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President’s Message

By John J. McTighe

I was pleased to see the 12.0% earnings reported for the SDCERA investment fund for the year ending June 30, 2017. After several years of disappointing returns, the fund outperformed its target earnings rate of 7.25% by a significant amount. At the end of the last fiscal year, the pension trust fund balance was $11.409 billion. All of us as retirees receiving pensions from SDCERA should take comfort in knowing that our pension funds are sound and the investment strategy set by the Board of Retirement with guidance from Chief Investment Officer Stephen Sexauer is working. It’s important to be reminded that one or even a few years of particularly good performance or particularly bad performance are not to be taken out of the context that pension funds are long-term, and what’s most important is the long-term trend in earnings, not any one year. The SDCERA pension fund has averaged 7% earnings over the past 20 years. This was despite the huge losses incurred in the financial collapse of 2008. Again, long-term perspective is what matters. It took us many years to earn our retirement and it will take many years for SDCERA to pay out our retirement, so we need not get too excited about one year’s stellar earnings or too disappointed by one year’s lousy earnings, but to put it in perspective with the long run.

Again this year, October is going to be a busy month for RESDC. We have our Coming Home event on October 4th, our Health Fair Picnic on October 17th, and a team walking in the Walk4ALZ San Diego on October 21st. This year’s Coming Home event will be at the County’s new Live Well Center in Escondido and will feature welcoming remarks from County Supervisor Kristin Gaspar and a keynote address from the County’s Chief Medical Officer, Dr. Nick Yphantides, MD.

We have some changes coming to the Health Fair Picnic this year. We are no longer requiring members to pay a refundable $5 deposit. This change however, requires an RSVP so we can get an accurate head count for lunch. We will continue to charge guests and non-members $5 each. This year’s Health Fair Picnic promises to be bigger and better than ever.

Admiral Baker Field can accommodate a lot of people and is a great place for a picnic. We will have many providers of healthcare products and services, as well as representatives from SDCERA there to provide information and answer questions. If you’ve never been to one of our Health Fair Picnics, I encourage you to come this year. After all, where else can you get a free lunch and information about healthcare all in one place? Add to that an opportunity to see old colleagues, meet your RESDC Board Members, and win opportunity drawing prizes, and you have a winning combination. Be sure to sign up at www.resdc.net/events, return the registration form, or call the office by October 12th to let us know you’re coming, so we’ll have plenty of that great Barbecue Pit food waiting for you. I’d love to see you there.

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Upcoming RESDC Events

Coming Home to North Inland Live Well Center

Wednesday, October 4, 2017 at 11:00 am
649 W. Mission Ave., Escondido, 92025
More information →

2017 RESDC Health Fair Picnic

Tuesday, October 17, 2017 at 10:00 am
Admiral Baker Field, 2400 Admiral Baker Rd., San Diego, 92124
New registration process this year!
More information →

Walk4ALZ

Saturday, October 21, 2017 at 6:30 am
Balboa Park, 2131 Pan American Plaza, San Diego, 92101
More information →

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Recent Events

• RESDC Day at the Padres Recap: A great time was had by all at the August 2 Padres game. While the Padres didn’t win….ugh!….the ballpark, refreshments and camaraderie were worth the price of admission. The Day at the Padres is an annual event and if you didn’t have a chance to join us this year, we highly encourage you to consider attending our 2018 outing! Click here for some great photos!
• Choose Well San Diego—New Senior Care Rating System. The County of San Diego has launched a new website that allows residents to compare local residential facilities so they can choose the one that best fits their aging family member. The website, www.choosewellsandiego.org, includes about 600 assisted living and board and care homes. They are rated on 11 quality measures such as food, staffing, and activities. This free tool to help seniors, families, and their caregivers find assisted living providers who have a good track record for giving great care.

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Good Returns from an Up-Market

By Stan Coombs

The markets have had a good year.

