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  #1641  
Old 09-19-2019, 03:31 PM
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CALIFORNIA
DIVESTMENT

https://www.pionline.com/legislation...sh-investments
Quote:
Bill passes moving CalPERS, CalSTRS closer to divesting Turkish investments
Spoiler:
A California bill requiring CalPERS and CalSTRS to divest from any investment vehicles owned by the government of Turkey upon passage of related federal legislation has cleared the state Legislature and is awaiting the governor's signature.
The $380.7 billion California Public Employees' Retirement System, Sacramento and the $238.3 billion California State Teachers' Retirement System, West Sacramento, would be required to divest only if Congress sanctions Turkey for its failure to acknowledge the Armenian genocide during World War I.
Both CalPERS and CalSTRS opposed the bill.
Gov. Gavin Newsom is expected to sign the bill.
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Old 09-19-2019, 03:52 PM
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ILLINOIS

https://wirepoints.org/third-domino-...hter-pensions/
Quote:
Third domino falls: Illinois Comptroller set to confiscate East St. Louis revenues to pay for city’s firefighter pensions
Spoiler:
On Tuesday, the East St. Louis’ firefighter pension fund demanded that Illinois Comptroller Susana Mendoza intercept more than $2.2 million of East St. Louis city revenues so they could be diverted to the pension fund.

The fund trustees said the city shorted firefighter pensions by $880,000 in 2017 and another $1.3 million in 2018. Under a 2011 pension law, the state comptroller gained the powers to intercept city revenues on behalf of police and fire pension funds shorted by their municipalities.

Harvey was the first municipality to run afoul of the intercept law. North Chicago, a Chicago suburb of 30,000, was the second. Now it’s East St. Louis’ turn.



Back when Harvey was first intercepted last year, Wirepoints reported that comptroller confiscations could wreak havoc on hundreds of Illinois communities, potentially creating a domino effect. Hundreds of Illinois’ 650 pension funds have not received their statutorily required contributions from their respective cities in recent years, meaning the intercept law could go into wide usage under a broader crisis scenario. In the most recent analysis of Illinois Department of Revenue data, nearly half of the 650 funds were not properly funded in 2017 (see details below).

That domino effect could be exacerbated given that municipalities have virtually no control over their own pension funds. State law sets all the rules and pensions are protected by the Illinois Constitution, meaning that in a market downturn, the pension funds may have little choice but to demand more intercepts.

The East St. Louis firefighter fund has certified to the comptroller that the municipality didn’t fully pay its required contributions to the pension fund in 2017 and 2018. Now the Comptroller has 60 days to decide whether that’s correct. After that, it can begin confiscating East St. Louis revenues. The request by the lawyers of the firefighter fund can be found here.

The intercept law was first utilized in 2018, when Harvey, Illinois, revenues were garnished to pay the city’s police and firefighter pension funds.

That intercept of nearly $3.3 million led to the layoff of 40 public safety workers so the city could avoid insolvency. The city found it couldn’t simultaneously pay for both current workers and pensioners. The city and the pension plans eventually reached a deal that relieved some of the pressure on the city.

The East St. Louis intercept

East St. Louis is no stranger to fiscal crises, but the intercept is bound to cause the city a new level of pain. The Comptroller can confiscate revenues that come from the state and an overwhelming share of the city’s general budget comes from the state.

If the full $2.2 million is intercepted, the city would end up losing the equivalent of 10 percent of its budget (the city’s 2018 general budget equaled $18 million). And what’s worse, the city’s 2019 budget is already facing millions in deficits.

East St. Louis’ fire and police pensions are some of the worst funded in the state, with funded ratios of just 31% and 9%, respectively. In total, the city has a shortfall of more than $104 million in its public safety pension plans, according to Illinois’ Department of Insurance. That’s more than $9,700 per household in a community where 43 percent of people live below the poverty line.



And with just $6.1 million in assets and annual payouts to beneficiaries totaling $3.7 million, the city’s fire fund has the equivalent of only two years of payouts in its accounts today.

Another day, another domino

Cities like Harvey, North Chicago and now East St. Louis are the vanguard of a much wider problem faced by municipalities across Illinois.

