"3%@50" Safety Members
Information
OCERS' Board of Retirement affirmed the retirement
system's neutral status relating to the question of
the legality of the retroactive portion of the
"3%@50" benefit. OCERS will continue to pay
statutory benefits unless ordered otherwise by a
court with due authority or there is a relevant
change in the state law relating to the payment of
benefits.
The following resources are being made available to
all interested parties, including OCERS Members,
Plan Sponsors and Bargaining Unit representatives.
Posted 08/22/2008
On Friday, August 22, 2008, notices
were mailed to all members
and beneficiaries
that could potentially be
affected by the ongoing litigation
between the County
of Orange and the Association of Orange
County Deputy Sheriffs.
Click here to
view the notice.
Posted 08/12/2008
Click here to view a document with statistics on
potentially-affected OCERS members and beneficiaries
as it relates to Orange County Resolution 01-410.
Posted 08/01/2008
Amended Complaint -
Attorneys for the County of Orange have filed an Amended Complaint in their ongoing lawsuit to roll
back Orange County Sheriff’s pensions. Although the
County had originally directed its legal action
solely against OCERS, the Amended Complaint now
includes the Association of Orange County Deputy
Sheriffs as a defendant.
Click here to view the
Amended Complaint.
Posted 01/29/2008
On
Tuesday, January 29, 2008, the County of Orange
Board of Supervisors met and voted 5-0 to approve
the following agenda item:
"Adopt resolution authorizing Kirkland & Ellis, LLP
as outside counsel to obtain a declaration of
unconstitutionality and injunction against OCERS
prohibiting it from paying out, in any month
following Court declaration any increase pension
benefits arising from Resolution 01-410 that are
based on years of service rendered before June 28,
2002 and taking various actions to ensure that the
rights and interests of affected active-duty and
retired peace officers are protected to the greatest
extent possible."
Reed L. Royalty, Chairman of the OCERS Board of
Retirement, addressed the Board of Supervisors. He
stated the following:
"Good morning, Mr. Chairman and honorable members. I
am Reed Royalty, chairman of the Board of
Retirement, which governs the Orange County
Employees' Retirement System (OCERS).
Lawsuits generally are filed to resolve disputes.
OCERS has no dispute with the County. We simply do
our job. Our job is to administer the benefits that
are granted by the County, not by us. We take no
position on the legality of a benefit granted by the
County. We take no position on the County's own
questioning of the legality of a benefit.
The proposed lawsuit would compel OCERS to take a
position on this issue, just to create a dispute for
the court to resolve. It's not OCERS job to take a
position on benefits. Forcing OCERS to take a
position on a benefit could increase OCERS' legal
and administrative expenses significantly.
If the County believes it violated the law when it
signed a Memorandum of Understanding in 2001, it
should ask the court to rescind the MOU. If you are
successful in doing so, OCERS will administer
whatever benefits the Court says we should."
Posted 11/07/2007
OCERS’
consulting actuary, The Segal Group, has prepared a
review of non-economic actuarial assumptions in a
comprehensive “Actuarial Experience Study” for the
three-year period of January 1, 2002 through
December 31, 2004.
Posted 10/04/2007
The
County requested additional data on the impact of
the past service liabilities on County budget. We
have posted the request and Segal's response.
Posted 09/07/2007
The Segal
Company, OCERS’ actuary, has completed their
preliminary review of the liability impact of the
past service portion of the 3% at 50 benefit formula
change for certain law enforcement members of OCERS,
which was effective June 28, 2002. Using certain
simplifying assumptions, they have arrived at a
figure of about $187 million for paying off the cost
of improving the past service benefit to the 3% at
50 level for retirees and actives if that payment
were made as of October 1, 2007. The October 1, 2007
date was chosen because OCERS believed that using a
date certain would provide a good start for
discussion purposes, and this date is after the
September 18th Board of Supervisors meeting where
potential action may take place.
The $187 million figure does not account for any
benefit payments that have been made to the affected
retired law enforcement members between June 28,
2002 and October 1, 2007, nor does it take into
account the contributions made by the county towards
OCERS' unfunded actuarial accrued liability (UAAL)
and any payments made by the law enforcement members
to their employers to offset the increased cost.
OCERS was not asked to determine the payment of the
past service upgrade from June 28, 2002 to the
present. We were only asked to determine what the
current cost is if affected law enforcement members
were to pay for the past service upgrade on a
prospective basis. Because of this, additional data
would need to be compiled before Segal can estimate
how much of the $187 million still remains unfunded
as of October 1, 2007.
Please note that Segal's estimate of the past
service liability impact was larger than that
calculated by OCERS' prior actuary at the time of
the improvement. Some of the change can be explained
by changes in assumptions and funding methods since
the original cost study.
Segal has also verified the retirement age
assumptions used in the calculation of the current
contribution rates and they have concluded that the
assumptions used in their December 31, 2006
valuation are reasonably reflective of the
retirement experience of the Law Enforcement members
after the 3% at 50 improvement.
Posted 08/28/2007
A
presentation by Harvey L. Leiderman, Attorney for
Reed Smith, was made to and adopted by the Board of
Retirement on August 27, 2007.
