VENTURA COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION
BOARD OF RETIREMENT
BUSINESS MEETING
JUNE 19, 2017
AGENDA PLACE: Ventura County Employees' Retirement Association
Second Floor Boardroom 1190 South Victoria Avenue Ventura, CA 93003
TIME: 9:00 a.m. Members of the public may comment on any item under the Board’s jurisdiction by filling out a speaker form and presenting it to the Clerk. Unless otherwise directed by the Chair, comments related to items on the agenda will be heard when the Board considers that item. Comments related to items not on the agenda will generally be heard at the time designated for Public Comment.
ITEM:
I. CALL TO ORDER
Master Page No.
II. APPROVAL OF AGENDA
1 – 3
Welcome of Newly Elected General Member, Maeve Fox.
III. APPROVAL OF MINUTES
A. Disability Minutes of June 5, 2017 4 – 11
IV. CONSENT AGENDA
A. Approve Regular and Deferred Retirements and Survivors Continuances for the Month of May 2017.
12
B. Receive and File Report of Checks Disbursed in May 2017.
13 – 17
C. Receive and File Budget Summary for FY 2016-17 Month Ending May 31, 2017.
18
Business Meeting Agenda - II. APPROVAL OF AGENDA & WELCOME OF NEWLY ELECTED GENERAL MEMBER
MASTER PAGE NO. 1 of 202
BOARD OF RETIREMENT JUNE 19, 2017 AGENDA BUSINESS MEETING PAGE 2
IV. CONSENT AGENDA (continued)
D. Receive and File Statement of Fiduciary Net Position, Statement of Changes in Fiduciary Net Position, Schedule of Investments and Cash Equivalents, and Schedule of Investment Management Fees for the Period Ending April 30, 2017.
19 – 24
V. INVESTMENT MANAGER PRESENTATIONS
A. Receive Annual Investment Presentation, Parametric, Justin Henne and Ben Lazarus.
25 – 53
B. Proposed Private Equity Investment Policy and Proposed Private Equity Investment Annual Plan – Abbott Capital Management: Charles Van Horne and Matthew Smith; VCERA – Dan Gallagher
1. Staff Letter.
54
2. Abbott Capital Management Presentation.
55 – 64
3. Proposed Private Equity Investment Policy. RECOMMENDED ACTION: Approve and Adopt.
65 – 72
4. Proposed Private Equity Investment Annual Plan. RECOMMENDED ACTION: Approve and Adopt.
73 – 81
VI. INVESTMENT INFORMATION
A. NEPC – Allan Martin and Tony Ferrera. VCERA – Dan Gallagher, Chief Investment Officer.
1. Preliminary Performance Report Month Ending May 31, 2017. RECOMMENDED ACTION: Receive and file.
82 – 89
2. Fourth Quarter 2016 Private Markets Review – Private Equity. RECOMMENDED ACTION: Receive and file.
90 – 104
VII. OLD BUSINESS
A. Determine Compliance of County’s Proposed Publicly-Available Pay Schedule for Market-Based Premium Pay (MBPP) and Determine Pensionability of MBPP under PEPRA. RECOMMENDED ACTION: EXCLUDE MBPP FROM PENSIONABLE COMPENSATION DUE TO DEFICIENCY IN MEETING PEPRA CRITERIA. Time: 10:30 a.m.
1. Staff Letter with Attachments. 105 – 181
Business Meeting Agenda - II. APPROVAL OF AGENDA & WELCOME OF NEWLY ELECTED GENERAL MEMBER
MASTER PAGE NO. 2 of 202
BOARD OF RETIREMENT JUNE 19, 2017 AGENDA BUSINESS MEETING PAGE 3
VII. OLD BUSINESS (continued)
B. Determine Pensionability of HCA Fiscal Premium Pay. RECOMMENDED ACTION: EXCLUDE HCA FISCAL PREMIUM PAY FROM PENSIONABLE COMPENSATION DUE TO DEFICIENCY IN MEETING PEPRA CRITERIA.
1. Staff Letter with Attachments. 182 – 189
VIII. NEW BUSINESS
A. Renewal of Hearing Officer Contracts. RECOMMENDED ACTION: Approve.
1. Staff Letter.
190
2. Proposed Contract. 191 – 192
B. Annual Review of Education and Travel Policy.
1. Staff Letter. 193 – 194
2. Education and Travel Policy Proposed (Redline).
195 – 201
IX. INFORMATIONAL
A. Tortoise Exploring Alternatives with Mariner. 202
X. PUBLIC COMMENT
XI. STAFF COMMENT
XII. BOARD MEMBER COMMENT
XIII. ADJOURNMENT
Business Meeting Agenda - II. APPROVAL OF AGENDA & WELCOME OF NEWLY ELECTED GENERAL MEMBER
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VENTURA COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION
BOARD OF RETIREMENT
DISABILITY MEETING
JUNE 5, 2017
MINUTES
DIRECTORS PRESENT:
Tracy Towner, Chair, Alternate Safety Employee Member William W. Wilson, Vice Chair, Public Member Steven Hintz, Treasurer-Tax Collector1 Robert Bianchi, Public Member Craig Winter, General Employee Member Arthur E. Goulet, Retiree Member Will Hoag, Alternate Retiree Member Chris Johnston, Safety Employee Member Ed McCombs, Alternate Public Member
DIRECTORS ABSENT:
Peter C. Foy, Public Member Mike Sedell, Public Member
STAFF PRESENT:
Linda Webb, Retirement Administrator Lori Nemiroff, General Counsel Henry Solis, Chief Financial Officer Dan Gallagher, Chief Investment Officer Karen Scanlan, Accounting Manager I Shalini Nunna, Retirement Benefits Manager Donna Edwards, Retirement Benefits Specialist Stephanie Berkley, Retirement Benefits Specialist Chris Ayala, Program Assistant
PLACE: TIME:
Ventura County Employees' Retirement Association Second Floor Boardroom 1190 South Victoria Avenue Ventura, CA 93003 9:00 a.m.
ITEM:
1 Arrived at 9:04 a.m.
Business Meeting Agenda - III. APPROVAL OF MINUTES
MASTER PAGE NO. 4 of 202
BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 2
I. CALL TO ORDER Chair Towner called the Disability Meeting of June 5, 2017, to order at 9:00 a.m.
II. APPROVAL OF AGENDA MOTION: Approve the agenda. Moved by Goulet, seconded by Bianchi. Vote: Motion carried Yes: Bianchi, Goulet, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Hintz, Sedell
III. APPROVAL OF MINUTES A. Disability & Business Meeting of April 17, 2017. Trustee Bianchi provided a correction to master page 4, where he was listed incorrectly as the Alternate Public Member. Trustee Goulet provided a correction to master page 9, noting that the Board returned to open session following the closed session item. After discussion by the Board, the following motion was made: MOTION: Approve with corrections. Moved by Bianchi, seconded by Goulet. Vote: Motion carried Yes: Bianchi, Goulet, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Hintz, Sedell
IV. RECEIVE AND FILE PENDING DISABILITY APPLICATION STATUS REPORT MOTION: Receive and File. Moved by Winter, seconded by McCombs. Vote: Motion carried Yes: Bianchi, Goulet, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Hintz, Sedell
Business Meeting Agenda - III. APPROVAL OF MINUTES
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BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 3
V. APPLICATIONS FOR DISABILITY RETIREMENT
A. Application Service-Connected Disability Retirement - Jerardo Gomez;
Case No. 16-035.
