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From YouTube: Public Pension Oversight Board (4-25-22)
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A
Welcome
everybody
to
the
first
interim
public
pension
oversight
board
meeting
and
before
we
get
started.
I'd
like
to
call
the
roll
secretary.
Please
call
the
roll.
A
And
just
for
the
record,
we
we're
no
longer
allowed
to
accept
not
in
person,
testimonies
or
voting
or.
A
A
Thank
you
secretary
and
first
I'd
like
to
just
ask
for
approval
of
the
minutes.
A
So
moved
and
if
we
could
we'll
just
get
right
into
it
and
right
first
on
the
agenda,
would
be
mr
david
eager
to
give
us
an
investment
update
so
david.
The
floor
is
yours,
please
announce
who
you
are
and
who
you
have
with
you
for
the
record.
G
You
may
proceed.
Let
me
let
me
clarify
something
if
I
could,
because
I
understand
maybe
the
rules
of
change
and
I
wasn't
aware
we
have
stephen
herbert
our
cio
on
this
zoom
call.
He
was
going
to
do
the
investment
portion
of
this.
A
And
I
I
slightly
misspoke
when
I
when
I
spoke
you,
you
are
able
to
do
your
testimonies
from
from
afar,
but
being
counted
as
present
or
counted
as
a
vote
cannot
be
done
unless
you're
here.
But
you
can
go
ahead
and
give
testimonies
that
will
be
not
a
problem.
All.
G
In
that
representative,
posse
in
that
two
minute
pause,
I
was,
I
was
scrambling
to
say
all
right.
Here's
what
we
could
talk
about
in
the
investments,
that's
okay!
G
This
is
our
agenda,
and
this
is,
I
think,
the
first
time
that
the
three
of
us
have
been
at
the
table,
but
we're
we've
evolved
after
484
to
say
some
of
these
issues
are
cers
issues.
Some
of
them
are
krs
issues,
ke
and
kers,
the
two
buttons
and
the
state
police
and
some
of
them
are
kppa,
and
so,
when
we
get
to
talking
about
things
like.
B
G
That's
really
the
policies
really
come
out
of
the
out
of
the
individual
boards.
Not
that's
not
a
kppa
issue,
so
ed
and
john
are
going
to
speak
to
that
I'll,
ask
and
steven's
going
to
talk
to
investment
performance
in
a
minute.
I
will
tell
you
I
I'm
hoping
for
a
positive
year.
G
G
All
this
volatility,
passing
through
we're
going
to
talk
about
asset
allocation
c,
has
made
a
new
allocation,
since
we,
I
think
last
presented
steven's
going
to
talk
about
where
we
are
now
and
how
our
move
trying
to
move
toward
getting
to
our
targets
and
some
of
the
things
that
are
impeding
that
esg.
As
I
said,
john
and
ed,
we'll
talk
to
that
proxy
voting.
Stephen
will
talk
to
that.
That's
a
kind
of
brief
comment,
and
I
do.
G
I
would
note
that
in
your
packet,
you
have
copies
of
the
c
and
the
k
proxy
statements.
We'll
talk
more
about
that
and
and
then
the
question
was
what
was
the
impact
of
the
eight
percent
salary
increase
on
the
retirement
systems,
and
we
have
data
on
that.
G
E
First,
let
me
say:
there's
quite
a
few
slides
here.
I
don't
plan
on
on
presenting
to
all
of
them.
Some
of
them
will
be
reference
slides,
so
we
towards
the
end.
We
can
we'll
probably
slide
through
those
if,
if
there
aren't
any
questions-
and
I'm
as
as
mr
eager
said,
I'm
here
to
talk
to
you
today
about
the
return
update
and
we've
got
preliminary
numbers
through
the
first
quarter,
calendar
quarter
and
also
s
allocation
in
terms
of
returns.
E
What
you'll
see
is
both
the
equities
and
the
bond
portfolios
are
experiencing
negative
returns,
year-to-date
calendar
year
to
date,
so
you'll
see
where
that
is
a
negative
drag
on
the
portfolio,
since
that
is
a
large
allocation
to
both
of
those
asset
classes
in
this
portfolio
or
all
the
portfolios.
Excuse
me
and
then
asset
allocation
itself,
we're
really
in
a
period
of
transition,
a
mini
transition
if
both
deliberate
and
involuntary
the
the
the
deliberate
piece
is,
as
mr
eger
said,
an
asset
allocation
change
with
the
county
employee
retirement
system.
E
We
also
had
a
liquidity
event
within
by
us
moving
away
from
an
investment
manager
which
had
a
60,
40
style
portfolio,
60
equity,
40
bonds.
Earlier
this
year
and
caution,
we
are
moving
towards
an
allocation
for
cers.
That
is
a
few
percentage
points
higher
in
the
public
equity
space.
E
We
have
gone
very
slowly
towards
that
from
late
last
year,
when
it
was
changed
due
to
our
perceived
well
the
perception
of
future
market
volatility
in
especially
growth
stocks,
but
stocks
in
general,
with
the
fed
coming
in
to
raise
interest
rates
that
turned
out
to
be
a
a
good
decision.
So
at
least
we've
done
no
harm
there.
E
In
terms
of
involuntary
in
the
ass
allocation,
there
were
a
couple
of
plant
successions
which
increased
the
cash
in
in
the
kentucky
employee
retirement
systems
plan
for
non-hazardous
and
covet.
Frankly,
much
of
the
allocation
that
we've
been
looking
to
increase
has
been
real
assets,
and
from
that
standpoint
it
has
been
especially
last
year.
It
has
been
very
difficult
to
to
invest
in
real
assets,
given
the
restrictions
just
in
terms
of
business
operations
for
those
managers
so
on
to
the
slides.
E
E
Excuse
me,
so
the
top
line
is
the
results
for
cers,
non-hazardous
you'll,
see
the
market
value
the
month
return,
and
this
is
calendar
month
three
months,
then
your
fiscal
year
to
date
so
you'll
see
the
big
negative
number,
the
the
bulk
of
the
drag
down
for
the
three
months
with
the
negative
three
point:
one
six
percent
and
your
fiscal
year
to
date
just
over
one
point:
four
percent,
so
that
next
line
is
the
plan
index
oops.
Sorry,
just
I'm
going
to
go
quicker.
E
I
just
wanted
to
read
through
these
numbers,
so
you'll
you'll
see
it
back
to
the
original
slide.
So
the
next
line
is
the
plan
index.
So
that
is
really
just
the
the
beta.
If
you
will
it's
the
it's,
the
index
returns
of
the
benchmarks
which
are
in
our
asset
allocation
and
we'll
talk
about
asset
allocation
below
briefly,
but
then
c,
and
you
also
see
the
c
hazardous
same
return
lines.
E
Then
graphically
you've
got
a
couple
of
asset
allocation
graphs,
one
showing
the
actual
allocation
in
the
middle
and
on
the
bottom.
You
can
see
the
relative
weights
and
I've
broken
these
relative
weight
slides
out
into
a
bigger
graph,
we've
enlarged
them.
So
we
can.
We
can
discuss
that
when
we
get
into
allocation.
E
E
The
next
slide
is
the
insurance
plan,
so
you've
got
cers
hazardous
and
non-hazardous,
broken
out
very
similar
returns
because
of
the
same
asset
allocation
and
then
the
next
slide
is
insurance
for
the
kentucky
employee
retirement
systems.
So
again,
very
similar
returns
with
the
same
theme
of
a
negative
three-month
and
slightly
positive
fiscal
year
to
date.
E
So
here
are
the
enlarged,
slides
coming
up.
So
this
one
is
the
total
of
all
of
the
plans
in
kers
for
the
pension
system.
You'll
see
there
that
this
gives
you
the
zero
being
the
actual
asset
allocation
and
then
a
negative
bar
going
to
your
left.
What
means
it's
under
allocated,
so
you
would
need
funds
and
the
positive
bar
going
to
your
right
would
be
over
allocated.
So
you
need
to
reduce
funds.
E
So,
as
you
can
see
the
the
cash
that
I
was
referring
to
a
bit
cash
heavy,
a
big
bit
fixed
income
heavy
and
that
those
assets
are
to
be
invested
in
the
real
return
and
real
estate
allocation,
which
is
underweight.
G
J
Okay,
when
we
look
at
the
allocations
and
they
are
kind
of
they
they
deviate-
you
know
somewhat
from
the
the
goals
that
were
set
out.
Did
we
come
out
better
or
did
we
come
out
worse
and-
and
this
deviation
from
what
what
the
goals
were
for
the
allocation?
What
we
said
back
in,
I
guess
last
year,
target
allocations.
E
Well
year,
to
date,
it's
it's.
It's
kind
of
a
wash
you've
done
better
with
the
cash,
but
you'd
have
been
better
off
with
more
real
assets.
You
know,
I
think
they.
G
C
Thank
you,
mr
chair.
While
we're
talking
about
allocation
we're
experiencing
very
high
inflation
now
the
federal
reserve
has
indicated
they're
going
to
be
raising
interest
rates.
I
think
substantially
how
how
will
those
factors
impact
your
allocations
in
the
near
and
the
long
term.
E
Thanks
for
that
good
question,
we,
as
you
would
imagine
we
have
been
focusing
on
inflation,
and
that
is
where
we're
putting
the
assets
to
work
in
real
return
and
real
estate
real
return,
especially
we
do
have
some
inflation
protection,
specific
portfolios,
like
treasury
inflation,
protected
securities
tips
and
also
within
the
private
infrastructure.
There
are
cpi
targets.
Excuse
me,
cpi,
adjustments
that
go
on
with
those
leases,
for
instance,.
G
E
E
Good
point:
we
did
shorten
the
duration
due
to
our
anticipation
of
raising
rates,
and
that
has
helped
tremendously.
E
B
E
High
end,
especially
credit
and
you're,
under
weights
to
your
real
assets,
slight
underrate
weights
to
some
of
the
other
asset
classes,
but
nothing
nothing
that
the
market
is
isn't
making
move
in
terms
of
the
equities
and
then
the
pension
weighting
is
really,
as
I
said,
due
to
the
new
asset
allocation.
So
you
see
you
see
much
higher
differences
because
of
the
new
allocation,
so
in
that
allocation,
real
return
was
increased.
E
Therefore
we
have
a
bigger
underweight
and
specialty
credit
was
decreased
and
we
just
that
has
not
occurred
in
actuality.
Yet,
and
I
can
I
can
better
explain
that
when
we
get
to
those
slides,
but
these
this
is
the
cautious
rebalancing
to
the
new
target
that
I
spoke
of.
E
So
if
we
could
skip
through
these
to
an
asset
allocation,
these
are
the
previous
quarter
returns,
I'm
happy
to
to
review
them.
If
anyone
has
any
questions,
but
it's
also
the
previous
quarter's
asset
allocations,
which
is,
which
is
a
very
similar
story
to
what
I
just
told
about
this
quarter.
A
What
percentage
of
the
portfolio
is
cash
and
is
it
growing
and
krs
nan
has
cares.
G
Stephen
he's
looking
for
that
stephen
mentioned
earlier:
two
events:
one
was
northern
kentucky
university
and
kentucky
housing
paying
off
in
total
about
230
million
240
million,
and
then
we
terminated
a
manager
that
had
I'm
gonna
say
between
eight
and
nine
hundred
million
dollars.
We've
gotten
the
cash
from
that.
So
there's
two
huge
infusions
of
cash
in
a
short
period
of
time
recently
for.
E
E
E
F
You,
sir,
on
your
after
allocation
study
pages,
you
you
don't
seem
to
break
out
us
from
non-us
equity.
Was
that
intentional
or
just
an
editorial
streamlining
it.
E
Was
intentional,
let
me
why
don't
we
go
to
those
slides
dave?
There's
a
few
more
down,
keep
going
there!
You
go
so
this
one.
So
this
is
the
cers!
I
started
here
because
that
that
change
has
occurred.
It
was
as
of
december
1st,
so
the
before
had
the
as
you
as
you
mentioned,
representative
miller,
u.s
and
non-us
broken
out.
Specifically,
the
decision
was
made
to
bring
that
together
and
make
it
a
public
global
equity
allocation.
E
So
it
went
from
the
you
know,
adding
the
two
together
the
43.5
to
the
50,
so
that
is
now
a
global
portfolio
as
opposed
to
a
distinct
choice
made
by
by
breaking.
G
E
It
correct
and
it
doesn't
require
us
to
to
get
any
new
global
mandates,
so
we
we
can
just
we
were
managing
the
international
and
the
and
the
us
together
as
a
global
mandate.
We
could
get
a
global
mandate
with
it
with
an
outside
active
investment
manager,
but
there's
no
no
requirement
to
do
so.
A
So
getting
back
to
where
I
was
at
a
minute
ago,
with
the
cash
allow
percent
and
then
before
for
the
percent
of
cash
in
the
portfolio
it's
going
up
every
year
or
every
quarter
we're
above
our
allowable
now,
you
know,
and
cash
is
a
good
thing
when
your
market's
dropping.