The huge California Public Employees Retirement System (CalPERS) reports 11.2% investment gains for 2016-17. They earned only 2.4% and 0.61% the previous two years, against a 7.5% goal, or “assumption rate.” They say they’re the largest public retirement system in the United States, with 1.8 million state, county, city, special district and school district members, and a $327 billion fund.

CalPERS also says they have 68% of the funds needed if they suddenly had to pay off all the benefits they owe members. That’s a bit low, but they have very little chance of being placed in that situation. Benefits come due when members retire over time, which means there’s time, and a system in place, to make up periodic shortages.

Then on July 20, 2017, the California State Teachers’ Retirement System (CalSTRS) announced they gained 13.4% during 2016-17, well over their 7.5% assumption rate, and up from 4.8% in 2014-15 and 1.4% in 2015-16. CalSTRS is reported to be 64% funded.

CalSTRS is no small shakes either. Claiming to be the largest, educator-only pension system in the world, they serve over 900,000 California educators, employed by 1,700 school districts, county offices of education and community college districts, with a $208.7 billion fund. They’ll be around for a while too.

And, there’s more good news. On July 20th, our own SDCERA Chief Investment Officer Stephen Sexauer reported 12% fund earnings for the 2016-2017 fiscal year, against a 7.25% assumption rate. This soundly breaks a two-year down-streak for us too, which included 2.25% earnings in 2015 and 0.5% in 2016. SDCERA is reported to be the third largest county retirement system in California, behind Los Angeles and Orange Counties, serving about 41,000 members, with an $11.4 billion fund. SDCERA was reported to be 76.9% funded in 2016.

The very long-term character of government retirement systems and their investment performance is not unimportant. Benefit obligations are long coming due, allowing assumption rates to be multi-decade goals and average earnings over long periods much more important than short-term, up and down variations.

So, CalPERS, for example, reports their total fund averaged 8.8% gains over the last five years, 4.4% over ten years and 6.6% over 20 years. CalSTRS says they averaged 10.1% gains over the last five years, 5% over 10 years and 6.9% over 20 years. Those ten and twenty-year periods include the most devastating recession since the 1930s.

Back home, SDCERA reports 7.1% average earnings over the last five years, 4.4% over ten, and 7.0% over 20 years. That compares favorably to the 6.6% and 6.9% long-term twenty-year earnings reported by CalPERS and CalSTRS, respectively.

There’s also an interesting and intricate aside, applicable to many public retirement systems, including SDCERA, having to do with how public employer and employee retirement costs fare under various estimated and actual earning scenarios.

You’ll need to follow closely . . . Regular readers know that public defined benefit systems are annually funded from annual investment earnings of accumulated funds, and employer and employee contributions. Because no one knows exactly how much will be earned in a given future year, earnings estimates (assumption rates) are developed beforehand, so the remaining funds needed from contributions can be calculated. The higher earnings are estimated, the lower employer and employee contributions need to be. Thus, one would think, both employers and employees would be cautious about lowering assumption rates because lower rates mean higher employer and employee costs.

But, if actual earnings at the end of an investment year fall below the earlier estimate, leaving a funding gap, that gap is funded entirely by employers in most systems, while normal, calculated contributions are shared with employees. So, the employer is faced with an annual quandary of sorts. Decisive economic factors aside, is it better to lean toward higher earning estimates, knowing normal contributions would be less, but the earning estimate might be optimistic? Or, to encourage a lower earning estimate and know there will be higher contributions required, but shared with employees, and unshared deficit costs will be less likely? Got all that?

Incidentally, the earnings estimate, or “assumption rate,” is not commonly set by the employer, the Board of Supervisors, but by the independent Board of Retirement.

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You’re Invited!
Coming Home
to the North Inland Live Well Center

When

Wednesday, October 4, 2017 at 11:00am

Where

North Inland Live Well Center
649 W Mission Ave, Escondido, CA 92025

What

Our annual “Coming Home” event invites retired employees of San Diego County to celebrate County sites. On October 4th, we invite you to join your fellow RESDC members in “coming home” to the County’s new North Inland Live Well Center in Escondido.

