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From YouTube: OCT 3, 2019 | Police & Fire Department Retirement Board
Description
San José Police & Fire Department Retirement Board
View Agenda at https://sjrs.legistar.com/View.ashx?M=A&ID=711119&GUID=B7A2B8F2-1969-406E-AE85-4DDD66FF914A
A
A
A
A
Back
on
track,
sorry
for
the
long
delay,
let's
move
on
through
there's
no
orders
of
the
day.
Let's
move
on
to
the
consent
calendar
do
I,
have
a
motion
to
approve
approve.
Okay,
do
I,
have
a
second
okay
motion
from
trustee
Santos,
second,
by
trustee
vato,
all
in
favor
aye.
Any
opposed
all
right
motion
carries.
C
Make
sure
that
you,
you
bore,
pays
attention
to
item
one
point
three
D,
that's
the
communication.
They
went
out
to
retirees
regarding
the
launch
of
our
new
member
direct
Porter.
Just
just
to
you
know,
if
you
have
any
questions,
you
can
see
me
after
the
meeting
and
I
can
address
them,
but
I
just
wanted
to
make
that
reference.
Thank
you.
Mister
thank.
A
C
D
B
We
had
a
grand
jury
report,
all
kinds
of
information
related
to
investments
and
I.
Think
that
I
see
investment
committee
is
doing
a
great
job.
I
think
this
board
doing
a
great
job.
It
is
frustrating
it's
long,
but
we're
doing
the
best.
We
can
to
make
sure
that
those
investments
pay
off.
So
it's
a
great
job.
Thank
you.
E
E
Markets
have
been
very
strong
in
the
year
today
period,
but
we
have
seen
some
volatility
in
the
past
couple
of
days.
I
figured
I'd
give
an
update
there.
We
estimate
the
plan
on
a
year-to-date
basis
is
up
seven
and
a
half
percent,
and
we
estimate
that
in
the
fiscal
year
two
day
period
plan
is
down
roughly
80
basis
points
in
the
past
week,
or
so
we've
seen
you
know,
the
Dow
Jones
drop
off
the
eight
to
nine
hundred
points.
I
thought
it
might
be
helpful
to
provide
an
estimate
continuing
through
to
the
private
market
report.
E
E
We'll
start
on
page
3
of
the
report,
the
retirement
plans,
private
markets
program
consists
of
legacy:
private
equity,
Neuberger
fund
of
one
private
debt,
real
estate
and
real
assets
spans
roughly
1.3.
Five
billion
dollars
in
committed
capital,
which
has
achieved
the
net
IRR
of
eight
point,
one
percent
digging
into
asset
class
returns,
will
flip
through
to
page
five,
starting
with
private
debt.
E
Private
debt
consists
of
nearly
five
hundred
million
dollars
in
committed
capital
to
ten
private
debt
partnerships
and
one
co-investment.
This
represents
roughly
five
point
four
percent
of
the
retirement
plan
versus
a
four
percent
policy
target
during
the
first
quarter
2019
now
there
were
roughly
eighteen
million
dollars
in
contributions
to
the
private
debt
program
there,
roughly
three
million
dollars
in
distributions
with
no
new
commitments,
like
the
continue
on
to
page
eight,
which
Dee
some
performance
returns
for
your
managers
as
a
reminder
within
private
markets,
IRR
and
net
investment.
Multiple
are
the
most
meaningful
measures
of
return.
E
You
see
those
columns
and
fourth
from
the
right
and
third
from
the
right
and
this
performance
report
on
page
8,
the
net
IRR
of
5.5%
and
multiple
of
1.2
times
are
unchanged
from
the
previous
quarter
in
kind
of
framing
the
time
period.
For
this
report,
being
through
the
first
quarter
of
2019
we'd,
like
to
kind
of
characterize
the
market
environment
that
we
experienced
as
a
reminder
in
the
fourth
quarter
of
2018,
we
saw
a
very
weak
markets
in
particular
December,
which
was
historically
week
before
the
recovery
in
the
first
quarter
of
2019.
E
Continuing
through
to
the
real
estate
program
on
page
12,
as
of
March
31st,
the
real
estate
program
consisted
of
two
hundred
and
sixteen
million
dollars
of
committed
capital,
213
real
estate
funds,
representing
2.5
percent
of
the
plan
versus
a
3
percent
target.
So
a
more
mature
close
to
policy
asset
class.
During
the
quarter
and
the
first
quarter
of
2019,
we
saw
a
5.4
million
dollars
in
contributions,
5.1
million
dollars
in
distributions
and
no
new
commitments
within
the
real
estate.
E
And
then
flipping
through
to
page
15,
we
know
it's
a
manager,
performance,
total
real
estate
program.
Net
IRR
was
thirteen
point.
Nine
percent,
with
some
of
the
more
recent
contributions
contributing
nicely.
The
more
recent
contributions
represent
roughly
thirtyish
percent
of
the
program.
That's
contributions
in
the
last
two
years,
two
to
three
years
and
you'll
note
that
some
of
those
returns
are
designated
by
an
nm
on
this
report,
which
is
not
meaningful.
E
E
As
of
the
first
quarter
of
2019,
the
real
assets
program
had
46
million
dollars
in
committed
capital
to
three
partnerships
representing
about
1%
of
the
plan
versus
a
3%
target.
Contributions
for
real
assets
in
the
first
quarter
consisted
of
2.1
million
dollars,
while
distributions
consisted
of
0.7
million
dollars
on
no
new
commitments
in
the
quarter.
E
E
B
B
E
Think
rec
control
in
general,
we're
not
just
talking
about
the
California
area,
decreases
valuation
anytime
in
finance,
where
you
put
a
floor
or
a
ceiling
on
prices,
you're
not
allowing
things
to
normalize
to
regular
pricing.
So
as
a
financial
concept,
I'm,
not
sure
that
it
is
additive,
but
as
a
social
concept,
I
think
that's
very
different.
E
Will
note
that
the
bulk
of
this
programs
commitments
were
in
2010
and
also
2013,
and,
to
be
frank,
these
investments
have
not
performed
up
to
snuff
with
their
benchmark.
These
are
legacy
investments
by
previous
staff,
different
investment
consultant,
but
that
being
said,
the
net
IRR
is
pretty
well
below
what
we
would
have
expected
in
that
period
from
other
managers.
B
G
Acceptable
higher
are
for
this
I
suppose,
and
that
is
something
that
we're
very
diligent
about
as
we're
analyzing.
New
investments
is
understanding
the
organization
and
how
they're
approaching
the
market,
as
well
as
the
macro
opportunity,
rather
than
getting
caught
up
in
the
marketing
demonstrating
that
they
can
perform
across
a
variety
of
environments
and
structuring
contracts
that
are
appropriate
for
what
they're
trying
to
execute
on
and
that's
something
that
you
can
see
in
call
it.
A
One
observation
I
want
to
make
is
that
the
concern
when
the
sponsor
is
looking
at
the
amount
of
fees
that
we're
paying
in
our
plan,
they
typically
will
look
at
alternative
investments.
This
is
primarily
in
the
space
that
you're
doing
here,
and
some
of
these
asset
classes
are
actually
doing
well.
If
you
look
at
real
estate,
if
you
look
at
private
equity,
I
believe
the
returns
look
pretty
attractive.
A
Alternatively,
in
the
private
debt,
you
pointed
out
disappointment
and
we
may
see
the
same
thing
when
we
talk
about
absolute
return,
but
in
the
performance
reports
that
come
to
the
board,
I
noticed
the
last
quarter
when
it
was
a
viewed
last
month
that
wasn't
here
for
that
meeting,
but
the
full
data
is
not
available
in
those
reports,
so
in
private
debt
it
didn't
show
a
five
year
number.
Yet
we've
had
a
program,
that's
been
in
place
for
five
years
and
in
private
real
estate.
It
didn't
show
a
five
or
ten-year
number.
A
We've
been
in
private
real
estate
for
more
than
five
years.
So
if
you
can
take
a
look
at
that,
so
the
next
quarterly
report
is
more
comprehensive.
I
think
it's
important
that
when
we
talk
to
stakeholders,
we
have
the
data
to
support
what
parts
of
our
absolute
return
or
our
alternative
investments
are
working
and
which
parts
are
not,
rather
than
the
entire
approach
being
painted
with
a
negative
brush.
A
A
C
Thank
You
mr.
chair,
just
if
you
bear
with
me
just
two
or
three
minutes,
have
a
list
of
things.
I
want
to
update
you
on
the
first
one
is
that,
as
directed
by
your
bore
to
the
chair
to
work
with
staff
and
fishery
council,
the
responses
to
the
grand
jury
were
actually
completed.
They
were
issue,
they
were
actually
chair,
they
were
provided
to
OER
and
the
City
Council
for
the
reference,
and
we
actually
delivered
an
or
mail.
Then
this
past
week
to
the
presiding
judge,
which
the
deadline
was
at
our
first
had
been
extended.
C
If
you
recall
for
two
weeks-
and
we
did
it
toward
the
end
of
last
week,
so
it
was
received
on
time.
I
just
want
to
keep
you
apprised
on
the
the
city
clerk
process
for
the
for
the
fire
member
election
process
is
ongoing
and
he
actually
ends
the
application
process
ends
on
Friday
October
4.
So
he
ends
tomorrow.
So
if
there
any
are
standing
issues
they
should
be
resolved
by
tomorrow,
so
that
people
can
continue
if
they
want
to
remain
at
the
board,
those
that
are
fire
and
active
members.
C
We
attended
and
want
to
thank
publicly
chairs
in
Surrey.
He
was
nice
enough
to
attend
with
staff
the
council
every
meeting
last
Tuesday,
where
we
were
scheduled
to
present
the
54
for
2018.
Unfortunately,
we
were
not
able
to
make
a
presentation.
There
was
a
lengthy
discussion
and
a
couple
of
items
for
the
councilmember
meeting
and
so
he's
been
deferred
to
next
week.
So
we
are
not
on
board
for
next
week
same
time
same
place
and
we're
looking
forward
to
present
the
report
to
the
council
members.
C
C
Looking
at
options,
we
actually
visited
some
other
similar
buildings
in
the
area,
and
so
I
will
keep
you
posted
as
to
what
the
the
negotiations
are
going,
how
the
going
and
what
the
end
result
will
be
and
but
want
to.
Let
you
know
that
that's
part
of
the
work
that
we
are
working
on
right
now
visited
with
my
peers.
C
I
was
speaking
to
him
because
he
has
this
idea
of
sometimes
going
around
to
visit
other
plans
busy
listening,
just
not
their
offices,
but
also
attending
the
board
meetings
and
I.
Just
think.
That's
an
excellent
idea
and
I
try
to
to
push
that
with
my
peers,
where
maybe
we
should
start
thinking
about
every
one
of
us
attending
each
other
board
meetings,
maybe
not
in
one
year
but
over
a
prettier
view,
so
that
we
can
see
not
only
the
interaction.
C
C
C
You
may
be
called
that
one
of
the
issues
that
we
have
put
on
the
side,
the
last
couple
of
years
for
our
budget
is
the
the
communications
part
of
a
meaning
kicking
back
and
an
issuing
new
newsletters
and
everything
else.
I
mentioned
to
you
as
part
of
this
year
budget.
We
actually
allocated
some
money
to
hire
a
communications
consultant.
We
met
with
her
and
I
wanted
to
let
you
know
our
goal
is
to
kick
off
again.
The
quarterly
newsletter
studying
January
2020,
so
I
will
keep
your
price.
C
The
idea
is
number
one
to
issue
the
the
first
newsletter
of
this
approach,
generally
2020
and
towards
the
second
half
of
the
fiscal
year.
The
goal
also
is
to
bring
to
your
board
for
review
strategic
planning
on
really
a
communications
plan
that
really
utilizes
social
media.
So
that's
also
a
plan
towards
the
second
half
of
the
year
to
bring
that
forward
to
you
board
for
decision.
I
also
wanted
to
let
you
know
that
tier
two,
the
highest
members
that
went
back
to
tier
one
you
may
be
called.
C
There
was
a
little
discussion
and
you
approve
those
retirement
rates
that
are
different
than
the
total
retirement
rates.
The
statements
are
going
now
this
week.
Is
that
correct
Weber
to
those
members
they
member
statements
on
the
retirement
contributions,
our
new
IT
manager
started
at
our
office
last
September
23rd.
We
also
had
a
new
accounting
clerk
study
in
September.
23Rd
I
want
new
financial
analyst,
for
the
investment
section,
I
believe
is
ready
to
start
this
coming.
Monday,
October,
7th
and
the
new
office
specialist
from
this
is
to
start
on
October
21st.
C
So
we
have
quite
a
few
new
members
either
studying
the
history
already
are
starting
very
soon.
This
month,
our
office
and
finally,
the
senior
analyst
recruiting,
is
still
ongoing
and
we're
hoping
to
have
a
senior
analyst
on
board.
I
think
our
goal
is
to
have
them
hopefully
at
this
month.
That
concludes
my
diminisher.
C
I
Relations
as
Roberto
mentioned,
we
have
been
working
with
retirement
services
to
try
and
put
our
investment
professional
staff,
as
well
as
the
CIO
and
CEO
into
or
not
the
incumbent
CEO,
but
future
CEOs
into
the
CalPERS
benefit.
So
you
may
recall
that
we
did
try
to
get
an
ordinance
passed,
but
it
had
to
be
pulled
and
deferred,
because
CalPERS
did
contact
us
to
work
with
them
a
little
bit
for
it.
So
the
city
has
been
in
contact
with
CalPERS.
I
They
have
requested
some
additional
information
which
we
have
provided,
and
it
is
my
knowledge
that
they
are
reviewing
that
additional
information
to
then
provide
us
with
an
additional
timeline
of,
or
to
ask
us
any
questions
of
anything
additional
that
we
need
to
complete.
So
we
are
working
with
CalPERS
directly
on
on
making
sure
that
we
get
them
whatever
they
need
from
us,
so
that
we
can.
We
can
get
these
members
into
that
CalPERS
plan.
C
I
Absolutely
and
if
I
may
ask
I
know
that
you
just
had
a
question
about
the
question,
but
an
update
about
the
account
member
statements
for
tier
2
to
tier
1,
I.
Think
just
the
office
of
employee
relations
would
like
to
be
included
on
any
of
those
member
statements
just
so.
We
know
that
they're
going
out
in
case
we
get
questions
about
it
because
we've
been
the
main
contact
for
those
employees
about
any
changes
to
their
retirement
benefits.
That's.
H
C
Very
good
point
so
federated
actually
just
welcomed
a
new
trustee
last
month.
At
the
first
meeting
they
had
two
openings
and
in
the
second
opening
is
actually
one
where
you
have
the
same
one
here
and
the
member
that
occupies
that
series
actually
drew
lanza,
where
you
bore
actually
interview
candidates
and
then
send
a
recommendation
to
City
Council
we
were
lucky
drew
was
the
only
candidate,
but
we
were
lucky
that
obviously
the
board
as
well
so
highly
mr.
Lanza
and
so
I'm
the
best
it
was
said.
C
C
So,
on
the
next
meeting,
this
Monday
in
October
that
same
seed
is
going
to
be
addressed
at
the
federal
board.
They
have
two
candidates
that
the
boy
is
going
to
interview
and
they
will
recommend
one
of
those
candidates
to
City
Council
for
appointment,
so
that
November
for
the
first
time
in
some
time
the
board
will
have
a
full
board.
However,
that
November
month
associate
the
last
month
of
the
chair,
Matt
Lodge
he's
been
with
the
with
the
plan
for
about
12
years
and
I
believe
Dana
Dena's
chair.
C
He
is
going
to
be
he's
going
to
be
missed
if
you're
watching
Matt
will
miss
you
and,
and
so
after
that,
then,
what's
going
to
happen
is
that
the
city
clerk
I,
believe
Linda
is
actually
running,
also
an
opening
or
not
yet
they're
running
an
election,
so
that
I
think
the
goal
is
to
have
someone
being
selected
and
appointed
by
the
City
Council
in
time
for
the
December
meeting
for
further
review.
So
hopefully
going
forward
is
going
to
be
fully
staff
all
seven
positions
and
we'll
have
better
options
when
we
have
joint
meetings.
J
J
At
4:30
I
look
forward
to
participating
on
the
working
group.
That
starts
its
work
in
two
weeks
to
see
to
talk
about
various
issues
on
possibly
consolidating
the
two
boards,
as
recommended
by
the
grand
jury
report
and
other
items
everything's
on
the
table.
As
far
as
the
discussion,
so
I
look
forward
to
being
a
part
of
that
and
a
couple
weeks
ago
the
City
Council
adopted
climate
of
a
state
of
a
climate
emergency
in
the
city
of
San
Jose
and
which
will
result.
J
Part
of
the
resolution
was
disavowing
any
investments
in
businesses
that
had
a
negative
impact
on
the
environment.
The
question
came
up
that
that
the
federated
and
police
and
fire
retirement
boards
might
want
to
take
a
look
at
that
too.
I
don't
know
where
that
has
gone
or
whether
you've
heard
anything
along
that
those
lines.
C
Yes,
let
me
address
that
issue,
actually
miss
Parkman,
who
is
our
liaison
and
contact
person
for
the
staff
for
the
city
they
reach
out
to
me,
and
we
had
a
conversation
and
I
believe
she's
working
internally
with
the
city
to
put
together
a
memo
for
the
board,
I
think
if
I'm
misspoke,
please
correct
me
I,
think
the
goal
of
the
city
is
to
start
with
the
Federal
Board
of
the
meeting
October
17.
Subsequently
that
memo
will
come
before
you
bore
for
your
neighbor
meeting.
Is
that
correct
Cheryl?
Yes,.
A
And
I
also
point
out
that
it
was
probably
three
four
months
ago
at
one
of
the
investment
committee
meetings.
They
had
a
topic
specifically
about
ESG
investing
which
addressed
that
topic.
It
was
very
educational
in
nature,
it
was
not
action
oriented,
but
at
least
there
was
a
discussion
point
that
happened
there.
Great.
C
J
I
We're
actually
taking
a
memo
next
Tuesday
on
the
membership
and
logistics
of
that
working
group
to
council.
So
on
the
8th,
we
are
proposing
to
push
back
our
first
meeting
until
November,
because
there
is
a
very
short
turnaround
time
from
that
October
8th
meeting
to
chapter
calmest
a
so
we
are
hoping
to
start
in
November
for
a
term
of
about
six
months
and
then
at
the
end
of
six
months
there
will
be
probably
a
list
of
recommendations
from
that
working
group
that
will
be
presented
to
full
City
Council.
Yes,.
B
C
I
C
Our
mr.
Palani,
our
CI,
you
and
myself,
we
look
forward
to
working
with
the
retirement
task
force
and
the
meetings
and
I
think
you
and
I
spoke
about
this.
Before
is
the
goal.
It
is
the
task
for
really
expecting
us
to
kick
off
with
the
presentation
on
the
players.
Is
that
still
the
expectation
and
so
can
we
get
some
direction
of
what
they're
looking
for
just
wanted
to
make
sure
that
that
was
understood
absolutely.
I
So
the
working
group
really
is
meant
to
be
a
collaborative
space
where
everyone
get
on
the
same
page
about
the
different
statuses
of
the
plan.
So
we
are
going
to
be
looking
for
Roberto
and
Prabhu
to
be
maybe
doing
a
very
similar
presentation
to
what
they
presented
in
front
of
the
Joint
Council
and
retirement
board
meeting
where
you
talked
about
the
status
of
the
plan
and
the
investment
allocation.
So
we're
not
looking
to
really
deviate
from
that.
But
of
course
we
can
talk
more
about
that
online.
I
A
I
So
we
did
need
to
go
to
City
Council
in
order
to
approve
the
membership
and
logistics
of
that
particular
working
group.
I
can
be
honest
with
you
and
tell
you
that
we
we
were
not
expecting
to
need
to
go
to
City
Council
to
get
that
approved.
So
that's
that's
the
cause
of
the
delay,
and
so
you
can.
You
can
put
that
on
me
and
myself
myself,
but
we
aren't
hoping
to
kick
off.
We
are,
you
know,
expected
to
kick
off
in
November
and
from
there
on
it
will
be
a
full
six
months.
Great
thank.
A
A
Knowing
that
there's
already
a
presentation
put
together
for
City
Council
on
the
fee,
disclosure
and
report
for
both
plans
and
the
meeting
was
deferred,
so
it
actually
gives
it
even
more
time
to
think
about
that.
Are
there
specific
things
for
you
specifically
as
a
council
member
or
possibly
your
knowledge
of
your
peers
that
it's
important
to
hear
at
that
meeting
about
those
fees
or
questions
that
you
might
have
that
we
should
be
thinking
about
in
anticipation
of
the
meeting
well.
J
They've
all
seen
thanks
for
asking
they've
all
seen
the
grand
jury
report
and
the
passive
rate
of
return
and
recommend
date.
The
recommendation
from
the
grand
jury
that
we
consider
more
passive
investments
and
therefore
less
fees
so
I'm
sure
that
the
council
will
focus
on
that
component.