The most recent numbers show that 301 of Illinois’ 651 public safety pension funds, or 46 percent, were shorted their full payments in 2017, according to the actuarial standards published by the Illinois Department of Insurance.



Illinois cities – from Kankakee to Danville to Alton – need pension fixes before costs bankrupt them. And while state politicians have effectively quashed any chance for reforms now, that shouldn’t stop city officials from demanding real changes.

Municipal leaders across Illinois need to demand the following if they want their cities to survive Illinois’ collective crisis:

An amendment to the constitution’s pension protection clause so pensions can be reformed and workers’ retirement security saved;
The ability to convert pensions to defined contribution plans for workers going forward;
A freeze on retirees’ cost-of-living adjustments (while protecting small pensioners) until pension plans return to health;
Public sector collective bargaining reforms so officials can hold the line on new labor contracts, and;
And the possibility of a fresh start through the ability to invoke municipal bankruptcy.
The troubles brewing in Illinois are all happening during one of the longest economic expansions ever. When the economy and the stock markets inevitably correct, things will only get worse.

Without the above reforms, East St. Louis, North Chicago and Harvey might only be the first in a long list of collapsing cities.
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Old 09-19-2019, 04:08 PM
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CALIFORNIA
DIVESTMENT

https://www.latimes.com/opinion/stor...el-gun-control
Quote:
Op-Ed: Frustrated by the lack of action on climate change and gun violence? Divest

Spoiler:
Californians frustrated by Congress’s failure to pass climate and gun control legislation have a potentially potent tool to produce the change they want: divestment.

The California Public Employees’ Retirement System and the California State Teachers’ Retirement System, the nation’s second- and third-largest retirement plans⁠, own investment portfolios that brim with shares in fossil fuel companies, ammunition manufacturers and gun retailers. So do almost all 401(k) accounts. Divestment campaigns can change that.

The primary goal of divestment advocacy usually isn’t to force the collapse of target companies by depriving them of capital — that outcome is often out of reach. According to a 1999 study in the Journal of Business, the anti-apartheid divestment campaign that targeted corporations and individuals who did business in South Africa in the 1980s — generally considered the most successful such efforts — didn’t deeply affect South Africa’s financial sector⁠. It achieved its goal by stigmatizing the practices of the South African government. As a 2012 Harvard Political Review article concluded, “It is almost certain that worldwide popular opposition … contributed to the decline of apartheid, and divestment was an important piece of this puzzle.”

This kind of activism is a long slog, however. It runs up against the caution, political impassivity and sheep mentality of institutional investors, many of whom resent activist interference.


One rationale for resisting a divestment campaign is “fiduciary duty,” which imposes a legal requirement on managers to try to maximize financial returns for their funds. As long as fossil fuel and gun companies make money, many managers consider them worthy investments. But divestment campaigns challenge investors to take a broader view of companies’ benefits, considering their long-term social and environmental impacts as well as their short-term profitability. In the case of fossil fuels, for instance, gas and coal companies have been underperforming stock market indexes for the last half-decade and are likely to continue to decline as renewable energy spreads and climate change intensifies. Even fiduciary duty can argue for divestment.

The effort to persuade the University of California to sell its fossil fuel holdings is a showcase for institutional investors’ resistance to divestment.

Last month, an overwhelming majority — 77% — of the UC faculty on all 10 campuses asked the university’s regents to definitively rid the school’s portfolio of holdings “in the 200 publicly traded fossil fuel companies with the largest carbon reserves.” The petition added weight to student demands since 2013, and it was personal for many of the science faculty, who for the last two decades have been in the forefront of identifying global warming’s dangers.

Unfortunately, in response, a day after receiving the petition, Roger Sherman, chair of the regents’ investments committee, issued a statementthat essentially sidestepped the issue. It emphasized that UC has already moved away from fossil fuel stocks and toward sustainable energy, and cited the board’s fiduciary duty to give climate change “the same weight as other material risks.”

This is hardly the unambiguous divestment commitment the faculty voters want. Because of the university’s stature, such a commitment would generate enormous ripples throughout academia and beyond. “This would be one of the biggest moments in the seven-year history of the fossil fuel divestment movement,” said Bill McKibben, co-founder of 350.org, which has led the international campaign.