Opened in 2015, the center serves as a community hub for health and social services. The center also houses the County of San Diego’s Military and Veterans Resource center, including many community-based organizations dedicated to assisting military veterans and their dependents and survivors.

Our event will kick off with welcoming remarks from Kristin Gaspar, Vice Chairwoman of the San Diego County Board of Supervisors. Prior to becoming a Supervisor, Gaspar was an Encinitas City Council Member and went on to become the first Mayor ever elected in that city. Supervisor Gaspar believes in fiscal discipline and accountability. She is a proponent of protecting the environment and preserving open spaces. Other issues that are important to Supervisor Gaspar include: the growing homeless problem around the county, public safety, and improving our streets, infrastructure and neighborhoods. Recently, she partnered with her colleagues on a County initiative to help those with Alzheimer’s receive the proper care they need. Kristin was born and raised in North County and is proud to represent her hometown community.

The keynote speaker will be Dr. Nick Yphantides, who currently serves as the Chief Medical Officer for San Diego County and its 3.3 million residents (1% of America’s population). He is the Founding Co-Chair of San Diego’s Childhood Obesity Initiative, was the Chief Medical Officer (CMO) of one the largest network of Community Clinics in San Diego County, the CMO of the Council of Community Clinics and was the publicly elected Chairman of the Board for Palomar Health, the largest Public Hospital District in California. Dr. Nick currently serves on several Boards including San Diego Health Connect (our regional Health Information Exchange), the San Diego County Medical Society, Champions for health and several other community based and charity organizations.

Event Highlights

• 11:00 am – Reception & Resource Booths – light hors d’oeuvres and refreshments available
• 11:20 am – Welcoming Remarks by RESDC and Kristin Gaspar, Vice Chairwoman of the San Diego County Board of Supervisors
• 11:35 am – Keynote Speech by Dr. Nick Yphantides, San Diego County Chief Medical Officer
• 12:00 pm – Guided Tour

Directions

• Take I-15 North.
• Use exit 32 to merge onto CA-78 East, and then exit onto Centre City Pkwy S.
• Take an immediate right onto W Mission Ave.
• Turn left at Alvarado Way into the parking lot.

RSVP

This is a FREE event. RSVP is requested but not required: online by clicking here and following the steps, or by calling (619) 688-9229.

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Retirement Board Raised 2018 Health Admin Fee at July Meeting
RESDC President John McTighe Testified

On July 20, 2017 the SDCERA Board of Retirement (BOR) approved increasing the 2018 Health Program administrative fee 31 cents, from $4.85 to $5.16 per month. RESDC President John McTighe addressed the Board opposing the increase. His statement is printed below.

RESDC representatives attended the SDCERA Benefits Committee meeting in June, where the increase was recommended, and requested details about the justification for the fee hike and how the administrative costs were calculated. Between the committee meeting and the BOR action, President McTighe continued to communicate with SDCERA officials, providing written inquiries and receiving detailed responses about the process for evaluating health program administrative expenses.

These materials were provided to the entire BOR. SDCERA Board members and staff thanked RESDC for raising concerns that helped everyone better understand the admin fee issue and feel comfortable that the fee was being accurately and fairly applied. The review of the issue revealed that the Health Program administrative fund had a $538,655 reserve from three years where fee revenue exceeded actual costs. The calculation for calendar year 2018 included a credit of $187,831 from the reserve to keep the increase to 31 cents. The remainder of the reserve fund would be phased in to “smooth” future fee increases.