When
you
look
at
the
comparison
of
other
plans
and
how
they're
managed,
with
the
greater
return
and
lower
cost.
That's
a
question
with
the
city
because
of
the
unfunded
liability
and
what
that
results
into
the
actual
cost
to
the
city.
A
J
J
So
we
felt
the
report
was
that
we
okay,
we
accept
what
you're
saying,
but
we
may
not
be
changing
anything.
We
are
considering
looking
at
merging
the
two
boards.
I
know
that's
looked
at
before,
and
that
was
one
recommendation
from
the
grand
jury.
So
we
didn't
spend
a
lot
of
time.
Analyzing
the
grand
jury,
okay,.
C
B
You
95
mid
90s,
we
police,
a
fire,
Retirement
Board
had
something
called
the
Sullivan
principles
and
it
was
a
party
at
a
time
in
South
Africa
with
investments.
So
with
the
councilmembers
saying
we
did
that
in
your
every
seats
here,
how
we
went
about
it
and
you
know
when
it
comes
to
investments,
you
got
a
diverse
slowly
because
of
the
amount
of
funding
or
whatever
have
you,
but
that's
something
we
did
during
that
time
and
turn
out
to
be
very
good.
B
J
C
J
C
J
C
B
A
Any
more
questions,
thank
you
for
the
update,
okay,
4c,
actually
I
think
in
tandem,
we're
going
to
be
covering
for
C
and
D.
Given
the
report
in
front
of
you
ties
this
together.
This
is
part
of
a
few
months
of
work
that
happens
beginning
typically
here
in
the
fourth
quarter,
as
we
start
to
look
at
the
economic
and
demographic
expectations
and
assumptions
that
we
have
for
the
plan.
I'll
turn
it
over
to
Bill
and
Ann.
Thank
you.
K
K
This
is
an
action
item,
but
you
do
have
the
option
of
deferring
decisions
on
these
until
the
November
board
meeting.
We
split
this
up
because
at
the
November
board
meeting
we'll
be
presenting
the
demographic
experience,
study
that
covers
assumptions
like
retirement
rates,
mortality
and
all
of
those
things
and
we'll
also
have
some
preliminary
valuation
results,
and
so
at
that
time
we
want
all
the
decisions,
if
possible,
on
all
the
assumptions
and
all
the
methods
so
that
we
can
produce
the
final
pension
valuation
report
for
December,
then
OPA
we
do
in
January
and
February
board
meetings.
K
So
just
a
reminder
of
where
we
were
from
the
2018
valuation.
The
18
valuation
determine
the
contribution
rates
for
the
current
year,
the
fiscal
year
in
2020.
This
city's
contribution
rate
covering
both
tears
and
police
and
fire
is
eighty
two
point:
six
percent
of
pay
and
the
average
member
contribution
rates
eleven
point:
nine
percent.
K
Those
were
not
significant
changes
from
the
prior
year.
The
City
rate
did
go
up
a
bit,
but
they're
part
of
that
is.
We
decrease
the
discount
rate
from
six
point:
eight,
seventy
five
to
six
point:
seven:
five,
whether
it
was
part
of
that
increase,
the
red
line.
There
shows
the
normal
cost,
that's
the
expected
costs
or
the
benefits
for
the
current
year's
service.
H
H
K
You
can
kind
of
see
it
on
the
right-hand
chart
here,
so
the
the
right-hand
chart,
the
the
bars
represent,
the
the
liability,
the
actuarial
liability
split
between
those
in
pay.
The
gold
is
people
who
have
a
deferred
benefit,
but
are
no
longer
working
for
the
city
and
the
red.
Is
the
people
still
working
for
the
city,
the
active
employees,
the
green
and
blue
lines
are
the
market
value
and
actuarial
value
of
assets.
K
G
K
77
right,
the
77
percent
is
the
funded
ratio
based
on
the
actuarial
value.
So
we
have
77
percent
of
the
assets
that
we
are
targeting,
so
the
actuarial
liability
represents
kind
of
our
funding
target
where
we
think
the
assets
should
be
at
this
point
in
time,
and
we
only
have
77
percent
of
what
we
think
we
should
have
so.
K
H
K
No
yeah,
this
is
a
very
important
distinction.
This
means
we're
fully
funded,
meaning
we
have
the
target
amount
of
assets
that
we've
set
based
on
the
assumed
rate
of
return
of
6.75.
It
does
not
mean
that
we
have
enough
assets
to
absolutely
guarantee
benefits
without
future
contributions,
because
we
still
have
the
risks
of
that
investment
return.
K
A
A
K
A
I
guess
what
I'm
trying
to
get
to
it
for
a
specific
number
is
an
example.
Is
that
if
we
use
one
billion
dollars,
we
walk
into
the
year
that
we
only
make
a
normal
cost
contribution.
You
al
has
gone
up
from
1
billion
to
1
billion
67
million
roughly
yeah.
Are
there
any
other
contributing
factors
beyond
the
assumed
return?
That
would
grow
that
if
all
these
other
factors
stayed
constant,
it.
K
K
And
so
this
is
the
projections
we
showed
it
the
last
valuation,
and
so
you
can
see
from
the
top
graph.
The
gray
bars
are
the
liability
and
then
the
blue
line
is
the
market
value
of
assets.
There's
a
green
line.
There
that's
kind
of
covered
up
behind
it,
that's
the
actuarial
value,
but
we're
projecting
to
be
fully
funded
by
2035
and
to
be
90%
funded
by
2026.
If
all
of
our
assumptions
are
met
again.
K
K
2021
were
projecting
an
increase
of
almost
3%
of
pay
in
the
contribution
rate
and
that's
because
of
our
asset,
smoothing
we're
smoothing
in
the
losses
from
2015
and
16
still,
and
so
we've
got
two
years
of
projected
increases
based
on
smoothing
the
those
losses
in
and
then
we
have
this
pattern
where
we
go
down
and
up
and
then
and
then
drop
down
significantly.
So
we'll
talk
about
that
a
little
bit
later
in
the
presentation,
but
this
was
the
expectation
from
the
last
valuation
before
reflecting
any
of
the
changes.
Since
then,.
K
These
assumptions
will
affect
the
2021
contributions
and
all
of
the
things
we're
talking
about
are
gonna
affect
the
the
pension
and
the
opah,
except
for
the
discount
rate.
We
will
come
back
to
talk
about
the
discount
rate
for
the
open-plan
and
that's
because
you
have
a
different
investment
policy
for
the
115
trust,
and
so
we
have
to
apply
the
capital
market
assumptions
to
that
policy.
The
other
thing
I
would
note,
is
in
the
past,
we've
only
talked
about
price
inflation,
wage
inflation
and
the
discount
rate.
K
We
didn't
have
the
line
on
the
amortization
payment
increase
rate.
Typically,
we've
just
set
that
as
equal
to
wage
inflation
and
at
the
retreat.
Last
year
we
talked
about
some
potential
changes
to
that,
so
we're
identifying
it
as
a
separate
assumption
this
year
to
address
so
with
that
I'll
let
and
get
into
the
details.
L
Good
morning,
I'm
gonna
start
out
talking
about
price
inflation,
because
this
is
the
assumption
that
is
the
building
block
or
foundation.
If
you
will
for
all
the
other
economic
assumptions.
Currently,
the
price
inflation
assumption
for
your
plan
is
2.75
percent,
and
that
has
been
unchanged
since
2016,
the
biggest
largest
direct
impact
that
inflation
could
have
on
evaluation.
L
L
L
So
we
look
to
economic
forecasters
and
your
peer
groups,
inflation
assumption
to
look
at
setting
the
price
inflation.
We
look
at
to
it
just
to
form
a
context
of
what
other
people
are
thinking
and
what
other
people
are
doing
and
the
left-hand
bars
on
this
graph
show
the
economic
forecasters
and
the
horizon
survey
and
the
horizon
survey
is
compiled
of
about
35
different
investment
consultants
and
their
projections
for
inflation
are
very
consistent
with
each
other.
L
About
2.2
percent
is
the
median
for
both
of
those
professional
forecasters
and
then,
when
you
look
to
those
right
floating
bars,
those
are
actual
assumptions
for
public
systems.
The
left-hand,
the
wider
range
there's.
The
public
plan
database,
which
consists
of
about
200
public
plans
nationwide,
so
state
plans,
City
local
plans,
but
all
across
the
country,
and
then
our
California
survey
looks
just
specifically
at
plans
in
California
those
that
participate
in
CalPERS
sectors
and
some
few
transit
plans.
L
So,
looking
at
those
assumptions,
the
public
plan-
databases
of
the
medians
2.75%
and
then
the
California
public
plans
are
ranging
about
3/4
the
medians
about
3%,
so
a
little
bit
higher
than
those
forecasters,
because
there's
a
slight
lag
and
how
public
sector
pension
plans
how
those
assumptions
are
set,
there's
a
lag
in
the
timing.
There
there
were
slower
to
react
so
Annie.
H
K
So
the
public
plan
database
is
maintained
by
Boston
College,
the
Center
for
retirement
research
and
they
just
load
data
from
financial
reports
from
pension
plans
across
the
country.
We're
showing
the
there
are
potential
issues
with
the
quality
of
the
data
when
you
get
out
to
the
maximum,
so
we've
seen
errors
in
the
database.
I
don't
know
if
a
four
percent
maximum
is
an
error
or
if
somebody
is
actually
still
assuming
four
percent,
but
that's
not
actual
inflation.
That's
what
they
are
choosing
to
assume
and
four
percent
is
very
much
an
outlier.
C
K
Yeah
so
we're
you're
putting
us
in
speculative
territory
here,
but
traditionally
the
well
over
the
last
decade
at
least
the
California
plans
have
been
more
conservative
in
their
assessments
of
different
economic
measures,
primarily
the
discount
rate,
but
also
quicker
to
recognize
that
inflation
was
moving
down.
I.
Think
the
other.
B
K
That
affects
California
plans
is
that
inflation
in
the
state
of
California
has
been
higher
than
it
has
been
nationally
and
so
I'm
speculating,
but
I
think
that
maybe
part
of
the
reason
that
California
plans
have
been
a
little
bit
slower
to
reduce
their
assumption.
Particularly
if
they're
Cola
is
based
on
California
inflation
and
not.
L
B
L
M
M
So
would
I
be
correct
and
reading
this,
since
this
is
broad
surveys
across
a
broad
number
of
people's
people.
We
asked
this
question
last
time.
There
is
general
consensus
among
pension
plans,
economic
forecasters
that
something
very
fundamental
has
changed
with
regard
to
inflation.
That's
a
fair
statement,
right
inflation.
A
And
in
looking
at
this
information,
I
guess
what
I'm
thinking
as
a
trustee
is
what's
driving
my
decision?