Only students, faculty and alumni can pressure the UC regents to divest, but millions of other Californians can put similar advocacy to work on their own portfolios. CalSTRS, for example, has repeatedly proclaimed that its funds are gun-free, but according to As You Sow, a shareholder advocacy nonprofit, the teachers’ pension fund still holds hundreds of thousands of shares in ammunition manufacturers and millions of shares in gun retailers such as Walmart and Dick’s Sporting Goods.

One obstacle to divestment campaigns is that individuals don’t know what companies a pension behemoth like CalSTRS or CalPERS is investing in, and 401(k) holders have to choose among mutual funds, which are just as opaque. As You Sow cuts through this obfuscation with a website search function. You can enter a fund name or ticker symbol to get a list of fossil fuel, gun and other kinds of controversial companies your savings may be supporting.

Andy Behar, As You Sow’s chief executive, is a divestment optimist: He believes that if enough individual investors abandon funds with holdings they object to, fund managers will drop the objectionable companies, which, in turn, will face trouble raising money.

“Every company in California should let their employees know what their [401(k)s are] invested in — that to me is really the big issue,” Behar said. “We’re complicit in climate change and gun violence, yet none of us know it, and we don’t realize the power we have to change it.”

In contrast, the UC regents can’t claim ignorance: They manage the university’s portfolio. They should directly address the faculty petition, and they should overcome their timidity and commit the university to wholehearted divestment. The rest of us should end our complicity by dropping investment funds that contain socially destructive companies.

Jacques Leslie is a contributing writer to Opinion.
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Old 09-20-2019, 02:44 PM
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If public plans choose not to invest in certain industries, that creates more opportunity for the rest of us to buy these profitable companies at depressed prices.
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  #1645  
Old 09-20-2019, 03:12 PM
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The divestment stuff, in my opinion, is idiotic.

But the biggest idiotic thing are the people pushing for these policies aren't those who will suffer the consequences.
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Old 09-21-2019, 08:36 AM
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MARIN COUNTY, CALIFORNIA
PENSION OBLIGATION BONDS

https://www.marinij.com/2019/09/16/m...pension-costs/
Quote:
Marin elected leaders seek 10-year plan on pension costs

Spoiler:
Marin’s 11 cities and towns urgently need to develop a 10-year plan on how to cope with the rising cost of employee pensions and health care obligations, according to a new report by the Marin County Council of Mayors and Councilmembers.

“We have few levers we can pull to fund these costs; therefore, we have to get out and plan as soon as possible,” said Mill Valley City Councilman John McCauley, who co-wrote the report together with Larkspur City Councilman Larry Chu.

The report makes one concrete recommendation about how Marin cities and towns can reduce their other post-employment benefits (OPEBs), the largest being health care costs.


“We support curtailment of this benefit for future employees when legally allowed,” the report states, “and for agencies using the California Public Employees’ Retirement System (CalPERS) medical benefit plan only to fund at the legally allowed minimum under the Public Employees’ Medical & Hospital Care Act.”

“Nobody is trying to vilify public employees or their benefits,” Chu said. “There is no discussion about taking benefits away that have already been earned. It’s like dieting; you either have to eat less or exercise more. We either have to find more ways of raising revenue or we have to reduce the expenses.”

The report also recommends that municipalities provide more transparency about the cost of their employee benefits.

“We support specific disclosure of payroll and benefit costs,” the report states, “so that citizens can see how their tax dollars are spent.”

With the exception of San Rafael, all Marin municipalities participate in CalPERS, the state-run pension plan. San Rafael participates with a number of other Marin entities in a plan run by the Marin County Employees’ Retirement Association (MCERA).

According to the report, the municipalities participating in CalPERS have a cumulative net pension liability of $179 million to CalPERS. San Rafael has a $120.6 million pension liability to MCERA. In addition, the municipalities participating in CalPERS have a collective OPEB liability of $67.8 million, and San Rafael has a $33.7 million OPEB liability.

