Response to San Diego Union Tribune article

Date: Sep 15, 2017

 


Re: "City increases pension fund debt, but delays the financial consequences" (Sept. 9. 2017)

To the Editor:

 

As reported, San Diego City Employees’ Retirement System’s board of administration lowered the pension system’s investment return assumption from 7 percent to 6.5 percent over two years, adopting the lowest, most conservative investment return assumption of all California public pension plans. This will enhance system security and increase pension contributions required annually by employees. The board took this action despite SDCERS’ strong historical investment returns: 8.1 percent over the past 20 years.

 

The board also modified the city’s pension debt amortization schedule, smoothing future city contributions. This action was supported by the system’s actuary, fiduciary counsel and chief investment officer to achieve more consistent cash inflow and aid benefit security.

 

Proposition B had no impact on SDCERS’ unfunded liabilities. Proposition B promised savings by freezing pensionable pay, saving the city approximately $25 million a year.

 

Mark Hovey

CEO, SDCERS

 

Valentine Hoy

Board president




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