The 7.75 percent return rate is overly optimistic this year, according to CalPERS Chief Investment Officer Joe Dear. The lagging economy has put a damper on expectations and Dear believes overall the next few years will be tough for the pension fund. The officer commented that “This low-return environment is structurally driven, and there’s not a lot of policy to move it.” While losses and gains are spread out over 15 years, Bloomberg reports that “Even with gains in fiscal 2011, the pension fund has earned 3.41 percent annually on average in the past five years, 5.36 percent in the last 10 and 6.97 percent in the last 15. It has only beat its assumed rate of return with a 20-year average of 8.38 percent annually.” Back in the spring, the Board of Directors rejected a proposal to reduce the assumed rate of return. While the pension fund was fully funded before the recession, it is now at about 70 percent.
And in other CalPERS-related news, from October 24th to the 26th, the pension fund will hold its annual educational forum in the city of Long Beach. The three-day learning and networking event for public agency employers will include workshops, exhibits, leadership training and keynote speakers. This year’s two featured speakers are former North Dakota Congressman Earl Pomeroy, a leading expert on retirement and health, and Dennis Snow, a former Walt Disney Executive, will discuss proven techniques to create customer service excellence. Anne Stausboll, CalPERS Chief Executive Officer, commented that “CalPERS staff looks forward to meeting with employer representatives at exhibits and workshops. The Forum offers an excellent opportunity to strengthen our partnership in managing health and pension benefits.” Here is the pension fund’s description of the event:
“This year’s offerings include updates on popular topics such as Social Security and payroll reporting, actuarial basics, reportable compensation and membership eligibility. In the exhibit hall, participants can meet one-on-one with an actuary, and visit booths to learn more about CalPERS customer contact center, retirement estimates, supplemental retirement plans, and electronic fund transfers. The Leadership Policy Series provides up-to-date information on a variety of topics including public pension reform and health care benefits, and will also offer an opportunity to ask questions of CalPERS Chief Actuary.”
Location: Long Beach Convention Center
Registration Fee: $300
Registration Deadline: Friday, October 7, 2011
Registration information can be found here. A video on the event can be viewed below: