December 9, 2015

The San Diego Union Tribune's criticism of CalPERS' move to reduce risk and volatility in the pension fund was unwarranted.

This Board action was a result of an 18-month analysis that looked at several strategies to mitigate risk. We sought input from leaders representing our members, as well as cities and counties across the State who belong to our system. Industry experts provided guidance and our professional staff provided their best recommendations. The result was a measured and balanced approach that will incrementally lower our assumed rate of investment return, help pay down the pension fund's unfunded liability, and provide greater predictability and less volatility in contribution rates for employers.

The editors need only to look at their story archives to read of the economic strain that still exists in many of California's local public agencies, and the impact that a rapid reduction of our assumed investment rate would have on their ability to pay for pensions and deliver vital services to citizens.

It's a shame that the editors chose a path of cynicism toward CalPERS, instead of recognizing the progress that we are making to protect the fund.

(This response was submitted to the San Diego Union Tribune Opinion Editor)

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