So
it's
not
necessarily
a
bad
thing.
But
what
are
your
plans
for
that
since
you're
you're
kind
of
outside
of
the
allowable
already?
What
are
your
thoughts
and
plans
for
that.
E
That
that
cash
is
going
down
to
excuse
me,
let's
say
down,
because
it's
below
the
the
equities
it's
going
to
real
estate
in
real
return.
We
are
currently
we
have
three
searches
going
on
once
for
a
real
estate.
Obviously
one
is
for
to
look
at
commodities
for
inflation
protection
and
the
other
one
is
looking
at
infrastructure
for
inflation
protection.
E
Those
are
currently
ongoing
and
we'll
have
money
allocated
there
as
as
we
choose
those
managers,
but
it's
also
being
allocated
through
capital
calls
on
some
of
the
real
estate
portfolios
that
were
slow,
slow
to
take
the
money
last
year
due
to
covet
yeah.
A
E
E
G
A
C
E
E
E
C
E
So
it's
easier
to
answer:
if
you
take
the
old
asset
classes,
you
see
where
the
growth
is
in
the
in
the
part
on
the
left.
That's
your
high
risk
and
then
liquidity
is
your
low
risk
and
then
diversification,
therefore
diversifying
which
are
now
called
inflation
protected.
There
is
risk
there,
especially
when
there's
no
inflation,
but
yet
that's
there's
it's
it's
slightly
more
than
liquidity
and
slightly
less
than
the
growth.
E
True
and
used
to
forgive
me,
I
I
I
default
to
volatility
as
risk
and
as
you
as
you've
seen
the
the
public
equity
markets
this
year
are
highly
volatile
and.
E
Have
pointed
out
as
well
so
the
we
that's
true,
we
did,
we
did
change
some
of
the
nomenclature
on
the
asset
allocation.
We
did
it
for
the
asset
classes
as
well.
So
we've
gone
to
a
more
traditional
from
growth
made
it
equity
liquidity,
became
fixed
income
and
diversifying
became
inflation
protected
in
both
cers
and
kers.
C
I
have
a
question:
yes,
please
this.
This
can
be
for
the
director
or
whoever
answers
it
seems
like
we
had
in
the
past,
asked
that
we'd
see
30-year
reporting,
as
our
table
show
us.
We
we
stopped
there
20
again
and
also
the
question
actually
is
the
the
last.
C
Column
is
an
acronym
that
I
don't
recognize,
is
itd
and
just
to
see
what
that
is.
E
That
is
inception
to
date
and
I
believe,
don't
quote
me,
I
believe
that's
1984.
C
So
there's
excuse
the
follow-up,
there's
four
of
these
charts
and
there
are
a
number
of
plans
and
I
I
don't
think
they're
all
the
same
inception-to-date
time.
C
G
It'll
be
from
whenever
that
that
started,
going
forward
and
there'll
be
different
time
frames
and
and
I'll
take
responsibility
in
a
30-year.
We,
we
were
relying
on
on
schedule
that
we
had
readily
available
and
my
fault
it
didn't
take
the
time
to
re-calculate
and
put
the
30-year.
We
can
do
that
and
send
it
to
you.
A
G
In
in
if
if
interest
rates
rise
and
the
short
run
is
going
to
hurt,
because
the
assumptions
won't
be
adjusted
that
quickly
and
the
anything
that's
interest
sensitive,
any
investments
can
hurt
in
the
long
run.
It
probably
is
we're
going
to
find
out
that
the
assumptions
would
go
up.
The
interest
assumptions
most
likely
to
go
up
as
interest
rate
go
up
and
the
liability
is
going
to
go
up.
The
benefits
are
going
to
be
more
costly,
so.
G
C
H
Yeah
again,
my
name
is
john
chilton,
I'm
ceo
of
the
kentucky
retirement
systems,
which
has
three
plans:
kentucky
employee,
non-hazardous
kentucky
employees,
hazardous
and
the
state
police.
Before
we
start
the
discussion
on
environmental,
social
and
governance,
I'd
like
to
thank
both
the
house
and
senate
members
for
the
support
that
you've
given
this
year
for
fully
funding
the
pensions,
the
additional
money
that's
going
into
the
case
systems
and
especially
for
the
money
that's
going
into
the
state
police.
H
H
It's
really
a
work
worldwide
trend
towards
significantly
increasing
disclosures
of
esg
related
information
to
investors.
The
initial
focus
has
been
on
environmental
issues,
the
initial
focus
and
the
initial
discussion
with
social
and
governance
issues
coming
later
publicly
traded
companies,
including
businesses,
doing.
H
The
to
further
understand
the
esg
components-
environmental-
well,
this
is
the
social
slide
has
to
do
with
community
relations,
diversity,
equity
and
inclusion,
employee
health
and
safety,
human
capital,
development,
labor
management,
privacy
and
data
security,
product
quality
and
safety
and
supply
chains
standards.
H
The
other
the
last
component.
Here
the
governance
is
anti-bribery
and
anti-corruption
board
composition
in
elections.
There's
going
to
be
a
lot
of
focus
on
the
on
the
composition
of
the
board
under
this
metric
business:
ethics,
corporate
resiliency,
diversity
of
leadership,
executive
compensation,
lobbying
and
political
contributions,
ownership
structures
and
tax
transparency.
H
H
The
disclosures
will
relate
to
short-term,
medium-term
and
long-term
climate-related
risks,
and
this
is
the
quote
from
the
the
sec's
proposed
rules.
H
H
H
So
it's
just
not
just
the
big
publicly
traded
companies,
but
any
customers
that
they
have
and
the
suppliers
the
companies
will
be
requiring
information
from
these
customers
and
suppliers
in
order
to
consolidate
it
into
their
reporting.
H
The
initial
reporting
is
expected
to
begin
in
2023
with
reporting
requirements
expanding
in
the
future.
H
H
H
Maybe
it's
on
the
next
page
here
I
think
no,
okay,
the
policy
statements.
It
basically
says
we're
aware
of
gesg
issues
and
the
fact
that
it
affects
our
businesses,
the
profitability,
the
sustainability
of
those
businesses
and
they'll
make
investments
in
that
context.
H
An
accountant
I
can
envision
the
development
of
metrics
for
different
kinds
of
businesses
as
it
relates
to
the
environmental
issues.
I
have
a
much
more
difficulty
envisioning
metrics,
to
create
a
scoring
system
for
the
the
social
component
of
it,
and
maybe
even
the
governance.
So
there's
a
lot
yet
to
be
known
about
this.
H
I
Mr
chairman,
thank
you
for
the
opportunity
to
come
before
you
and
to
speak
to
this
committee
to
this
board
about
cers's
perspective
on
esg.
Before
I
get
to
that.
I'd
like
to
just
make
a
couple
of
general
statements
to
say
that
the
county
employees
retirement
system
board
has
now
been
in
force
for
a
little
more
than
a
year.
I
In
that
time,
we've
made
great
strides
under
the
leadership
of
our
chairman,
betty
pendergrass
and
our
vice
chairman,
jerry
powell.
Much
of
what
stephen
spoke
to
in
terms
of
the
change
in
the
asset
allocation
foresee
has
been
driven
by
our
board,
as
we
look
very
closely
and
very
intently
at
what
we
need
to
do
moving
forward.
It
was
mentioned
earlier
that
we
had
redeemed
about
900
million
dollars
from
a
manager
who
had
a
portfolio
that
mirrored
what
we
were
doing
in
equities.
I
People
who
stephen
will
utilize
to
implement
the
cash
that
he's
been
given
back
and
to
start
tips
programs
so
that
we're
bringing
more
in-house
than
we've
ever
been
able
to
do
in
the
past.
That's
a
huge
step
forward
for
us.
We're
excited
for
it
and
excited
to
have
been
given
the
opportunity
by
you
for
that.
Now,
as
I
speak
to
esg,
I
I
really
prepared
my
slides
not
so
much
for
you,
because
you
know
everything
that
we've
done
here,
because
you
promulgated
much
of
the
legislation
that
I'm
going
to
speak
to.
I
So
it
really
is
prepared
for
people
who
are
watching.
Who
may
not
know
the
standard
that
the
trustees
have
to
abide
by
when
they
look
at
issues
like
this,
and
I
wanted
to
be
able
to
give
those
individuals
a
perspective
of
that.
I
I
I
You
codified
that
the
general
assembly
in
78
782-90,
when
you
said
specifically
notwithstanding
any
other
legislative
intent
that
you
were
confirming
that
the
federal
statute
or
regulation
in
order
to
meet
the
qualifications
need
of
26
usc,
section
401a
needed
to
be
followed.
So
the
that's
just
one
example
of
how
the
general
assembly
has
codified
that
federal
statute
for
the
establishment
of
our
pension
plans.
I
I
With
that,
as
a
backdrop,
I'll
say
that
on
november
10th
2021
the
crs
board
after
much
deliberation,
deliberation
that
occurred
several
times
in
our
investment
committee
and
at
the
board
level,
we
adopted
an
esg
policy
and
I'll
direct
you
to
the
last
sentence,
and
it's
very
similar
to
what
k
adopted
the
overriding
consideration
of
every
trustee
must
be
that
we
invest
to
maximize
the
long-term
returns
to
the
plan's
beneficiaries.
I
Okay,
I
I
included
this
statute
because
again
it's
it's
it's
evidence
of
what
you've
done
and
how
you've
helped
us
remain
focused
on
what
our
responsibility
must
be
so
in
krs,
78
790,
and
there
would
be
a
a
similar
section
in
in
chapter
61.,
the
board,
in
keeping
with
its
responsibility
as
the
trustee
and
wherever
feasible.
I
So
you're,
clearly
saying
that
we
must
keep
with
the
responsibility
that
we
have
to
have
a
single
focus
for
the
planned
beneficiaries
and
when
we
can
do
that
and
when
it's
feasible
that
we
would
then
look
to
develop
opportunities
within
the
commonwealth
of
kentucky
dave.
I
wanted
to
put
this
this
slide
here.
It's
not
a
big
topic
today,
because
there
are
so
many
things
in
esg
that
have
to
be
formulated.
It
is
at
the
very
beginning
of
its
road
of
of
what
will
happen
in
this
space.
I
As
john
mentioned,
there
has
been
very
little
discussion
about
the
social
or
the
governance
aspects
of
esg.
All
of
what's
happened
thus
far
has
happened
in
the
space
of
environmental
and
the
only
places
where
that
really
has
coalesced
has
been
in
private
markets
and
in
international
markets.
I
We've
just
had
very
brief,
very
30,
000
foot
level
discussions
about
divestiture
and
it's
the
general
consensus
that
we've
got
to
stay
at
the
table.
We've
got
to
be
in
a
position
where
our
voices
are
heard
and
anytime
you
say,
I'm
pushing
my
chips
in.
I
no
longer
want
to
be
involved.
Your
voice
can
no
longer
be
heard.
I
We're
we're
focused
on
the
long-term,
investing
the
long-term
perspective
for
the
beneficiaries
of
the
sea.
Trust,
that's
what
each
trustee
will
continue
to
do
and
that's
what
I
will
do
as
the
ceo,
okay,.
A
Real
quick,
we
have
a
question
from
representative
miller.
F
Thank
you,
mr
chairman.
I'm
I
don't
know
if
this
can
be
a
question
or
a
statement,
a
statement,
but
I
I
really
appreciate
you
all
addressing
this
here
and
I
think
ed.
Your
slides
have
been
really
excellent
in
terms
of
getting
this
to
the
point.
This
is,
we
don't
know
where
this
is
going
to
go.
I
mean
you've
got
individual,
we
probably
between
all
your
plans
and
you
throw
in
trs.
We
probably
got
investments
in
90
of
the
companies
in
in
the
us
and
70
percent
of
the
companies
in
the
world.
F
Yes,
the
bigger
companies
in
the
world
and
all
that
distills
down
to
well
then
you've
got
investment
managers.
Is
our
investment
managers
going
to
have
to
report
on
their
esg
performance
it
just
and
then,
by
the
time
you
get
down
to
the
pension
plan
level?
I
don't.
I
think
what
you've
got
here
is
exactly
the
salient
point.
F
Is
it's
our
beneficiaries
and
it's
the
state
we
have
an
obligation
to,
and
I
would
say
to
my
colleagues
that
every
now
and
then
we
face
a
bill-
that's
been
filed,
whether
it's
to
get
out
of
russia
or
israel
or
south
africa
or
energy
companies,
or
only
to
invest
in
kentucky
companies.
F
You
see
that
and
we
have
to
as
a
legislative
body
focus.
This
is
about
the
beneficiaries,
it's
not
about
what
how
we
feel
about
this
topic
or
that
topic.
Yes,
because
you
go
into
your
one
of
your
slides
on
the
sixth
district
slide
on
page
26,
an
unwavering
duty
to
act
as
a
prudent
person.
