Retired Employees Association of Orange County
REAOC Board Welcomes You!
Pictured Left to Right: Co-President Doug Storm, Sharon Sedgwick, Co-President Linda Robinson, and John LaRoche
Board Watch Committee
In the News
INFORMATION REGARDING CALPERS LONG-TERM CARE (LTC) INSURANCE
For any members who purchased Long Term Care Insurance from CalPERS, you may be interested to know that CRCEA has formed an Ad Hoc Committee to monitor the class action lawsuit that has been commenced against CalPERS. This lawsuit seeks monetary damages and other remedies related to CalPERS' announcement that it will be increasing premiums for some by 85%. Futher information concering that class action litigation is available at the link below.
You may also find additional information about the CalPERS LTC issues in the letter from the attorneys who are representing the CalPERs members who have been impacted by the change in premium. Please click on the link below to read the letter.
IMPORTANT INFORMATION ABOUT THE COLA
For 2014, the Cost of Living Adjustment (COLA) for retirees is 1 percent. This is based upon a change in the CPI of 1.08 percent which was rounded to 1.0 percent as is required by statute. For benefit recipients who began receiving benefits on or before April 1, 1971 through April 1, 1985, OCERS will grant a 3 percent COLA and reduce the COLA banks by 2 percent. For those benefit recipients who began receiving benefits between April 2, 1985 and April 1, 1986, OCERS will increase those benefit allowances by 2 percent and reduce the COLA banks by 1 percent. For those benefit recipients who began receiving benefits between April 2, 1986 and April 1, 2014, OCERS will grant a 1 percent COLA with no reduction in COLA banks.
To obtain additional information about the COLA and also to obtain information about the STAR COLA for those retirees who retired before April 1, 1981, please click on the link below and you will be connected to the OCERS website.
REAOC Litigation Update March 2014
Attached is REAOC's submission of the Petition for Rehearing to the Ninth Circuit Court of Appeal. The actual Request is 12 pages in length but the submission document includes the panel’s ruling of last month helping to increase the Request to 32 pages.
IN THE NEWS - Week of April 14, 2014
Public Pensions and the Lessons of Success
Do we learn more from success or failure? When it comes to state- and local-government pensions, we tend to focus on the plans that are struggling. But there are valuable lessons to learn from public-sector retirement plans that have remained well funded and from governments that have successfully negotiated changes to put their pension systems on a path to full funding.Well funded in Illinois: Given all the headlines about Illinois' seemingly endless struggle to reform its pensions, some might be surprised to learn that that the Illinois Municipal Retirement Fund (IMRF), the state's second-largest public pension, is a model of fiscal responsibility. What distinguishes the IMRF from Illinois' other three statewide plans, which are struggling, is that all 2,969 governments that participate in it are required to pay 100 percent of their annual required contribution. (More)
Obama, Michigan in talks to free up $100M to aid Detroit pension deal
The Obama administration and state officials are in discussions on a deal that would free up an additional $100 million to soften the blow to Detroit pensioners, two people familiar with the talks told the Free Press late Tuesday. The two sources, who spoke on condition of anonymity because they weren’t authorized to disclose the information, confirmed that there have been talks about the federal government supporting a move by the state to give Detroit $100 million in federal money for blight remediation. That, in turn, would free up $100 million of the more than $500 million that emergency manager Kevyn Orr planned to spend for blight removal over the next 10 years. Orr could then use that money to reduce pension cuts. (More)
Pensioners in Detroit Rejoice, Though Deal Is Far From Done
My pension is my life,” Thomas Berry, a retired police detective, said on Wednesday, reacting to tentative deals that were struck between Detroit, the city’s pension funds and a retirees’ group that would mean no cuts to his current pension checks, though a reduction in annual cost of living increases. “I’m O.K. with that,” Mr. Berry said, “because a month ago, we were going to lose everything.”A day after Detroit scaled back from the large pension benefit cuts it had once been proposing, the bankrupt city fended off charges from some that it had simply caved in to retirees in ways that could come back to haunt it. But it also felt the elation of many of its current and former employees who for months had feared a more dire outcome. ------------ How it happened is the story of an effort to protect as much as possible the workers and retirees who have been the backbone of the city’s working and middle class. The deal was eased by a decision to project better pension fund returns because of the stock market’s performance last year, and fears by the workers’ negotiators that if they did not accept the agreement the terms would get worse. ----------- The city’s public shift in its posture on pensions this week seemed sudden and puzzling to some who wondered how a city could suddenly afford so much more than before. (More)
Bridgewater says outlook for public pension funds is pretty awful
Here's a scary retirement prediction: 85 percent of public pensions could fail in 30 years. That's according to the largest hedge fund firm in the world, Bridgewater Associates, which runs $150 billion for pensions and other institutions like endowments and foundations. Public pensions have just $3 trillion in assets to cover liabilities that will balloon to $10 trillion in future decades, Bridgewater said in a client note last week obtained by USA Today. To make up the difference, the firm said pensions will need to earn about 9 percent per year on their investments. But Bridgewater estimates pension funds are more likely to make 4 percent. (More)
American Airlines' bid to end benefits for many retirees is rejected
A federal judge has rejected an attempt by American Airlines to quickly cut off benefits for many of its retirees. The airline wants retirees who wish to keep their benefits to pay all the cost. Now the dispute could go to negotiations or a trial. On Friday, U.S. Bankruptcy Court Judge Sean Lane in New York rejected a request made by American's former parent, AMR Corp., for the right to immediately eliminate retiree benefits for former pilots, flight attendants and other union workers. (More)
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