority
as
we
have
trustee
chandra.
D
I
approve
I
vote.
I
on
change
of
the
discount
rate
to
six
percent.
A
B
Trustee
kelleher
hi
vice
chair
jennings
hi,
and
before
we
have
the
final
vote
I
needed
to,
I
should
have
asked
for
any
public
discussion.
Are
there
members
of
the
public
who
wish
to
comment.
I
So,
mr
chair,
I
should
have
asked
this
ahead
of
time,
but
that
motion
was
just
on
the
discount
rate.
Can
we
get
a
motion
on
the
other
assumptions.
D
Yeah
I
was
about
to
do
that
just
to
go
ahead
and
make
a
motion
to
approve
the
remaining
assumptions
as
presented
on
slide
8
health
care
trend
rates,
dependent
coverage,
elections,
health,
dental
plan
elections
in
lieu
elections
and
100
115
trust,
administrative
expenses.
B
B
So
hearing
none
we'll
have
a
roll
call
vote,
trustee,
chandra,
aye
trustee
orr
aye
trustee
keller
aye
vice
chair
jennings
aye,
and
I
vote
I.
It
is
unanimous.
B
Looking
forward
to
it,
thank
you,
and
now
it
is
on
to
item
5e,
if
I'm
reading
that
correctly.
Yes,
that
is
correct
and
you'll
present
on
this,
mr
pena.
E
Yes,
sir,
thank
you,
mr
chair.
As
I
mentioned
during
my
own
report,
I
left
my
comments
regarding
the
retiree
member
seat
for
this
item.
I
just
wanted
to
bring
you
up
today.
You
can
see
before
you
a
reference
to
municipal
code,
section
2.081070.
E
And
that's
because
we
were
I'm
sorry.
We
were
just
recently
alerted
last
week,
as
was
the
city
that
the
municipal
co
had
a
section.
That
was,
I
guess,
recent
in
the
code
that
actually
addresses
the
process
for
fielding
and
the
retirees
seed
for
the
bore
when
it
happens
during
the
term,
which
is
exactly
what
happened
here.
So,
in
other
words,
there
is
an
actual
process
when
the
seat
comes
up
for
the
regular
election
time.
E
But
if
it
happens
during
the
the
four
year
term,
there's
a
different
approach
and
that
approach
is,
as
stated
on
that
code
section,
is
that
the
the
cd
of
san
jose
retired
employees
association
shall
recommend
to
the
board,
meaning
the
federal
board
up
to
three
candidates
for
appointment
for
the
remainder
of
the
unexpired
term.
E
And
so
the
city
clear
actually
stopped
the
election
process
for
the
retiree
seat
and
just
yesterday
actually
reached
out
to
the
retiree
association
advising
them
of
this
code
section
and
in
the
communication
listing
three
names
of
of
applicants
that
were
seeking
the
retirees
so
that
so
that
the
city,
the
retiree
association,
can
can
look
at
the
application
of
the
information
and
then
presumably
decide
who
they
will
be
recommending
for
interview
by
your
board.
E
I'm
also
being
told
that
the
retiree
association
will
take
this
review
and
discuss
it
at
the
next
meeting
in
december,
and
so
ideally
what
will
happen
is
we
will
receive
a
communication
from
the
return
association
next
month
in
time
for
your
board
meeting
on
december
16th,
with
the
name
up
to
three
candidates
for
the
interview.
E
So
that's
the
latest
again,
the
process
as
it
was
initially
implemented
was
not
the
correct
one
and
the
city
just
changed
gears
just
early
this
week,
and
this
is
the
latest
I'm
happy
to.
Obviously,
council
is
aware
of
that
and
they
have
the
code
section.
I'm
happy
to
answer
any
particular
questions
that
you
may
have.
F
Do
I
have
a
question
on
that?
I
thought
I
heard
you
say
so
I
just
want
to
clarify.
Did
the
munich
code
section
just
get
changed
or
has
this
been
in
place.
E
It's
been
in
place,
but
it's
not.
I
guess
my
point
was.
It
was
recently
changed
over
the
last
few
years.
I
don't
know
the
particular
year
that
that
was
implemented.
