EAA’s Board of Governors has endorsed Annie Chao for reelection to the LACERS Board.  Annie, an experienced Investment Officer, continually demonstrates through her actions and decisions that she is working for all LACERS members ensuring a sound a viable pension system.  The Board of Governors’ encourages all EAA members to cast their ballot to reelect Annie keeping in mind that every vote counts and that every vote for Annie is essential for a secure and healthy pension system now and in the future.

There are two board members on the LACERS Board, who represent the active employees. All LACERS members get to vote for the person they want to represent them. Ideally, that person should be free outside of influences (i.e. the Mayor’s office, the unions, and special interest groups) because they should be making decisions solely for the interest of all the members of LACERS. Annie is the only candidate, who is truly INDEPENDENT, not bought by the unions or influenced by the Mayor. 

Because LACERS is YOUR pension fund, YOU need someone, who will be impartial and KNOWLEDGEABLE. Most LACERS members do not think about retirement until they are 3-5 years from retiring, The assumption is that the funds will be there in 20-30 years’ time. So, it’s imperative that YOUR LACERS Board representative 1) be ON TOP OF ALL THE ISSUES, including the ones that threaten the security of your pensions, 2) take the role seriously and responsibly by attending the meetings to voice YOUR concerns, 3) make a point to relay updates and important issues to the members they represent. Annie does that!

The sources of funding are the employer (the City), the employee (YOU), and the investment returns. For the past 10 years, 13% of the money has come from YOU, 36% from the City and 51% from the investment returns. IF investment returns are good net-of-fees that means YOU and the CITY pay less. If the investment returns are not what is expected, YOU need someone, who will put the City’s feet to the fire and increase the employer portion of the funds. As an Investment Officer of LAFPP, a $22.6 billion pension fund, Annie has both the investment experience to make good investment decisions, and she has demonstrated that she is willing to put fire to the City’s feet in increasing the employer portion of the funds.

That depends. The current funded ratio is 71.4%. A “healthy” funded ratio threshold is 80%. The funded ratio of a pension plan is equal to the value of assets in the plan divided by a measure of the pension obligation. So, at the current rate, LACERS is only able to pay 71.4% of YOUR retirement. However, the principal of first-in, first-out would indicate that there is not enough money for the younger members of LACERS. In the time that Annie’s been on the Board, she has voted on issues before the Board to increase the funded ratio. In the 2 years that she’s been on the Board, the funded ratio has increased!

There are two important agenda items coming up in 2018 at LACERS. The first is the re-study of the assumed rate of return. The second is the asset allocation study. In 2017, LACERS’s staff recommended reducing the assumed rate of return from 7.5% to 7.25% with another study in 2018 if the Board was not willing to reduce the rate from 7.5% to 7%, like the actuary recommended. At the time, SEIU and the Coalition requested the Board keep the assumed rate of return at 7.5%. When many motions failed to pass, Annie argued for staff’s recommendation and convinced the rest of the LACERS Board to approve a reduction of 7.25% and a new study in 2018. This mean that the City paid an extra 1% into funding YOUR retirement! This increased LACERS’ funded ration from 67.8% to 71.4%. You’ll need someone strong and convincing, not bought by SEIU or the Coalition on the LACERS Board when the assumed rate of return study comes back with the same recommendation of reducing the rate from 7.25% to 7%. Making sure the City continues to pay the right amount into OUR retirement is a priority for Annie!

The second important agenda item coming up in 2018 at LACERS is the asset allocation study. Because long-term decisions on investments via the asset allocation study impacts 90% or more of the investment returns, YOUR LACERS Board representatives needs to have a thorough understanding of investments. Annie is the only Investment Officer on the LACERS Board, and the only one on the ballot, who has worked on asset allocation, portfolio construction, and investment manager evaluation. She is the only one, who has a firm understanding of equity, bond, real estate, private equity, and commodities strategies. 

Voter turnout has historically been low at about 10% to 13%. In the last two elections, only two to three thousand LACERS active employee members turned in their ballots. This means that YOUR vote is important and could tip the election. Being aware of the LACERS election is step one. Taking action by voting is step two. Convincing your co-workers and friends to take action is step three. Please make your voice count by VOTING to RE-ELECT Annie Chao!

Any eligible voter, who has lost of did not receive an official ballot may get a replacement ballot by calling the City Clerk-Election Division Office at (213) 978 – 0440 or going to 555 Ramirez Street, Space 300, Los Angeles, CA 90012.

Ballots will be mailed to your home on May 2nd. Ballots can be mailed back, but need to be received by May 18th. Ballots can also be personally dropped off at the City Clerk-Election Division by 5pm on May 18th. 

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