Is
it
the
forecast
or
is
it
the
cola,
because
the
colas
going
up
regardless
of
what
inflation
is,
unless
you
think
inflation
is
going
to
be
higher
than
the
cola
so
shouldn't
you
be
thinking
primarily
at
the
Cola
right
now,
if
we're
running
at
a
very
low
inflation
rate,.
L
A
A
L
The
key
to
like
I
said
it
has
no
direct
impact
on
your
on
your
evaluation.
The
key
really
is
the
wage
inflation.
So
it's
it's.
If
you
set
it
your
price
inflation
at
2
percent.
Your
wage
inflation
currently
is
three
point,
two
five
percent,
so
you
would,
you
would
implicitly
then
raise
your
wage
and
or
your
real
wage
increase
to
be
equal
so
that
you
don't
decrease
your
wage
inflation.
So
you
can
keep
your
wage
inflation
constant,
determine.
C
You
so
having
said
that,
one
last
timing
and
quick
question
does
that
then
follow
that,
based
on
my
question
that
I
asked
about
public
plan
database
in
California
public
pension
plans,
then
because
California
public
pension
plans
have
been
quicker
than
other
plans
in
the
country
to
decrease
the
discount
rate.
Then
somehow
California
plans
are
really
assuming
a
considerably
lower
Rhea
Rhea
return
than
our
peers
across
the
nation.
K
C
L
That
difference
is
between
1.6
and
1.8%
and
that's
across
all
different
time
periods.
For
instance
the
5
year
inflation
is
1.6
and
the
20
year
inflation
is
1.8,
so
it's
pretty
consistent
through
all
the
time
periods
and
that's
consistently
lower
than
the
what
we
were
seeing
last
year
at
this
time
in
was
30
to
50
basis
points
lower
than
last
year.
H
Take
a
minute
to
discuss
that
if
you
look
at
the
the
the
market
derived
rates
and
those
market
drive
rates
are
based
on
clearly
a
large
number
of
securities
and
in
the
case
of
Treasuries
trillions
of
dollars
in
of
tips
of
several
probably
several
hundred
billion
dollars.
So
this
is
a
fairly
robust
metric
and
if
I
go
back
to
2009
and
you've
just
sort
of
ten
years
ago,
and
the
numbers
have
been
lower
from
that
market
derived
metric
and
apparently
consistently
right.
L
H
And
they've
been
consistently
in
that
2%
range
they
have
moved
around,
but
not
from
two
to
four
or
from
1.9
2.1.
That's
kind
of
the
movement
there,
so
I'm
just
thinking
whether
the
2.75
going
out
2.5.
Although
it's
conservative,
there's
a
point,
I
think
there's
a
fine
line,
be
conservative,
inaccurate
and
conservative
and
just
wrong.
H
So
I'm
just
wondering
if
you
know
it's
great
to
be
conservative
but
I
think
to
the
extent
that
we
want
the
numbers
to
reflect
our
best
estimate,
whether
that
is
still
on
the
high
side
of
the
2.5
and
that
sort
of
consistent.
What
what
drew
is
mentioned
about
perhaps
is
structural
shift
in
inflation
downwards
and
I'm,
not
certainly
suggesting
going
much
lower
than
say
two
or
two
and
a
quarter,
but
going
from
2.75
to
25.
It
seems
conservative
but
probably
off
the
mark.
A
My
sense
of
what
might
be
valuable
here
is
to
let
you
go
through
the
presentation
so
that
you
can
tie
all
this
together
for
us.
So
that
way
we
can
see
what
the
impact
of
our
decisions
are
going
to
be.
I
feel
like
these
are
really
really
good
questions,
but
as
I'm
starting
to
think
through
this
I'm
feeling
like
it's
not
allowing
us
to
get
to
the
impact
on
the
plan,
and
maybe
if
we
get
to
the
bottom
of
this,
then
we
can
come
back
and
revisit
what
those
little
knobs
are.
We
might
adjust
yeah.
K
L
So
we
talked
about
wage
inflation
a
little
bit
already,
but
wage
inflation
is
can
be
thought
of.
It's
basically
across-the-board
increases
for
the
active
members,
and
it's
also
the
minimum
individual
salary
increase
that
we
use
in
the
valuation
to
project
members
salaries
until
they
retire
and
wage
inflation
is
generally
greater
than
price
inflation
to
account
for
increased
purchasing
power.
In
the
current
assumption.
H
L
Good,
so
segue
into
the
next
slide
is
that
this
is
looking
at
the
historic
look
at
how
wage
inflation
and
inflation
in
the
San
Jose
area
has
been
different
than
the
local
governments.
The
wage
growth
is
on
the
top
and
inflation
in
the
real
wage
growth,
and
you
can
see
for
San
Jose
that
they've
we've
had
consistently
higher
wage
growth
than
the
other
local
governments
and
higher
inflation.
L
But
bottom
line
is
that
the
real
wage
growth
is
is
higher
than
we've
seen
nationally
as
well.
So,
even
if
we're
considering
reducing
the
inflation
by
that
25
basis
points,
we
believe
we
should
hold
that
wage
inflation
constant
at
the
3.25%
based
on
on
this
data.
So
basically
by
reducing
the
inflation
like,
as
we've
said
in
the
earlier
slides,
is
that
it
really
doesn't
have
a
direct
impact
on
the
valuation,
but.
H
L
We
would
increase
that
50
basis
points
for
the
real
wage
growth
to
75
basis
points.
So
go
back
to
the
previous
slide.
There
see
the
equation
there
if
we
reduce
the
price
inflation
from
2.75
to
2.5,
we're
recommending
increasing
the
real
wage
growth
to
0.75
percent,
so
that
the
current,
so
that
the
wage
of
flashin
assumption
would
stay
constant
at
the
3.25%.
H
A
L
H
L
So
we
did
look
in
and
had
some
ideas
about
what
we
could
do
with
this.
This
new
assumption-
and
it's
really
appropriate,
given
that
when
we
looked
at
the
projected
city,
revenue,
growth
and
I
know,
we
couldn't
really
pinpoint
exactly
what
that
number
was,
but
somewhere
between
2.75
and
three
percent,
which
is
really
the
city
payroll
is
a
the
revenue,
is
a
proxy
for
the
San
Jose
payroll.
L
So,
basically,
what
that's
saying
is
that
the
San
Jose
payroll
could
be
increasing
at
a
lower
rate
in
the
short
term,
so
making
an
adjustment
to
your
immunization
scheduled
to
account,
for
that
is
more
conservative
way
of
looking
at
it.
You
could
also
look
at
having
that
amorous
Asian
payroll
increase
rate
at
2.5%
or
even
a
level
dollar
amount
which
is
0%,
but
a
level
dollar
amounts
like
you
would
have
in
a
mortgage
just
a
flat
dollar
amount
over
time.
L
K
He
said
that's
one
of
the
things
they've
started
looking
at
is
if
your
payment
increase
rate
is
too
high,
they
get
concerned,
particularly
if
it's
a
long
amortization.
We
don't
have
what
he
would
consider
a
long
amortization,
but
he
said
they
have
been
looking
more
and
more
at
trying
to
see
what
it
would
look
like
if
it
was
at
inflation
and
if
the
increased
rate
is
significantly
above
inflation.
It
causes
concerns
on
their
part
or
can
add
to
their
concerns.
So
so.
J
H
There
a
possibility
of
looking
at
other
alternative,
which
is
this
number
around
a
certain
medium,
say
two
and
a
half
percent
or
three
2.75
percent
or
inflation.
Two
point:
five
percent
sent
around
the
any
of
those
numbers
that
the
numbers
go
up
and
down
with
the
revenues
of
the
city,
so
that
the
burden
of
the
city
falls
when
its
revenues
fall,
the
burden
rises
when
the
serpentines
rises,
but
you
still
get
an
average.
That
is
consistent
with
whichever
of
these
three
options
we
choose
so.
K
We'll
show
you
here,
but
this
ends
up
being
a
if
you're
talking
about
the
difference
between
two
and
a
half
and
three
and
a
quarter
it
because
it
ends
up
being
a
real
refinement,
as
opposed
to
something
that
so
you
know
I
think
to
address
the
situation
you're
talking
about.
We
probably
need
something
good.
L
The
3.25%
is
like
our
baseline
and
it's
the
Green
Line
2.5
is
the
yellow
line
and
that's
showing
that
it
in
the
beginning.
It
starts
at
a
just
slightly
higher
level
than
the
3.25
baseline
and
as
an
increasing
over
time
by
two
and
a
half
percent,
and
you
can
see
at
the
end
of
the
image
this
payment
schedule.
L
The
payment
at
the
2.5
percent
schedule
is
lower
than
the
initial
3.25
and
then
the
level
dollar
amount
is
the
blue
line
across
the
top
of
the
page.
All
of
these
options
are
reasonable
and
basically,
a
lower
payment.
Growth
rate
results
in
a
more
conservative
contribution
strategy,
so
we're
considering
reducing
the
amortization
payment
increase,
particularly
after
bill
gets
done.
Discussing
some
of
these
a
memorization
smoothing
methods.
It
may
give
some
relief
I
mean
the
smoothing
methods
we
get
some
relief,
so
it
would
almost
be
an
offsetting
item.
Can.
L
So
it's
been
said,
moving
on
to
the
more
exciting,
more
impactful
assumption
the
discount
rate
going
back
to
an
equation
that
investment
consultants
and
actuaries
use
all
the
time.
It's
the
c,
plus
I
equals
b,
plus
e
c
plus
I
is
the
contributions
plus
investments.
The
B
plus
e
is
benefits
plus
expenses.
L
It's
basically
the
fact
that
the
you
set,
this
discount
rate
is
more
of
a
budgeting
tool
than
anything,
because
the
actual
returns
are
really
what
is
going
to
drive
the
cost
of
the
plan,
and
over
time
we
show
how
the
change
in
the
discount
rate
for
San
Jose
what
has
changed
and
from
2009
to
2010
a
change
in
the
discount
rate.
Almost
every
year
since
2009
and
and
lowering
of
the
discount
rate.
L
So
looking
at
historical
performance
is
one
it's
one
way.
We
look
at
setting
the
discount
rate
just
for
some
context,
though
it's
not
the
primary
focus
and
the
bars
are
the
returns
on
the
market
and
actuarial
value
of
assets.
Then
the
line
is
the
assumed
rate
of
return,
and
it's
important
to
point
out
here
that
out
of
the
eleven
years
five
of
these
years,
you've
had
market
value
returns
above
your
assumed
resumption,
but
only
one
of
those
years
where
the
actual
value
was
higher
than
the
assumption.