Well,
yes,
tell
me
your
politics
and
I'll.
F
Tell
you
what
avenue
what
realm
of
prudence
you're
on
yeah,
because
it's
it's
just
I
I
don't
know
it's
it's
a
it
could
get
very,
very
confusing
more
confusing
than
it
already
is,
and
I
think
you've
done
a
great
job
of
trying
to
focus
the
body
on
this
topic.
So
I
just
want
to
say
kudos.
I
don't
really
have
a
question
other
than
I
don't
envy
the
boards
trying
to
keep
on
track
of
this
yeah.
But
I
know
you'll
do
a
good
job.
D
Representative,
thank
you,
mr
chairman,
and
thank
you
all
for
coming
and
bringing
this
information.
I
know
I
had
expressed
some
concerns
last
time
and
certainly
appreciate
you
all
putting
this
package
together.
I
do
have
a
couple
of
comments
and
just
a
quick
question
and
probably
a
little
bit
more
of
it,
be
directed
when
we
get
to
the
proxy
part,
but
I
know
there
was
mention
that
there
was
an
sec
proposed
rule.
D
My
understanding
is
that's
being
challenged
and
there's
some
concerns
with
that
as
well,
and
then
it's
my
understanding,
they're
also
the
duty
of
loyalty
on
the
federal
level.
There
was
some
concerns
that
there
was
an
attempt
by
the
current
administration
to
make
changes
to
that
as
well.
I
don't
know
if
you
all
would
like
to
comment
on
that
or
how
much
you're
aware
of
that
or.
I
Aware
of
it,
auditor
harmon,
but
would
would
not
want
to
comment
on
things
that
are
in
the
courts
or
in
the
political
realm
sure.
D
D
And
I
know
some
of
my
biggest
concerns.
Of
course,
a
lot
of
this
is
starting
to
surface.
It's
probably
been
going
on
for
a
long
time,
but
a
lot
of
it
starts.
I've
been
hearing
some
things
that
are
concerning
such
as,
like
blackrock,
using
proxies
to
take
over
exxon's
board
and
then
start
to
divest.
D
B
My
my
question
goes
right,
along
with
the
proxy
question.
I
think
you
may
answer
here
in
a
little
bit,
but
have
you
all
looked
at
senate
bill
205
that
has
to
do
with
the
treasurer
coming
up
with
a
list
of
energy
boycotting
companies
and
have
you
thought
or
thought
about
how
that
will
affect
your
your
practices?
B
The
intent
of
the
bill
once
again
goes
back
to
not
harming
returns
of
funds
that
you're
invested
in,
but-
and
you
don't
answer
it
right
now,
if
you
don't,
if
you
hadn't
looked
at
it,
but
in
the
future
I'd
be
curious.
How
y'all
plan
once
the
list
is
formulated,
how
you
plan
to
react
to
that
yeah.
G
I
would
say
one
thing,
but
the
these
two
gentlemen
are
more
involved
with
policy.
It's
not
the
first
time
we've
had
a
bill
that
dealt
with
it.
We've
had
israel
boycotts
and
we've
had
sudan
and
a
number
of
things
that
to
represent
mildred's
point
are
not.
If
you
act
on
those
solely
that's,
not
the
benefit,
necessarily
in
the
benefit
of
our
plan
participants.
G
I
don't
know
you
want
to
add
yeah.
I
think
I
just
say
kind
of
the
bottom
line
how
this
has
evolved.
I
mean
every
issue
of
pensions
and
investment
magazine
probably
has
three
articles
on
esg
15
years
ago.
You
wouldn't
see
one
20
years
ago,
but
it's
really
evolved
from
eliminating
forcing
elimination
of
holdings
for
a
variety
of
reasons.
G
Alcohol
guns,
carbon,
a
variety
of
things:
it
was,
you
can't
hold
those
now
now
what's
happened,
how
it's
evolved.
Now,
it's
not
we're
not
away
from
that,
yet
not
by
any
means,
but
how
it's
evolved
now
is
to
say,
take
these
esg
factors
into
consideration
because
they
may
affect
the
outlook
of
the
company,
the
financial
going
forward
so
be
mindful
of
things
that
might
be
happening.
A
I
appreciate
your
testimony
on
on
and
I
think
it
makes
sense
what
you're
doing,
but
I
think
we
as
a
people
need
to
be
really
concerned
that
forces
that
are
not
elected
are
making
policy
decisions
that
affect
how
a
company
does
business
social
constructing
is
what
this
is.
So,
if,
if
you
want
to
get
away
from
guns,
you
can
force
people
not
to
use
to
financially
support
gun
companies.
If
you
are
against
any
number
of
things,
I
mean
this
is
a
really
big
deal
that
I
think
people
need.
A
A
A
Good
switching
gears
a
little
bit,
I
think-
was
it
senate
bill
2
that
required
monthly
reporting?
Where
are
you
guys
at
on
your
monthly
reporting
getting
that
on
the.
G
Internet,
I
I
think,
and
stephen
can
chime
in
here.
I
think
senator
bill
two
actually
required
quarterly
reporting,
not
monthly.
Okay.
We
do
we
do
put
a
report
up
every
month,
but
on
a
quarterly
basis
there
may
be
more
comprehensive
information.
That's
put
up
okay,
so
it's
going
up.
Okay,
thank.
A
G
Yeah
auditor
harman
at
the
recent
ppob
meeting
started
asking
me
about
proxies,
and
I
said
I
may
not
be
the
best
person
to
answer
that,
but
also
it's
probably
worthy
of
a
a
more
in-depth
delve
into
it.
I
would
say
this
that
both
boards
k
and
c
have
proxy
statements
they're
in
your
packet
and
in
general
they'll
talk
about
the
position
on.
Are
we
in
favor
of
or
against
particular
votes
on
particular
things
and
I'll?
Let
stephen
chime
in
on
that.
E
Thank
you,
one
correction
as
well
the
inception
to
date,
return
numbers
you
see
in
your
packet,
the
itd,
that's
1987.,
not
1984.,
apologies
40
and
slip
so
a
few
bullets
on
proxy
voting
and
then,
of
course
we
can
answer
questions
and
if
we
need
to
go
to
the
policy,
that's
fine
as
well.
So
so
you
know
as
investors
we
are
voting.
You
know
we
have
the
ability
to
to
vote
on
our
publicly
traded
shares
and
there's
different
processes
for
different
companies.
E
E
So
each
board
does
recognize
that
they
can
vote
on
these
and
and
they
have
the
policy
posted
to
the
website
they're
also
with
both
boards
now
currently
being
signed,
and
we
currently
use
iss
as
our
proxy
vendor
and
they
cast
the
votes
according
to
our
policy
that
we've
given
them,
much
like
an
investment
manager
would
manage
money
money
according
to
the
policy
that
we
give
them.
E
That's
it
in
a
nutshell,
happy
to
talk
about.
You
know
where
some
of
this
lies
in
terms
of
of
how
they
vote
the
proxy
on
our
how
they
vote
on
our
behalf
as
proxy.
E
But
it's,
as
mr
eager
said,
it's
it's
fairly
straightforward
in
terms
of
how
the
board
you
know
whether
or
not
they're
going
to
vote
with
management
on
certain
things
and
how
the
board
makeup
go
is
how
the
board
is
made
up
at
each
of
these
firms
and
then,
of
course,
there's
the
the
they're
just
attending
the
meeting
itself.
D
You
yeah.
Thank
you,
mr
chairman.
Once
again
I
appreciate
you
all
speaking
to
this
a
couple
of
questions
one,
I
know
you've
got
a
proxy
statement.
How
often
do
you
all
monitor
that
they're
voting
in
compliant
with
that
statement?
Does
the
statement
make
any
known
comments
regarding?
Is
it
just
financial
or
does
it
make
any
additional
comments
in
reference
to
any
of
the
esgs
and
and
finally,
are
our
proxies
being
used?
E
Great,
so
the
votes
are
monitored.
It's
it's
very
similar
to
the
way
we
monitor
the
portfolio.
You
know
a
periodic
basis
quarterly
basis.
The
only
thing
that
would
really
get
get
relatively
close
to
the
esg
would
be
something
called
our
our
social
and
policy
issues.
It's
a
brief
statement.
E
E
If,
if,
if
there's
something
being
discussed
and
voted
on
in
that
nature,
it
would
need
the
board
of
directors
approval
and
we
take
the
position
of
management
there.
D
Okay
position
to
mention
okay,
and
then
I
guess
just
just
finally
from
a
standpoint
of
the
the
proxy
votes
if
they
are
not
voting
according
is
there
a
for
lack
of
a
better
word
escape
clause
to
move
them
to
somewhere
else.
E
If
iss
is
not
as
a
vendor
does
not
does
not
live
up
to
our
expectations
or
breaches
contracts-
oh
yeah,
yes,
we
would.
We
would
just
go
out
for
a
bid
process
and
get
and
get
a
new
vendor
for
that.
So.
E
E
No,
it's
a
pretty
broad
line.
There
disagreeing
with
the
policy
you
mean
actually
not
fulfilling
their
duties
to.
E
If
they
continuously
do
that
on
a
on
a
sort
of
deliberate
basis,
then
yes,
we
that
would
be
grounds
for
changing
administrators.
G
Would
I
would
say,
by
the
way,
that
iss,
if
they're,
not
the
leading
firm,
they're,
a
leading,
firm
they're,
quite
used
quite
prominently.
G
A
E
A
But
but
I
think
I'm
asking
do
you
have
a
process
in
place
to
make
sure
because
I'm
sure
that's
a
lot
of
information
to
try
to
figure
out.
Do
you
have
a
process
to
make
sure
they
are
doing
what
you
would
want
them
to
do.
E
That
would
fall
under
our
compliance
process
or
investment
compliance
and
yes,
but
like
any
process,
we
can
always
enhance
it.
I'm
happy
to
have
a
look
at
it
and.
E
G
G
All
right
move
on
our
last
question:
what's
the
impact
of
the
salary
increase
upon
the
retirement
systems
and
the
quest
question?
Does
the
eight
one
question?
Does
the
eight
percent
raise
impact
the
considerations
associated
with
the
zero
percent
payroll
assumption?
I
put
that
question
to
grs.
I
thought.
First,
we
ought
to
define
what
payroll
growth
is
payroll
change.
That
seems
to
be
a
common
topic.
G
I'm
using
this
in
the
in
the
context
of
change
payroll
growth
change
is
the
change
in
the
number
of
members
could
be
positive
or
negative,
and
the
change
in
the
average
salary
could
be
positive
or
negative.
So
you
put
those
two
together
and
it
says
that,
let's
just
say,
the
payroll
was
a
dollar,
and
now
it's
a
dollar
one
or
now
it's
99
cents.
That
would
be
the
change
in
the
payroll.
What
we've
seen
historically
is
a
modest
increase
in
average
compensation,
every
salary,
a
bigger
decrease,
and
this
k9
has
a
bigger
decrease.
G
In
the
number
of
members
active
members.
Active
members
have
been
going
down
about
four
and
a
half
percent
a
year
for
the
last
seven
years.
It
was
4.4,
I
think,
last
year,
right
in
the
line
into
the
trend
and
the
compensation
has
been
going
up
two
to
three
percent,
so
we've
been
seeing
payroll
growth
declining
at
about
2
a
year,
for
I
think
it
was
about
10
years,
in
fact,
which
prompted
the
house
bill,
eight
that
was
kind
of
one
of
the
things
that
really
drove
prosperity.
G
So
so
the
grs
answer
to
the
question
is:
does
eight
percent
affect
the
interest
of
some
their
payroll
assumption,
not
immediately
they?
Their
point
is-
and
I
think
we
hear
it
over
and
over
there.
The
assumptions
are
intended
to
cover
long
periods
of
time.
We
have
a
27-year
period
to
write
down
this
unfunded
liability,
so
they're
looking
at
longer
periods
of
time.
They
do
think
that
the
zero
percent
assumption
is
appropriate
until
such
time
as
the
experience
begins
to
show
to
the
contrary
and
that
active
membership
levels
out
or
begins
to
rise.
G
As
long
as
we
keep
seeing
declines
in
active
members,
they're
inclined
not
to
move,
I
guess
if,
if
the
increase
in
compensation
year
after
year
after
year,
continued
and
continued
at
a
high
level,
they'd
have
to
reassess
even
if
membership
was
going
down
but
they're.
That's
the
key
that
they're
looking
for.
G
G
It
affected
the
normal
cost.
Only
so
the
payroll
went
from,
I
think
100
and
I've
got
notes
here:
134
million
the
normal
cost
went
from
134
million
to
145
million
up
about
11
up
about
11
million.
Again
it's
the
only
thing
impacted.
The
k9
has
is
the
normal
cost.
Normal
cost
is
now
9.97
just
drop
below
ten
percent
for
the
first
time,
so
you
gotta
pay
the
ten
percent.
