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San Diego Pension System Reports Investment Gain

The administrators of the San Diego city employees pension system reported today an investment gain of 13.4 percent in the fiscal year that ended June 30, based on preliminary data.

That compares with 0.9 percent in the previous fiscal year, a performance that hurt the San Diego city budget.

The return on investments by the $5.8 billion San Diego City Employees Retirement System is one factor in determining how much the city has to contribute to its workers' pensions the following year.

A bad performance means the city will have to chip in more money. The city's contribution climbed more than $40 million in the current fiscal year, about $8 million or so because of last year's poor investment performance.

On the other hand, the recent gains by the fund's portfolio mean the city's share could be less next year, coupled with expected savings from a five-year labor deal.

SDCERS announced that its annualized returns over three years were 12.2 percent, and 8 percent over 10 years. The system shoots for a 7 percent annual return.

Comments

Avatar for user 'fadeclercq'

fadeclercq | August 1, 2013 at 1:23 p.m. ― 1 year, 4 months ago

Wow! The investment gains of nearly 14% is quite substantial. I'm sure those suffering from 'pension envy' will have to find a new talking point to help cure their ailment.
The 1% 'rs and right wingers won't be able to say the 'sky is falling', at least for this year! The question is, what will the new talking point be next year, when the City's ARC payment is considerably less! I'm sure the pundits will come up with something.

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Avatar for user 'HarryStreet'

HarryStreet | August 2, 2013 at 7:40 a.m. ― 1 year, 4 months ago

I know plenty of family members who draw a pension, but can see the light at the end of the tunnel. In a day and age where workers earn less and less, to expect the taxpayer to foot the pensions when they suffer a 'bad performance' has become untenable. We did not make it this way, the changing of the times did. Although this is a good news report, remember, there will be ups and downs. I believe we are now in a time where people need to be responsible for their own retirement. It's not as safe as a pension, I know, and yes, I wish I had the security of a pension. However, it is a powerful statement to realize no private companies offer protected retirement pensions. Only the government. There must be a reason for that.

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Avatar for user 'TimO'

TimO | August 2, 2013 at 12:59 p.m. ― 1 year, 4 months ago

Harry-- You're misinformed in your statement that "no private compainies offer protected retirement pensions." (not quite sure what you mean by "protected") There are many, albeit a declining number, of private companies that provide defined benefit pensions to their employees. I'm fortunate enough to be a participant of one.

It's important to know that the significant decline in pension programs was the brainchild of Wall Street bankers/brokers who forsaw enormous profits with the rise of 401K type retirement plans which funneled funds through their operations.

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Avatar for user 'jptrugger'

jptrugger | August 2, 2013 at 1:36 p.m. ― 1 year, 4 months ago

What a surprise comment from Frank DeClercq, president of the San Diego City Fire Fighters Local 145, LOL. What about the $1 billion plus underfunding of the pension liability? That is and always be the 800 pound gorilla in the room. The positive investment returns can help minimize that shortfall... :)

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