L
L
K
K
K
That
is
much
shorter
term
and
we
have
to
live
through
the
short
term
to
get
to
the
long
term
and
so
we're
placing
more
and
more
weight
on
the
short
term
and
just
to
give
you
kind
of
a
rough
measure
out
of
the
present
value
of
all
the
future
benefits.
We
expect
to
pay
to
current
members
just
current
members,
not
new
members,
about
40%
of
that
present
value
is
paid
within
the
next
ten
years,
seventy
percent
within
the
next
20
years.
So
so
we
do
want
to
consider
the
the
shorter
term
assumptions
as
well.
K
We've
traditionally
looked
at
your
investment
consultant
and
what
their
assumptions
are.
We
compare
them
to
other
investment
consultants
and
we
put
some
slides
in
the
appendix
to
do
that
comparison.
But
given
that
they
are
your
consultant,
they
understand
the
in
particular
the
alternatives
and
and
private
market
classes
that
you
have
better
than
what
we
can
get
out
of
just
a
generic
set
of
capital
market
assumptions.
We
tend
to
give
preference
to
to
your
consultant
to
the
extent
that
they're
not
deviating
their
assumptions
from
what
other
consultants
are
doing.
K
The
thing
we
note
this
year
is
that
the
expectations
are
significantly
higher
than
they
were
here.
We
go,
and
so
we're
gonna
talk
about
that
in
a
couple
slides,
but
there
were
two
things
that
change:
there's:
a
change
in
asset
allocation
and
there's
a
change
in
the
capital
market
assumptions.
Last
year,
makita's
ten-year
return
was
6%.
This
year
is
7.2
roughly
30
basis
points
of
that
120
basis.
Point
change
is
due
to
the
change
in
asset
allocation.
The
rest
is
due
to
the
change
in
the
capital
market
assumptions.
M
K
About
30
basis
points
of
the
120
or
actually
they
their
return
was
7.4.
We
weren't
able
to
match
their
tenure
quite
right,
we
may
have.
It
may
be
a
rounding
issue.
It
may
be
something
else,
but
somewhere
in
the
range
of
120
to
140
basis,
point
change
in
their
tenure
expected
return,
30
basis
points
of
that
was
due
to
the
change
in
asset
allocation
and
the
remainder
was
the
change
in
the
capital
market
assumptions.
So.
M
K
C
A
Here's
what
I
want
to
propose
for
us
and
I
appreciate
you
coming
in
on
that
I'm
gonna
shift
this
a
bit
back
to
our
normal
Robert's
Rules
of
Order,
so
that,
if
you
do
have
a
question
or
a
comment,
raise
your
hand
and
I'll
call
on
you,
because
I
really
want
them
to
get
through
this,
because
a
lot
of
the
information
that
we're
getting
we're
gonna
see
that
as
they
go
through
the
presentation,
then
we'll
come
back
and
try
and
fill
in
the
blanks
here.
Okay,
thank
you.
K
Yeah
so
the
capital
market
assumptions
that
Makita
said
and
most
investment
consultants
they
set
each
December,
and
so
the
issue
with
this
year's
capital
market
assumptions
is
December.
2018
was
a
very
different
point
in
the
market,
then
either
before
or
since,
and
so
we
show
in
the
top
part
of
the
table
just
some
some
measures
of
the
market
and
you
can
see
the
10-year
Treasury
yield,
went
from
2.4
in
December
of
2017
up
to
2.8,
3
and
then
down
to
2.0
7
as
of
June,
the
S&P
500
had
had
fallen
and
then
it
recovered.
K
In
the
first
half
of
the
year
there
have
been
adjustments,
I
guess
in
this
quarter.
Cape
is
the
cyclically
adjusted
price
earnings
ratio
which
affects
valuations
of
stocks,
so
those
are
just
a
few
of
the
measures
that
might
go
into
setting
the
expected
returns.
If
you
look
at
the
bottom
part
of
the
graph,
we
selected
just
some
of
the
asset
classes,
to
show
you
the
difference
between
last
year's
assumptions
and
this
year's
assumptions,
and
so
like
short-term
bonds.
K
The
expected
return
increased
a
hundred
basis
points
large
cap
stocks
about
fifth,
some
of
the
international
stocks
increased
over
200
basis
points
and
with
the
changes
in
the
market.
The
question
is:
is
that
is
that
the
right
basis
we
should
use
now
to
set
our
expected
returns
and
I
guess
our
view
is?
Is
we
should
be
a
little
bit
skeptical
about
the
optimism?
That's
represented
in
those
December
capital
market
assumptions,
not
because
there's
anything
wrong
with
them,
but
because
they
were
based
on
conditions
in
December
and
those
are
not
the
prevailing
conditions
today.
K
So
our
our
starting
point
is
that
we
think
6.75
remains
a
reasonable
assumption.
We
don't
know
how
to
adjust
all
the
asset
classes
for
the
changes
in
the
markets
over
the
last
six
months
and
Makita
doesn't
address
those
on
interim
periods.
They
only
address
them
annually,
so
we
don't
have
a
robust
model
to
make
that
kind
of
adjustment.
K
K
K
Okay,
the
other
topic
we
wanted
to
talk
about
came
from
the
retreat,
where
we
were
talking
about
the
amortization
payments.
Specifically,
the
tier
1
am
ization
payments
and
the
pattern
that
that
results
in
for
costs.
So
we
showed
this
chart
at
the
retreat,
but
to
refresh
your
memory,
our
am
ization.
Payment
is
made
up
of
a
lot
of
different
components
for
each
year.
There's
a
gain
and
loss,
there's
assumption
changes
and
then
any
other
changes.
We
set
up
separate
a
musicians,
and
so
this
chart
shows
the
light.
K
These
are
from
2005,
they've,
been
paid
off
and
so
reduces
the
net
contribution.
But
then,
two
years
later
we
have
an
increase
and
that
increase
is
because
we've
paid
off.
We
finished
recognizing
a
game
that
we
got
in
2007
and
then
we
go
out
a
couple
more
years
and
we've
paid
off
the
loss
from
2009
and
then
we
start
this
significant
drop
in
contribution
rates,
which
then
bounces
back
up
when
we've
recognized
the
2011
game.
K
So
one
of
our
objectives
is
to
provide
some
predictable
and
stable
contribution
rates,
and
so
the
thought
was.
Maybe
we
don't
want
these
periods
where
it
goes
down
and
then
back
and
we
are
gonna
layer
more
on
top
of
this.
But
that's
not
gonna
affect
this
basic
pattern.
We're
gonna
have
this
basic
pattern
of
it
going
down
and
back
up,
and
then
we
also
maybe
don't
want
such
a
steep
drop
here.
K
K
What
that
does
is
that
creates
this
blue
line
as
opposed
to
the
red
line,
so
we
you
can
see
were
were
slightly
lower
over
the
next
four
years
than
what
was
projected
and
then,
instead
of
going
up,
we
stay
fairly
consistent,
but
we
extend
one
more
year
than
we
would
have
under
the
current
schedule.
And
then
we
don't
drop
as
far
and
then
we
continue
our
migration
down.
We
still
pay
off
the
UAL.
K
At
the
same
time,
the
the
real
difference
is
just
right
in
this
period,
but
there
are
some
slight
reductions
here
now
I
would
say.
Also
these
are
only
the
amortization
from
the
2018
valuation.
So
we
already
knew
that
we
were
smoothing
in
some
losses
on
the
asset
side
and
then
we
didn't
meet
the
expected
return
this
year,
so
our
actual
cameras
ations,
are
likely
to
be
higher.
We
still
don't
know
what
our
experience
is
in
terms
of
the
demographic
experience.
K
K
We
have
a
model
we
can
play
with,
but
the
reason
I'm
bringing
it
up
is
not
really
to
play
with
it.
So
much
just
to
show
you
this
table
over
on
the
right
shows
the
percent
of
total
pay
that
would
be
made
for
the
UAL
payment.
Only
these
are
not
the
total
contribution
rates,
just
the
UIL
payment
and
then,
if
you
make
these
changes,
this
is
what
the
new
pattern
would
be
and
here's
the
change
in
the
pattern,
and
so
it
would
reduce
it.
K
It's
expected
to
reduce
it
about
1.4
percent
of
pay
for
the
first
four
years
and
then
7.3
percent
for
those
two
years
where
it
bounced
back
up
previously,
but
then
it's
higher
by
12
percent
11
percent
for
two
years
before
dropping
down
to
numbers
that
are
very
close
to
the
ongoing.
So
so
that's
that's
the
trade
off
it's
a
trade
off
in
years
to
smooth
the
pattern
and
make
it
that
more
consistent
part
of
the
budget.
K
A
I
open
it
up
for
questions,
I
want
to
point
out
on
slide.
21
I
did
have
a
conversation
with
Bill
around
this.
You
can't
imagine
the
number
of
options
he
could
create
here
right
and
in
trying
to
put
together
a
fairly
smooth
amortization
schedule,
so
the
least
amount
that
we
start
to
tinker
with
this.
The
better
I'm
entrusting
the
professional
advice
that
we're
getting
the
work
that
all
the
scenarios
that
he's
ran
through
to
get
to
this
you're.
Looking
at
really
six
changes
here,
and
that's
really
important
to
keep
that
in
mind
as
we.
K
A
Right,
you
pointed
out
that
the
price
inflation
and
wage
inflation
tied
together
and
really
it's
more
of
an
impact
of
what
you
think
that
real
return
is
in
terms
of
the
the
difference
between
the
two
and
obviously
the
discount
rate.
You
spent
time
talking
about
that.
So
that
was
valuable,
particularly
it.
If
you
didn't
really
get
the
points
of
the
fourth
quarter
of
2018
makitas
valuation
was
at
that
end
point
the
market
sold
off,
which
means
future
returns
are
likely
going
to
be
higher.
A
We've
actually
captured
a
fair
amount
of
those
future
returns
in
the
first
nine
months
of
the
year.
So,
if
you
were
to
look
at
on
page
18,
the
50
percentile
last
year
was
6%
instead
of
7.2
and
the
20-year
was
7%
instead
of
7.8.
It's
really
important
to
keep
that
in
mind,
because
I
don't
want
this
to
have
too
big
an
impact
on
how
you
think
about
the
discount
rate.
Cuz
I
know
drew.
That
was
a
little
bit
where
the
path
you
were
going
on
so
veikkaus
I
think
you
had
a
question.
H
K
H
K
K
H
I'm
sort
of
left
scratching
my
head
a
little
bit
son
and
that's
more
because
I'm
less
informed
all
the
other
trustees,
not
not
because
of
anything
you've
done.
But
when
we
created
the
amortization
schedule
that
already
increases,
you
know
all
kinds
of
liabilities
by
various
numbers.