This is the second report that the Marin County Council of Mayors and Councilmembers (MCCMC) has issued on the impact of pension obligations on local municipalities. The first report, written by Chu and issued in 2011, concluded, “Absent significant changes to the status quo, local agencies could be left severely distressed, if not insolvent, long before the pensions systems become fully funded.”

MCCMC commissioned this new report in response to changes in policies by the retirement systems that are shifting a greater financial burden onto municipalities. CalPERS has began lowering the assumed annual rate of return for investments to 7 percent, shortened the time that municipalities have to fund their pensions, increased mortality assumptions and moved to a more conservative investment mix.

As a result, Marin‘s cities and towns face significant growth in their future payments to CalPERS. Between fiscal year 2018-19 and fiscal year 2024-25, cities’ dollar contributions will increase by more than 50 percent, according to a statewide study projecting pension costs commissioned by the League of California Cities.

The MCCMC report predicts that rising pension costs will require cities over the next seven years to nearly double the percentage of their general fund dollars that they pay to CalPERS.

The MCCMC report notes that under current established state law, known as the “California rule,” municipalities cannot switch existing employees from a pension system with defined, or guaranteed benefits, to a defined contribution 401(k) style plan, with contingent benefits.

As a result, the reports states, “There are only a few theoretical ways that cities can address the challenge of underfunded pension and other post-employment benefits (OPEBs).”

The alternatives it presents are: raise taxes and fees; reduce benefits or the number of employees; use existing reserves or borrow to pay higher contributions; or reduce services provided to residents.

“The report further emphasizes the need for the State Supreme Court to allow prospective pension changes by eliminating the so-called California rule,” wrote Jody Morales, founder of Marin’s Citizens for Sustainable Pension Plans, in an email. “Without the ability for adjustments, particularly during recessions, the pension debt hole gets deeper.”

Paul Premo, a board member of Marin ‘s Coalition of Sensible Taxpayers, wrote in an email, “The California courts are considering possible relaxing of the claimed ‘fixed in concrete’ pension benefit formulas that were lavishly increased in the early 2000s — retroactively to initial employment date — that are a large part of the problem.”

Senate Bill 400 in 1999, sponsored by CalPERS and several employee and retiree groups, enhanced pension benefits on the basis that retirees had not benefited from high stock market returns generated in the 1990s. Between 1995 and 2000, the Nasdaq index rose five-fold; then in 2000 the dot-com bubble burst.

McCauley said there is little room to reduce operating costs at most Marin municipalities, and he suspects a limited tolerance for additional taxes. He said one of the best strategies is for towns and cities to sock away as much money as possible to cover pension and health care obligations before the next economic downturn arrives.

Mill Valley has $38 million in pension liability and $23 million in OPEB obligations, sizable liabilities for a city of its size. But McCauley, who is serving his second term on the council, says the city has made some key changes in recent years. In 2016, the city eliminated OPEB for new employees, and it has put $1.2 million in a pension reserve fund and set aside nearly $10 million to cover OPEB obligations.

Another strategy the report says should be evaluated, which might seem counterintuitive, is borrowing.

“A cost savings can be achieved when the bond interest rate is lower than the pension fund discount rate,” the report states. The discount rate is the assumed rate of return.

Speaking of Larkspur’s pension obligations, Chu said, “One of the ways we can reduce our cost is to refinance our pension obligations. Right now, the discount rate is approaching 7 percent and if we can get a pension obligation bond for somewhere around 3 percent, that could save more than $10 million over the course of 20 years.”
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  #1647  
Old 09-21-2019, 08:40 AM
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UNIVERSITY OF CALIFORNIA
DIVESTMENT

https://www.sandiegouniontribune.com...rth-83-billion
Quote:
UC to dump fossil fuels holdings in pension and endowment funds worth $83 billion

Decision follows months of pressure by faculty and student to rid funds of major oil and gas investments

Spoiler:
Top financial officials with the University of California announced Tuesday morning in an opinion article in the Los Angeles Times that the school system plans to undertake a major divestment from fossil fuels.

The stocks and bonds to be sold off are currently part of UC’s $13.4 billion endowment and $70 billion pension fund.