G
You
gotta
pay
the
nine
point:
nine
perce
on
the
on
the
increase,
the
eight
percent
increase,
and
that
amounts
to
eleven
million
dollars,
no
increase
on
the
unfunded
liability,
because
hospital
has
already
assigned
that.
So
there's
no
need
to
compensate
for
that.
I
would
say
that
house
bill
8
on
the
side
did
prevent
a
29
million
shortfall.
G
Had
we
stayed
with
house,
had
we
not
had
house
bill
8
the
decline
in
the
payroll,
2.8
percent
would
have
cost
us
29
million
in
lost
contributions,
k
hazardous.
They
estimate
this
is
grs
between
one
and
two
million.
These
are
all
grs
numbers.
By
the
way.
G
The
state
state
police,
the
215
million
appropriation,
dropped
the
contribution
to
just
under
100
from
140.,
so
we're
going
to
get
less
number
more
less
money
as
a
result
of
that,
but
because
the
state
police
kind
of
across
the
board
have
had
a
variety
of
ways
of
increasing
compensation,
we're
going
to
get
more
money
and
it's
going
to
probably
prove
to
be
almost
a
wash
they're
saying
that
the
contribution
was
45
million.
Last
year,
it's
probably
going
to
be
49
to
51
million
as
a
result
of
the
8
increase,
so
modest,
relatively
modest.
C
Representative
tipton,
thank
you
miss
chair.
If
I
could
ask
a
question
off
your
assigned
topic,
real
quick,
I
had
reviewed
the
fiscal
last
fiscal
year.
Basically,
what
the
percentage
of
funding
levels
were.
Do
you
all
have
updated
numbers?
What
the
funding
levels
are
on
each
plan.
K
Excuse
me-
and
I
guess
this
would
be
the
time
because
you
all
may
leave
upon
your
presentation
and
beau
is
here,
and
I
guess
you
all
can
answer
this
together,
but
I've
met
with
some
constituents
who
have
worked
in
different
agencies
which
are
now
in
different
retirement
systems.
K
How
do
you
determine
the
credit
hours
for
the
high
five
pay
figures,
and
how
do
you
resolve
any
errors
that
the
individual
who
is
transferred
from
one
area
to
an
another?
How
do
you
re
resolve
those
errors
or
those
miscalculations
of
those
five
highest
years.
K
And-
and
the
other
thing
is
how
how
do
you
determine
how
accurate
those
differences
or
those
particular
figures
are
when
it
comes
to
an
individual
who's
about
to
retire
and
they
may
they
may
have
paperwork
that
shows
that
it's
different
than
what
the
agencies
are
providing
to
them.
So
can
someone
give
me
at
least
an
answer
or
possibility
of
an
answer
as
to
how
that
is
resolved
when
an
individual
is
about
to
retire
and
they've,
been
in
different
retirement
systems
because
they
moved
across
the
different
agencies.
K
B
A
Okay,
now
it's
time
now,
co-chair
higdon
has
some
comments.
J
Thank
you,
mr
chairman.
I
appreciate
that
and
we
we
passed
house
bill,
297
representative
miller,
very
good
bill,
clean
up
bill
that
we
discussed
during
the
interim
and-
and
it
contained
a
lot
of
a
lot
of
issues
that
we
discussed
here
in
this
committee,
and
so
there
were
no
surprises
in
it.
A
few
things
the
process
works.
J
A
few
things
were
added
few
things
were
subtracted
one
one
thing
it
was
vetoed
and
we
overrode
the
veto,
but
in
the
governor's
veto
message
he
was
concerned
about
folks
living
outside
the
state
of
kentucky
and
working
for
kppa.
J
G
G
No,
my
my
concern
is
about
the
governor's
concern
because
I
think
we're
going
to
be
faced
with
and
staffing
in
the
investment
area
we're
faced
with
a
limited
amount
of
candidates,
qualified
candidates,
and
we
may
have
to
we're
going
to
probably
identify
people
that
are
outside
who
choose
not
to
move.
I.
J
Think
I
think
everyone's
attitude
has
changes
about
remo,
remote
working
or
working
from
home.
I
think
covet
changed
those
things
that
we
kind
of
broke
down
that
barrier
and
when
we
discussed
this
during
the
interim,
we
openly
discussed
that
you
might
hire
an
investment
manager
that
lived
in
another
state
is
that.
G
G
J
J
Yeah
another
thing
that
house
bill
297:
did
it
it
added
four
new
members
to
ppob
two
from
the
house,
two
from
the
senate,
and
I
think
that
that's
really
a
good
idea.
We
need
more
legislators
with
an
understanding
of
pensions
and
that's.
I
think
that
that
was
our
problem
years
ago,
that
a
lot
of
let's
it
just
won
a
lot
of
understanding
about
the
pension
system
and-
and
we
didn't
have-
I
guess,
the
benefit
of
updated
actuarial
analysis
and
yeah
and.
J
I
I
think,
I
think,
that's
a
good
idea
and
we'll
try
to.
Maybe
we
can
schedule
that
during
our
our
first
week
also
one
of
the
things
that
to
this
committee
and
and
to
those
that
are
involved,
is
you
know,
pension
reform
or
things
that
deal
with
the
pension
are
major
issues
and
I
don't
think
they
need
to
be
added
on
as
amendments
during
the
session.
J
I
think
if
you
have
a
bill,
if
you're
an
interest
group
and
you
have
a
bill-
k-e-r-s
c-e-r-s
trs
state
police,
whoever
it
is
league
of
cities-
caico
any
of
the
interest
groups.
If
you
have
a
bill
that
you
want
to
pass
next
year,
it's
you
should
bring
it
forward
to
this
committee
and
and
and
and
have
have
some
discussions
about
the
bill
before
it
comes
to
session.
It
goes
to
state
government
and
but
again
I'm
I'm.
J
I
don't
like
the
idea
of
major
legislation
being
added
on
as
as
an
amendment
and
and
not
having
a
lot
of
time
to
discuss
it
and
most
legislators
like
myself,
you
know
our
hazardous
duty.
Folks,
we
we
take
a
great
you
know
we
want
to
help
them.
J
We
don't
want
to
be
the
bad
guy
and
say
no,
but
pension
policy
needs
to
be
well
vetted,
and
hopefully
the
members
of
this
committee
support
that
and
I'll
get
a
letter
out
to
leadership
and
the
interest
groups
and
say
you
know
if
you
have
a
bill
for
next
year,
please
bring
it
to
ppob
this
year
and
let's
discuss
it.
I
think
I
feel
you
know
very
strongly
about
that
and
I
think
that
prevents
mistakes
from
happening
and
we
have
some
issues.
You
know
to
quote
james
allen.
J
Tipton
representative
tipton,
we'll
be
talking
about
pensions.
Till
jesus
comes
back,
so
we
we
need
to
have
open
and
honest
discussions
about
these
things
and
it's.
It
is
important.
It's
very
important.
We
have.
We
have
discussions
about
colas,
we
have
discussion
about
insurance.
J
We
have
discussions
about
sick
days,
there's
a
lot
of
issues
out
there
that
need
to
be
discussed
and,
like
I
said
not
taking
anything
away
from
from
the
state
government
committees.
We
have
very
capable
chairmen
but
it'd
be
good
to
discuss
it
here.
First,
so
thank
you
for
hearing
my
rant,
mr
chairman,.
A
And
coach
chairman
higdon,
I
I
just
want
to
second
what
you
said:
we've
been
we've
talked
about
this
offline
and
just,
for
example,
the
the.
A
Pension
bill
that
we
did,
nobody
here
would
disagree
with
giving
a
firefighter
that.
However,
it's
not
good
policy
knowing
how
improvements
to
to
benefits
affects
the
pension
systems
that
haven't
been
vetted.
We
should
never
be
doing
things
like
that.
That's
what
got
that's
one
of
the
reasons
why
we
got
in
the
position
we
got.
We
wanted
to
give
out
sick
days.
A
We
wanted
to
give
out
high
threes
instead
of
high
fives,
and
we
did
it
without
properly
vetting
things
and
in
understanding
what
that
cost,
the
system,
the
state
and
how
people
should
help
pay
for
that
and
what
changes
should
should
be
made.
So
I
you
know
going
forward.
We
I'm
going
to
be
gone
from
here,
but
going
forward.
It
should
absolutely
be
the
policy
of
this
of
anybody
wanting
that
done,
so
anybody
who's
listening.
A
It
needs
to
go
through
this
committee
and
invented
and
talked
with
the
systems
and
understand
what
the
true
actuary
cost
is
and
not
just
what
an
annual
cost
is,
but
what
the
actuarial
cost
is.
So
a
second
what
you
had
to
say
and
you're
spot
on.
Thank.
B
I
I'm
going
to
do
the
same
thing
that
representative
duplessi
just
did
I
I
agree
wholeheartedly.
We
had
we
need
to
probably
take
another
step
and
whoever
the
house
new
house
state
government
chair
is
and
myself
we
we
need
to
stand
firm
and
when
somebody
files
a
bill
it
gets
sent
to
our
committee.
If
it
hadn't
been
vetted,
then
we
need
to
tell
the
bill
sponsor
that
needs
to
come
before
the
ppob.
B
J
K
K
You
don't
have
to
get
into
the
into
the
weeds
with
them,
but
they
need
to
be
at
least
know
some
a
little
bit
before
they
really
delve
into
it.
But
I
think
that
would
be
one
of
those
things
that
they
ought
to
be
presented
when
they
come
for
their
orientation
and
then
they
have
something
planted
and
they
can
start
looking
into
that,
particularly
those
who
get
on
state
government
or
a
r
committees,
but
usually
freshmen,
don't
get
on
anr,
but
it
could
be
the
exception
to
the
rule.
C
Thank
you,
mr
chair.
Many
of
the
things
that
our
co-chair
brought
up
were
very
a
poignant.
I
thought
and-
and
I
had
a
bill
that
came
into
the
session
last
last
year-
that
I
very
much
will
have
as
part
of
the
interim
and
look
forward
to
doing
that
and
that
you
may
have
recognized
it
not
being
quite
pushed
as
much
last
session.
But
it
was
it's
a
complicated,
a
bit
of
a
complicated
bill,
there's
more
work
that
needs
to
be
done
on
it
brad
and
jennifer.
C
As
I
look
around
here
so
I
appreciate
those
comments
and,
and
the
co-chair
did
bring
up
another
issue
related
to
the
governor's
veto
of
297
in
an
issue
that
wasn't
discussed
too
much.
But
I'm
going
to
give
mr
eager
a
chance
to
to
have
a
comment
on
the
four
to
six
employees
which
we
we
recently
just
talked
about
and
and
and
david
is
there
going
to
be
any
kind
of
guard
rails?
I
guess
related
to
the
salary
range
for
for
these
employees,
and
that
is
that's
been
a
concern.
G
Yeah
there
certainly
will
be
guardrails.
It's
it's
the
board's
responsibility
to
approve
positions,
so
the
majority
of
those
positions
are
four
of
those
positions
are
full
right.
Now
two
of
them
are
already
exempted.
Two
more
will
be.
One
is
a
vacant
position
that
needs
to
be
that's
the
the
board
will
approve
that
and
then
there's
a
there's,
a
position
that
hasn't
yet
been
defined.
That
needs
to
be
approved
by
the
board.
G
The
executive
director
doesn't
do
that
and
then
the
board
says
salary
ranges
minimum
maximum.
Those
are
the
guard
rails.
This
will
be
discussed.
I
don't
know
that
will
be
in
the
upcoming
meeting
at
the
end
of
this
month
or
a
special
meeting
after
or
the
next
kppa.
It's
a
kppa
decision.
They'll
set
the
guard
rails.
Then
the
executive
director,
whoever
it
is,
can
compensate
within
those
guard
rails.
G
So
if,
if
you
have
a
vested
interest
in
that
topic,
stay
tuned
because
it
may
be
discussed
at
the
upcoming
kppa
meeting.
Thank
you.
It's
good
to
hear.
Thank
you,
but
it's
going
to
it.
It'll
be
the
board,
and
it's
going
to
be
there.
Eight
people
on
the
board
kpba
boards.
Four
from
c
and
four
from
k,
they
said
it
and
then
the
executive
director
has
to
live
within
it
and
all
all
part
of
the
fiduciary
duty
actually.
A
F
A
L
Okay:
okay,
good,
yes
good
afternoon,
thank
you
for
inviting
us
here
today.
We've
been
asked
to
cover
a
couple
of
topics
this
afternoon.
The
first
of
those
is
investment
performance.
L
This
is
these
are
unaudited
returns
I'll,
be
sharing
today
for
the
period
ending
march
31st
2022
and
as
we
are
all
aware,
this
past
quarter
has
been
a
very
challenging
quarter,
a
lot
of
uncertainty
in
this
quarter
with
russia's
invasion
of
the
ukraine
with
inflation,
and
you
know,
questions
about
what
the
federal
reserve
might
do
in
response
to
that
inflation.