1. Chief Investment Officer Letter.
2. Application for Service-Connected Disability Retirement, dated
October 27, 2016.
3. Medical Analysis and Recommendation, including Supporting Medical
Documentation, submitted by County of Ventura, Risk Management, in
support of the Application for Service-Connected Disability Retirement,
dated May 22, 2017.
Trustee Hintz arrived at 9:04 a.m.
Paul Hilbun, was present on behalf of County of Ventura Risk Management. The applicant, Jerardo Gomez was not present. After discussion by the Board, the following motion was made: MOTION: Approve Application for Service-Connected Disability Retirement. Moved by Bianchi, seconded by Goulet. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell Both parties agreed to waive preparation of findings of fact and conclusions of law.
B. Application for Non-Service Connected Disability Retirement - Edward Z.
Hosseinipour; Case No. 16-023.
1. Application for Non-Service Connected Disability Retirement, dated
July 22, 2016.
2. Medical Analysis and Recommendation, including Supporting Medical
Documentation, submitted by County of Ventura, Risk Management, in
support of the Application for Non-Service Connected Disability Retirement,
April 3, 2017.
3. Hearing Notice, dated April 10, 2017.
Business Meeting Agenda - III. APPROVAL OF MINUTES
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BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 4
Paul Hilbun, was present on behalf of County of Ventura Risk Management. The applicant, Edward Z. Hosseinipour was also present. After discussion by the Board, the following motion was made: MOTION: Approve Application for Non-Service Connected Disability Retirement. Moved by Bianchi, seconded by Goulet. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell Both parties agreed to waive preparation of findings of fact and conclusions of law.
VI. OLD BUSINESS
A. Reaffirm Board Action for Merit Increases for General Counsel and Chief Investment Officer.
1. Staff Letter
a. Consideration and Possible Approval of Merit Increase for General Counsel.
Ms. Webb said that at the last meeting the Board authorized merit increases for the General Counsel and Chief Investment Officer, but the agenda had not specifically listed potential increases, which must be done in open session. Therefore, the item was on the agenda so the increases could be formalized and subsequently processed. After discussion by the Board, the following motion was made: MOTION: Approve a 4.76% Merit Increase for the General Counsel. Moved by Goulet, seconded by McCombs. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell
b. Consideration and Possible Approval of Merit Increase for Chief Investment Officer.
After discussion by the Board, the following motion was made:
Business Meeting Agenda - III. APPROVAL OF MINUTES
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BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 5
MOTION: Approve a 5% Merit Increase for the Chief Investment Officer. Moved by Hintz, seconded by Winter. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell Chair Towner requested a break at 10:00 a.m. Chair Towner left at 10:00 a.m. Vice Chair Wilson acted as Chair in his absence. The Board returned from break at 10:10 a.m.
VII. NEW BUSINESS
A. Review and Adoption of Proposed Fiscal Year 2017/18 Budget. RECOMMENDED ACTION: Approve. Materials to be provided.
1. Staff Letter.
Ms. Webb and Mr. Solis presented the FY 2017-18 proposed budget. Trustee Goulet expressed concern whether certain proposed expenditures included in the newly created Investment and Other Expenditures budgets were categorized correctly and should be excluded from the administrative spending cap (CAP). More specifically, Trustee Goulet believed that depreciation/amortization should not be excluded from the CAP and requested legal justification. Mr. Solis replied that the budgeted amount for depreciation/amortization represented the allocation of the accumulated costs associated with the recently completed pension administraton system. Mr. Solis further explained that the expenditures in question were excludible from the CAP as they were capitalized during the implementation period and would continue to be excluded from the CAP, as they are amoritized. He also stated that VCERA was following GASB standards specifically related to the treatment of intangible assets and had conferred with counsel regarding the treatment of capital expenditures and whether they should be included or excluded from the CAP. Trustee Goulet stated that VCERA follows the County Employees’ Retirement Law (CERL) and not GASB and did not believe VCERA had to follow GASB. Mr. Solis replied that he would research further and report back. After discussion by the Board, the following motion was made: MOTION: Approve. Moved by Bianchi, seconded by Goulet.
Business Meeting Agenda - III. APPROVAL OF MINUTES
MASTER PAGE NO. 8 of 202
BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 6
Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell
B. Recommendation to Engage Gabriel, Roeder Smith & Company for Actuarial Audit Services. RECOMMENDED ACTION: Approve.
Ms. Webb reported that the members of the ad hoc committee had reviewed the actuarial audit RFP submissions and recommended engaging Gabriel, Roeder Smith & Company. After discussion by the Board, the following motion was made: MOTION: Approve. Moved by Bianchi, seconded by Goulet. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell
C. Recommendation to Support AB 526 from Trustee Goulet.
1. Letter from Trustee Goulet.
2. Proposed Support Draft.
Chair Towner returned at 10:40 a.m., and acted as Chair for the remainder of the meeting. Trustee Goulet said that the drafted letter indicated that AB 526 is similar to AB 1853 from last session, which would have given CERL systems the ability to establish district status. He said AB 526 would only apply to Sacramento County, but he believed it was important to publicly support the legislation with the proposed draft letter. After discussion by the Board, the following motion was made: MOTION: Approve Support for AB 526. Moved by Goulet, seconded by Johnston. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell
Business Meeting Agenda - III. APPROVAL OF MINUTES
MASTER PAGE NO. 9 of 202
BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 7
D. Consideration and Possible Approval of Expedited Process for Retirement Administrator Evaluation.
1. Letter from Will Hoag, Chair, Personnel Review Committee.
Trustee Hoag informed the Board that it was discovered that the Retirement Administrator’s evaluation and possible merit increase had been due in January 2017. Trustee Hoag said that the Board would need to go into a closed session to discuss and then return to an open session to consider a merit increase. General Counsel reminded the Board that they would first need to approve the proposed expedited process approval for the Retirement Administrator and waive the formality of the established evaluation policy before convening into closed session. After discussion by the Board, the following motion was made: MOTION: Approve an Expedited Evaluation Process for the Retirement Administrator and Waive the Formal Evaluation Process. Moved by Hintz, seconded by Bianchi. Vote: Motion carried Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell The Board Adjourned to Closed Session at 10:42 a.m.
E. Consideration and Possible Approval of Merit Increase for Linda Webb, Retirement Administrator. This item to be considered following “VIII. Closed Session.”
