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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.



On February 13, 2014 we received disappointing news from the Ninth Circuit Court of Appeals’ three-judge panel which heard our case in Pasadena on November 4, 2013. In its ruling the panel affirmed the district court’s summary judgment in favor of Orange County ruling that “a practice or policy extended over a period of time does not translate into an implied contract right without clear legislative intent to create that right--an intent that the Association had not demonstrated in this case. The panel held that the nature of the Association’s evidence underscored the absence of any definitive intent or commitment on the part of the County to provide for the pooled premium.” In other words, the panel indicated that an “implied” contract term was nearly impossible, if not in writing—at least that is our interpretation of their ruling.

This ruling comes as a surprise, given the extensive documentation provided to the court during the past six years. Also surprising, is the panel’s interpretation of the California Supreme Court’s ruling in the REAOC case as well as a recent ruling made by another Ninth Circuit panel involving Sonoma County retirees—a case similar to ours. The extrinsic evidence presented to the panel included on-the-record comments by past board of supervisor members and direct testimony from the county’s past chief labor negotiator supporting the continuance of a co-mingled insurance pool. We are currently discussing our options with our attorneys and will provide additional information as to our membership as soon as possible. 

A copy of the ruling can be read by clicking on the link below.

IN THE NEWS - Week of March 31, 2014
San Jose mayor pledges to push pension reform effort on 2016 ballot

San Jose Mayor Chuck Reed on Thursday affirmed his commitment to put a highly controversial pension reform initiative before voters in 2016, despite recent legal setbacks that have threatened the plan's viability. "We have not stopped working on this. We will not give up," Reed told a gathering during a speech to the Sacramento Press Club. (More)

California seniors have highest poverty rate, study finds

Allen Stross of Berkeley started working at age 13. He's been a delivery boy, a sign painter, a Navy sailor and a photographer for the Detroit Free Press. Now, at age 90, he and his wife live on about $21,000 a year. After they pay for rent and medications, they're left with just $416 a month. "No restaurants. No movies. No new clothes. We look for a lot of freebies," he said. "But I try not to worry about things I can't control, such as the past or the future. My wife's a Buddhist. That helps." Stross and his wife, a retired art history teacher, are among a growing throng of formerly middle-class Americans who find themselves in poverty as seniors. For about 6.3 million seniors nationwide living below the poverty line, that means eating most meals at free dining rooms, rarely turning up the heat, rationing medications and praying that emergencies never strike. California, with its high cost of living and health care, leads the nation in the percentage of older adults living in poverty, according to a 2013 report by the Kaiser Family Foundation. Twenty percent of California adults over age 65 live below the poverty threshold of about $16,000 annually, when taking into account the higher cost of housing and health care.  (More)

Orange County Officials See Labor Deal as Bridge to Remaking Public Sector Work
Orange County’s all-Republican board of supervisors appears set to embark on a radical experiment to reshape local government, giving it a more entrepreneurial twist. And they’re doing it in partnership with labor. (More)

Brown’s California Rebound Belied by Placentia Plight

Placentia, a Los Angeles suburb with median home prices 34 percent above the state level, is struggling for fiscal survival amid a California renaissance led by Governor Jerry Brown. While California’s economy is surging to a record, the plight of Placentia shows how a financial misstep can imperil municipalities facing rising costs for retirees and infrastructure. The community of 52,000 exhausted most of its reserves on a failed railroad project. Southern California’s Adelanto and Upland are also fighting to avert insolvency. (More)

Orange County Fund Aims to Lower Private Equity Costs

Orange County, California’s $11.5 billion pension is putting together a fund open to smaller retirement plans to give them access to private-equity investments at a lower cost. The county selected London-based Pantheon Ventures LLP yesterday to manage the pool. For the past 10 months, Orange County’s Employees Retirement System has been collaborating with other California pensions to develop the fund, which would give them leverage when negotiating fees with private-equity firms. (More)
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Santa Ana, CA  92711-1787


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