In his remarks, John McTighe recommended the Board not increase the fee, but rather keep at the current amount of $4.85 using more of the reserve to hold the fee to the 2017 level. Board members expressed appreciation for RESDC’s involvement and efforts, but they felt the Benefit Committee’s recommendation to gradually increase the fee was more logical. The following is John McTighe’s statement to the BOR:

Good morning madam Chair and Board Members. I am John McTighe, President of the Retired Employees of San Diego County. I appreciate the opportunity to speak to the Health Care Administration Fee item on today’s agenda. When this item was discussed at your Benefits Committee meeting on June 29th, I commented to the committee that while RESDC doesn’t necessarily support any charges or fees that our members must pay, we fully understand that the law forbids any pension trust fund monies from being expended on health care related expenses. I said we would have preferred the 2018 Health Administration Fee would not have been recommended for an increase from the current 2017 fee of $4.85 per month per participant. I then requested that we receive backup for how the recommended fee of $5.16 per month was calculated.

Last Friday, I received a copy of the memo that appears in your agenda book at Tab 8 showing the major components of the fee. I noted in Mr. Bych’s memo that there is a fund balance of $538,655 that had apparently been accumulated over the past three years. While we appreciate Mr. Bych’s recommendation to use a portion of that fund balance in calculating the amount needed to be raised by the 2018 fee, we note that the recommended fee of $5.16 per month is a 6.4% increase over the current year’s fee of $4.85 per month.

I recommend you use a greater share of the fund balance in 2018 to maintain the Health Administration at $4.85 per month fee.
With the uncertainties facing the future of healthcare in the country, and the increases we see in health plans, it would be comforting to your retirees and our members to know that the fees they pay for the administration of the health plans would stay stable for at least another year.

Thank you for your consideration. I’m available to answer any questions you may have.

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2017 Board Election Update

By Carlos Gonzalez, Elections Committee Chair

As required in the RESDC Bylaws, a request for nominations of Association Board Officers and Directors was published in our July newsletter. The positions of President and Second Vice President require the nominees be a current or past Board members.

Nominations were officially closed on August 4, 2017. Our President and Second Vice President have agreed to remain on the board for another two-year term. Three of the four Directors whose terms expire in December 2017 are available to fulfill another two-year term.

In accordance with Article XI, Section 2 of the RESDC Bylaws, “When only one candidate for a vacancy on the Board of Directors is nominated, the nominee will be considered elected by the Board.” Accordingly, John McTighe will be elected to the position of President and Chris Heiserman will be elected to the position of Second Vice President. The three Directors reelected are Sarah Brooks, Joe McGuire, and George Shoemaker. All reelected Board members will serve a two-year term, beginning January 1, 2018. A new “candidate” for Board member has stepped forward and his name will be announced at this year’s Holiday Luncheon in December at which time all “successful” candidates will be sworn in as required. As there was only one candidate for the open board position, we will not hold an election.

The Retired Employees of San Diego County and all its members, greatly appreciate our volunteers, and their service as Officers and Directors of our Association.

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Join Team RESDC in Upcoming
Walk4ALZ San Diego
Saturday, October 21, 2017

By Mark Nanzer, Executive Director

RESDC is proud to be participating in the Walk4ALZ to raise awareness and funds to advance the fight against Alzheimer’s disease. The Walk4ALZ is San Diego’s largest Alzheimer’s walk. It’s the only Alzheimer’s walk where 100% of every dollar raised stays in San Diego to support free services for families and local research for a cure. The end of Alzheimer’s starts with you and this is a great way to get in a good walk and show your support for the great work done by Alzheimer’s San Diego!

To register, go to www.resdc.net/community-events, or go directly to Team RESDC on the Walk4ALZ website. If you’re unable to participate, please consider making a $35 donation to our fundraising campaign. Thank you!

Walk4ALZ 2017 – Balboa Park:

• Date:  Saturday, October, 21, 2017
• Where:  Balboa Park, start by the Hall of Champions
  2131 Pan American Plaza, San Diego, CA 92101 
• Registration and Check-in at 6:30 am | Opening Ceremony at 7:30 am | Walk at 8:00am

Team RESDC at the 2016 Walk4ALZ.

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“To dare is to lose one’s footing momentarily. Not to dare is to lose oneself.” Soren Kierkegaard

Bits and Pieces

Edwin Kues and his wife, Yukiko, celebrated their 62nd wedding anniversary in June! Edwin retired in 1992 from the Probation Department. He is 88 years old.