E
I
think
the
rationale
for
the
change
just
so
we
understand
when
the
same
page
is
exactly
to
avoid
what
was
happening.
Youtube
has
seven
seats
and
that
approach
is
a
much
more
efficient
approach
to
bring
candidates
forward
for
for
appointment
by
the
city
council.
So
I
think
it
was.
I
don't
want
to
speak
for
the
city.
I
don't
know
if
parkman
is
attending
the
meeting,
but
I
think
that's
what
the
city
was
looking
for
to
be
more
efficient
in
that
process.
E
F
Interesting
so
so
at
our
next
board
meeting
they're
going
to
present
the
three
people
is
that
it
and
then
we're
going
to
schedule,
interviews
or
house.
I.
E
Do
not
know
who
or
how
many
they're
going
to
be
recommending.
They
can
recommend
up
to
three,
so
they
can
recommend
all
three.
They
recommend
two
of
the
names.
So
just
one
name,
it's
up
to
the
hitter
association.
To
do
that,
once
we
get
that
communication,
we
going
to
be
on
your
agenda
for
the
16th
and
we
will
then
be
in
contact
with
the
applicant
or
applicants,
whoever
whatever
minute
there
may
be.
Let
them
know
that
there's
going
to
be
an
interview
process
with
your
board.
E
It
is
a
public
meeting
just
like
the
interviews
that
the
city
council
contact
with
your
public
members
when
they
attend
the
board
meetings.
So
then.
E
No
no!
Well,
I
mean
I
don't
want
to
speak
for
the
detail
association.
My
understanding
is
they're
going
to
send
to
me
communication
or
who
would
they
will
be
recommending
for
interview
with
the
with
the
board
and
then.
C
E
The
the
communication
by
the
city
clerk
to
the
retiree
association
listed
three
names.
That's
correct,
sheriff.
E
B
Good
all
right!
Well,
that
will
be
interesting
and
and
also
take
some
time
at
our
december
meeting
to
adequately
vet
three
potential
candidates.
B
All
right
any
other
questions
or
comments
on
the
retiree
seat.
B
Right
very
good,
so
moving
forward
to
5f
where
there
will
be
some
action,
nominations
for
the
board
chair
and
vice
chair
this.
This
month
we
will
have
the
nominations
and
next
month
there
will
be
the
actual
election
vote
for
those
two
positions.
B
So
does
it
make
sense
to
take
the
chair
first
and
then
the
vice
chair.
C
B
Well,
I
don't
know
if
there's
any
preliminary
discussion
or
if
anyone
would
like
to
nominate
someone
for
chair
or
to
put
themselves
forward
for
the
position
of
chair.
I
could
tell
you
it's
an
exciting
and
dynamic
position
that
you
would
all
enjoy.
D
I
think
I
second
that
nomination
you're,
just
revving
up
and
in
in
in
like
fine
form
right
now.
Why
would
we
sh
it
change
mid
course?
Trustee
keller
would
like
to
third.
C
B
And
I
it
appears
I'm
to
be
punished
in
that
way,
but
seriously
are
there
any
other
nominations
that
anyone
would
like
to
make.
B
I
don't
suppose
there's
a
vote
to
be
taken,
so
we're
just
accepting
nominations,
so
I
guess
I
am
nominated
right.
Did
you
accept
it
yeah
yeah?
Do
I
have
to
accept
it
now,
or
can
I
wait
until
the
december
meeting
there'll
be
a
vote
in
the
december
meeting
I
see?
Well,
I
guess
I
accept
the
nomination.
I
guess
we
will
see
if
any
an
insurgency
emerges
between
now
and
december.
B
Let
us
move
forward
then
to
the
vice
chair
and,
let
me
add
just
this
note.
I
have
been
able
to
maintain
a
record
of
perfect
attendance
up
until
this
date,
but
I
certainly
cannot
promise
that
in
the
coming
year,
so
up
until
trustee
castiano's,
unexpected
resignation,
the
vice
chair
position
seemed
to
rather
a
quiet
and
uneventful
practice.
B
C
Second,
that
motion
or
second
nomination,
I
guess.
C
Just
for
the
record
seconds
are
not
necessary
for
nomination.