The article — penned by Jagdeep Singh Bachher, UC’s chief investment officer and treasurer and Richard Sherman, chairman of the UC Board of Regents’ Investments Committee — comes after faculty across the 10-campus system held a historic vote in July to demand divestment of the endowment.

“I have been hearing rumors about this, but I was surprised that they included the pension plan,” said Eric Halgren, a UC San Diego professor who played a key role in organizing the push for divestment.

Teachers, backed by a vocal student movement, have said to the UC Regents that dumping the oil and gas holdings represents an ethical obligation in the age of climate change. They also argued that investing in fossil fuel companies has become increasingly risky because extractive activities will likely, and perhaps abruptly, be significantly restricted in the future to limit damage to the environment.

Sherman of the UC Board of Regents has, as recently as August, rejected the second argument, saying that divestment would be in conflict with the university system’s “fiduciary duty.”

However, in Tuesday’s article, he and Bachher said the decision to divest was based solely on what’s best for the system financially.

“We believe hanging on to fossil fuel assets is a financial risk,” they wrote. “That’s why we will have made our $13.4-billion endowment ‘fossil free’ as of the end of this month, and why our $70-billion pension will soon be that way as well.”

Halgren said he’s unconcerned about whether faculty gets credit for UC’s divestment pledge.

“I’m in this for our children and grandchildren and this beautiful planet. If it makes them feel better to say it has nothing to do with us, that’s perfectly fine.”

The environmental group 350.org kicked off the divestment movement in 2012, with student campaigns on UC campuses starting up that same year. To date, it has recorded more than 1,000 pledges on behalf of investment funds worth more than $11 trillion.


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Old 09-21-2019, 10:14 AM
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NEW HAVEN, CONNECTICUT

https://www.newhavenindependent.org/...ntract_alders/
Quote:
Police Contract Passed; $834K Pension Hit Expected

Spoiler:
Alders unanimously approved a new police union contract that will grant city officers their first pay raises in over three years, and that will also cost the city around $834,000 more in annual pension contributions.

The full Board of Alders took that vote Monday night during its regular bimonthly meeting in the Aldermanic Chambers on the second floor of City Hall.

In front a full house of officers eagerly waiting to see if the alders would approve the new six-year contract, which will grant a total of 13.5 percent in retroactive and future pay raises covering 2016 through 2022, the alders cast their unanimous support behind the new labor accord.

Before that vote, however, a trio of fiscal skeptics questioned the wisdom of signing a new union agreement after having so little time to review some of its most critical citywide financial implications.


Prospect Hill/Newhallville Alder Steve Winter.
Prospect Hill/Newhallville Alder Steve Winter, Downtown Alder Abby Roth, and East Rock/Cedar Hill Alder Anna Festa pointed in particular to the numbers that the city’s Office of Management and Budget (OMB) had delivered to alders only seven hours before the vote that detailed how the new agreement will affect the city’s pension costs.

That report, put together by city contracted actuaries at the accounting firm H&H, projects that the labor contract’s salary increases will add $843,264 to the city’s annual actuarily recommended contribution (ARC) to the Police and Fire Pension Fund (P&F).

The city currently contributes $38,629,220 to P&F every year, as well as $22,221,339 every year to the other public pension fund, the City Employees Retirement Fund (CERF).

Click here and here to read the actuary’s estimates of the increased pension costs.

In a public information caucus before Monday’s full board meeting, city Acting Budget Director Michael Gormany explained that the alders received the pension impact information so late in the process because the final contract had only been ratified less than a month ago, and actuaries need time to crunch all of the numbers in such a long and complicated document. Furthermore, the increase likely won’t affect the city budget until Fiscal Year 2021-2022 (FY22), since that is the next time the city plans to recalculate and update its annual ARC.

“I want to note publicly that this agreement comes with significant costs to the city,” Winter said. “Over $3.4 million in police salary and an estimated $800,000 increase in pension payments, assuming the P&F fund returns an average of 7.75 percent annually. To pay for these increases along in Fiscal Year 2021 would require a 1.5 percent increase in property taxes.”


Downtown Alder Abby Roth.
Roth and Festa expressed a similar level of wariness over the last-minute provision of the pension increase estimate.

