Jacksonville City Pension Fund Recovering Well

[FayeforCure]

PENSION FUND Recovering well

Posted: March 20, 2011 - 12:00am

The economic recovery has been under way for two years.

In that period, the Police and Fire Pension Fund increased over $360 million in value, posting a return of 52 percent.

The city pension fund recovered over $580 million.

City pension system assets have increased by $940 million.

Our investment policy will continue to produce outstanding investment returns.

For many years, the fund sought legislative relief from restrictive investment regulations affecting only police and fire pension plans.

These outdated restrictions cost local taxpayers millions in lost investment opportunity.

Our court win last year permits the fund to significantly diversify our investment allocations.

Historically, our fund has returned over 9 percent on investments. However, from 2000 to 2010, the "dot.com" and global economic recession hurt our pension fund as well as every other investor.

The economy, coupled with years of weak funding of city pension obligations identified by a study by Jacksonville Community Council Inc., is causing the "pension crisis," not the level of pension benefits.

Recent reports quote respected academic and governmental leaders, saying the recovery is well under way. When interest rates return to normal levels, much of the underfunding will vanish.

The Police and Fire Pension Board and staff are working on pension reform initiatives that will strengthen the fund for the future.

The millions of dollars in city obligations to the pension system are not due and payable until many years from now, and will not evaporate with political gamesmanship or slogans.

JOHN KEANE,

executive director,

Police and Fire

Pension Fund



--------------------------------------------------------------------------------

http://jacksonville.com/opinion/letters-readers/2011-03-20/story/letters-readers-city-pension-fund-recovering-well

[NotNow]

Defined Benefit Plans also act as "insurance" for Police Officers and Firefighters.  If injured, Jacksonville Police Officers and Firefighters are medically retired and are compensated by the Police & Fire Pension Fund, rather than the city, worker's comp, or Social Security.  If you wish to shift Police and Firefighters to a different plan, you will need to pay for income continuation insurance and place them on the Social Security rolls (at a cost to employee's of about 6.2% and to the city of a slightly higher percentage of payroll).  I am not aware of what the cost of income contiuation insurance per million dollars of payroll would be, perhaps someone here knows of those costs.

I won't even get into the State laws on Police & Fire pensions that would forbid this, that would have to be changed.

[FayeforCure]

What a joke. My personal favorite line;

"Our investment policy will continue to produce outstanding investment returns.". Whewwwww. Problems solved! Thank you, Bernie Madoff.

Anyone with just a basic understanding of Defined Benefit Plans, the affects of compound interest, investment returns, and the benefits of better cost certainty would know that this City needs REAL Pension Reform. But no, much better to just keep pushing things off to the future.....the Gov Model that works so well (for government)

and, no pension reform DOES NOT MEAN THAT POLICE AND FIRE DO NOT DESERVE RETIREMENT PLANS.

There are people that are in the KNOW that don't just parrot the political buzz words: "we need to reduce pension benefits"

Actually you are partially right: it was the Wall Street abuses that caused the crash in the pension fund.

It always amuses me............ first Republican policies of deregulation cause our economy to crash, and then they use that as an excuse to dismantle the benefits of our working middle class:

Controller John Liu fights Mayor Bloomberg's push to reduce pension benefits
BY Adam Lisberg
DAILY NEWS CITY HALL BUREAU CHIEF

Thursday, April 7th 2011, 9:36 AM


Warga/NewsA report from Controller John Liu's office said city taxpayers paid $3 billion last year to make up for low returns on the pension funds' investments after the economy crashed.

Controller John Liu pushed back Wednesday against Mayor Bloomberg's drive to reduce pension benefits, saying half the city's increase in pension costs was caused by Wall Street.

A report from his office said city taxpayers paid $3 billion last year to make up for low returns on the pension funds' investments after the economy crashed.

In contrast, increased benefits for cops, firefighters, teachers and other city workers have captured headlines - but were only worth $2.4 billion last year, Liu said.

