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The Pension Board – SDCER’s
I recently accepted the mayor’s request that I join the SDCER’s pension board. I knew there would be a lot of work to do, but frankly, I had no idea how much.
I have been there but a few months, but in that time, I have come to some findings I think help to understand my beliefs in Kroll’s recommendations for this organization.
First, it sure appears to me that the actions of the past board were self-serving, and they violated the public trust that you and I had placed in these individuals.
I believe the ones most responsible for these violations are gone and in their place are individuals who are knowledgeable and committed to public service.
First, there is no pay or compensation for service on the pension board, and meetings run long and there are a lot of them.
Second, trying to get up to speed and to understand a system that is complex by its nature and seemingly made more so by those who led the organization in earlier years, and who may have wished its comprehension not be easy, takes a lot of “homework.”
The board has hired some top consultants to assist it with unraveling the problems and procedures that led to them. These consultants are nationally known, and produce an excellent product on time and on budget, unlike city consultant reports which have raised concerns with all of us. One of the consultant firms is Navigant Consulting – a nationally listed firm, whose report is available to the public at the reception desk at SDCER’s offices.
Due to the Navigant report and the “new” board’s response to it, many of the recommendations in the Kroll report had already been undertaken before the Kroll report was finally received.
Some of the remaining Kroll recommendations are as follows:
(None of these have been addressed or decided by the SDCER’s board – these are my, present opinions on them.)
- Reduce the board from 13 to nine.
I think this is a good idea – 13 members is a large board, and if each member feels a need to make a public comment on each item, the time needed is far longer then should be required. Most public boards have nine or fewer members; this is a recommendation that should be accepted. But it will take a vote of the public.
- The board should have four employee representatives and five independent appointees from the public.
I think it’s important for the employees to have a voice from the board – but I worry that they not influence the board as they did in the past.
- SDCER’s should have its own legal council.
I agree, as I discussed under the Kroll report item.
- 15-year amortization schedule.
This is premature, as the city and SDCER entered into a legal agreement known as the Gleason Settlement – which established the present schedule – this agreement expires in a couple of years.
The city’s voters passed a proposition in 2004 to set a 15-year schedule, but the state attorney general has questioned the validity of this City Charter change, stating the authority rests in the State Constitution, which places the responsibility for this decision with the pension board.
I think the pension board’s actuary a professional individual, which the board hired, should provide his recommendation in a public meeting, addressing, as I feel sure he will, or the board will require, the Kroll recommendation and the city’s proposition, approved by the voters. And a very public discussion will take place in which I feel a logical decision will come from.
Overall, I think the city and the pension board, now forwarded are well on their way to correcting the problems of the past.
The problem remains where the city will get the money to pay for the benefits it has promised.
Thanks for letting me be the guest host of the day.