After praising the new contract for relieving officers of years of “stressful and unsustainable financial uncertainty,” Roth asked publicly why the the city could not wait a few more weeks to review the auditor’s recommendations before submitting the ratified agreement for aldermanic approval.

“I was surprised to discover that the city agreed to the contract without first finding out from an actuary how this likely will impact how much money we will have to pay each year into our already seriously underfunded pension system,” she said. “This would be like entering into a mortgage without knowing your annual payments.” According to the city’s latest budget document, CERF is currently funded at around 37 percent, and P&F is currently funded at around 40 percent.

“I stand not in opposition of this contract,” Festa said, “just with concerns.”

Winter, Festa, and Roth stood alone in that dissent, however, as their colleagues dismissed their concerns as inappropriate at a time when the police department has gone over three years without a valid contract, and has been hemorrhaging officers as they retire or flee to better paying jobs in the suburbs and at Yale.


Dixwell Alder Jeannette Morrison.

“Finally our police officers can get what they need in order to be comfortable in their job,” Dixwell Alder Jeannette Morrison said, “which is to protect us.”

The long-suffering contract negotiations and expired labor agreement have directly fomented a “blue exodus” of officers from the city, she said, which in turn has hurt the city’s ability to conduct a neighborhood-engagement model of community policing.

“I do understand the cost,” she said. “I do understand all those different things. But sometimes we have to look at the people part of it. And this is the people part of it: This is our officers. This is the residents who live in the City of New Haven.”


Police applaud as the new contract passes.
Hill Alder Dave Reyes and Fair Haven Alder Jose Crespo agreed.

“We’re losing our officers to the surrounding towns and we’re not getting anything back,” Reyes said. This contract will finally grant city police “their fair share in compensation” and much needed job stability and security.

“I support it 150 percent,” he said, “and I urge my colleagues to do the same.”

“I understand that there might be a couple of unknowns,” Crespo added, “but right now, this is what’s best. This is what’s needed for the department, to bring stability, to bring up the self-esteem of the officers.”


Board of Alders Majority Leader Richard Furlow.
Board of Alders Majority Leader and Amity/Westville Alder Richard Furlow expressed the sharpest indignation at his colleagues’ skepticism of the contract.

“We can’t have this both ways,” he said. “We have a contract that is before us now that the officers have ratified overwhelmingly. This is what they want, and it is our response to vote favorable on what is before us.”

The alders cannot control what happened in the past, he said, what may have led to the three years of delays and bitter labor disputes as officers fled the department after the last contract expired. But they can control what happens going forward, he said.

“Let’s vote in favor on this,” he said, “and stop the shenanigans.”

Fire Union Contract Ratified, Submitted

Monday night’s full board meeting.
Monday night’s agenda also included a newly submitted fire union contract, which, according to city Labor Relations Director Thomas McCarthy, the members of the city’s fire union, Local 825, ratified on Sept. 6. That proposed and member-ratified contract now advances to the Finance Committee for a public hearing before being sent back to the full board for a final vote.

Click here to download details on the new ratified fire union contract.

According to McCarthy’s submission letter to the Board of Alders, the new six-year deal extends from July 1, 2018, when the last contract expired, through June 30, 2024.

It includes an 11 percent pay increase over the term of the contract; implements a new Health Incentive Program (HIP) that requires union members and their dependents to take various preventative medical measures like designating a primary care physician and receiving annual checkups; and increases the employee pension contribution to 11.5 percent of their annual salary.

Click here to read a criticism penned by Westville alder candidate Dennis Serfilippi about a memorandum of understanding signed during the contract negotiations that limits the chief’s abilities to reduce the department’s minimum staffing levels.


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Old 09-21-2019, 10:41 AM
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ILLINOIS

https://www.chicagobusiness.com/greg...0-and-counting
Quote:
$250,000,000,000 and counting
That's a quarter-trillion dollars, which is how much Illinois pension debt now totals, according to Moody's—which also suggests that any improvement is fleeting.

