PERS officials Pat Robertson, Greg Gregory, and Lori Tingle went before the legislature last week for the annual budget request. PERS sought a budget increase of only $106,173. The hearing quickly turned from a presentation on the financial shape and profile of PERS to a debate over the PERS study commission created by Governor Barbour (See note at end of post before reading any further.
The session was colorful at times as Democrat Representatives Steve Holland, George Flaggs, and others used the hearing as an excuse to attack the commission.
Notes from videos: 29:40 of Part 1 and beginning of Part 2: Holland attacks commission in rather colorful fashion. Its worth watching. Another legislator 17:00 wants to make consultants employees. Um yeah, financial experts who handle multiple portfolios for large clients such as PERS will give all that up to go work for a state salary. Yeah. Cecil Brown starts at 20:20 in Part 2. Cecil then brings up converting retirement system from defined benefit to defined contribution.
Senator Dean Kirby (commission non-voting member) starts at 23:30. This is the part where Senator Kirby says the Commission Chairman said they would not touch the 13th check. Um, not so fast as the video posted on this website two weeks ago shows no such thing and in fact at the end of the hearing, the Chairman pointed out the large expense spent on the 13th check. The Republicans follow up behind him.
Part 3 at 2:03: Ms. Robertson points out the problems with the 1999 increase in benefits passed by the Legislature. Senator Hewes and Ms. Robertson have a nice exchange at 8:30 on Part 3.
Here are the materials distributed by PERS to the committee:
Items of interest from the budget request:
*PERS requested $13,619,557. Salaries are $9.4 million.
*PERS has 162 authorized positions.
*PERS has consistently come in under budget by several hundred thousand dollars for the last several fiscal years each year.
*NOTE: Information on PERS from a previous post:
Before we get started on what took place at the hearing, here are the basic facts about PERS according to its most recent audited financial statements and Executive Director Pat Robertson's comments at a May luncheon videotaped by this website. All figures are based on the financial statements for the year ending June 30, 2010. READ THIS BEFORE YOU READ ANYTHING ELSE.
Employees: 165,644
Average years of service is 31
Average age is 59.
Asset allocations:
47.8% in US equities
25.4% in debt securities
4.6% in real estate
19.5% in non-US equities
Total assets: $21.2 billion on May 1,2011, $17.1 billion in 2010 ($15.5 billion in 2009, $19.7 billion in 2008).
Investment rate of return: 14.1% for 2010.
3-year rolling average: (5.5%)
5-year rolling average: 2.1%
10-year rolling average: 2.3%
20-year rolling average: 7.4%
30-year rolling average: 8.7%
Investment performance since 2000:
2000: 8.4%
2001: -7.1%
2002: -6.6%
2003: 3.5%
2004: 14.6%
2005: 9.8%
2006: 10.7%
2007: 18.9%
2008: -8.2%
2009: -19.4%
2010: 14.1%
Current funding level of actuarial accrued liability: 64.2%. Ms. Robertson said 80% is considered to be the "benchmark of a well-funded plan." Ms. Robertson stated at the May 3 luncheon PERS' accrued liabilities have doubled since 1998 (thanks to the legislature's increase in benefits in 1999 with no additional improvement in "funding mechanisms"). 2010 audited financial statements
Page 8 of the 2010 audit states PERS spent $409 million more in benefits payments than it received in contributions although that does exclude the $2.1 million income from investments. PERS lost $3.7 million in investment income in 2009.
Post on Commission hearing Video included.
PERS Investment Committee August meeting Includes Videos and reports.
6 comments:
Holland, Flaggs and Brown talk out of both sides of their mouths -- typical of all three but especially of Cecil Brown. They go on and on that the commission is a waste of time because only the Legislature can make changes to PERS but then in the next breath fear monger about powers the commission does not have.
As for Robertson she is simply a spinner for a status quo of, at best, mediocrity. She's been a bureaucrat since 1981. Over and over again she says in the videos that no changes are necessary to PERS. No changes. She can't even recommend one. UNBELIEVABLE.
If the current state employees don't rise up to demand action and accountability they are going to get screwed. Unless the PERS Board is gutted and the turf-protectionist Robertson sent packing the ONLY thing guaranteed about PERS in the future will be its demise.
You can't fix the PERS problem on the back of taxpayers with the same Board and the same life long bureaucrat Director making the same dumb decisions. Current employees can't get to their there with that crew from here.
Kingfish, I'm curious as to why you report 2011 fy numbers in a post below but don't report them here. The returns you are showing are from 6/30/2010. You have the updated info. You should let people know you're showing outdated numbers. Thanks.
Pat Robertson is the best thing that ever happened to PERS. She is a brilliant woman who is highly qualified for this job. As long as she's there, there will be stability and honesty in running this agency. The men should listen to her--she knows her stuff!!!!!
12:26 is obviously on Barbour's lame duck payroll. Too much useless, inside Bullshit information to be anything else.
Shadowfax is is obviously a near brain dead piss ant who wears intellectual dishonesty as a badge of honor.
Correction, dude. That's 'intellectual HONESTY' to you.
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