So
a
lot
of
challenges
and
uncertainty.
L
This
quarter
and
I'm
going
to
share
with
you
first
the
return
numbers
for
the
retirement,
annuity,
trust
or
the
pension
fund,
and
then
I'll
do
the
health
insurance
trust
next,
but
even
given
those
challenges,
and
even
given
that
uncertainty
that
we've
had
this
past
quarter,
the
market
has
proven
itself
to
be
pretty
resilient.
Okay
and
I'm
going
to
go
to
the
bottom.
Left-Hand
number
here.
Percentage
and
you'll
see
negative
4.9
for
the
quarter.
That's
for
the
three
month
period
january,
1st
2022
to
march
31st
2022.
So
we
had
negative
returns
again.
L
We
knew
that
was
going
to
happen
before
this
quarter
even
ended,
given
everything
that
was
going
on,
but
with
everything
going
on
with
those
challenges
and
level
uncertainty,
that's
not
a
major
market
correction
at
negative
4.9
percent,
that
is
a
market
holding
up
pretty
well
under
those
challenges.
L
Moving
on
down
that
row-
and
we
don't
have
at
this
point
in
time-
because
these
are
march
31st
numbers-
we
don't
have
the
benchmark
quite
yet
or
our
a
on
rank.
Quite
yet.
So
those
that's
why
those
are
missing,
but
moving
on
down
that
row
fiscal
year
to
date,
negative
0.67
return
one
year,
4.76
three-year
11.99
five-year,
10.4
percent
10-year
9.5,
20-year
7.26
and
30-year
at
the
bottom
in
the
blue
box,
30-year
compounded
gross
return,
8.25
percent
and
so
for
for
all
of
those
long-term
numbers.
L
Next
be
moving
to
the
the
health
insurance
chart
and
it's
it's
the
same
format
and
this
again
the
unauthored
returns
as
of
march
31st,
2022
and
I'll
move
to
the
bottom,
lower
left
hand
corner
percentage
of
negative
three
point:
eight
eight
percent
so
negative.
Three
point:
eight,
eight
percent
for
the
quarter
for
those
for
that
three
month
period:
fiscal
year
to
date,
zero
point:
eight
six
percent
return,
a
positive
for
the
for
that
nine
month
period.
L
One
year,
seven
point:
one:
seven
percent:
three
year,
eleven
point:
six:
six
percent
five
year,
nine
point:
eight
eight
percent
10-year
8.17,
and
we
don't
have
longer-term
numbers
for
this
fund
because
of
course,
it's
a
new
fund.
It
really
got
established
in
2010
with
the
enactment
of
shared
responsibility.
L
Okay,
we've
also
been
asked
to
talk
about
the
same
subject
that
kppa
was
asked
and
that's
proxy
voting
and
esg,
which
is,
of
course,
environmental,
social
and
governmental
issues.
So,
first
with
with
proxy
voting,
we
are
similar.
Well,
let
me
back
up.
We
do
have
a
policy
statement
on
proxy
voting
which
has
been
provided
to
the
board
and
the
overriding
policy
tenet
of
our
proxy
voting
is
to
protect
the
system's
long-term
financial
interest.
L
L
We
do
use
institutional
shareholder
services,
iss,
which
is
the
largest
proxy
voting
company
out
there
and
what
they
do,
and
they
do
a
lot
of
things
for
institutional
investors,
but
proxy
voting
is
one
of
those,
so
they
are
looking
at
the
proxies
that
are
out
there
and
the
companies.
You
know
that
we
that
we
have
that
we
own
and
they
are
looking
for
and
and
they
are
making
recommend
recommendations
to
trs
about
those
proxy
votes
in
which
way
which
those
votes
should
go
to
protect.
L
The
long-term
financial
interest,
okay,
that
we
have
those
recommendations
from
iss,
come
to
our
internal
investment
staff
and
they
review
those
recommendations
to
make
sure
they
feel
that
they
do
protect
the
system's
long-term
financial
interest,
and
then
we
vote
those
those
those
proxy
votes.
We
cast
those
votes
with
that
goal
in
mind.
Okay,
so
that's
how
the
proxy
voting
works
and
again
we're
looking
for
what
protects
the
system's
long-term
financial
interest.
L
We
also
have
the
esg
again
environmental,
social
and
governance
issues.
I
know
kppa
talked
a
little
about
the
reporting
and
some
of
the
things
are
going
on
nationally
and
whether
rather
be
duplicative
of
that,
I
would
thought
I'd
focus
this
afternoon,
just
on
what
trs
does
with
esg
and
and
trs
is
not
a
esg
investor.
Okay
and
we've
provided
a
couple,
a
copy
of
the
policies
that
trs
has
on
this
matter.
Again,
we
are
fiduciaries
what
our
number
one
our
fundamental
overriding
tenant
on.
L
Everything
on
all
of
our
investing
is
the
highest
return
within
acceptable
risk
levels.
That's
what
we're
trying
to
do
is
bring
value
to
the
portfolio
we
like
kppa.
There
have
been
a
lot
of
things
over
the
years
we've
seen
where
there
have
been
attempts
to
have
trs
divest
in
various
companies,
one
of
the
biggest
ones
that
I
was
involved
in
was
the
sudan
that
went
on
for
several
years.
L
There
are
a
couple
of
bills
even
filed
that
never
were
not
enacted
and
not
advanced,
but
there
were
a
couple
bills
filed
that
would
require
at
least
review
of
divestment
in
companies
that
did
business
in
the
sudan,
which
is
a
very
tricky
thing
to
do,
because
a
lot
of
those
companies,
for
example
pharmaceutical
companies,
might
be
providing.
You
know
important
benefits
you
know
for
that
company.
So
how
do
you
untangle
that?
How
do
you
decide
who's,
a
bad
actor
and
who's
not?
And
it's
really
a
difficult
thing
to
do?
L
But
there
was
a
big
push
for
that
several
years
ago
and
granted.
You
know
we're
human
beings
at
trs,
and
we
know
that,
like
in
the
sudan,
there
were
atrocities
being
committed
that
were
horrible
and
we
we
sympathize,
but
you
know
and
you'll
see
under
our
policy.
You
know
we
don't
make
foreign
policy
for
example.
In
this
case,
you
know
we
looked
at
federal
government,
you
know
the
supremacy
clause
of
the
united
states
constitution
for
them.
You
know
the
state
department
to
make.
L
You
know
that
kind
of
policy
and
that's
not
something
that
we
weighed
into
again
we're
looking
for
the
best
value
for
returns
within
our
acceptable
acceptance
for
for
risk.
So
that's
how
we
invest
and
we're
not
an
esg
investor.
We
are
a
fiduciary
and
that's
always,
first
and
foremost,
and
then
everything
that
we
do
at
trs.
L
A
Before
we
move
on
bo,
let's
just
stop
for
just
a
second
talking
about
proxy
voting
and
possibly
esg
the
question
I
posed
to
kppa
what
what
metric
do
do
you
have
to
make
sure
that
your
proxy
votes
are
aligned
with
your
goals.
L
We
have
within
the
policy
statement
that
we
handed
out.
There
are
some
general
guidelines,
a
lot
of
what
you
see
and
probably
most
of
what
you're
going
to
see
with
proxy
phone.
Not
everything,
there's
a
lot
of
other
stuff
in
there
too,
but
it's
you
know,
electing
board
members.
You
know
members
to
that
board.
So
what
you're
looking
for
there
and
you
can
see
in
our
written
guidelines
we
like
a
board-
that's
mostly
independent.
You
know.
I.
We
also
like
that
board
to
have
some
people
who
are
not
considered
deemed
independent
board
members.
L
They
may
be,
you
know,
involved
in
the
day-to-day
running
of
that
corporation,
but
that's
a
good
thing
to
have
some
expertise
on
that
board.
We
just
don't
want
them
to
be
the
majority
of
the
board.
We
don't
want
the
ceo
to
be
the
same
person
as
the
board
chair,
so
we're
looking
for
good
governance
and
that
good
governance
brings
about
the
kind
of
goals
that
we
want,
where
they're
really
working
to
maximize.
L
You
know
the
best
into
financial
interest
of
that
company,
which
then
and
endows
us
in
our
best
financial
interests
and
we're
avoiding
conflicts
of
interest,
for
example
among
members
of
that
board
interest
they
may
have
with
individual
interests,
so
we're
we're.
We
are
doing
those
sort
of
things
when
we
have
those
guidelines
and
the
policy
I
handed
out
as
well
as
others,
but
well
I'm
trying
to
interrupt.
A
You
with
those
goals,
those
are
great
goals
for
for
that,
but
to
use
your
example
for
board
members
that
you
want
them
all
to
be
independent
board
members
free
thinking
able
to
how
do
you
know
as
as
trs
that
the
proxy,
the
proxy
that
you've
hired
iss
is
giving
you
is
give
their
votes,
are
based
on
independence
and
not
on
insiders
that
they
would
like
to
control
that
board.
L
Well,
we,
you
know,
we
review
all
those
proxies
every
proxy
that
comes
in
we'll
see
what
it
is
and
then
we'll
have
the
ability
to
cast
a
vote
on
that
and
then
those
proxies
are
reviewed
and
again,
usually
you
know
you're
going
to
see
something
like
the
qualifications
of
an
existing
board
member,
that's
being
reappointed.
There
haven't
been
issues
with
that
board
member
there's,
not
any
complaints
filed
against
that
board
member
with
the
sec
or
otherwise.
You
know
we're
looking
for
good
governors
constantly,
and
it
goes
before
that
as
well.
L
So
before
we,
you
know
when
we
pick
managers
and
when
our
managers
are
picking
companies
to
invest
in
governance
is
very
important.
So
usually,
when
you
are
picking
a
company,
you
are
looking
well,
not
usually
always
when
you
are
looking
to
invest
in
a
company
or
managers
will
invest
in
a
company
they're,
looking
not
just
on
what
their
business
model
is,
but
what's
their
governance,
do
they
have
good
governance?
Are,
do
they
abide
by
state
or
the
federal
law?
Do
they
avoid
conflict
of
interest?
Do
they
like
that
model?
L
A
I
don't
think
that's
my
question,
but
my
question
bo
is:
if,
if
you
as
a
board,
tell
iss
that
for
this
particular
vote,
this
is
what
we
would
like
to
see.
L
D
Thank
you,
mr
chairman
bo,
thank
you
for
bringing
this
information,
and
I
appreciate
your
explanation.
First,
what's
the
total
amount
that
we
have
invested
currently.
L
Okay,
we
have,
let's
see
so
june
30th
of
last
year.
It's
going
to
be
close
to
that,
because
those
fiscal
year-to-date
numbers
I
gave
you
yeah,
you
know
for
retirement.
Trust
is
a
negative
4.9
percent
decline.
M
L
Right
in
a
negative,
I
think
it
was
just.
D
D
L
So
probably
a
little
under
26
billion
dollars
in
retirement,
annuity
trust
and
a
lindle
under
2.3
billion
in
the
health
insurance
trust.
You
know
it's,
those
were
the
higher
numbers
of
june
30th,
so
you
know
24
billion.
Maybe
you
know
a
little
less
than
2
billion,
maybe
right
around
2
billion,
though.
D
Well-
and
I
appreciate
that,
I
appreciate
your
comment
on
the
esg
as
well.
I
probably
didn't
make
myself
as
clear
in
the
previous
questions
with
kppa,
but
I
mean
from
the
standpoint.
If
I'm
investing
my
money,
then
I
can.
If
I
want
to
invest
a
free
sg,
I
can,
if
you
want
to
invest
your
personal
money
you
can
but
the
dollars
that
we
are
as
the
board
or
you
as
a
board
are
investing.
D
D
Your
explanation
of
the
proxy
services
was
a
little
different
than
kppa
that
their
testimony
seemed
to
indicate
that
they
gave
them
their
policy
statements
and
then
I
they
actually
voted
it
for
them.
But
from
what
you're
saying
is
that
you
all
receive
the
recommendations
and
then
you
make
a
decision
whether
to
vote
in
favor
or
against
or
remain
neutral
on.
Such
things
is
that
a
fair
assessment.
L
L
We're
not
really
getting
that.
You
know
our
our,
for
example,
our
managers
out
there
that
we
invest
with.
We
don't
want.
You
know
social
investors.
You
know
we
want
people
who
are
going
to
bring
us
the
most
value,
so
we're
not
really
having
that
as
an
issue.
We
are
aware
that
that
is
an
issue
out
there
in
places
in
the
country.
We
are
aware
of
that.
L
There
are
maybe-
and
I
couldn't
quantify
this,
but
there
have
been
some
large
institutional
investors
out
there
that
have
chosen
an
esg
approach,
but
that
is
something
that
trs
we
are
firmly
against.
I
mean
we
have
to
live
up.
We
have
to
adhere
to
our
fiduciary
responsibility
and
that's
just
so
important.