VIII. CLOSED SESSION
A. PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: Retirement Administrator (Government Code section 54957(b)(1))
Upon returning to open session at 10:49 a.m., Chair Towner stated that the Board would like to thank Ms. Webb for her outstanding job performance over the past 2 and a half years. After discussion by the Board, the following motion was made: MOTION: Approve a 7.83% Merit Increase for the Retirement Administrator. Moved by Bianchi, seconded by Goulet. Vote: Motion carried
Business Meeting Agenda - III. APPROVAL OF MINUTES
MASTER PAGE NO. 10 of 202
BOARD OF RETIREMENT JUNE 5, 2017 MINUTES DISABILITY MEETING PAGE 8
Yes: Bianchi, Goulet, Hintz, McCombs, Johnston, Wilson, Winter No: - Absent: Foy, Sedell
IX. INFORMATIONAL
A. 2017 Abbott Capital Private Equity Client Conference & Annual Meeting.
B. SACRS UC Berkeley Program.
C. Consent to Assignment of Agreement for REAMS.
D. Nossaman Public Pensions Fiduciaries Forum 2017.
X. PUBLIC COMMENT
None.
XI. STAFF COMMENT
Mr. Gallagher informed the Board that the $30 million allocation to Harbourvest’s Co-Investment Fund IV had been accepted in time for the May 31 fund closing. Mr. Gallagher also said that contract negotiations with Abbott Capital were expected to be completed by the end of the week.
XII. BOARD MEMBER COMMENT
None.
XIII.
ADJOURNMENT The meeting was adjourned at 10:55 a.m.
Respectfully submitted,
___________________________________________ LINDA WEBB, Retirement Administrator
Approved,
__________________________ TRACY TOWNER, Chairman
Business Meeting Agenda - III. APPROVAL OF MINUTES
MASTER PAGE NO. 11 of 202
DATE OF TOTAL OTHER EFFECTIVE
FIRST NAME LAST NAME G/S MEMBERSHIP SERVICE SERVICE DEPARTMENT DATE
Judith E. Allen G 2/11/2007 10.13 Public Works Agency 4/1/2017
Elia Arciniega G 2/4/2002 15.17 Human Services Agency 4/1/2017
Martha Barragan G 1/20/1991 21.90 Human Services Agency 4/9/2017
Valerie Barraza G 12/13/1999 22.38 D=5.0 Auditor-Controller 4/22/2017
Jaime C. Bautista G 3/17/2001 16.08 General Services Agency 4/22/2017
Ross Bonfiglio S 7/25/1982 34.74 Sheriff's Department 3/31/2017
Reem Dajani-Stratton G 9/16/1979 37.13 B=0.1154 Resource Management Agency 4/29/2017
Daniel Farmer S 8/22/2010 5.52 Sheriff's Department 3/17/2017
Gregory Ford G 12/25/1988 28.33 Health Care Agency 4/29/2017
Michael Gram G 6/18/2006 10.07 Health Care Agency 4/29/2017
Olivia Herrera G 2/25/2007 10.15 General Services Agency 4/15/2017
Richard Herrera G 11/16/1992 24.46 * C=5.98 Public Works Agency 4/22/2017
Armand Horgan G 3/11/2007 10.06 Human Services Agency 4/1/2017
Dennis Kanthack G 12/20/1992 23.09 Public Works Agency 3/30/2017
Christina L. Kiefer G 7/30/1995 13.44 * B=0.1151 Fire Protection District 3/31/2017
C=8.33
(deferred)
Carol Kilbey G 10/10/2004 5.87 Health Care Agency 12/10/2012
Robert MacInnes S 8/10/1986 10.22 District Attorney 4/1/2017
Bart Matthews S 3/30/1980 37.01 Fire Protection District 3/26/2017
Linda Mora G 9/21/1986 30.40 A=0.0962 Clerk and Recorder 4/1/2017
Joseph Munoz G 11/5/1995 22.56 B=1.0659 General Services Agency 4/27/2017
Molly M. Pearson G 3/26/1995 6.11 B=0.1123 Air Pollution Control District 4/24/2017
(deferred)
John K. Pena G 7/17/2005 11.56 Public Works Agency 4/10/2017
Scott H. Quady G 8/20/2001 26.30 Regional Sanitation District 4/8/2017
Maria Rangel G 11/2/1986 30.80 B=0.2842 Sheriff's Department 4/28/2017
* C=5.30
Shirley J. Smith G 2/6/2000 13.50 Health Care Agency 5/9/2017
(deferred)
David S. Swenson G 2/25/2007 7.05 A=0.4568 Health Care Agency 4/22/2017
Brian Trushinski G 12/8/2003 13.14 * C=1.6760 Public Works Agency 5/1/2017
(deferred)
Joanne Y. Urasaki G 7/31/2000 16.65 Information Services Department 4/8/2017
Joseph P. Villasana G 8/17/1980 25.73 B=0.2838 Public Defender 4/6/2017
Deborah L. Weigand G 1/8/2006 10.84 Human Services Agency 3/31/2017
Christine Clark G 02/04/2012 5.24 C=10.3075 Health Care Agency 04/27/2017
Amber B. Madden G 10/19/2008 7.38 Health Care Agency 05/20/2017
Joyce L'Heureux G 11/02/2008 8.49 Health Care Agency 05/20/2017
Kimberly D. Prendergast G 06/01/2008 10.14 D=1.8351 Health Care Agency 04/29/2017
Anna Adams
Patsy E. Hulsey
Joanna I. Lange
Joseph F. Marnick
Raul R. Ramirez
Freddie Salinas
* = Member Establishing Reciprocity
A = Previous Membership
B = Other County Service (eg Extra Help)
C = Reciprocal Service
D = Public Service
SURVIVORS' CONTINUANCES:
VENTURA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION
REPORT OF REGULAR AND DEFERRED RETIREMENTS AND SURVIVORS CONTINUANCES
MAY 2017
REGULAR RETIREMENTS:
DEFERRED RETIREMENTS:
Business Meeting Agenda - IV. CONSENT AGENDA
MASTER PAGE NO. 12 of 202
ClosedInvoice Discount AmountDocRefCheck Check InvoiceCheck
Nbr Type DateVendor IDVendor Name Nbr Type Date Taken PaidNumberTo Post
Date:Time:User:
Thursday, June 01, 201711:36AM103745
Page:Report:Company:
1 of 503630.rptVCERA
Ventura County Retirement AssnCheck Register - Standard
Period: 11-17 As of: 6/1/2017
Period
Company: VCERAAcct / Sub: 1002 00
122261VCGINA SIMONELLI
5/3/2017 11-17027012 11-17
108530VCCHRIS WEBB
5/3/2017 11-17027013 11-17
BLACKROCKVCBLACKROCK INSTL TRUST C
5/3/2017 11-17027014 11-17
CUSTOMVCCUSTOM PRINTING
5/3/2017 11-17027015 11-17
SACRSVCSACRS
5/3/2017 11-17027016 11-17
SPRUCEVCSPRUCEGROVE INVESTMEN
5/3/2017 11-17027017 11-17
STROUDVCSTROUD DESIGN, INC.