Spoiler:
Thanks to a roaring stock market, Illinois and its taxpayers aren't quite as deeply in a pension hole as they were. But with gross unfunded pension IOUs still running at nearly a quarter of a trillion dollars—just for the state alone—the Land of Lincoln continues to drown in red ink.

That's the bottom line of the latest annual look at the conditions of the government retirement systems in the 50 states by Moody's Investors Service.

Moody's uses a lower discount rate than others who monitor state debt, which tends to increase the size of Illinois' hole. Ergo, according to the bond-rating firm, Illinois' adjusted net pension liability as of June 30, 2018, stood at a cool $240.8 billion.

That's more than any other state, with California coming in second—its population is more than three times ours—at $230.8 billion and Texas coming in third at $132.8 billion.

Difficult as it is to fathom, Illinois’ figure actually was a little worse this time a year ago, topping $250 billion in unfunded liabilities. But according to Moody's, the whole reason for the decline was the market, which was really hot but lately has been pretty flat. With Illinois putting in only about two-thirds of what we need to hold even—Moody's "tread water" line—the hole probably already has resumed growing, it says.

The current hole is bad enough. According to the report, it represents 505 percent of own-source (non-federal) revenues, and has grown more than a quarter since fiscal 2014.

If there's a scintilla of good news in the report, it is that the good economy that has boosted investment returns also has boosted the income of state residents. Ergo, as a share of total state personal income, pension liabilities dropped from 36 percent to 33.2 percent in the most recent year.

When it comes to total state debt—total pensions, other retirement costs such as retiree health care, and general obligation bonds for infrastructure and other purposes—Illinois ranks second, at 38.2 percent of state GDP compared to Connecticut's 38.9 percent.

Keeping Illinois company in the high-debt category are New Jersey at 37.9 percent, Hawaii at 35.6 percent and Alaska at 30.6 percent. Every other state is below 30 percent.

Illinois lawmakers are expected to consider some modest changes to improve pensions in their veto session this fall, but they're likely to impact local systems rather than the five statewide systems covered in the Moody’s report. More on that later.


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Old 09-21-2019, 10:43 AM
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NETHERLANDS
DIVESTMENT

https://www.ai-cio.com/news/dutch-pe...s-decarbonize/
Quote:
Dutch Pension Funds Look to Transform How Real Estate Investors Decarbonize
New initiative backed by APG and PGGM looking for pathways to help real estate investors go green.


Spoiler:
A new coalition backed by Dutch pension funds APG and PGGM has been formed to help real estate fund managers find avenues to decarbonize their portfolios and investment pipelines while still maintaining strong performance metrics.

The coalition’s mission is to help real estate managers identify potential strategies to meet the 1.5- and 2-degree decarbonization pathways similar to that of the Paris Agreement. The coalition intends announce its proposal by February 2020, and the initiative requested that participants in the industry provide feedback and “help develop a common language for assessing climate transition risk in real estate.”

“Decarbonization pathways based on a transparent methodology that is aligned with the Paris Agreement offer a tool for understanding and managing transition risks, enabling investors to benchmark assets and derive significant risk indicators,” said Dr. Sven Bienert, managing director at the IIÍ Institute for Real Estate Economics.

The institute is helping to carry out research endeavors for the coalition, with the support of GRESB and the ESG Benchmark for Real Assets. The initiative is essentially expanding the work of the Carbon Risk Real Estate Monitor project, which analyzes carbon risk in European commercial real estate, to expand into markets outside of the EU, as well as into the residential sector.

The initiative is part of a larger worldwide decarbonization method as investors seek to adhere to environmental, social, and governance (ESG) concerns. Major institutions such as the New York State Common Retirement Fund, one of the largest funds in the US, recently announced plans to grow its ESG program’s investments to an aggregate $20 billion over the next decade. A recent study said that the pension should work to ensure that all its assets are sustainable by 2030.

Several groups have popped up in recent months to assist in the growing ESG movement. One such institutional investor consortium called the Group of 88 is pushing more than 700 companies to reveal metrics regarding their respective environmental impacts.

New York is also leading an institutional investor rally coined the Climate Majority Project, made of up pension plans throughout the United States, whose goal is to entice the 20 largest public traded utility companies to eliminate their carbon pollutants by 2050.


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