Tom Bunkley retired from the Probation Department in 2002. In May, Tom and his wife, Sue, flew to Japan to celebrate their 50th wedding anniversary! They boarded a cruise ship for a 14 day visit to Taiwan, South Korea, and seven ports in Japan. They cruise frequently, but this trip was exceptional.

Marilyn Chisholm will soon turn 94 years old! She retired in the 90s from Edgemoor Hospital as a recreational therapist. Before working for the county, she was a teacher in Chula Vista. She still lives in San Diego and walks a mile every day. She enjoys playing cards at a church near her home.

Robert “RT” Denny and his wife recently celebrated their 60th wedding anniversary! Robert retired from The Registrar of Voters. He still lives in San Diego County.

Barbara Hayes celebrated her 80th birthday in July! Her son threw a large birthday party for her with many friends and family members. Barbara has lived in Maryland since 2011. She retired in 1998 from Juvenile Hall where she was a nurse.

Paul Cornell and his wife, Gwen, celebrated their 68th wedding anniversary in August! Paul retired from the Sheriff’s Department in 1980. Gwen retired from Grossmont College Music Department in 1981. They live in Sun City, Arizona and are both active in a local Host Lions Club and other senior volunteer activities.

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San Diego County Credit Union

Are you taking advantage of SDCCU’s FREE Checking with eStatements? Access over 30,000 surcharge-FREE CO-OP ATMs nationwide. Visit sdccu.com/partner to see how you can get up to $100 for a limited time! Open an account in minutes and free yourself of monthly activity fees. When you direct deposit your pension deposit into your SDCCU® checking account, you many enjoy it earlier than your regularly scheduled payday. Sign up for direct deposit at sdccu.com/directdeposit today to start enjoying your paycheck early! Restrictions apply. Actual deposit date not guaranteed. Federally insured by NCUA.

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Theatre Ticket Discounts for RESDC Members

Cygnet Theatre welcomes members of RESDC to enjoy $10 off per ticket for any show in Season 15! This discount is valid for most performances through June 10th, 2018 (except Opening Nights and other select dates). Use the discount code in the email and print version of The NETWORK* at checkout online, or when ordering by phone or in-person from the Cygnet Theatre Box Office. Learn more about the shows and purchase tickets at CygnetTheatre.com or by calling the Cygnet Theatre Box Office at (619) 337-1525. This offer is not valid on previously purchased tickets. Cygnet Theatre is located at 4040 Twiggs St., San Diego, CA 92110.

Save the Date! RESDC will be hosting another Evening at the Theatre on March 21st, 2018 for A Little Night Music at Cygnet Theatre. Those discount tickets will be available for purchase through RESDC closer to the performance date. We recommend waiting to purchase tickets for this particular show until that time, so that you can attend on the same evening as your fellow retirees!

MOXIE Theatre is offering RESDC members $10 tickets for select performances of their upcoming show Ironbound. Use the discount code in the email and print version of The NETWORK* to buy $10 tickets online at www.moxietheatre.com, by phone (858) 598-7620, or in-person at the MOXIE Theatre Box Office for Sunday, September 17 or Thursday, September 21 (there is also a $3 processing fee per ticket).

Ironbound by Martyna Majok: “At a bus stop in a run-down New Jersey town, Darja, a Polish immigrant cleaning lady, is done talking about feelings; it’s time to talk money. Spanning over 20 years, three relationships, and three presidents, Darja negotiates for her future. A darkly funny, heartbreaking portrait of a woman for whom love is a luxury–and a liability–as she fights to survive in America.”