5/3/2017 11-17027018 11-17
122261 57.800.00TRAVL/MILG REIM 5/3/2017CKGINA SIMONELLI
5/4/2017 VO027019 02186511-17
108530 76.990.00TRAVL/MIL REIMB 5/3/2017CKCHRIS WEBB
5/4/2017 VO027020 02186611-17
BLACKROCK 245,805.210.00INVESTMENT FEES 5/3/2017CKBLACKROCK INSTL TRUST C
5/4/2017 VO027021 02186711-17
CUSTOM 1,179.310.00ADMIN EXP 5/3/2017CKCUSTOM PRINTING
5/4/2017 VO027022 02186811-17
SACRS 1,080.000.00ADMIN EXP 5/3/2017CKSACRS
5/4/2017 VO027023 02186911-17
SPRUCE 61,253.870.00INVESTMENT FEES 5/3/2017CKSPRUCEGROVE INVESTMEN
5/4/2017 VO027024 02187011-17
VOIDED CHECKS
Business Meeting Agenda - IV. CONSENT AGENDA
MASTER PAGE NO. 13 of 202
ClosedInvoice Discount AmountDocRefCheck Check InvoiceCheck
Nbr Type DateVendor IDVendor Name Nbr Type Date Taken PaidNumberTo Post
Date:Time:User:
Thursday, June 01, 201711:36AM103745
Page:Report:Company:
2 of 503630.rptVCERA
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Period: 11-17 As of: 6/1/2017
Period
STROUD 1,500.000.00 ADMIN EXP 5/3/2017CKSTROUD DESIGN, INC.
5/4/2017 VO027025 02187111-17
124709 81.310.00TRAVL/MILG REIM 5/10/2017CKLINDA WEBB
5/10/2017 VO027026 02187211-17
BOFA 3,527.140.00ADMIN/IT 5/10/2017CKBUSINESS CARD
5/10/2017 VO027027 02187311-17
BRENTWOOD 10,675.000.00IT 5/10/2017CKBRENTWOOD IT
5/10/2017 VO027028 02187411-17
EDSI 585.000.00IT 5/10/2017CKEXECUTIVE DATA SYSTEMS,
5/10/2017 VO027029 02187511-17
HARRIS 119.500.00ADMIN EXP 5/10/2017CKHARRIS WATER CONDITIONIN
5/10/2017 VO027030 02187611-17
MEGAPATH 603.630.00IT 5/10/2017CKGLOBAL CAPACITY
5/10/2017 VO027031 02187711-17
LINEA 40,761.040.00ADMIN/PAS 5/10/2017CKLINEA SOLUTIONS
5/10/2017 VO027032 02187811-17
RETJOURNAL 195.000.00ADMIN EXP 5/10/2017CKTHE PUBLIC RETIREMENT JO
5/10/2017 VO027033 02187911-17
SBS 565.000.00IT 5/10/2017CKSBS GROUP
5/10/2017 VO027034 02188011-17
TOWERS 13,166.660.00ADMIN EXP 5/10/2017CKTOWERS WATSON DELAWAR
5/10/2017 VO027035 02188111-17
VOLT 2,850.730.00ADMIN EXP 5/10/2017CKVOLT MANAGEMENT CORP
5/10/2017 VO027036 02188211-17
WESTERN 207,121.450.00INVESTMENT FEES 5/10/2017CKWESTERN ASSET MANAGEM
5/10/2017 VO027037 02188311-17
Business Meeting Agenda - IV. CONSENT AGENDA
MASTER PAGE NO. 14 of 202
ClosedInvoice Discount AmountDocRefCheck Check InvoiceCheck
Nbr Type DateVendor IDVendor Name Nbr Type Date Taken PaidNumberTo Post
Date:Time:User:
Thursday, June 01, 201711:36AM103745
Page:Report:Company:
3 of 503630.rptVCERA
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Period: 11-17 As of: 6/1/2017
Period
CLIFTON 40,067.000.00INVESTMENT FEES 5/10/2017CKPARAMETRIC PORTFOLIO AS
5/10/2017 VO027038 02188411-17
ADP 2,876.280.00ADMIN EXP 5/18/2017CKADP, LLC
5/18/2017 VO027039 02188511-17
ACCESS 334.280.00ADMIN EXP 5/18/2017CKACCESS INFORMATION MANA
5/18/2017 VO027040 02188611-17
BARNEY 315.000.00ADMIN EXP 5/18/2017CKA.B.U. COURT REPORTING, IN
5/18/2017 VO027041 02188711-17
AT&T 346.180.00IT 5/18/2017CKAT&T MOBILITY
5/18/2017 VO027042 02188811-17
REUTERS 357.000.00IT 5/18/2017CKTHOMSON REUTERS- WEST
5/18/2017 VO027043 02188911-17
SBS 3,125.050.00IT 5/18/2017CKSBS GROUP
5/18/2017 VO027044 02189011-17
SHRED-IT 145.860.00ADMIN EXP 5/18/2017CKSHRED-IT USA
5/18/2017 VO027045 02189111-17
TWC 294.990.00IT 5/18/2017CKTIME WARNER CABLE
5/18/2017 VO027046 02189211-17
102661 1,123.360.00TRAVEL REIMB 5/24/2017CKLORI NEMIROFF
5/24/2017 VO027047 02189411-17
104238 1,058.560.00TRAVEL REIMB 5/24/2017CKTRACY TOWNER
5/24/2017 VO027048 02189511-17
124709 1,541.990.00TRAVEL REIMB 5/24/2017CKLINDA WEBB
5/24/2017 VO027049 02189611-17
124968 1,487.060.00TRAVEL REIMB 5/24/2017CKDAN GALLAGHER
5/24/2017 VO027050 02189711-17
990002 1,328.120.00TRAVEL REIMB 5/24/2017CKARTHUR E. GOULET
5/24/2017 VO027051 02189811-17
Business Meeting Agenda - IV. CONSENT AGENDA
MASTER PAGE NO. 15 of 202
ClosedInvoice Discount AmountDocRefCheck Check InvoiceCheck
Nbr Type DateVendor IDVendor Name Nbr Type Date Taken PaidNumberTo Post
Date:Time:User:
Thursday, June 01, 201711:36AM103745
Page:Report:Company:
4 of 503630.rptVCERA
Ventura County Retirement AssnCheck Register - Standard
Period: 11-17 As of: 6/1/2017
Period
ADP 2,892.110.00ADMIN EXP 5/24/2017CKADP, LLC
5/24/2017 VO027052 02189911-17
MF 16,989.750.00ADMIN EXP 5/24/2017CKM.F. DAILY CORPORATION
5/24/2017 VO027053 02190011-17
PRUDENTIAL 136,763.210.00INVESTMENT FEES 5/24/2017CKPRUDENTIAL INSURANCE
5/24/2017 VO027054 02190111-17
SBS 3,587.500.00IT 5/24/2017CKSBS GROUP
5/24/2017 VO027055 02190211-17
SEGAL 3,554.000.00ACTUARY FEES 5/24/2017CKSEGAL CONSULTING
5/24/2017 VO027056 02190311-17
VITECH 88,990.000.00PAS 5/24/2017CKVITECH SYSTEMS GROUP, IN
5/24/2017 VO027057 02190411-17
VOLT 2,150.130.00ADMIN EXP 5/24/2017CKVOLT MANAGEMENT CORP
5/24/2017 VO027058 02190511-17
107666 12.250.00ADMIN EXP 5/31/2017CKSHALINI NUNNA
5/31/2017 VO027059 02190611-17
990004 640.860.00TRAVEL REIMB 5/31/2017CKWILL HOAG
5/31/2017 VO027060 02190711-17
AYALA 875.000.00ADMIN EXP 5/31/2017CKIRENE P. AYALA
5/31/2017 VO027061 02190811-17
FEDEX 38.280.00ADMIN EXP 5/31/2017CKFEDEX
5/31/2017 VO027062 02191011-17
NOSSAMAN 414.400.00LEGAL FEES 5/31/2017CKNOSSAMAN LLP
5/31/2017 VO027063 02191111-17
CDW GOVERN 215.500.00IT 5/31/2017CKCDW GOVERNMENT
