Retreat highlights the future of state employee benefits
The nation’s largest public pension fund is taking a long, hard look inward at how it protects the investments of 1.3 million beneficiaries – about half currently retired – who rely on the system for their retirement.
That’s essentially the common theme of the board and staff of the California Public Employees’ Retirement System over a three-day annual retreat attended by about 40 people. The retreat started Monday at Embassy Suites Lake Tahoe. The meetings are open to the public.
The CalPERS board controls a $164 billion investment fund for state and local government workers like Midge Bevilacqua, a California State Parks employee of the Sierra District who plans to retire in two years.
At 60, she relies on boarding and breeding horses at her Sierraville ranch. She believes she’ll have to continue the business to support the comfortable lifestyle she’s come to know.
In a way, she’s far removed from the big business of financial investments and corporate accountability.
“I hope the fund is still there because I plan to retire on it,” she said.
Not to worry, CalPERS spokeswoman Pat Macht said: “It’s a guaranteed allowance.”
In a day and age of corporate scandals led by Enron’s $62.2 million stock loss, CalPERS’ 13 board members grapple with how to best go about that type of obligation on the heels of widespread criticism of voting against directors of U.S. companies that hired their own consultants to perform their auditing.
And, voting against high-profile investors such as Warren Buffet raised many eyebrows. But many on the panel applauded their convictions.
Investment consultant Ralph Whitworth reminded the group how tough it is to stand by those convictions.
“People don’t throw rocks at trees that don’t bear fruit,” he said.
Along with team building, auditing procedures consumed much of Monday’s session.
Today, the chief executive officers of leading health care firms will discuss tackling skyrocketing medical costs.
That topic is of interest to Bruce Eisner, who works for the California Tahoe Conservancy.
“I don’t worry about the solvency of the program. I’d like to know how aggressive they’ll be at holding down (health care) rates. They sure have been climbing,” he said, turning his attention to the private sector. “Still, comparatively speaking, it’s better than what most employees face.”
– Susan Wood can be reached at (530) 542-8009 or via e-mail at email@example.com