You
know
there's
so
to
have
an
additional
increase
by.
H
B
M
Discount
rate
discussion,
but
I
apologize
to
the
board
I
will
miss
the
next
board
meeting,
which
is
so
much
the
most
important
board.
Meeting
a
year,
I
have
to
chair
meeting
in
China
I
tried
to
look
I
couldn't
get
out
of
it.
So
I'm
really
looking
you
Vince,
because
you
really
sort
of
kicked
this
off
in
2012.
M
There's
a
coherent
narrative
underlying
all
this
and
clear
narrative
is
that
we
sort
of
figure
out
how
much
risk
were
willing
to
take
gone,
and
we've
said
I
think
partly
in
reaction
to
the
city
and
to
the
mayor
that
we're
willing
to
take
on
more
risk
because
the
city
is
strong
and
I
think
when
we
take
on
more
risk
and
adjust
our
portfolio,
it
degenerate
a
slightly
higher
return.
I
think
it's
incumbent
on
us
to
slightly
raise
the
discount
rate
from
six
point.
M
Seven,
five,
six
point:
eight:
seventy
five
we
tend
to
raise
to
raise
it
in
AIDS
and
I.
Think
politically.
If
we
don't
hold
true
to
that,
axiom,
I
think
we're
gonna,
send
the
wrong
message
to
our
members
to
the
city
and
so
on.
I
think
we
dialed
the
risk
way
down
and
I
think
you
know
Vince.
You
said
a
couple
years
ago:
I
think
we've
over
dialed
that
risk
I
think
the
met
the
mayor
and
the
City
Council
come
back
and
said
guys
we're
pretty
strong.
M
You
can
take
on
a
little
more
risk,
not
a
lot.
Nobody
in
the
city
said:
oh,
it's
a
girl
and
you
know
high-risk
stocks,
but
we
did
tweak
that
knob
consciously
and
I.
Think
anytime.
We
tweak
that
knob
consciously
and
our
financial
people
say
so.
I
asked
you
to
that
question
bill
yeah
yeah.
When
you
take
on
that
much
more
risk
that
much
more
volatility.
We
should
see
about
a
30
basis,
point
increase
over
time
in
our
return.
I
think
we
should
reflect
that
by
raising
our
discount
rate.
A
Probably
I'm
gonna
go
to
you
in
one
second,
but
I
want
to
respond
to
that
bill.
When
you
were
commenting
on
that
slide
of
the
50%
tile
and
the
fact
that
we've
actually
had
a
return
expectation,
that's
been
different
than
our
discount
rate.
Part
of
it
is
that
we
wanted
to
philosophically
have
a
greater
probability
than
50/50
of
ashlee,
meaning
the
assumed
return
and
I
I
know.
We've
had
the
discussion,
particularly
at
our
retreat
in
April
about
intergenerational
equity,
and
if
you
move
too
far
from
that
50
percentile,
then
you
start
to
impact
them.
A
But
if
I
sat
down
with
any
one
of
you
individually
and
said,
you
know,
you've
got
this
much
money.
I
think
you
might
live
this
long,
I
think
there's
a
50/50
chance.
You're
gonna
make
it.
You
probably
wouldn't
want
to
rely
upon
that
plan
to
get
you
from
here
to
end-of-life,
so
that
to
me
is
a
little
concerning.
A
Secondly,
the
fact
that
we
actually
have
a
difference
difference
in
assumed
return
and
the
expected
return
in
the
plan
helps
us
tackle
the
UAL.
That's
intentional.
We
haven't
seen
the
city
increase,
additional
contributions
to
the
plan.
I
think
council,
member
Deb
Davis
brought
that
up
at
our
joint
meeting
with
the
boards
and
the
City
Council
is
that
could
be
an
action
the
city
could
take
it.
They
wanted
to
knock
down
the
UAL.
A
A
The
last
point
I
want
to
make
through
raising
the
discount
rate,
and
it's
very
simplistic
and
I
know,
there's
a
lot
of
ways
of
looking
at
it
assumed
returns,
but
looking
at
the
risk-free
rate
and
building
from
there
that
chart
that
they
had,
which
showed
the
10-year
Treasury
at
2%
today
is
closer
to
1.5%.
If
that's
a
building
block
and
we're
lowering
the
foundation,
but
we
want
to
assume
that
we're
gonna
actually
hit
higher
returns.
That's
quite
a
leap,
so
those
would
be
my
responses
to
that.
M
Probably
even
quick
reaction
that
actually
makes
a
lot
of
sense
to
me
I
think
we
can
send
a
message
that
says:
look.
We
have
dialed
up
the
risk,
but
we're
not
gonna
reflect
that
just
yet
in
the
discount
rate-
and
here
are
the
four
or
five
good
reasons
you've
said,
fitzy
I'd
be
very
comfortable
that,
but
let's
send
that
message
right
because.
B
M
Have
we've
heard
you
mr.
mayor
City
Council,
we
dialed
up
the
rest,
give
us
a
chance
to
absorb
that
we're
not
going
to
lower
the
rate
glowing.
The
rate
would
send
the
wrong
message,
and
the
second
point
is
something
you
cash.
You
know:
I've
gone
around
round
lists
or
five
or
six
years
Vince
and
I'm
supportive
of
you
in
this,
and
you
you.
M
When
you
say
okay,
we
are
going
to
own
the
schedule
slip
and
the
way
we're
going
to
own
that
Murphy's
Law.
Some
somebody
pays
us
bad
news.
Is
we're
deliberately
going
to
kick
the
can
towards
us
a
little
bit
and
I
am
comfortable,
but
let's
acknowledge
that.
That's
what
we're
doing
right,
we're
doing
the
opposite
of
kicking
the
can
down.
The
road
were
sorry
City
for
that,
but
we've
seen
what
happens
other
plans
when
they
kick
can
down
the
road
and
so
we're
going
to
own
the
uncertainty
in
the
plan.
M
M
A
That's
a
great
point
sure
that
our
messaging
needs
to
be
clear
on
why
we're
selecting
this
kind
of
a
discount
rate,
the
other
factor
that
I
failed
to
talk
about
is,
although
the
markets
bounced
right
back
this
year
from
the
canyon
that
we
were
in
in
the
fourth
quarter
of
last
year,
we're
back
at
these
rich
levels
today
and
to
expect
higher
expected
returns.
You
actually
need
to
have
cheaper
markets.
I
mean
that's
what
we
got
from
Makita
in
December,
the
markets
were
cheaper.
A
D
Think
it's
a
reasonable
assumption.
It's
not
seven!
It's
closer
to
six
since
then,
we've
had
more
of
a
life
normal
market
X
for
the
last
week.
The
second
thing
the
board
did
make
a
decision
to
increase
risk.
This
is
in
support
of
slightly
increasing
the
rate
and
we
went
our
standard
deviation.
I'm,
just
using
makitas
numbers
went
from
11
to
12
and
a
half
pretty
big
jump
and
our
expected
return
on
a
10-year,
forward-looking
basis
went
from
six
point.
D
Nine
to
seven
point:
five
60
basis,
point
jump
and
we
made
this
decision
in
August,
so
our
expected
returns
are,
you
know,
projected
on
a
going-forward
basis,
60
basis
points
higher,
whether
we
will
actually
realize
that
or
not
is
a
different
question,
but
we
have
dialed
up
the
risk
a
little
bit.
So
those
are
the
two
points.
D
I
wanted
to
make
and
I
just
thought
of
the
third
point
which
actually
a
Fed
trustee
pointed
out,
and
it's
but
a
Fed
trustee
pointed
this
out,
and
so
it's
been
working
on
my
mind
ever
since,
and
it's
more
of
a
behavioral
thing
right.
So
if
you
lower
your
discount
rate,
you
then
start
Makeda
looks
at
that
and
then
you
start
building
a
portfolio
that
can
be
a
little
bit
more
conservative
and
that
may
have
happened
in
the
last
several
years.
D
H
Back
to
what
drew
said
earlier,
you
know
we
our
standard
deviations
gone
up
a
bit,
and
so,
given
that
the
portfolio's
Sharpe
ratio
hasn't
changed
much,
it
does
argue
for
a
modest
increase
in
in
expected
returns.
I.
Don't
want
to
press
that,
but
I
think
that
is
what
I
wear
I
would
if
I
had
a
choice,
I
would
say
if
we
haven't
been
standing
still,
we
have
moved
in
the
right
direction
in
terms
of
shifting
some
things
around
the
portfolio
that
the
returns
should
be
higher,
at
least
expectation
aliy.
H
The
other
thing
I
just
wanted
to
bring
up
is
then
we
should
not
be
targeting
higher
than
50%
probabilities,
because
your
example
works
wonderfully
for
an
individual
or
for
a
family.
I
think
where
a
lot
of
us
make
I
think
an
error
of
judgment
is
that
that
a
plan
is
not
a
cedi.
Is
it's
not
a
family
is
not
an
individual.
A
family
doesn't
have
any
other
legs
to
stand
on.
M
Okay,
I
can't
rebut.
Let
me
rebut
that
I'm
Clyde
14,
so
that's
what
my
instinct
tells
me,
but
there's
a
little
knot
in
the
back
of
my
head,
and
it
says
this
is
something
we
were
gonna
work
on
over
the
next
couple
years.
What's
the
historic
bias,
because
that
works,
if
we're
bouncing
around
our
forecasts,
I'm
pretty
confident.
We
all
believe
this
is
part
of
the
cola
that
we've
consistently
under
forecast.
Our
liabilities
to
the
extent
of
billions
of
dollars-
and
that's
probably
due
to
retroactive
benefit-
increases,
that's
pretty
straightforward.
M
So
the
question
is
over
a
five-year
period
of
ten
year
period
of
20
year
period,
and
this
is
who
owns
the
schedule
slip?
Do
we
consistently
under
forecast
our
here's,
the
benchmark?
How
do
we
do
against
that?
This
is
that
you
know
alpha
argument
and
this
slide
would
seem
to
say
that,
at
least
in
the
recent
past
we
have
under
forecast
and
I.
M
Don't
know
if
that's
what
that
says,
it
could
say
a
lot
of
different
things,
but
that
bias
that
implicit
bias
has
to
somehow
get
factored
in,
and
so
when
Vince
says
well,
we
want
to
hit
more
than
50%
of
time.
I
translating
that
in
my
brain
to
say
you
know,
drew
one
way
before
we
know
the
implicit
bias
would
just
be
to
turn
that
knob
a
little
bit
until
we
know
the
implicit
bias
and
the
fact
you
talk
about
tree
rings
builds
last
offsite.
The
fact
that
you
and
I
can't
intellectually
right
now
say
okay.
M
So
how
much
have
we
hundred
forecast
liabilities
over
a
quarter
century
ten
years
buy
your
five
years
now?