L
You
know
our
trustees
get
training
on
what
it
is
to
be
a
fiduciary
every
they
hear
it
every
single
year,
but
we
do
it
every
single
year,
if
not
more
often,
investment
committee
meetings,
for
example,
about
the
importance
of
bringing
value
for
our
members,
which
in
turn
brings
value
and
savings
for
kentucky's
taxpayers.
Thank.
L
Yes,
yes,
mr
chair,
so
I
had
to
I
really
wanted
to
discuss
the
budget
that
was
just
enacted
because
it
was
a
phenomenal
budget.
We
were
trs
and
I
know
teachers
are
extremely
appreciative
of
this
budget
that
was
just
passed
out
and
I'm
just
going
to
go
over
real,
quick
and
again.
L
This
ties
back
in
to
investing,
because
with
additional
funding
that
we're
getting
now,
we
are
able
to
invest
better
we're
able
to
not
avoid
certain
investments
we
had
to
avoid
before
we
were
able
to
take
advantage
of
opportunities
that
maybe
we
couldn't
take
advantage
of
before,
but
the
budget
that
was
just
enacted
in
the
2022
session.
L
This
is
marks
the
eighth
straight
year
of
full
or
very
near
full
funding
for
trs
and
when
I
say
near
nearly
full
funding,
I'm
talking
about
maybe
97
and
99
in
the
two
first
years
of
this,
so
really
full
funding.
Okay,
so
again
game
changer.
For
us,
it's
a
wonderful!
It's!
It's
meant
a
lot
to
the
system.
It's
able
to
invest
and
to
implement
its
funding
plan
to
pay
off
that
legacy.
Unfunded
liability
which
we're
on
track
to
do.
L
We
got
a
little
under
24
years
left
in
that
amortization
schedule
to
fully
implement
that
funding
schedule,
get
us
to
100
percent
funded,
at
which
time
we
will.
Our
cost
to
the
state
will
be
a
little
bit
less
than
social
security
in
today's
dollars.
Just
a
few
more
numbers
here,
you
know
over
1.3
billion
dollars,
and
you
know
in
both
years
to
meet
that
additional
contribution
needed
for
adec.
So
we
can
fully
implement
that
funding
policy.
There
are
about
another
900
million
dollars
over
the
next
two
years
that
come
for
the
department.
L
Education
seek
formula
for
that
fixed
statutory
contribution
rate
under
health
insurance,
the
state's
portion
of
under
65
health
insurance
completely
funded
at
149
million
dollars
over
the
next
two
years,
and
these
next
two
is
explain
these
just
a
little
bit.
We've
talked
about
it
here
before
this
board
several
times,
maybe
not
everyone.
Who's
listening
has
heard
this,
but
we
have
something
that
was
sometimes
colloquially
referred
to
as
the
greenbox
dollars,
and
that
reflected
payments
on
an
amortized
basis,
for
some
past
benefit
adjustments
that
were
awarded
years
ago,
or
even
more
currently
for
sickly.
L
But
when
that
happened,
when
there
was
additional
funding-
and
none
of
these
no
calls
were
provided
without
funding,
then
the
state
at
some
point
moved
away
from
paying
those
sort
of
a
lump
sum
to
paying
the
costs
for
those
new
retirees
colas
or
for
those
I'm
sorry
for
those
colas.
Instead
of
paying
those
off
and
lump
sum,
they
started
paying
them
over
a
period
of
years.
I
think
it
started
out
maybe
10
years
and
it
grew
20
years
and
then
the
other
thing
was
sick.
Leave.
L
Okay,
sick
leave,
instead
of
being
paid,
those
active,
I
mean
retired
teachers
as
they're
retiring,
the
cost
of
their
sick
leave.
It
was
being
paid
for
over
a
period
of
years
and
that
had
grown
to
20-year
periods
too.
So
we
had
this
balance
sheet
of
all
these
amortized
streams
of
payments
that
were
being
made
to
trs
over
a
period
of
years
with
interest.
L
L
That
was
provided
in
this
current
budge
to
pay
those
off.
A
C
A
A
If
co-chair
higdon,
if
you
would
ask
your
questions,
thank.
J
L
What
we
have
there
and
the
reason
that
split
out
is,
we
have
items
that
are
in
the
trs
budget,
request
that
we
present,
you
know
to
the
executive
branch
and
to
the
general
assembly
and
then
there's
a
some
of
the
money
we
get
doesn't
come
of
our
budget
request.
It
comes
through
the
kde,
the
department
of
education
budget
request,
and
that
is
for
the
state,
makes
the
contribution
that
fixed
contribution
for
teachers
on
their
salary
that
13.105
percent.
So
that's
what
that
is.
L
It
goes
through
the
seek
formula
and
in,
but
we
kind
of
break
it
down,
because
you
won't
see
that
number
on
our
budget
request
because
it
comes
through
kde.
We
work
with
kde.
They
ask
us
questions,
but
they
actually
come
up
with
that
number
and
make
that
request.
So
that's
that
fixed
statutory
amount.
A
Okay,
well,
please
get
back
on
sorry
about
that.
Chair,
higdon,
back
to
your
discussion
about
sick
leave.
L
Well,
this
was
that
next
to
last
bullet
point,
and
so
instead
of
having
these
streams
of
payment
that
we're
receiving
over
years
and
years
and
we'll
continue
out
into
the
future,
you
know
for
years
the
commonwealth
made
a
decision
and
they
come
with
paying
interest
on
that
at
7.1
percent.
Now
the
commonwealth
made
the
decision,
we're
just
going
to
go
ahead
and
pay
this
off
and
lump
sum.
So
that's
what
that
amount
reflects
paying
off
all
those
past
liabilities
today,
now
in
full
and.
A
I'd
like
just
to
explain
anybody
who's
listening
that
that
saves
the
state.
A
compounding
interest
is
seven
and
a
half
percent.
Yes,
sir,
and
so
it's
a
good
thing
for
the
state.
It
costs
us
a
lump
of
money
up
front,
but
for
the
state
taxpayer,
it's
a
seven
and
a
half
percent.
Yes,
long-term,
comprehensive
savings,
it's
kind
of
like
thinking
of
a
house
mortgage.
If
you
had
a
house
mortgage
at
seven
and
a
half
percent,
that's
not
a
good
house
mortgage
you're,
paying
a
lot
of
interest
at
seven
and
a
half
percent.
A
So
by
paying
that
upfront,
we
basically
paid
off
this
mortgage
saving
a
lot
of
compounded
interest.
Representative
tipton
thank.
C
You
and
I'll
give
I'll
give
a
pat
on
the
back
to
the
pbob,
because
the
spark
that
initiated
this
policy
decision
started
in
policy
discussions
here
with
bo
and
trs,
and
we
took
that
to
our
and
our
folks
and
were
able
to
see
that
through
in
the
budget,
and
I
believe
we
were
paying
payments
of
around
70
million
so
we'll
be
saving
the
taxpayers
about
30
million
dollars
a
year
roughly.
I
think
it's
close
on
health
on
the
health
insurance
fund.
C
I
know
we're
getting
closer
and
closer
to
the
hundred
percent
and
I
will
have
a
follow-up
to
this.
Mr
chair,
do
we
are?
Do
you
have
a
projection
now
a
two-part
question,
a
projection
on,
and
maybe
you
need
to
do
some
research
on
this
so
when
we
might
get
to
that
hundred
percent
and
when
we
get
to
a
hundred
percent,
what
will
the
normal
cost
be
to
keep
that
funded?
At
that
point
in
time,.
L
Yeah,
so
it
is,
we
are
getting
very,
very
close
and
that's
great
news
that
we
are
getting
that
health
insurance
trust
close
to
100
funded
as
we've
discussed
here.
That's
a
good
thing.
You
know
for
a
couple
reasons:
one
you
know
we
would
be
getting
more
in
for
the
health
insurance
benefit
than
we
need.
L
So
that
means
that
you
know
there
can
be
reductions
in
that
payment,
savings,
okay
and
then,
second,
very
importantly,
being
so
close
to
getting
that
100
percent
funded
and
getting
there
actually,
if
anything,
does
happen
with
medical
inflation
or
anything
else.
When
you're
100
funded
it's
a
lot
easier
to
fix
than
when
you're
60
funded,
which
we
were
june
30th.
You
know
just,
but
we
are
moving
very
strongly
and
we
will
have
that
health
insurance
trust
funded
fully.
L
In
a
few
years
I
mean
we're
talking
about
single
digits,
there's
some
things
going
on
right
now.
You
know
national
health
scene
within
young
inflation,
what's
going
to
be
happening
with
medicare
part
b,
because
our
active
teachers
under
six
are
not
I'm
sorry,
I
retired
teachers
under
65..
L
They
pay
that
part
b
premium
amount
which
went
up
quite
a
bit
this
year.
We're
gonna
see
what
ultimately
happens
with
that,
but
you
know
that
that
could
change
the
dynamics
a
little
bit,
but
you
know
we're
within
you
know
just
a
matter
of
years.
You
know
we're
in
before.
You
know
the
the
end
of
this
current
decade.
You
know
having
that
fully
funded.
C
If
I
could
follow
up,
of
course,
teachers
paying
3.75
into
that
the
state
pays
in
the
0.75
and
the
local
school
district
pays
3
percent
and
I
believe
I'm
looking
for
the
budget,
I
believe
I'm
correct.
C
C
I
believe
it's
a
specific
line
item
in
the
budget
and
it's
a
pass
through
to
the
local
districts
to
pay
to
pay
for
that.
So
we've
got
a
total
of
seven
and
a
half
percent
going
into
that,
and
hopefully
down
the
road
that
it
won't.
Take
that
much
contribution
to
keep
the
fund
going
and,
like
you
say,
we
could
take
a
take,
a
look
at
what
we
need
to
do
going
forward
when
that
time
comes
hopefully
very
soon.
Yes,
sir
representative,.
A
L
Okay,
the
last
bullet
point
item.
We
had
quite
a
bit
of
discussion
about
sick
leave,
the
last
meeting
of
pplb,
but
as
those
teachers
retire
every
year
with
sick
leave.
You
know
we
know
how
many
there
are.
We
know
how
much
sick
leave
they
have,
and
you
know
how
much
it
increases
their
retirement
benefit.
L
There
is
in
the
budget
an
assessment
for
the
cost
of
that
crop
of
retiring
teachers.
You
know
every
budget,
and
you
know
this
is
like
those
old
supplemental
colas.
You
know
over
and
above
the
one
and
a
half
percent
which
you
know
haven't
had
since
2008,
but
the
commonwealth
years
ago,
I'm
talking
about
probably
1998
instead
of
paying
the
full
cost
for
those
teachers
who
are
retiring
every
year
was
amortizing
that
cost
over
a
20-year
period.
L
So
not
only
did
that
479.2
million
pay
for
all
the
old
cost
for
those
retiring
teachers
for
sick
leave
and
the
old
supplemental
colas.
It
also
now
is
paying
the
full
amount
for
those
teachers
who
are
retiring
every
year.
For
you
know,
their
added
sick
leave
liabilities
instead
of
paying
that
over
a
period
of
time.
So
that's
not
only
has
the
commonwealth
paid
off
these
past
liabilities,
they
are
now
paying
fully
every
year
so
that
going
forward
because
coals
are
gone
now.
L
You
know
the
liability
of
those
supplementals
are
gone
with
the
409.2
million
and
the
sick
leave
is
going
to
be
paid
for
these
retiring
group
of
active
teachers.
Every
year
you
know,
will
be
paid
in
each
budget.
Now
we
do
have
active
teacher
liability,
which
came
up
when
we
discussed
that
last
session.
That's
part
of
you
know
the
a
deck
that
we
are
getting
is
to
address
active
teacher,
the
normal
cost
and
their
liability
for
sick
leave,
and
that
is
being
captured
as
well.
L
Just
in
that
general,
a
deck
budget
request
the
additional
supplemental
funding
we're
asking
for
it's
not
broken
out
as
a
separate
line
item
in
that
budget
request,
but
it
is
part
of
that
budget
request,
like
so
many
other
things
have
a
part
of
that.
There's
a
cost
for
disability.
You
know
there's
even
a
tiny
cause
for
life
insurance,
so
that
is
being
captured
as
well.
L
L
B
L
What
that
does
okay,
there's
there
are.
There
are
a
couple
ways
that
the
full
cost
of
sick
leave
is
being
captured.
We
have
the
cost
for
our
retired
teachers
and
we
have
the
costs
for
our
active
teachers
who
have
not
yet
retired,
but
there
is
some
liability
already
assigned
to
them
because
they're
so
far
in
their
career.
You
know
they
have
so
many
annual
leave
days
accrued
right,
so
there's
a
cost
for
them
too.
L
The
78
million
dollars
gets
to
the
actual
cost
for
each,
I
would
say,
retiring
class
of
teachers
so
we're
paying
for
their
costs.
You
know
the
liabilities
assigned
for
their
use
for
sick
leave.