MOXIE Theatre is located at 6663 El Cajon Blvd., Ste. N, San Diego, CA 92115

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RESDC Day at the Padres Game
August 2, 2017
Padres vs. Minnesota Twins

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Annual RESDC Health Fair Picnic

When

Tuesday, October 17, 2017, 10:00 am – 1:00 pm
Lunch Served 11:30 am – 12:30 pm

Where

Admiral Baker Field
2400 Admiral Baker Rd., San Diego, CA 92124

What

The annual RESDC Health Fair Picnic is an outdoor event with over 20 resource booths related to health and wellness. Enjoy a buffet style barbecue lunch, an opportunity drawing, and mingling with fellow retirees.

Menu

Barbecued beef, green beans, baked beans, fruit, coleslaw, rolls, beverages, and dessert.

Sponsored By

Ameritas Dental, Cigna Dental, Health Net, Kaiser Permanente, Pacific Group Agencies, Inc., San Diego County Credit Union, United HealthCare, and My Senior Health Plan.

Registration – New Registration Process This Year

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RESDC T-Shirts are Here!

RESDC T-shirts are available for purchase! Beyond being reasonably priced, the benefits of the new RESDC T-shirts are many. Here are a few reasons to get yours:

• Impress your fellow county retirees by sporting this very comfortable and fashionable shirt
• Proudly tell the world of your connection to RESDC
• As a retiree, you can wear it every day and not get in trouble with the boss, and of course…
• It’s a great gift idea!

RESDC T-shirts can be purchased for $11.00 plus tax at:

Custom Tees and Things
5450 Complex Street, Suite 306
San Diego, CA 92123
(858) 715-8211
Monday through Friday, 8:00 am-4:00 pm
You can have T-shirts shipped to you for a small shipping fee.

RESDC T-shirt sizes available:
Women: Small – XL
Men:  Small – 2XL

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Welcome New Members

Christine Adams – Child Support Services
Gloria Barajas – Health & Human Services
Mario S. Colada – Sheriff
Diane Dominguez – Probation
Jerri L. Foley – Health & Human Services
Victoria G. Infante – Health & Human Services
Joseph Kelly, Jr. – Auditor & Controller
Cheryl Miller – Health & Human Services
Mark A. Nicklin – Sheriff
Caren M. O’Conner – Revenue & Recovery
Aundria L. Reif – Child Support Services
Roxanne Rodriguez – Probation
Jeffrey Rowe
Judy Schickler
Willie J. Shippen – Sheriff
Sonje J. Tomey – Health & Human Services
Josephine B. Velasco – Health & Human Services
Deanna Walker – Associate Member
Charisse B. Zeff – Health & Human Services

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In Memoriam

David Anderson – Public Works
Nancy Barnes – Surviving Spouse
Gail Becker – Health Services
Maria Bruington – Surviving Spouse
George Carr – District Attorney
Denice Ducharme – Housing & Community Devel
Jane Eppele – Registrar of Voters
Paul Finnerty – Sheriff
Karla Flores – Sheriff
Betty Haworth – Surviving Spouse
Michiko Holdeman – Health Services
Nita Johnson – Surviving Spouse
Nancy Kelso – Health Services
Irene Kessler – County Counsel
Mary Koppel – Medical Examiner
Rose Leavenworth – Clerk Of The Board
Rodolfo Martinez – Social Services
Nancy Moran – Social Services
Wilfred Morris – General Services
Faith Niles – Library
Darris Poole – District Attorney
Fred Shisler – Parks & Recreation
Jane Shofe – Social Services
Erlinda Zamora* – Health & Human Services

*Active

As long as we think of you,
You’ll always be with us.

The surviving spouse of a member is eligible for RESDC membership. For enrollment assistance, call (619) 688-9229.

Member Privacy
Any retiree or surviving spouse who does not want his/her death notice published in the “In Memoriam” section of this newsletter may notify the RESDC office and your privacy will be maintained.

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Change of Address?

If you have moved recently or are planning to move, be sure to provide RESDC with your new address and any changes to your email address. We want to be sure you continue to receive your monthly NETWORK and all important email announcements from us.
Call the RESDC office at (866) 688-9229 or email us at resdc@resdc.net if you have any changes to your address. Let us also know if you have changed your name or telephone number.