Drawing a line on pension fund investment By Seth R. Nelson, Tampa Tribune, September 17, 2010 Two months ago, at the monthly meeting of the pension board, I asked the board to change its investment guidelines to mirror the Protecting Florida’s Investment Act of 2007. The act requires the State Board of Administration (SBA), the agency that oversees Florida’s investment of approximately $138 billion of state pension money, to divest from companies conducting prohibited business operations in Iran and Sudan. Although there was support from some Tampa pension board members to divest, the board’s investment consultant and some of the board’s international fund managers were not in support. Perhaps these fund managers believe that their only duty is to provide the best return on investment, but it’s time they realized that our national security matters more and also has the potential to have a major impact on return on investment. SBA’s efforts to rebuild trust meet with some skepticism By Sydney P. Freedberg, St Petersburg Times, September 19, 2010 Almost three years after cities, counties and school districts felt betrayed by the State Board of Administration, some don’t trust the state’s FRA money managers. Florida Prime, which three years ago was the country’s largest local investment pool with $31 billion, has dwindled to less than $6 billion. The number of communities and schools participating has fallen from 1,002 to 803; some are parking their extra cash in banks, other money markets or Treasury bills. The breach in trust came in 2007, when the SBA did not fully inform its clients that the local pool and other funds held about $2 billion of troubled, mortgage-related securities like those fueling the collapse of Wall Street. After anxious communities started withdrawing billions, the state froze the local fund. Miami Passes $499 Million Budget With Fees, Employee-Cost Cuts By Simone Baribeau, Miami Herald, September 28, 2010 Miami commissioners passed a $499 million general-fund budget for fiscal 2011 after closing a $115 million deficit with new fees and payroll and pension cuts. Miami imposed more than $75 million of wage, pension and healthcare cuts on police and firefighter unions on Aug. 31. The city, whose pensions will consume almost one-fifth of its budget this year, declared a state of “financial urgency” in April that allowed it to rewrite contracts with four unions without their agreement. Pension costs in fiscal 2011 will be reduced by about $43 million; salaries will fall $27 million, including more than $1.5 million less for non-union employees, and contributions toward health care will drop $7 million, according to the budget document provided by the city. Miami will spend almost 75 percent of its current $514 million budget on employee costs, including about 18 percent on pension contributions, according its annual budget book.
www.publicpensionsonline.com/fppta.html
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