5/31/2017 VO027064 02191211-17
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ClosedInvoice Discount AmountDocRefCheck Check InvoiceCheck
Nbr Type DateVendor IDVendor Name Nbr Type Date Taken PaidNumberTo Post
Date:Time:User:
Thursday, June 01, 201711:36AM103745
Page:Report:Company:
5 of 503630.rptVCERA
Ventura County Retirement AssnCheck Register - Standard
Period: 11-17 As of: 6/1/2017
Period
NOVANIS 16,730.000.00PAS 5/31/2017CKNOVANIS
5/31/2017 VO027065 02191311-17
CORPORATE 1,714.890.00ADMIN EXP 5/31/2017CKSTAPLES ADVANTAGE
5/31/2017 VO027066 02191411-17
VITECH 93,896.740.00PAS 5/31/2017CKVITECH SYSTEMS GROUP, IN
5/31/2017 VO027067 02191511-17
Check Count: 56 Acct Sub Total: 1,015,069.99
Amount PaidCountCheck Type1,015,069.9949Regular
0.000Hand
0.007Void
0.000Stub
Zero 0.000Mask 0 0.00Total: 56 1,015,069.99
Electronic Payment 0 0.00
Company Total 1,015,069.99Company Disc Total 0.00
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VENTURA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION BUDGET SUMMARY FISCAL YEAR 2016-2017
May 2017- 91.67% of Fiscal Year Expended
Adopted AdjustedEXPENDITURE DESCRIPTIONS 2016/2017 2016/2017 Year to Date Available Percent
Budget Budget May-17 Expended Balance ExpendedSalaries & Benefits: Salaries 2,370,800.00$ 2,512,612.00$ 201,978.07$ 2,150,264.13$ 362,347.87$ 85.58% Extra-Help 192,400.00 192,400.00 17,200.86 140,132.60 52,267.40 72.83% Overtime 3,000.00 3,000.00 0.00 31.47 2,968.53 1.05% Supplemental Payments 74,400.00 75,322.00 3,341.50 44,024.52 31,297.48 58.45% Vacation Redemption 131,300.00 191,300.00 7,578.04 168,246.99 23,053.01 87.95% Retirement Contributions 432,100.00 437,235.00 37,988.38 380,744.78 56,490.22 87.08% OASDI Contributions 141,800.00 143,515.00 13,025.53 121,970.73 21,544.27 84.99% FICA-Medicare 37,800.00 38,202.00 3,046.35 33,767.67 4,434.33 88.39% Retiree Health Benefit 4,000.00 4,000.00 0.00 3,970.75 29.25 99.27% Group Health Insurance 194,300.00 197,212.00 17,350.00 180,495.47 16,716.53 91.52% Life Insurance/Mgmt 1,100.00 1,125.00 86.50 971.34 153.66 86.34% Unemployment Insurance 2,400.00 2,427.00 201.95 2,140.81 286.19 88.21% Management Disability Insurance 18,400.00 18,609.00 1,326.12 14,539.80 4,069.20 78.13% Worker' Compensation Insurance 19,900.00 20,138.00 1,619.30 17,783.43 2,354.57 88.31% 401K Plan Contribution 48,600.00 49,403.00 4,685.90 49,737.13 (334.13) 100.68% Transfers In 135,500.00 135,500.00 0.00 23,668.92 111,831.08 17.47% Transfers Out (135,500.00) (135,500.00) 0.00 (23,668.92) (111,831.08) 17.47%
Total Salaries & Benefits 3,672,300.00$ 3,886,500.00$ 309,428.50$ 3,308,821.62$ 577,678.38$ 85.14%
Services & Supplies: Telecommunication Services - ISF 35,400.00$ 35,400.00$ 3,144.75$ 32,840.90$ 2,559.10$ 92.77% General Insurance - ISF 13,100.00 13,100.00 0.00 13,079.00 21.00 99.84% Office Equipment Maintenance 2,000.00 2,000.00 0.00 672.00 1,328.00 33.60% Membership and Dues 14,700.00 14,700.00 0.00 13,437.00 1,263.00 91.41% Education Allowance 8,000.00 8,000.00 0.00 2,000.00 6,000.00 25.00% Cost Allocation Charges 89,500.00 89,500.00 0.00 89,508.00 (8.00) 100.01% Printing Services - Not ISF 12,000.00 12,000.00 1,179.31 3,515.84 8,484.16 29.30% Books & Publications 3,000.00 3,000.00 195.00 1,302.52 1,697.48 43.42% Office Supplies 20,000.00 20,000.00 1,757.74 14,531.67 5,468.33 72.66% Postage & Express 60,000.00 60,000.00 50.53 51,078.16 8,921.84 85.13% Printing Charges - ISF 18,000.00 18,000.00 0.00 4,157.60 13,842.40 23.10% Copy Machine Services - ISF 4,500.00 4,500.00 684.24 1,831.44 2,668.56 40.70% Board Member Fees 13,300.00 13,300.00 1,200.00 10,200.00 3,100.00 76.69% Professional Services 1,292,100.00 938,200.00 44,622.49 657,182.67 281,017.33 70.05% Storage Charges 4,200.00 4,200.00 334.28 3,882.19 317.81 92.43% Equipment 6,000.00 6,000.00 0.00 15,331.78 (9,331.78) 255.53% Office Lease Payments 205,000.00 205,000.00 16,989.75 186,827.06 18,172.94 91.14% Private Vehicle Mileage 12,500.00 12,500.00 1,768.47 11,659.10 840.90 93.27% Conference, Seminar and Travel 138,400.00 138,400.00 10,982.96 88,482.89 49,917.11 63.93% Furniture 15,000.00 15,000.00 0.00 1,658.76 13,341.24 11.06% Facilities Charges 13,300.00 13,300.00 220.00 3,100.00 10,200.00 23.31% Judgement & Damages 0.00 0.00 0.00 0.00 0.00 #DIV/0! Transfers In 20,000.00 20,000.00 0.00 2,501.18 17,498.82 12.51% Transfers Out (20,000.00) (20,000.00) 0.00 (2,501.18) (17,498.82) 12.51%
Total Services & Supplies 1,980,000.00$ 1,626,100.00$ 83,129.52$ 1,206,278.58$ 419,821.42$ 74.18%
Total Sal, Ben, Serv & Supp 5,652,300.00$ 5,512,600.00$ 392,558.02$ 4,515,100.20$ 997,499.80$ 81.91%
Technology: Computer Hardware 45,000.00$ 65,000.00$ 514.28$ 5,011.48 59,988.52$ 7.71% Computer Software 216,000.00 216,000.00 4,849.35 76,123.12 139,876.88 35.24% Systems & Application Support 449,000.00 474,000.00 11,810.48 280,874.32 193,125.68 59.26% Pension Administration System 353,000.00 937,100.00 228,177.78 931,115.65 5,984.35 99.36%
Total Technology 1,063,000.00$ 1,692,100.00$ 245,351.89$ 1,293,124.57$ 398,975.43$ 76.42%
Contingency 786,000.00$ 296,600.00$ -$ -$ 296,600.00$ 0.00%