We do need pension reform," Liu said. "But how we change our policy going forward has to be based on the facts, not on rhetoric."

Bloomberg has led the charge to trim benefits for city workers, as New York's annual pension cost shot from $1.5 billion in 2002 to $8.4 billion next year.

Independent budget analysts said Liu's report seemed on target, but Bloomberg's office said it undercounted the impact of city workers' annual wage increases.

"You can't control the market - what you can control is benefits," said Bloomberg spokesman Marc La Vorgna. "I guess he thinks padding pensions with final year OT and people retiring in their 50s with taxpayers footing the bill is appropriate."

"There they go again," Liu replied. "I think the major flaw is we don't simply echo what the mayor's been saying."

alisberg@nydailynews.com

http://www.nydailynews.com/news/politics/2011/04/07/2011-04-07_controller_john_liu_fights_mayor_bloombergs_push_to_reduce_pension_benefits.html


Attacking our middle class by reducing their pension benefits is not the answer.

I just hope we aren't in another stock market bubble and heading for a dubble dip recession.

[NotNow]

Faye and StephenDare!,

I appreciate the support on the pension issue.  And sammar, there is plenty of history on the LOCAL pension issue on this forum.  I encourage you to research it and if you want a local viewpoint, feel free to PM me.  This is certainly one area where bipartisan action is needed.  There has been abuse of pension funds by both sides of the argument in this country, and a careful review of the facts should be carried out before we blindly change systems and affect many peoples lives.

[Captain Zissou]

Attacking our middle class by reducing their pension benefits is not the answer.

I'd rather not tread into this messy issue, but I want to address one thing.  At least in the mayoral race, most of the talk of pension reform has only been towards new hires.  It's not right to touch the pension of people already working for the city.  I'm sure many of those men and women would have chose not to serve their city by working for the public if they thought their pension was in jeopardy.

For those men and women who have already made the commitment to work for our city, they deserve to have their pension left alone.  However, I do believe that reforming the benefit structure to more closely align with the market at large for new hires would be beneficial and appropriate.

[NotNow]

Sanmarco,

I have to concede that suggesting reading past threads as "research" was a poor choice of words.    It just gives you an idea of the misinformation that is out there on this issue.  Documentation on the Police/Fire plan is available on the COJ/net site.  I would be VERY interested in hearing your opinions as a professional in the field.  I am only a participant and I have no training in the field.  There are State laws and specialized rules and needs for "high risk" pensions as I have pointed out.  It is my belief that to change the COJ Police/Fire pension and make it comparable to similar sized Florida cities would greatly increase the cost of the system.  The city recently did such a study and has kept it very quiet.  What do you think needs to be done?

[JeffreyS]

My guess is they had a decent deal in place.  Then the city decided to take "pension Holidays" then a corrupt wall street and corrupt mortgage bankers ruined the economy making it tough for the city to live up to it's deal.  Now the only people we can vilify are the unions who spelled their deals out and were the only ones to operate "above board" the whole time.

Now had the Unions acted deceitfully like Wall Street hedging against the country, the mortgage banksters make bad loans they planed to sell to the government and the city of Jax not funding the pensions when times were good getting behind with these "pension holidays"  the unions would probably be fine.  Unfortunately their honesty has made them easy targets.

[Garden guy]

Does'nt this mean they can take a break like the rest of us have?

[buckethead]

I'm not sure I can grasp it all within the first go-around, but I'm willing to give it the ol college try.

(Schedule permitting of course) I'd love to understand more about pensions than I currently do, which sadly consists of "they're unsustainable" and "I don't have one".

So many sound bites... so little time.

[BridgeTroll]

Consider me in the "schedule permitting" group also.

[BridgeTroll]

Looks good to me... I have to confirm with my "social director".

[NotNow]

SMMATT,  I wasn't able to attend your meeting.  Can you give me a brief on your opinions of the PFP? 

[NotNow]

Interesting opinion.  Did you look at the comparison pension plans from around the State?