B
B
All
right,
then,
I
believe
we
have
completed
item
five
f
now
we're
on
to
5g,
and
I
believe
council
chin
will
address
us
on
this
matter.
C
Yes,
good
morning,
trustees
we've
done
this
a
number
of
times,
but
to
continue
to
meet
virtually
under
ab361.
The
board
continues
we'll
need
to
make
certain
factual
findings
yet
again
to
continue
to
meet
for
the
next
30
days,
and
so
with
the
backup
materials
I
have
provided.
C
We've
outlined
the
supporting
factual
findings
that
are
evidence
that
would
support
the
board's
factual
findings
to
allow
the
board
to
utilize
ab
361's,
continued
abbreviated,
teleconferencing
procedures
under
the
brown
act,
and
so
in
your
materials
exhibit
a
is
the
governor's
continued
proc
proclamation
for
the
continued
state
of
emergency
due
to
coven
19
is
still
in
place,
which
is
a
required
factual.
Finding
and
two.
The
san
jose
city
council
resolution
dated
october
26
2021,
continues
to
recommend
social
distancing
in
city
facilities.
C
Now
I
will
note
that's
not
in
your
packet
is
that
the
city
council
did
meet
on
november
16th
and
passed
another
resolution
that
continues
to
require
social
distancing.
So
that
is
the
most
recent
resolution
on
social
distancing
in
city,
the
cities
of
facilities.
That's
not
included
with
your
packets,
but
I
can
represent
you
in
the
past
with
those
two
factual
findings.
If
the
board
so
accepts
them,
the
board
shall
be
allowed
to
continue
to
meet
virtually
for
the
next
30
days.
B
Okay,
so
I
have
a
a
specific
script
for
a
motion
to
be
read
here
and
it
says
under
under
ab361
this
board,
as
the
legislative
body
must
make
certain
factual
findings
if
it
elects
to
continue
meeting
virtually
within
the
next
30
days,
based
on
the
information
presented
by
council
and
provided
with
our
board
backup
materials.
It
appears
that
the
following
factual
findings
justify
the
continuation
of
virtual
meetings
under
ab361
one,
the
governor's
proclamation
state
of
emergency
continues
due
to
the
ongoing
covert
19
pandemic
and
two
the
san
jose
city
council.
B
B
B
Any
comment
from
the
public
hearing?
None.
We
will
go
for
a
vote,
trustee
chandra
hi
trustee,
orr
aye
trustee
kelleher.
I
vice
chair
jennings
hi,
and
I
vote
I
as
well.
It
passes
unanimously.
B
And
I
believe
that
completes
item
5g
on
to
agenda
items,
6
investment,
sorry
committee
reports:
the
investment
committee
had
a
special
meaning.
I
believe
that
was
simply
to
continue
meeting
under
ab361
or
is
there
something
more
to
report
chair,
chandra.
D
B
Very
good,
the
governance
committee
meeting:
it
was
again
we
a
special
meeting
simply
to
approve
the
ab361
requirements,
and
our
next
meeting
I
believe,
is
also
in
december,
and
that
will
be
a
quote
actual
content-filled
meeting
and
the
audit
committee
committee,
chair,
kelleher,
did
do
we
have
something
to
report
here.
It
looks
like
we
do.
B
E
E
Obviously,
as
you
can
see,
one
of
them
is
the
actual
independent
auditors
report,
which,
by
the
way,
issue
what
is
known
as
a
unqualified
or
clean
opinion,
which
is
the
highest
opinion
available,
indicating
that
the
financial
statements
are
firmly
presented
on
the
government,
auditing
standards
and
management.
They
also
include
the
required
communications.
We
will
discuss
fully
with
the
audit
committee
and,
lastly,
on
f
the
actual
comprehensive
financial
report.
E
You
can
see
it
there
for
2021
for
the
pension
plan
on
health
care
also
discussed
at
the
audit
committee.
The
audit
committee
actually
took
action
in
their
meeting
approving
those
enf
and
again
I
don't
want
to
speak
for
the
chair,
but
I
would
suggest
I
understand
the
committee
intention
is
is
to
recommend
to
your
board
to
take
action
and
actually
approve
both
item
e
and
f.