Total Current Year 7,501,300.00$ 7,501,300.00$ 637,909.91$ 5,808,224.77$ 1,693,075.23$ 77.43%
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ACCRUED INTEREST AND DIVIDENDS 4,051,774SECURITY SALES 9,427,719MISCELLANEOUS 28,455
DOMESTIC EQUITY SECURITIES 129,435,938DOMESTIC EQUITY INDEX FUNDS 1,376,862,960INTERNATIONAL EQUITY SECURITIES 399,662,361INTERNATIONAL EQUITY INDEX FUNDS 377,478,397GLOBAL EQUITY 523,340,508PRIVATE EQUITY 185,979,327DOMESTIC FIXED INCOME - CORE PLUS 719,391,179DOMESTIC FIXED INCOME - U.S. INDEX 218,739,475REAL ESTATE 386,654,349ALTERNATIVES 414,844,987CASH OVERLAY - PARAMETRIC (9,963)
SECURITY PURCHASES PAYABLE 19,342,254ACCOUNTS PAYABLE 584,443TAX WITHHOLDING PAYABLE 3,076,580PREPAID CONTRIBUTIONS 10,465,564
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EMPLOYER $153,450,170EMPLOYEE 58,411,036
NET APPRECIATION (DEPRECIATION) IN FAIR VALUE OF INVESTMENTS 471,480,133INTEREST INCOME 11,840,939DIVIDEND INCOME 11,329,004REAL ESTATE OPERATING INCOME, NET 12,494,260SECURITY LENDING INCOME 463,695
MANAGEMENT & CUSTODIAL FEES 11,033,255SECURITIES LENDING BORROWER REBATES 229,778SECURITIES LENDING MANAGEMENT FEES 73,404
BENEFIT PAYMENTS 211,657,027MEMBER REFUNDS 4,262,466ADMINISTRATIVE EXPENSES 5,158,881
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WESTERN ASSET INDEX PLUS $129,435,938 $42,632,159
BLACKROCK - US EQUITY MARKET 1,322,004,711 0BLACKROCK - EXTENDED EQUITY 54,858,249 0
SPRUCEGROVE 205,143,030 0HEXAVEST 86,359,284 0WALTER SCOTT 108,160,047 0
BLACKROCK - ACWIXUS 377,478,397 0
BLACKROCK - GLOBAL INDEX 523,340,508 0
ADAMS STREET 112,481,828 0PANTHEON 22,922,569 0HARBOURVEST 50,077,303 0DRIVE CAPITAL 497,627 0
LOOMIS SAYLES AND COMPANY 76,150,939 2,426,024LOOMIS SAYLES - ALPHA 45,074,515 0REAMS 305,130,070 475WESTERN ASSET MANAGEMENT 293,035,655 5,114,694
BLACKROCK - US DEBT INDEX 218,739,475 0
PRUDENTIAL REAL ESTATE 136,969,399 2,218RREEF 180,164 0UBS REALTY 249,504,786 0
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BRIDGEWATER 289,772,725 0TORTOISE (MLP's) 125,072,262 2,927,109
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BLACKROCK - US EQUITY $194,580BLACKROCK - EXTENDED EQUITY 15,415WESTERN ASSET INDEX PLUS 219,698
BLACKROCK - ACWIXUS 245,258SPRUCEGROVE 461,883HEXAVEST 279,030WALTER SCOTT 648,328
GRANTHAM MAYO VAN OTTERLOO (GMO) 297,518BLACKROCK - GLOBAL INDEX 121,979
ADAMS STREET 1,308,365DRIVE CAPITAL 175,000HARBOURVEST 713,510PANTHEON 450,035
BLACKROCK - US DEBT INDEX 90,630LOOMIS, SAYLES AND COMPANY 227,003LOOMIS ALPHA 132,104REAMS ASSET MANAGEMENT 396,320WESTERN ASSET MANAGEMENT 393,559
PRUDENTIAL REAL ESTATE ADVISORS 865,836RREEF 3,437UBS REALTY 1,784,156
BRIDGEWATER 832,985TORTOISE 578,551
BORROWERS REBATE 229,778MANAGEMENT FEES 73,404
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INVESTMENT CONSULTANT 221,658INVESTMENT CUSTODIAN 246,335
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MASTER PAGE NO. 24 of 202
PERFORMANCE REVIEW
VENTURA COUNTY EMPLOYEES’ RETIREMENT ASSOCCIATION (VCERA)
June 19, 2017
This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
Firm Overview 3
PIOS® (Policy Implementation Overlay Service)*
– Program Review for VCERA 11
Risks 21
Appendices 23
TABLE OF CONTENTS
*PIOS is a trademark registered in the U.S. Patent and Trademark Office.
Portfolio Management
Justin Henne, CFA
Managing Director – Customized
Exposure Management
952.767.7718
Business Development
Ben Lazarus, CFA
Senior Director – Institutional Relationships
952.767.7707
Parametric MN Client Service
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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3This material has been prepared for the exclusive use of VCERA
in a one-on-one presentation only.
FIRM OVERVIEW
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
WHO WE ARE
Parametric is divided into two segments: Parametric Investment & Overlay Strategies and Parametric Custom Tax-Managed & Centralized
Portfolio Management. For compliance with the Global Investment Performance Standards (GIPS®), the Firm is defined and held out to the
public as Parametric Investment & Overlay Strategies.
*As of 3/31/2017. Includes AUM of Parametric Investment & Overlay Strategies and Parametric Custom Tax-Managed & Centralized Portfolio Management.
Seattle, WA Minneapolis, MN Westport, CT
• Leaders in rules-based, engineered
portfolio solutions
• Strategies ranging from index tracking
portfolios to managed smart beta
• Ability to incorporate responsible investing
themes
• Founded 1987
• A subsidiary of Eaton Vance Corp.
since 2003
• Pioneers in overlay strategies and
custom risk management solutions
(formerly The Clifton Group)
• Innovative product solutions in real asset
and liquid alternatives
• Founded 1972
• Acquired by Parametric in 2012
• Specialists in option portfolio
management
• Provide product-based and custom
option overlay solutions
• Founded 2002
• A part of Parametric since 2007
We provide systematic, disciplined portfolio management solutions
We offer investment solutions through our three investment centers:
> Parametric Portfolio Associates®
LLC (“Parametric”) is a majority-owned subsidiary of Eaton Vance Corp.
