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On 12/12/11 the Mendocino County Board of Supervisors met with the County's Retirement Board.
One Supervisor - Carre Brown -
said something the local press completely missed. Click to see - Less than 2 minutes.
"It's difficult for
me
as a first-term Supervisor to look at information (about the County's Pension Fund) and believe I can have trust in it." Think about what it means when a County Supervisor comes to that conclusion.
In January 2011 Retirement Administrator Jim Andersen gave the Retirement Board the draft "Actuarial Valuation" for June 30, 2010. Valuations lay out the Pension Fund's financial position and sets Pension contributions for employers and employees.
The Net Investment Profit for 2010 was reported as $44.7 million. That's a key number that affects the Valuation.
The following month Anderson passed out the draft Audited Financial Statements for June 30, 2010 produced by a CPA. That document showed Net Investment Profit for 2010 to be $38.1 million - $6.5 million less!
There isn't supposed to be a difference - they should be EXACTLY the same. Andersen hadn't noticed the difference - nor did any of the Retirement Directors - except for Ted Stephens.
I had compared the two reports and saw the difference. Ted confirmed the error. Ted said to the Retirement Board "How can we approve these two reports with a $6.5 million error - and we don't know which one is wrong?"
Well - the Retirement Board DID approve the two reports - with the $6.5 million error!
Andersen gave a memo to the Retirement Board in March 2011 that stated the Actuarial Valuation was in error - the Actuary had included transfers from the Pension Fund to pay Retiree Healthcare as if the transfer were investment profits!
Well - LAST MONTH the Retirement Association got it's latest Actuarial Valuation. Guess What.
It carried forward the same $6.5 million error - it wasn't corrected!
The Retirement Board - over Ted Stephen's objection - approved the Actuarial Valuation - WITH THE SAME $6.5 MILLION ERROR!
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I can give dozens of examples of information from the Retirement Association FULL OF ERRORS - and never "fixed".
No one in the County or Retirement Association (until Ted came along) seems to think it's their job tomake sure the reports are "right".
Our County has the highest debt per capita of all California counties because of this kind of deeply flawed financial management.
Supervisor Brown is completely justified in not having trust in the information Supervisors receive about the Pension Fund!
Frankly - until I started no one ever analyzed County and Retirement Fund financial reports from the public's point of view. It does't have to be me - but by now we should know someone has to do this analysis - and that's one major reason we need the Coalition Education Fund.
No one ever looked over the County's financial shoulder from the public's point of view and today's hugely destructive debt is the result.
Supes Discuss Pension Problems
At the end of the December 12 Supervisors - Retirement Board meeting all 5 Supes had some important things to say (click to see - 16 minutes). What "Pension Reform" means to them, what went wrong, what the underlying problems are. Important insight into how Supes think.
Pension Reform Initiative Dies
In my last email newsletter I talked about how 2012 would be the year of "Pension Reform". I thought the year in California would be dominated by a 3-way chess game with public unions. Governor Brown, and an group named Californians for Pension Reform (CPR) pushing for a major ballot initiative.
Oops. CPR announced they wouldn't put their initiative on the November ballot after all.
All links open either a new window or tab if clicked. San Diego Union-Trib slams Attorney General Kamala Harris' Dirty Trick on Pension Reform. Calpensions opines that the action will now focus on many much stronger local reform ballot measures. The SacBee says it's time for Jerry Brown to come up with a Pension Plan B and agrees Harris produced an "inaccurate and dishonest" summary of CPR's proposed initiative.
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