January 7, 2015

January 2015 
In this issue: 
Unions Weigh In On SF Employee Retirement System (SFERS) Board Functionality 
BREAKING NEWS: Blue Shield/Sutter Dispute Settled – Impact on Benefits Avoided 

Unions Weigh In On SFERS Board Functionality The following letter was sent to the SFERS Retirement Board in January of 2015:
Dear Members of the San Francisco Retirement Board:
We, the undersigned unions of the City and County of San Francisco, are writing with a united voice to urge that this Board move forward to approve and implement a thoughtful and sound investment policy which protects the pensions of thousands of public employees. What began as a discussion about investment policy has revealed a troubling pattern of political intrigue that delays decisions and threatens our members’ retirement security.
We believe the Board should respect the advice of professionals – staff members and experts whose entire careers consist of understanding and balancing complex financial decisions with the goal of maximizing returns in good markets and protecting assets in down markets. Your fiduciary duty requires that you make fact-based decisions in the best interest of the Fund and its participants without regard to politics, hype or disinformation.
Nonetheless, some members of this Board have been silent while dishonest tactics are used to frighten retirees and employees. No retiree will lose their pension based on investment policies set by this Board. Each retiree has a vested right to their pension. The entire Board should actively reassure retirees that while the asset allocation issue may be controversial, it does not have these implications. Facts should rule this Board’s deliberations, and any other influence or interest is truly worrisome. It should be clear that if the right decisions are not made, and made soon, the financial risk is borne entirely by active employees and SF taxpayers.
The premise of 2010’s Proposition C was that both the City and the employees would pay more to cover the huge pension contributions necessary as a result of the 2008 meltdown. It was anticipated that with thoughtful and sound investment principles, those high contributions would decline within a few years. It is now clear that without changes in the investment strategy, we remain extremely vulnerable to even higher contributions for a longer period of time in the event of another downturn. That means less money for programs, services and employees. It is up to you to act appropriately to do everything you can to ensure that does not come to pass.
You have before you expert advice that states that we need to protect the pension fund from an inevitable down market. These experts believe that placing some assets in alternative investment mechanisms is the best way to achieve this balance. We urge all of you to do what is best for the plan
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