This
is
one
part
of
the
sick
leave
cost
the
other
part
and
again
two
different
camps,
a
retired
teacher
camp.
To
kind
of
simplify,
put
this
in
simplistic
terms
and
then
the
active
teacher
camp.
The
active
teacher
camp
is
something
different
from
the
78
million
and
that's
what
is
part
of
the
additional.
B
Funding
we're
receiving
okay,
so
the
active
teachers
contribution
is
involved
in
the
a
deck
the
retired
teachers
is
the
78
million.
It.
L
A
Thank
you
and
co-chair
higdon.
J
Thank
you,
mr
chairman.
I
want
to
try
to,
I
guess,
of
course,
the
479
million
green
box
dollars.
We
won't
hear
any
more
ever
again
about
green
box
dollars
right.
J
L
L
J
J
L
J
J
L
Yes,
so
the
amount
we're
getting
is
for
the
normal
cost
of
that
sick
leave,
plus
the
unfunded
liability
portion
of
that.
So
the
goal
is
to
pay
off.
You
know
the
unfunded
liability
portion
and
just
get
to
normal
cost.
As
I
understand,
the
actuaries
is
ultimately
just
to
get
to
normal
cost
of
sick
leave.
L
Which
is
kind
of
like
a
regular
pension
contribution?
You
know,
part
of
that
is
normal
costs
that
we
would
get
from
now
for
foreseeably
into
the
you
know,
perpetuity
part
of
that,
and
the
greatest
part
of
that
is,
you
know,
unfunded
liability,
so
we're
getting
both.
You
know,
for
example,
in
the
pension
contribution
or
whatever
the
normal
cost,
is
how
much
we
have
to
put
away
each
year.
So
when
that
teacher
retires,
we
know
we
can
pay
for
their
benefits,
but
then
we
have
the
additional
cost.
L
J
F
L
Into
the
system,
I
can't
speak
for
that,
I'm
going
to
actually
sick
leave
came
about
in
the
80s
I
have
I
looked
and
it
came
about
in
the
80s
and
I'm
not
sure
what
happened,
and
certainly
that
preceded
my
time.
It
could
be
that
the
new
statute-
it
was
discretionary
with
the
school
districts,
whether
or
not
they
even
had
to
make
lumps
on
payments
for
unused
sickly
they
didn't
have
to.
They
didn't
have
to
do
30
percent
of
the
daily
rate.
L
They
could
do
10
percent
of
the
daily
rate
and,
of
course,
that's
a
kde
stat
department,
education
statute.
So,
as
we've
discussed
before
this
board,
it's
outside
the
inviolable
contract,
so
I
don't
know,
if
perhaps
for
those
reasons
that
you
know
they
might
have
been
capturing
normal
costs
but
made
I'm
not
sure
what
happened
that
was
with
the
actual
our
prior
actuary,
not
our
current
actuary.
L
When
that
came
about.
I
know
they
had
concerns
about
capturing
the
cost,
because
I
saw
a
letter,
so
I
think
they
were
capturing
normal
costs.
I
think
that
then
became
a
normal
budget
item.
I
don't
think
and
again
this
is
before
my
time.
I
don't
think
they
were
then
trying
to
capture
the
unfunded
liability.
L
A
It's
what
it
seems
to
be
senator
higdon.
Did
you
have
a
follow-up.
J
I
I
I
do
I'm
still
confused
bo
on.
I
I
understand
the
79
78
million-
that's
39
million
in
each
year
for
those
teachers
that
are
retiring
the
sick
days
now-
and
this
is
the
this-
is
the
liability,
the
pension
liability,
the
sick
days
are
already
paid
for
at
the
local
level
when
they
retire.
This
is
the
pension
liability
of
the
of
those
sick
days,
correct,
correct,
okay,
so
the
78
million-
that's
pre-paying
in
advance
for
those
sick
days
for
that
teacher
going
forward
as
they
retire.
L
L
And
that's
for
the
normal
cost
and
the
the
unfunded
liability.
Yes,
sir,.
J
And
so
I
guess
I'm
confused,
as
is
that,
is
that
number
reducing
or
is
it
is
it
remain
constant?
I'm
I'm
confused
at
that
point.
No.
L
It
it
it
is
not
reducing
year
by
year.
It
can,
you
know
it
can
go
up
or
down
just
depending
on
experience,
but
it's
eventually
at
some
point
when
the
unfunded
liability
is
paid
off
and
it
would
go
down.
J
Okay,
I
maybe
sometimes
he
gives
a
flow
chart,
a
flow
chart
or
something
and
and
give
it
a
name.
Not
greenbox,
though,
give
us
give
us
a
name.
So
we
can.
We
can
better
understand
that
that
how
that
how
that
works?
Just
you
know
this
is
again.
This
is
something
that
we
didn't
know.
I
think
until
it
was
last
month
or
the
month
before,
we
ask
you
about
the
that
unfunded
liability
for
current
teachers.
J
J
Last
month
we
asked
you
about
annual
sick
days
and
annual
leave
being
converted
to
sick
days.
Yes-
and
I
think
also
full-time
employees
and
just
part-time
employees
accumulate
sick,
sick
days,
and
do
you
have
a
report
for
us
on
that.
L
Yes,
sir,
so
we
checked
and
you
know
we
have
some
non-school
district
employers.
You
know
like
department,
education,
you
know
not
very
many.
I
mean
most
of
our
field
of
membership
is
school
districts.
You
know
95
percent,
you
know
school
districts,
so
I
think
I
think
the
question
really
revolved
around
school
districts.
You
know:
do
we
have
annual
leave
and
school
districts
rolling
over
into
sick
leave?
And
so
I
checked
I
had
our
director
of
member
services
check
and
there
are
two
districts
that
are
doing.
L
A
L
J
We
need
to
know
more
about
that
because
that's
that's
creating
an
unfunded
liability
for
us
and
there
was
never
an
intent
to
take
care
of
those
those
annual
leave
or
or
anything
other
than
sick
days,
in
that
in
that
formula
so,
and
eventually
like
to
see
you
know
a
breakdown
of
how
many
days
are
they
actually?
What
is
that
actually
costing
us?
Because
that
it's
important
that
we
that
we
get
a
you
know
get
a
grasp
on
that
expense,
because
it
is
an
expense
to
the
pension
system.
L
I'll
I
I
will
have
those
I'll
find
out
what
those
districts
are
and
I'll
have
you
an
answer
by
tomorrow,
the
latest
I
just
need
to
find
someone
who
collected
this
data
for
me
and
so
let.
A
L
I
I
can
tell
you
they
would
be
because
kde,
like
other
state
agencies,
are
under
the
personnel
cabinet,
and
there
are
regulations
in
place
that
talk
about
conversion
of
annual
leave
to
sick
time.
You
can
accumulate.
It
depends
on
how
many
years
of
service
you
have,
but
I
think
at
20
years
and
above
of
service.
The
max
annual
days
that
you
can
hold
on
to
at
the
end
of
each
year
is
60
annual
days
and
then
anything
by
that
by
administrative
regulation
is
required
to
roll
over
as
sick
leave.
L
If
you
have
folks
that
are
not
using
their
annual
leave,
then
you
can
have
quite
a
few.
You
know
roll
over
into
sick
leave.
I
will
say
you
know.
I
know
this
board's,
probably
aware,
but
just
okay,
you
know
annually
for
retirement
calculation
purposes
ended
for
individuals
who
became
members
on
or
after
july,
1
2008.
So
no
more
annual
leave
goes
in
retirement.
No
more
comp
leave.
L
A
My
issue
with
this
is:
if
somebody
works
as
a
teacher
for
20
years,
making
30
40
50
60
000,
but
then
they
work
three
to
five
years
as
a
superintendent
or
as
kde
or
something
making
a
six
figure
salary
they
they
get
a
pretty
nice
bump,
especially
if
your
vacation
time
is
considered
sick
time
and
the
sick
time
is
paid
on
your
last
sal,
your
last
salary,
which
can
be
a
six-figure
salary,
not
a
forty
thousand
dollar
salary
like
you,
had
not
used
that
sick
day
time
on.
Does
that
make
sense
one.
L
More
thing
I
do
need
to
make
sure
I'm
I'm
clear
back.
I
don't
want
to
miss
anyone,
but
it's
just
to
be
clear:
the
use
of
sickly
that
lump
sum
payment
at
30
percent
of
the
daily
rate
at
retirement
and
using
that
lump
sum
payment
to
increase
salary.
You
know
your
last
annual
salary
retirement
calculation
purposes.
Only
school
districts
can
do
that,
okay
for
kde
and
for
other
employers,
and-
and
I
believe
this
is
true,
for
you
know
all
state
employers-
it's.
It
is
added,
as
in
fact
I
know
it.
L
L
No,
it's
just
applied
as
additional
day's
worth,
so
you
don't
get
the
30
payoff
like
no.
That
only
is
possible
in
the
school
districts.
Okay,
thank
you.
L
L
For
trs
we're
very
restrictive
about
what
we
allow
for
that
multiplier,
and
it's
got
to
be
worked
days
essentially
for
us
accumulated
sick
leave
days.
If
you're
100
days
short
of
meeting
retirement
conditions,
you
can't
use
your
100
days
of
sick
leave
to
get
there,
you
have
to
actually
meet
those
retirement
conditions
independently
and
you
can't
use
it
to
bump
up
with
a
higher
multiplier.
That's
a
great
question,
though:
that's
a
we.
We
specifically
addressed
that
because
we
didn't,
we
felt
three
percent
multipliers.
Reward
days
worked.
J
Thank
you,
mr
chairman,
of
course,
I
guess
in
teachers
retirement
years
ago
we
did
service
credit
versus
the
sick
days
correct
years
years
ago.
Service
credit
was
a
option
for
local
school
boards
to
do
that
and
some
and
then
we
transitioned
into
sick
days.
L
It
could
be
those
service.
Credit
would
still
be
an
option
with
the
districts
it's
available
to
all
employers,
but
they
have
to
it's
voluntary,
so
district
could
say
I
don't
want
to
do
salary
credit
anymore.
I
want
to
do
service
credit,
but
the
statute
says
the
employer
has
to
pay
the
actual
cost
of
sick
leave
as
service
as
opposed
to
salary.
Credit.
J
Okay,
one
one
other
question
and
and
again
going
back
to
the
last
month
was
of
or
the
prior
month
prior
that
was
first
time.
We
knew
that
about
this
534
million
sick
day
liability
that
for
current
teachers
does
is
the
board
aware
of
that?
Does
the
board
understand
that
that
liability
is
out
there
do
they
did
they
know
that
it's.
L
It
is
part
of
the
overall
liability
there's
in
all
the
actual
aerial
reports
you
know
just
like
there
are
a
lot
of
other
liabilities.
A
portion
of
that
liability
is
for
disability,
there's
a
cost
to
that.
You
know
they
have
an
idea
of
the
assignment
for
that,
but
I
have
we
discussed
that
specifically
they
know
about
sick
leave.
We've
talked
about
sick
leave.
Do
they
know
that
part
of
the
overall
liability
is
active
teacher
sick
leave?
J
Well
again,
back
to
our
discussions
here,
we've
always
discussed
those
green
box
dollars
for
years,
but
you
know
just
interior
here
recently
understood
that
there
was
also
a
liability
designated
for
current
teachers.
So
I
I
think
you
know
transparency
is
good
stuff.
Everybody
needs
to
understand
exactly
where
we're
at
and
how
this
all
works.
L
And
we
just
have
so
much
actual
information
that
we
give
the
board.
You
know
they
get
the
annual
evaluations,
they
get
reports
by
the
actuaries.
They
get
separate
presentations
powerpoints
they
get
a
deluge
of
information.
So
I
hate
to
say
specifically
they've
had
this
or
not
that,
but
they
do
get
a
lot
of
information
about
what
is
going
on
actually
with
the
system,
what
the
liabilities
are
and
the
okay
plan
to
pay
them
off.
B
Short
question:
could
you
do
a
narrative
on
where
this
534
comes
I'm
trying
to
get
my
hands
around
it,
because
I
thought
the
sick
day.
Liability
is
for
the
the
sick
day,
pay
that's
added
to
the
high
three
at
the
end
of
retirement
from
retirement
until
they
pass
away.
I
thought
that's
that's
what
the
sick!
That's!
What
the
green
box
dollars
was
about.
Is
this
534
something
else
related
to
sick
days.
L
It's
all
sick,
it's
all
sick
leave.
Okay,
so
part
of
that
479.2
does
represent
costs
for
sick
leave.
Okay,
and
that
is
again
it's
when
teachers
are
retiring.
We,
the
actuary,
is
providing
us
with
a
cost
for
those
retiring
teachers.
How
much
needs
to
be
provided
actually
to
pay
for
the
cost
of
them
retiring
right
and
that's
almost
a
pay-as-you-go
kind
of
thing.
You
know
it's
and
in
addition
to
that,
that's
not
the
full
cost
of
sick
leave.