C
I
guess
we
need
to
approve
and
accept
those.
Do
we
have
a
motion
for
that.
B
Yes,
it
sounds
like
we
we
can
take.
Can
we
take
a
single
motion
to
accept
b,
c
and
d.
B
Horowitz
I
see
well
unless
I
hear
any
comments
from
trustees
or
the
public
that
would
advise
otherwise,
then
I
will
say
we
should
accept
items
b,
c
and
d
as
presented
and.
D
I'll
make
a
motion
to
approve
item
e.
B
Okay,
so
we
have
a
motion
to
approve
the
reports
under
item
e.
Do
we
have
a
second.
E
Mr
chair,
my
only
comment
is
again.
I
did
the
same
at
the
audit
committee
and
I
do
this
annually.
This
is
really
a
joint
effort.
I
mean
the
whole,
I
mean
we
really
enjoy
working
with
brown
thornton.
They
do
great
work,
but
I
also
wanted
to
publicly
and
only
thank
grant
thornton,
but
also
the
staff.
E
The
bulk
of
the
work,
obviously
is
by
the
accounting
group
led
by
the
accounting
manager,
but
it's
a
team
effort
for
the
whole
office
that
includes
investment
benefits
the
whole
group,
and
so
I
wanted
to
give
a
big
shout
out
to
the
whole
office
and
especially
for
the
group
for
a
job
well
done.
It
is
not
easy
to
go
to
a
financial
audit
and
especially
on
a
remote
approach.
E
Is
the
second
year
they've
done
that,
and
I
think
if
you
look
at
not
only
the
the
clean
opinion,
but
also
the
required
communications,
you
can
see
that
the
the
office
in
general
did
a
fantastic
job
so
again,
a
big
kudos
to
the
whole
staff
and,
on
behalf
of
the
boards
and
the
members,
I
wanted
to
thank
them
publicly
for
the
hard
work
in
the
vacation.
Thank
you
very
much.
F
Yes,
and
as
a
city
employee,
as
well
as
a
trustee
and
dealing
with
audits,
in
my
experience
I
was
very
impressed-
I
mean
it
was,
you
know
pretty
much
a
plus
around
you
know
and
that's
hard.
You
know
in
the
remote
world
that
we're
operating
in
in
this
time.
So
I
also
want
to
applaud
the
accounting
group
and
all
the
other
members
of
your
staff
that
have
participated
in
it.
B
B
Great
and
now
we
will
move
to
the
roll
call
votes,
trustee,
chandra,
hi,
trustee,
orr,
hi
trustee
keller
hi
vice
chair
jennings
hi,
and
I
vote
I
as
well.
It
passes
unanimously.
D
With
that,
how
about
I
make
a
motion
to
approve
item
f,
okay,.
B
And
we
have
a
second
from
vice
chair
jennings,
any
questions
or
discussion
on
the
the
acfr.
B
B
Joint
personnel
committee,
the
last
meeting
was
april
30th.
So
I
assume
there's
nothing
to
report.
E
There's
nothing
to
him
for
mr
share,
but
there
is
a
meeting
that
has
been
scheduled
for
next
month
december
7th,
I
believe
at
one
o'clock
I
think
december.
7Th
is
a
tuesday
if
I'm
not
mistaken,
and
it's
at
one
o'clock
right
now.
We
still
have
to
put
together
an
agenda
for
the
meeting,
but
right
now
it's
getting
from
one
to
three.
Thank
you,
mr
chair.
B
And
I'll
just
comment
that
I
am
a
member
of
this
committee
by
virtue
of
the
fact
of
my
chairmanship,
but
we
are
restricted
by
the
brown
act
from
having
all
three
members
attend.
B
So
my
plan
is
to
attend
merely
as
a
member
of
the
public
and
and
not
to
act
in
a
voting
capacity
at
that
next
meeting
and
we're
we
are
not
likely
to.
You
know
it's
impossible
for
us
to
to
have
another
member
of
the
board
installed
by
that
time.
E
B
Okay,
all
right
on
to
item
seven
education
and
training.
B
We
have
the
usual
cortex
report
and
a
calipers
course
any
any
comment
on
that.