How
much
have
we
under
forecast
the
assets
and
why
I
think
speaks
volumes
about
the
problems
to
the
pension
systems
in
California
and
we're
gonna
get
at
that?
We
talked
about
that
for
years.
Vince
I
know
you're
a
supporter
of
that.
That's
what
your
offsites
were
about.
So
that's
my
problem
is
my
gut
tells
me
that
we
have,
and
we
have
these
biases
both
on
liabilities
and
the
biases.
M
Why
buildings
I,
don't
know
our
massive
but
I'm
guessing?
We
also
have
a
bias
on
assets
and
how
do
we
incorporate
that
bias?
Maybe
we
should
do
nothing
cuz,
we
don't
know
yet,
but
it
seems
to
be
that
we
don't
hit
what
we
say.
We're
gonna
do
and
the
questions
other
plans,
it
would
say:
they're
gonna
do.
Is
there
a
systemic
bias
across
all
the
pension
plans
of
California
I.
B
A
A
Conversely,
what
we
talked
about
in
the
retreat
and
off
site
was
that,
in
the
event
that
we
got
into
a
difficult
economic
climate
and
the
city's
finances
were
to
be
impacted
by
that,
we
could
use
these
tools
to
provide
some
relief
to
the
sponsor
and
at
the
same
time,
if
assets
went
down,
future
returns
would
be
higher
which
may
justify
higher
discount
rates
in
the
future.
The
other
tool
which
I've
been
very
reluctant
to
use
has
been
changing
the
amortization
time
period,
trying
to
keep
that
as
short
as
possible.
A
B
F
World's
not
flat
right
we're
talking
about
this
just
strictly
in
a
financial,
but
this
is
actually
a
much
bigger
picture.
So
the
first
thing
I
will
say
is
that
there's
two
systems
that
are
lower
than
us
we're
tied
with
two
others.
So
we
have
been
leading
the
pack
here
in
the
discount
rate
and
what
I'm
basically
saying
is
I'm
an
advocate
for
leaving
it
where
we
are
and
here's
some
of
the
reasons
why
there's
going
to
be
some
uncertainty
come
on
in
the
last
11
months,
we've
lost
100
police
officers.
F
There's
gonna
be
a
little
lull
the
end
of
next
year
that
numbers
gonna
go
on
for
five
years.
We
can't
hire
that
fast.
We've
talked
about
some
of
the
risk
that
we
have
in
our
plan,
it's
partially
because
we
have
more
people
retired
than
active,
and
we
are
going
to
struggle
to
hire
and
I'm.
Speaking
on
the
police
side,
perf,
which
is
police,
executive,
Research
Forum,
just
came
out
with
a
very
large
article
on
public
safety
crisis
and
it's
they
can't
get
people
to
do
these
jobs
anymore.
F
So
hiring
is
becoming
more
of
a
problem
and
we're
gonna
get
into
a
large
group
of
people,
leaving
and
I.
Think
correct
me
if
I'm
wrong,
but
the
city's
over
the
next
few
years
is
also
projecting
some
budget
deficits.
So
so
your
point
about
the
plan
sponsor
being
able
to
pay
and
that's
being
able
to
give
them
a
little
bit
of
relief.
Lowering
that
discount
discount
rate
right
now
is
going
to
increase
a
contribution
when
they
already
know
they're
gonna
be
a
little
underwater.
C
C
Harvest
harvest
accent,
yes,
and
it's
to
remind
you
that
add
another
day
you
are
a
fiduciary
to
the
members
of
the
plan.
Clearly
he
makes
sense
to
take
in
consideration
everything,
including
and
it's
an
important
factor,
the
ability
by
the
employer
to
pay.
But
you
know
I
just
feel
compelled
if
Harvey
was
here,
he
will
tell
you
at
the
end
of
the
day.
C
G
I
agree
with
everything:
Roberto
said
the
fiduciary
duty
is
owed
to
the
plan
not
to
the
employer.
Every
single
decision
you
make
should
be
viewed
through
the
lens
of
what
is
good
for
the
members.
Having
said
that,
sometimes
what
is
good
for
the
members
is
also
good
for
the
city,
because
you
do
have
active
members
who
are
participants
in
the
city
and
when
the
city
finances
get
in
trouble,
that
might
mean
less
pay
less
jobs
for
the
active
members.
That
is
there's
case
law
directly
on
point.
G
That
holds
exactly
that,
including
a
case
of
one
of
our
cases,
holds
exactly
that
from
2017.
So
it's
all.
It's
all
part
of
the
consideration.
The
with
regard
to
your
level
of
flexibility
in
this
realm
I
consider
this
realm.
These
actuarial
decisions
assumed
rate
of
returns
and
relation
schedules.
To
me,
this
is
the
very
heart
of
your
discretion.
This
is
you
what
you
decide
collectively
as
a
board,
is
the
right
answer:
I,
don't
really
think
there.
G
There
is
not
a
right
answer
until
you
tell
us
what
it
is
so,
what's
great
is
that
you
have
these
debates
everything
you've
been
doing
today.
You
air
it
out,
people
make
thoughtful
comments,
you
reach
a
decision
and
then
it
will
absolutely
be
defensible.
Everything
that's
been
talked
about
today
is
within
your
discretion.
Your
actuaries
telling
you
that
I'm
telling
you
that
I
think
these
smoothing
ideas
are
great.
Personally
I'm,
not
you
know,
I'm
not
trying
to
tell
the
board
what
to
do,
but
I
love
the
work.
G
They've
done
I
mean
I
love
that
they've
shown
you
that
it's
all
still
within
the
range
of
reasonable
approaches
and
you're,
just
smoothing
out
the
chart
so
that
you're
not
having
massive
ups
and
downs
but
yeah
yeah,
so
I
mean
every
like
I
said.
Roberto
is
absolutely
correct,
but
the
plan
sponsor
is
an
important
part
of
the
members
interests.
So
so
you
have
to
consider
it
all.
It's
all
one,
big
organic
being
that
you
need
to
take
care
of,
but
but
obviously
the
members
come
first.
F
Everybody
saying
I
would
like
to
keep
the
discount
rate
current.
You
know
it's
important
to
pay
off
this
from
the
liability
as
soon
as
we
can,
but
I'm,
also
very
conscious
about
the
city
and
web
making
sure
their
contributions
don't
go
up
too
high.
It
also
affects
tier
two
to
because
they
played
50
percent
of
liability
with
on
page
at
the
very
beginning.
F
On
page
three
is
already
showing
that
from
last
year
to
this
year,
not
including
I
believe
the
not
hitting
our
target.
The
city's
contribution
is
going
to
go
from
80
per
state
II
point
through
eight
to
eighty
two
point:
six,
so
we're
already
capturing
increase
in
contributions
from
from
the
city
and
also
go.
F
Think
we
just
got
to
keep
it
steady
I
hate
to
use
are
all
tools
in
our
tool
belt
that
we
talked
about.
You
know
changing
the
amortization
schedule,
ramping
up
the
discount
rate
a
little
bit
higher
to
provide
a
relief
for
the
city
for
the
members,
because
I
don't
think
we're
at
that
point.
Yet
we
got
to
wait
for
that
point.
We
don't
want
to
use
all
our
tools
in
our
tool
belt.
H
Because,
somewhere
to
get
to
the
bottom
on
page
23,
where
decisions
are
outlined,
I'm,
okay,
with
all
of
the
recommendations
except
one
and
the
one
is
the
the
wage.
Inflation
I
think
that
that
is
the
one
that
is
actually
out
of
whack
in
terms
of
being
inconsistent
with
the
framework
that
that
bill
and
has
laid
out
if
we
lower
the
inflation
from
two
point.
Seven
five
to
two
and
a
half
I
would
say
that
beige
inflation
dropped
probably
should
come
to
three
percent,
and
everything
else,
I
believe
seems
reasonable
to
me.
I
think.
H
And
in
terms
I
just
want
to
address
one
thing
about
biases:
yes,
there
are
biases
and
all
systems
and
all,
but
we've
tried
to
do
what
we
can
by
relying
on
Makita,
so
that
these
are
not
our
own
individual
opinions,
but
we
try
to
externalize
the
the
inputs.
So
so
I
would
say
that
6.75
clearly
makes
sense.
Lowering
it
makes
limited
sense.
I
can
see
it
going
higher,
but
not
lower.
The
only
number
I
would
change
as
a
wage
inflation
to
be
consistent
with
the
2.5
plus
2.5,
which
gets
to
three
percent.
Not
three
point.
A
Well,
and
do
you
want
to
comment
again
on
on
that
piece,
I
think
what
I'm
trying
to
understand
is
which
one's
more
impactful,
the
inflation
number
or
the
wage
number
I
know
that
by
lowering
the
inflation
number,
the
only
thing
that's
changing
is
the
real
wage
growth
but
you're
focused
on
the
wage
growth
number
itself.
The
three
right.
K
A
On
page
10
of
your
presentation,
you
show
the
20-year
wage,
both
numbers
sitting
right
around
three
and
a
quarter
so
I'm,
because
I'm
more
focused
on
that
than
I
am
the
actual
inflation
number.
Because
that's
what
moves
the
needle
here
more
than
anything
else
so
I'm
for
discussions
in
gonna
make
a
motion
that
we
accept
the
recommendations
that
are
provided
here.
One
on
price
inflation
consider
reducing
that
from
2.75
to
2.5
wage
inflation.
J
A
A
A
H
H
H
So
if
the
inflation
right,
the
the
wage
growth
has
not
happened
in
isolation,
it's
happened
because
prices
have
risen
by
two
and
three
quarters.
So
if
prices
are
expected
to
rise
at
two
to
two
and
a
half
percent,
two
and
a
half
itself
is
quite
conservative,
then
I
would
say
the
the
right
number.
It's
probably
closer
to
three,
not
three
and
a
quarter.
Mm-Hmm.
B
F
Am
in
favor
of
those
recommendations
that
Chiron
has
proposed
I
think
on
the
topic
of
amortization
adjustments,
I
think,
maybe
there's
you
could
do
some
slight
improvement
on
the
years
between
2026
and
2030
and
I.
Think
in
the
cases
where
you've
tweaked
it
a
little
bit
I
think
you
can.
You
can
probably
improve
that
slightly.
G
F
K
K
F
To
followup
on
Gia's
comments
when
so,
you
smooth
out
a
few
prior
years
by
doing
this,
how
far
in
advance
should
we
be
looking
to
the
smoothing
out
so
I
mean
so
it's
addressed
at
27,
28
years.
That
Gia's
talking
about
is
that
something
we
typically
address
seven
years
advance,
or
do
we
wait
till
three
to
five
years
prior.