L
So
there's
there's
you
know,
there's
some
liability
assigned
to
all
benefits
for
active
teachers,
in
addition
to
retired
teachers,
and
so
that
530
million
dollars
addresses
the
liability
for
active
teachers
that
are
out
there.
In
regard
to
sickly
the
continued
use
of
sick
leave,
I.
B
L
A
A
A
Okay
bo,
thank
you
for
your
testimony.
It'll,
be,
I
guess,
there's
a
few
follow-up
items.
I
hope
you
got
those
down
if
you
didn't.
L
We'll
get
you
those
two
school
districts
here
very
very
shortly
I'll
send
that
to
staff
so
that
they
can
share
that
with
the
rest
of
the
board.
Thank
you
appreciate.
A
M
Awesome,
my
name
is
beau
craycraft,
I'm
the
executive
director
at
judicial
forum
retirement
system.
It's
good
to
be
here
and
I
don't
mind.
I
learn
a
lot
so
good
meeting.
I
wanted
to
open
up
first,
but
just
one
more
time
publicly
thanking
senator
higdon
and
representative
miller
and
and
the
rest
of
you
all
for
helping
us
pass
a
housekeeping
bill
during
the
regular
session.
Much
appreciated
just
wanted
to
start
off
with
that,
also
just
to
speak
quickly
to
representative
graham's
question
with
regards
to
reciprocity.
M
In
our
case,
jrp
does
not
have
reciprocity
with
regards
to
salary
statute,
defines
that
as
the
last
60
months
of
judicial
service.
So
there
is
no
need,
even
if
they
have
an
account
with
kppa
or
lr
lrp
or
trs.
It's
based
solely
on
the
salary
in
that
system,
lrp
does
have
reciprocity
with
other
plans
and
so
subject
to
some
pension
spiking
provisions
and
in
those
cases
we
verify
and
certify
service
and
salary
from
that
plan,
and
then
those
you
know
in
the
case
of
lrp,
it's
a
high
three.
M
L
K
L
M
Let's,
let's
use
an
example
of
a
judge
who
was
a
judge
with
us:
their
their
pension
is
based
off
their
judicial
salary,
but
let's
assume
they
leave
the
bench
and
go
work
in
the
executive
branch
or
they
in
our
case,
some
have
worked
in
the
in
a
as
a
county
attorney
or
a
prosecutor
prior
to
becoming
a
judge.
Kppa
will
ask
us
to
certify
their
salary
information
and
service,
and
we
provide
that
information
to
kppa
staff,
and
then
they
calculate
the
kppa
benefit.
M
K
All
right
so
in
terms
of
so
the
calculations
is
based
upon
what
the
other
agency
they
work
for
the
other
system.
They
were
in
right
based
from
that,
then
you
all
make
that
or
whoever
makes
that
determination
right
in
regards
to
where
they
would
be
correct.
So
are
there
instances
where
there
is
a
discrepancy
between
what
the
individual
has
from
paperwork
that
was
given
to
them
earlier
versus
paperwork
that
is
now
in
the
system.
M
M
Mean
there's
a
there's,
a
likelihood
that
that
could
happen
right
I
mean
salary
increases
occur,
and
so,
if
you
know,
for
instance,
we're
doing
a
lot
of
projections
right
now
for
judges
and
they're
all
set
to
retire
december
31st,
but
they're
they're
likely
to
get
an
eight
percent
increase
july
one.
So
their
final
compensation
is
gonna
change,
and
so
therefore
the
ultimate
benefit
would
change.
But
you
know
we
try
to
clearly
identify
what's
a
projection
and
then
at
retirement.
M
You
know
you
know
I
can
think
of
a
couple
of
cases
where
we've
retired
a
legislator
we're
using
a
high
three
salary.
Your
all's
terms
end
on
12
31
right.
We
won't
get
2021,
sal
or
22
salary
information
until
the
middle
of
january,
after
you've
retired.
In
those
cases.
What
we
we
you
know,
we
say:
here's
your
benefit
based
on
your
high
three.
If
your
2022
salary
becomes
one
of
your
high
three,
then
we
recalculate
that
and
and
you'll
get
you
know,
whatever
the
difference.
K
Is
able
to
include
that
yeah
last
month
that
you
didn't
get
yeah,
so
is
I
I
guess
from
the
standpoint
I
think
you've
answered
all
of
the
things
that
I
question,
but
if
there
is
a
discrepancy,
is
there
a
process
by
which,
if
they
have
information,
that
shows
a
different
thing
and
the
system
has
something
different?
Is
there
a
process
by
which
you
resolve
this.
M
It's
flowing
through
contribution,
data
is
flowing
through
kppa,
I
assume
is,
is
probably
more.
You
know
automated
than
us.
You
know
with
the
with
the
new
line
of
business
project,
but
I
think
you
know
we
would
you'd
have
to
try
to
get
this.
You
know.
Ultimately,
the
personnel
department
is
generally
cutting
the
payroll
and
I
think
you
would
there
would
have
to
be
some
process.
I
just
haven't
had
to
work
on
one
right.
K
I
guess
my
ques
my
concerns
is
that
now
everything
is
done
electronically,
whereas
people
who
started,
who
are
my
age
and
older
started
and
everything
was
processed
by
hand.
The
possibility
of
numbers
being
in
inverted,
I
mean
inverted
in
different
directions-
could
have
an
impact
on.
I
don't
know,
I'm
not.
M
Asking
those
questions
because
I
was
asked
yeah
they're
good
questions
and
I
mean
I
can
I
can.
I
can
confirm
that
things
were
handwritten
in
the
judicial
forum
retirement
office.
You
know
I've
been
working
through
some
we're
scanning
and
trying
to
update
our
documents,
and
so
there
was
much
that
was
not
automated.
M
You
know,
but
I
think
in
those
situations
we
would
try
to.
You
know,
get
data
as
the
best
we
could
from
personnel
from
chris
records
and
then
from
our
own
records
and
try
to
and
make
a
decision.
You
know
and
there
should
be
w-2s
and
those
type
of
things.
Hopefully
you
know
well.
K
Yeah
and
their
their
word
their
when
I
talked
to
an
individual
who
I
also
dealt
with
a
couple
of
individuals
in
terms
of
what
their
w-2
stated
also
did
not
correlate
with
what
was
done
in
the
process
of
them
changing
from
one
agency
and
going
into
you
know
another
okay
but
anyway,
but
I
appreciate
you
at
least,
and
maybe,
if
you
can
or
you
or
bo
since
bo
knows
either.
K
One
of
you
know
both
of
you
know
well
so
if
you
could
get
back
with
me
and
and
send
me
something
in
regards
to
what
you
have
said
today,
so
that
I
can
send
it
on
to
those
who
who
were
for.
M
Know
real
quickly,
just
investment
performance,
I'm
not
going
to
spend
a
ton
of
time.
Much
like
the
comments
you
heard
earlier
fiscal
year
to
date,
returns
are
right
around
two
and
a
half
percent.
Depending
on
the
plan
you
know,
last
quarter
was
pretty
difficult
and,
as
you
can
see,
over
the
one
year,
eight
and
a
half
percent
are
we're
currently
slightly
trailing
our
benchmark.
M
You
know
just
to
refresh
you,
we
we
have
a
large
cap
equity
portfolio
of
about
25
names,
26
names,
then
we
have
a
fixed
income,
it's
a
short
duration,
mostly
almost
all
corporates
and
the
equity
markets.
Just
struggled
with
you
know
all
this
all
the
geo,
ukraine,
russia
and
then
also
inflationary
concerns
longer
term
we're
still
above
benchmark
strong
returns,
and
so
hopefully,
things
will
stabilize
with
regards
to
esg
real
quick.
You
know
I
want
to
spend
just
a
minute
on
here.
You
know.
M
Our
point
of
view
is
a
little
bit
different,
mostly
because
when
you
start
talking
about
esg,
you
know,
a
lot
of
the
conversation
is
outside
the
u.s
start,
talking
about
divesting
from
certain
countries
or
divesting
from
certain
political
issues.
M
Our
we're
fully
invested
in
the
united
states,
so
our
lens
of
esd
changes
just
a
little
bit,
and
so,
when
we
think
about
esg,
we
don't
think
about
it.
As
you
know,
first,
first
and
foremost,
you
know
our
board
is
not
in
support
of
dot.
You
know,
you
know
mandated
divestment.
We
want
to
be
able
to
give
our
investment
managers
the
ability
to
choose
companies
that
they
think
are
attractive
and
will
provide
a
long-term
return.
But
that
being
said,
the
partnership
that
we
have
with
baird.
M
You
know
the
overall
emphasis
on
being
what
we
call
better
business.
Citizens
is
not
a
bad
thing
either.
So
you
know
our
our
strategy
through
baird
is
to
try
to
find
to
be
long-term
business
holders.
When
you
look
at
our
portfolio
of
25
26
names,
there's
multiple
companies
that
baird
has
owned
for
20-plus
years
home
depot
is
one
of
them.
We
just
talked
about
it.
M
It's
struggling
a
little
bit
in
the
near
term,
but
it's
it's
been
in
the
portfolio
for
20
years,
and
so
the
idea
is
that
if
you
or
I
we're
going
to
start
a
local
business
in
frankfort
kentucky,
you
know
we
would
want
to
be
good
corporate
citizens.
We
want
to
be
good
to
our
customers.
We
want
to
be
good
to
our
our
city.
We
want
to
be
good
to
the
places
that
we
live,
because
we
want
to
be
around
for
a
really
long
time,
and
so
what
ends
up
happening
is
we're
not
esg.
Investors.
M
Baird
would
tell
you
they're,
not
esg
investors,
but
a
lot
of
times
the
the
two
things
align
right:
we're
trying
to
create
shareholder
value
and
returns
for
the
pension
plan,
but
at
the
same
time
we're
finding
companies
that
have
solid
management
teams
that
treat
their
employees
well.
Who
have
who
are
trying
to
be?
You
know
environmentally
conscious
and
use
sustainable
materials
when
they
can
and
and
so
they
align,
and
so
not
everything
in
our
portfolio
rates,
real
well
on
an
esg
scoring
sheet.
M
But
a
lot
of
our
companies
do-
and
you
know,
and
so
we're
not.
We
wouldn't
consider
ourselves
esg,
but
we
do
want
to
consider
our
you
know
being
good
business
and
corporate
citizens,
and
I
think
a
lot
of
that
is
because
we
are
invested
in
the
places
that
we
live
too,
and
so
we
don't
currently
have
a
policy.
F
M
You
know
some
of
the
impacts
that
several
of
their
companies
have
had
over
the
last
couple
of
years,
where
they've
they've
made
what
we
would
consider
short-term
financial
sacrifices,
but
with
a
very
long-term
point
of
view,
and
that
would
be
things
they
did
for
their
employees.
Some
of
the
banks
did
some
debt
forgiveness.
You
know
short-term
debt
forgiveness
through
the
pandemic
and
those
type
of
things,
but
they
believe
will
create
value
long-term,
as
as
that
is
rewarded,
as
it
relates
to
proxy
voting
as
a
single
source
manager.
M
We
don't
currently
vote
any
proxies
in-house,
trs
and
krs
didn't
mention
this,
and
I
don't
want
to
speak
on
their
behalf,
but
I
know
in
the
past
they
have
generally
only
voted
the
the
stocks
that
they
hold
in
their
internal
portfolio
for
managers
that
have
full
discretion
over
their
portfolios.
M
They
also
have
the
responsibility
for
proxy
voting
and
generally
it's
because
they're,
the
ones
choosing
the
companies
they're
the
ones
that
are
a
lot
of
times
investing
in
management,
and
so
our
structure
is
similar
to
that.
We've
partnered,
with
baird
baird
votes
all
of
our
meetings.
They
utilize
a
third
party,
not
iss.
They
use
what
is
probably
the
second
largest
provider
called
glass,
lewis
and
glass.
M
M
M
There
was
a
shareholder
proposal
for
his
company
to
draft
some
type
of
environmental
report,
and
you
know
there
was
a
push
for
that
from
a
lot
of
your
socially
aware
type
of
you
know,
shareholder
groups,
glass
lewis's
position
was
yes
that
you
should
approve
that
baird's
position
was
no,
they
believe
you
know.
Warren
buffett
is
the
best
asset
allocator
in
the
world.
So
why
would
we
ask
him
to
start
writing
environmental
reports
and
he
also
he
always.
M
F
M
Have
25
stocks
baird
is
managing
our
money
along
with
a
number
of
other
clients,
and
so
they
can
be
a
little
bit
more
hands-on
than
you
know
if
we
were
holding
a
s,
p
500
index
fund
and
voting
500
securities,
but
that's
currently
our
setup
with
regards
to
proxy
hilliard
does
have
a
proxy
voting
policy
and
they
do
also,
like
I
said
utilize.
The
supplemental
research
from
glass
lewis,
which
is,
is
just
a
it's
a
very
similar
setup
to
iss.