> Parametric equity ownership is broadly distributed among senior management and investment professionals.
> Approximately $197.7 Billion in assets under management; 85 investment professionals*.
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
KEY DIFFERENTIATORS
Aligned investment philosophy across three investment centers, where we:
• Dismiss traditional market forecasts
• Seek to add value through portfolio construction
• Implement a disciplined, transparent investment process, with extensive
risk management
Self-managed, with a culture of innovation and pragmatism
Deep, experienced, and stable team
Client-centered with a focus on service
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
MASTER PAGE NO. 29 of 202
This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
PARAMETRIC INVESTMENT PLATFORM
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
MASTER PAGE NO. 30 of 202
This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
ASSETS UNDER MANAGEMENT AS OF MARCH 31, 2017
Institutional Assets by Client Type Institutional Assets by Asset Class
Parametric Volatility Risk Premium Strategies’ assets total $12.4 Billion, and are included in US Equity and Developed Global Equity asset classes, depending on the referenced equity
index.
All numbers are approximate as of 3/31/2017.
Parametric is divided into two segments: Parametric Investment & Overlay Strategies and Parametric Custom Tax-Managed & Centralized Portfolio Management. For compliance with
the Global Investment Performance Standards (GIPS®), the Firm is defined and held out to the public as Parametric Investment & Overlay Strategies. Parametric Investment & Overlay
Strategies provides rules-based investment management services to institutional investors, individual clients and registered investment vehicles. For a complete list and description of
composites, please contact us at 206.694.5575. Total Institutional Assets presented above include assets from the Parametric Investment & Overlay Strategies segment. Please refer to
the GIPS® Presentation and the Disclosures included at the end of this presentation for additional important information.
Total Institutional Assets $116.6 BillionConsists of Funded and Overlay Assets
Corporate & Healthcare
$34.7
Foundation & Endowment
$36.8
Public & Taft-Hartley$29.8
Sub-Advised$15.4
Commodity$3.9
Developed Global Equity
$11.5
Developed International
Equity$9.9
Emerging Markets Equity
$16.4
Fixed Income$40.3
US Equity$34.6
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
REPRESENTATIVE CLIENT LIST AS OF MARCH 31, 2017
It is not known whether the listed clients approve or disapprove of the adviser. The partial list of clients included herein were selected as being representative of the different types of
institutional clients and businesses serviced by Parametric. Performance-based data was not a determining factor in their selection.
>Public
Alaska Retirement Management Board
Arizona State Retirement System
California State Teachers’ Retirement System
East Bay Municipal Utility District
Fairfax County Retirement Systems
Houston Police Officers’ Pension System
Manhattan & Bronx Surface Transit Operating Authority Pension Plan
Marin County Employees’ Retirement Association
Massachusetts Pension Reserves Investment Management Board
New Mexico Public Employees' Retirement Association
Oakland Police and Fire Retirement System
San Joaquin County Employees’ Retirement Association
San Luis Obispo County
San Mateo County Employees’ Retirement Association
Seattle City Employees’ Retirement System
Wisconsin Investment Board
>Endowments
Indiana University & Foundation
Pepperdine University
Texas Christian University
University of Minnesota Foundation
University of Missouri System
University of Pittsburgh
University of St. Thomas
Regents of the University of Michigan
>Faith Based
Covenant Ministries of Benevolence
Ministers & Missionaries’ Benefit Board of American Baptist Churches
Pension Fund of the Christian Church
>Healthcare
Advocate Health Care Network
Allina Health
North Memorial Health Care
OhioHealth Corporation
Trinity Health
>Taft-Hartley
Board of Trustees ABC-NABET Retirement Trust Fund
Boilermaker-Blacksmith National Pension Trust
Central Laborers’ Pension Fund
Electrical Workers, IBEW, Pacific Coast Fund
Chicago Laborers’ Pension & Welfare Funds
National Retirement Fund
Teamsters, Western Pennsylvania
>Foundations
Auburn University
The Doris Duke Charitable Foundation & Related Entities
The John D. & Catherine T. MacArthur Foundation
The McKnight Foundation
>Corporate
Cargill, Inc.
Macy's, Inc.
3M Company
Nestlé USA, Inc.
Eversource Energy
Target Corporation
United Technologies Corporation
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
1 Dedicated resources at the Minneapolis Investment Center location with additional compliance resources available in the Seattle Investment Center.2 For overlay services programs, the absolute value of futures and swap based synthetic index exposure is included as assets under management. For Enhancement/Risk Control
programs, the notional hedge target value of the options positions held for clients is included in assets under management.
THE MINNEAPOLIS INVESTMENT CENTER UPDATE (3/31/17)
The Minneapolis Investment Center Highlights: Q117
• As of 3/31/2017, assets under management were approximately $197.75 billion2 for the firm, and $88.48 billion for the
Minneapolis Investment Center.
• During Q117, The Minneapolis Investment Center welcomed 9 new clients in Custom Overlay and 29 to our Volatility Risk
Premium suite.
• Over the last year, the equity market has experienced several instances of sharp pullbacks followed by a quick recovery.
Many clients who utilize Parametric to synthetically rebalance portfolio exposures in a disciplined manner added a
meaningful amount of incremental return with lower risk relative to policy targets.
• In December 2016, Parametric Portfolio Associates LLC and Research Affiliates, LLC announced a partnership to provide a
Systematic Global Macro strategy to institutional separate accounts.
Minneapolis Investment Center:
New Client RelationshipsQ117
Custom Overlay 9
Volatility Risk Premium 29
Total 38
Minneapolis Investment Center:
PersonnelTotal
Investments 38
Marketing / Reporting / Sales 10
Accounting / Operations 23
Information Technology 12
Client Service / Documentation / Management 6
Compliance1 / Risk Management 4
Total 93
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
THE MINNEAPOLIS AND WESTPORT INVESTMENT CENTERS:
INVESTMENTS
Effective Date: 6/5/2017
INVESTMENT SUPPORT
Ben Adams Ashley Boecker Shane Claugherty Bill Heffernan James Ostrem Tim Post Ryan Spengler Colt Wolfram
Isaac Beckel Max Chisaka Arthur Harris David Mattson Patrick Persons John Schneider Heather Wolf
Jack Hansen, CFA
Chief Investment Officer
Minneapolis and Westport
Investment Centers
Justin Henne, CFA
Managing Director – Customized Exposure Management
Alex Braun, CFA
Portfolio Manager
Macki Anderson
Assoc. Portfolio Manager
Antony Motl, CFA
Portfolio Manager
Dan Wamre, CFA
Sr. Portfolio Manager
Jan Mowbray, CFA
Assoc. Portfolio Manager
Clint Talmo, CFA
Sr. Portfolio Manager
Dane Fickel
Assoc. Portfolio Manager
Jason Nelson, CFA
Portfolio Manager
Ricky Fong, CFA
Portfolio Manager
Drew Carlson, CFA
Assoc. Portfolio Manager
CUSTOMIZED EXPOSURE MANAGEMENT
Larry Berman
Managing Director –
Trading – Westport
Investment Center
Brendan Lanahan
VP – Trader
Mike Kelly
Managing Director
Thomas Lee, CFA
Managing Director – Investment Strategy & Research
Minneapolis and Westport Investment Centers
Alex Zweber, CFA
Portfolio Manager
Jay Strohmaier, CFA
Managing Director
Michael Zaslavsky
Assoc. Portfolio Manager
Chris Haskamp, CFA
Sr. Portfolio Manager
Greg Liebl, CFA
Portfolio Manager
Ken Everding
Managing Director –
Research – Westport
Investment Center
Wei Ge, Ph.D., CFA
Sr. Researcher
ENGINEERED ALPHA STRATEGIES
Yuepeng “Perry” Li,
CFA
Assoc. Portfolio Manager
Joe Zeck, CFA
Assoc. Portfolio Manager
Justin Horner, CFA
Assoc. Portfolio Manager
James Thorson, CFA
Assoc. Portfolio Manager
Tyler Nowicki
Assoc. Portfolio Manager
Allie Neese, CFA
Assoc. Portfolio Manager
Adam SwinneyAssoc. Portfolio Manager
Westport Minneapolis
Zach Olsen, CFA
Assoc. Portfolio Manager
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
MASTER PAGE NO. 34 of 202
11This material has been prepared for the exclusive use of VCERA
in a one-on-one presentation only.