K
A
F
A
H
E
H
A
K
C
In
fact,
you
made
that
you
reminded
us
the
governor's
committee
two
weeks
ago,
so
I
did
pitch
out
to
Bill
and
he
very
politely
reminded
me
that
he
actually
sent
me
some
information
on
these
about
five
months
ago.
I
think
there's
a
cost
to
it,
and
so
I'm
I'm
just
debating
how
to
bring
that
request
to
the
floor
at
a
future
meeting
or
talk
to
the
board
chairs
first,
because
they
say
costs
associated
with,
providing
that
to
to
the
trustees
and
I
think
the
cost
is
the
same,
whether
it's
just
one
trustee
or
all
trustees.
C
C
K
H
B
I
just
got
the
county
pension
plans.
Just
give
me
a
little
statement
here.
It
said
a
nutshell
that
says
how
unfunded
public
pensions
are
in
the
United
States
and
it
says
basically
44
trillion
dollars
throughout
the
United
States.
So,
in
my
opinion,
what
we're
doing
is
trying
to
do
the
best
we
can
to
make
sure
that
people
have
money
to
retire.
Thank
you.
A
A
Aurelio
of,
let
me
finish
with
Kevin
P
McMillan
police
officer,
police
department,
effective
October,
5th,
2019,
25.8,
six
years
of
service
with
reciprocity,
Aurelio
Rodriguez
police
officer,
police
department,
effective
September,
21st
2019,
with
27.3
years
of
service.
Nicholas
l
speaks
police
officer,
police
apartment,
effective
October,
5th
2019,
with
twenty
five
point,
one
four
years
of
service
to.
A
Right
the
motion
by
Santos
second
by
trustee
Muyo,
all
in
favor
all
right
any
opposed
I'm
gonna
continue
with
this
and
I'll
come
back,
we'll
go
through
five.
We
have
five
to
a
alum
Allen
Emmie
police,
sergeant
police
department,
effective
October,
13th
2019,
with
twenty
six
point
one
one
years
of
service.
This
was
a
deferred
vest.
B
A
All
right,
all
in
favor,
okay,
let
me
back
up
to
probably
the
most
important
item
on
the
agenda
really
was
not
intentional.
That
I
wanted
to
pass
by
giving
up
this
chairmanship,
but
for
e
is
nomination
for
the
position
of
board
chair
for
the
calendar
year
2020
and
simply
to
start
this
off
I
have
to
tell
you
that
it
has
been
fantastic
working
with
Andrew
over
the
last
couple
of
years,
as
the
vice
chair
he's
extremely
engaged.
He
asked
great
questions
and
in
fact,
he's
actually
led
a
couple
meetings
now,
which
has
been
terrific.
A
J
A
A
B
A
B
A
B
B
Also
to
sergeant
Lee
I
did
not
have
the
pleasure
of
knowing
the
sergeant
Thomas,
but
obviously
on
behalf
of
the
board
and
myself
condolences
to
his
family
and
friends,
Vikrant
and
is,
and
I
actually
got
hired
together
years
ago
and
worked
together
in
patrol
and
also
worked
a
couple
of
extra
jobs.
On
occasion,
just
a
happy-go-lucky
guy
really
enjoyed
being
a
police
officer.
He
was
a
good
police
officer
and
I'm
very
sorry
to
hear
of
his
passing
so
again
on
behalf
of
the
board,
our
condolences
to
his
family
and
friends.
B
A
H
F
A
F
F
Actually
think
that
we
may
need
to
probably
tweak
some
of
the
information
to
the
investment
committee
a
little
bit
more
just
so
that
we
can
kind
of
have
a
good
sense
of
what
what
has
been
invested
in
as
opposed
to
just
one
line.
That
they've
already
invested
in
I
mean
that's
just
kind
of
now
that
we're
moving
to
every
other
month
and
then
there's
less
data
that
we're
seeing
so
I.
Don't.
K
A
M
B
M
F
So
the
idea
being
that
when
staff
has
to
respond
to
something
they
have
to
look
at
our
specific
document
to
see
in
which
way
it
may
be
different
than
how
federated
would
do
it
and
trying
to
get
them
all
in
a
line
and
I
think,
with
the
exception
of
about
one
item,
correct
me,
if
I'm
wrong
Roberto,
we
were
pretty
much
in
agreement
with
changing
all
the
language.
It
was
all
minor.
Tweaks
I
think
the
one
area
was
related
to
the
communications
Yesi.
F
Differed
federated
wanted
a
more
I,
think
liberal
policy
that
allowed
the
chair
to
speak
on
behalf
and
we
kind
of
wanted
to
keep
it
narrowed
down
that
the
CEO
would
direct.
Whoever
is
most
appropriate
to
make
those
kind
of
communications.
For
example,
if
it
was
something
related
to
legal,
then
he
would
have
legal
make
it
or
he
would
make
it
if
it
was
investment
related.
C
C
There
were
some
minor
changes
in
all
the
ones
that
are
listed
here
on
an
action
and
I
Dendy,
some
minor
changes,
but
then
the
big
one
was,
you
didn't,
have
to
make
any
changes
but
federated
to
being
comply
to
be
in
agreement
with
police
and
fire.
It's
a
second
what
you
just
indicated
so
because
federated
community
not
mean
because
they
didn't
have
a
quorum.
We
are
intending
to
bring
these
items
to
their
meeting
in
October
and
they
will
deal
with
that
there.
C
Ideally
they
will
agree
with
you
bore
approach
on
who
should
be
the
designated
it's
either
the
CEO
or
the
CEO
of
the
Sydney,
depending
on
the
case
or
general
counsel,
right
which
DVA
from
for
the
radius
so
I'm
hoping
for
the
radio.
It
will
be
willing
to
take
that
input,
but
there's
always
a
chance
that
they
may
not.
A
However,
in
other
parts,
it's
more
specific
to
the
cio,
so
who's
making
a
recommendation
to
the
investment
committee
into
the
boards.
Is
this
staff
and
the
cio
considered
to
be
one
because
there's
nowhere
in
here
that
it
references
the
cio
in
making
the
recommendation
to
the
board
or
the
investment
committee
on
the
general
consultant
I.
C
A
A
Where
is
the
investment
consultants?
Okay?
This
is
again
7.3
d
number,
10,
okay,
on
page
four
investment
consultants,
the
CIO
appoints
and
terminates,
and
we
know
clearly
we
were
delegating
that.
But
there
was
one
minor
thing
which
is
in
the
CIO
Charter,
which
is
the
board,
approves
all
contracts.
But
that's
not
it's
not
clearly
spelled
out
here
and
that's
a
really
important
thing.
I
just
want
to
make
sure
that
that's
in
getting
missed
that
it's!
C
A
D
C
A
C
So
two
things
I
agree
with
you
in
the
CIO
and
the
CEO
charter,
because
in
the
discussion
there
was
understanding
that
those
have
been
dealt
with
with
by
the
ABC
cup
by
the
joint
Personnel
Committee.
So
they're
going
to
come
back
after
the
joint
Personnel
Committee
have
a
chance
to
make
whatever
changes,
suggestions
they're
going
to
be
made
in
after
the
matrix
and
everything
else,
so
that
that's
it's
a
separate
issue
on
this
one.
We
certainly
can
take
your
approach,
but
I,
wonder
mr.
C
chair,
if
you're
willing
to
amend
your
motion
to
approve
a
painting
there
suggest
as
changes
or
addressing
the
issues
that
you
raised
as
opposed
to
having
to
come
back
to
you
bore.
We
can't
do
it
that
way.
If
you
just
want
to
confirm
that
that
were
made-
or
you
know
you
kind
of
prove
it
painting
the
issues
that
you
raised
to
be
addressed
with
with
cortex.
Okay,.
A
So
let
me
be
clear,
probably
you're,
pointing
out
that
Harvey
says
the
investment
Paul.
She
says
one
thing
and
that's
maybe
not
consistent
here:
let's,
let's
stick
with
the
investment
consultants.
So
under
the
vendor
policy
for
investment
consultants,
everything
is
staff
and
then
you
appoint
and
terminate
is.
That
was
also
in
the
investment
policy
statement
or
where's
the
difference
in
the
entire
level
to
go.
D
C
A
A
G
G
M
M
C
A
A
A
G
C
A
F
C
Chair
Oney,
you
certainly
kind
of
proof
e
has
to
do
with
the
CEO
and
CIO.
He
actually
made
the
changes
to
have
the
charters
to
be
consistent
between
the
board,
but
he
also
made
the
point
that
they're
gonna
have
to
come
back
before
the
Governance
Committee
because
of
the
work
that
the
joint
Personnel
Committee
is
doing.
C
G
C
K
C
C
A
F
C
This
is
just
you
did
talk
about
F
and
I.
Just
quickly
wanted
to
remind
you
bore,
you
should
have
received
an
email,
but
if
you
haven't,
you
should
be
receiving
one
and
they're
gonna
follow
with
you
to
fill
out
the
survey
and
then
they're
gonna
follow
up
with
the
question
to
talk
about
the
survey.
So
is
that
happening
already.
M
C
B
A
B
A
All
right
and
then
the
last
is
the
joint
Personnel
Committee.
We
met
on
September
9th
and
we're
doing
a
great
body
of
work
in
conjunction
with
cortex,
to
look
at
the
evaluation,
both
performance
measurement
and
performance
management
that
helps
move
us
further.
In
line
with
some
of
the
observations
that
came
in
the
civil
grand
jury
report
regarding
how
we
we
do
our
reviews
of
our
CEO
and
CIO
so
we're
moving
along
there.
We
did
have
a
discussion
on
roles
and
responsibilities
of
CEO
and
CIO
fairly
robust
discussion.
A
Just
as
a
reminder,
a
large
body
of
work
was
done
on
that
by
the
Governance
Committee
over
a
year
and
a
half
ago
network
lasted
over
12
months
or
so.
At
this
point,
the
joint
Personnel
Committee
decided
to
continue
with
that
structure
and
not
change
it,
but
we're
certainly
open
to
having
further
discussions
down
the
road.
If
there's
a
need
to
revisit
that
again,
that's
kind
of
the
update.
C
Mr.
chair,
can
any
man
you
that
the
next
meeting,
by
the
time
we
issued
at
the
end-
and
it
wasn't
determined,
but
it's
still
about
31st-
we
issued
the
email
to
remind
everyone
in
the
community
that,
even
though
trustee
Chandra
is
not
available,
that
we
are
going
to
bring
an
action
item
to
the
Fed
board
meeting
in
October
so
that
they
can
appoint
another
member
so
that
they
squadron
from
for
the
meetings.
So
we're
still
sticking
with
the
October
28th
Monday.