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THE SECURITY OF YOUR BENEFITS AND THE PLAN

July 17, 2009

UPDATE: PENSION REFORM ON HOLD

Governor Arnold Schwarzenegger’s proposal to reform the State’s pension plan has come to a halt. The controversial proposal was one of many ways the Governor planned to help balance California’s budget. Officials are expected to revisit and discuss the proposal once a budget has been approved.

July 13, 2009

UPDATE: GOVERNOR PROPOSES PENSION CHANGES FOR STATE EMPLOYEES

California’s budget has become a major point of contention across the state. As part of the on-going budget debate, Governor Arnold Schwarzenegger has proposed a reduction in pension and retiree health benefits for NEW State workers.

The proposed changes, if approved, would only apply to future State employees and retirees, and would not impact existing employees or retirees.

SBCERA and its members are not a part of the State’s retirement system, which is CalPERS. If any changes are made to the State’s pension plan, these changes will not impact the members of SBCERA or its retirement plan. SBCERA is one of 20 county retirement systems in the state governed by the 1937 California County Employees’ Retirement Law (CERL). At this time, there are no proposed changes for current or future members of SBCERA.

SBCERA has been successfully investing contributions and paying retirement benefits since 1945. We have experienced numerous market fluctuations over the past 63 years, and our conservative investment policy is expertly engineered to weather good and bad times.

The daily media reports about the U.S. economy and the investment market are frightening and can be overwhelming at times. We hear daily from SBCERA members who are concerned about the impact of the extreme market on the financial health of our retirement fund. Here are a few poignant facts we would like to highlight for you as you seek information and assurance about your retirement benefits:

Members can be confident that their retirement benefits are safe, despite recent market fluctuations and daily volatility.
The economic crisis does not affect members promised retirement benefits, nor does it affect SBCERA's ability to pay those benefits.
SBCERA's fund is highly diversified and invested with a focus on the long term.
Your Board of Retirement and investment staff are diligent in their responsibility to monitor all investments and they are focused on managing the associated risk through prudent and strategic investment policies.
The Board's asset allocation policy has enabled SBCERA to make significant and strategic moves in anticipation and in response to these conditions.
SBCERA is a defined benefit plan that, by law, guarantees lifetime retirement benefits for its members. Your retirement benefits are a vested right.
SBCERA remains a solid and secure pension plan and the Board of Retirement is committed to ensuring its security.