LACERS BOARD UPDATE
By Michael R. Wilkinson
It may be unseemly, but this is utterly shameless self-promotion time. You have been warned. The LACERS Board Retired Member election ballots will be going out soon, and I would like your vote.
I have served on the Board since 2013. I am currently the Vice President and chair the Benefits Administration Committee and serve on the Audit Committee and the Ad Hoc Cybersecurity Committee.
I am happy to report that LACERS is 71.3 percent actuarily funded for retirement and 84.4 percent funded for health benefits for a total funded ratio of 73.1 percent. The health benefits figure is one of the highest in the country because LACERS has been putting away money for health benefits for decades while most plans were pay-as-you-go.
The plan has been doing well with a diversified strategy of investments to provide investment returns that support our members’ pensions in both up and down markets. Here are the unaudited returns for the time period ending Dec. 31, 2019: The investment returns are:
1 year, 17.89 percent
3 years, 9.9 percent
5 years, 7.37 percent
10 years, 8.77 percent
As I frequently remind my readers, these returns will vary, so expect the inevitable market correction. LACERS is a well-diversified long-term investor and is prepared to ride out the ups and downs of the investment cycles.
I have fought for keeping investment fees down by using low cost index funds wherever possible. Index funds have extremely low fees, and, in many asset classes, regularly outperform active managers who pick individual stocks and bonds. Currently 38 percent of all LACERS’ assets are indexed. I have asked the investment staff to report back to the Board anytime that they believe that active asset managers are not earning their fees by outperforming their index so that we can expand this low-cost option.
I am also a voice for solid fundamental investments with no use of fads that come through the pension investment world claiming they get great returns and promising almost no risk. I have staunchly opposed dangerous trends such as market timing and any high-risk strategy that does not perform well over time.
I have backed enhancements to our health benefits such as adding Silver Sneakers and Silver and Fit gym memberships to our LACERS Well program. I also have overseen upgrades to our drug benefits, including a change that drastically cut drug costs for members who have had very large out-of-pocket costs.
I am endorsed by the Retired Los Angeles City Employees, Inc. (RLACEI), of which I am a former director.
In short, I look forward to serving you for five more years. Please consider me when you get your ballot in the mail. Ballots will be mailed out March 23, 2020. n
Opinions expressed in this column are those of the author and not necessarily those of Alive! or the Employees Club of California.