PROGRAM REVIEW FOR VCERA
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
IMPLEMENTATION CHALLENGES PARAMETRIC OVERLAY COMPONENT 1
• Performance drag due to liquidity needs /
inefficient cash flow process• Fund Cash Securitization
• Residual manager cash balance
performance drag• Manager Cash Securitization
• Exposure management needs related to
manager transitions
• Overlay Transition / Reallocation
Management
• Meaningful deviation from policy targets • Rebalancing
• Unique exposure needs • Outsourced Exposure Management
ADDRESSING IMPLEMENTATION CHALLENGES
Most portfolios have one or more
policy implementation challenges
that may prevent the portfolio from
meeting its objectives
An overlay adds value by alleviating
the inefficiencies created by policy
implementation challenges
An overlay
application for each
implementation
challenge
TARGET ASSET ALLOCATIONOVERLAY
Implementation Challenges Overlay Value Added
TARGET ASSET ALLOCATION
1 Client selects from the Parametric Overlay Component(s) based on unique needs and objectives. Additional Parametric Overlay Components including Currency Exposure
Management and Interest Rate Management are also available.
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
OVERALL PROGRAM RESULTS
1 Net of management fees and net of transaction costs. April 2017 fees are estimated. Past performance is not indicative of future results.
Note: Fee schedule for overlay assets only is: First $25M @ .15% annually, next $75M @ .10%, above $100M @ .04%, with a minimum annual fee of $50,000.
Please refer to disclosures on the last page.
Program Results
• Market environment through April 30, 2017 produced a synthetic index overlay return1
of $48,823,971 or 0.17% of fund assets since inception.
‒ Benefit-to-cost (net of fees) of 53 to 1.
• Unwanted cash exposure was dramatically reduced.
• Portfolio tracking working well with high level of confidence in portfolio reports.
• Improved tracking error versus benchmark index thus lowering performance risk.
• The overlay program is in compliance with the current investment guidelines.
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
PROGRAM HIGHLIGHTS
Highlights
• Deployed the $170M contribution via the overlay program on July 1, 2016
• Maintained transition exposure of approximately $200M for the liquidations of PIMCO
Global and Loomis Sayles Global from January 2016 to September 2016 when it was
used to fund three Blackrock allocations
• Bridged a $210M exposure gap related to the full redemption of GMO and
subsequent funding of Blackrock MSCI ACWI Index Fund from 9/28/16 through
10/13/16
Business Meeting Agenda - V.A. INVESTMENT MANAGER PRESENTATIONS - PARAMETRIC
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This material has been prepared for the exclusive use of VCERA in a one-on-one presentation only.
FUND CASH SECURITIZATION
Please refer to disclosures in Appendices. The deduction of an advisory fee would reduce an investor’s return. Past performance is not indicative of future results. For illustrative
purposes only. Source: Parametric; Date: 6/6/2017
CHALLENGE
Holding cash to facilitate liquidity needs results in tracking error relative to
the investment policy and creates long-term expected performance drag
EXPECTED BENEFITS
• Increase expected return
• Reduced transaction costs
• Increase day-to-day liquidity
• Simplify the management of inflows and outflows resulting in time
savings for staff
FUND LEVEL CASH RESULTS1
Fund Level Cash Balance
VCERA IMPLEMENTATION
Fund level cash balances are invested with the objective of reducing the
Fund’s deviation from the target asset allocation
Gain/Loss Summary
April ‘17 $1,404,253
YTD $5,087,206
Since 1/1/2014 $219,981
Average:
$92,657,057
1 Returns are through 4/30/2017 and gross of management fees.$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
Fund Cash Average
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MANAGER CASH SECURITIZATION
CHALLENGE
Residual or transactional manager cash exposure (e.g. 1-3% of portfolio)
creates an expected long-term performance drag
EXPECTED BENEFITS
• Increase expected return
• Ability to customize cash overlay for each manager
• Maintain exposure across multiple asset classes
Gain/Loss Summary
April ‘17 $58,182
YTD $460,161
Since 1/1/2014 ($263,206)
MANAGER CASH RESULTS1
Manager Cash Balance
VCERA IMPLEMENTATION
Manager cash balances are invested with the objective of reducing the
Fund’s deviation from the target asset allocation
Please refer to disclosures in Appendices. The deduction of an advisory fee would reduce an investor’s return. Past performance is not indicative of future results. For illustrative
purposes only. Source: Parametric; Date: 6/6/2017
Average:
$6,552,6641 Returns are through 4/30/2017 and gross of management fees.
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
Manager Cash Average
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TRANSITION / REALLOCATION MANAGEMENT
CHALLENGE
Manager changes, manager reallocations, liquidation of illiquid holdings
(e.g. hedge funds), change to target allocations, etc. which cause the fund
to meaningfully deviate from target exposures
EXPECTED BENEFITS
• Mitigation of exposure gaps which reduces performance risk
• The manager termination point can be accelerated or new manager
search period can be extended as long as needed without losing
targeted market exposure
• Note: Parametric works closely with transition service providers but
does not transition physical portfolio holdings
TRANSITION RESULTS1
VCERA IMPLEMENTATION
Reduce or eliminate exposure gaps using index overlays or ETF’s
1 Returns are through 4/30/2017 and gross of management fees.
Please refer to disclosures in Appendices. The deduction of an advisory fee would reduce an investor’s return. Past performance is not indicative of future results. For illustrative
purposes only. Source: Parametric; Date: 6/6/2017
Gain/Loss Summary
April ‘17 $0
YTD $0
Since 1/1/2014 $18,102,644
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REBALANCING
CHALLENGE
Asset class exposures which deviate meaningfully from long-term policy
targets or short-term tactical preferences may result in unwanted
exposures and increased tracking error
EXPECTED BENEFITS
• Reduced transaction costs
• Timely and efficient reallocation of portfolio exposures
• Reduction of tracking error versus policy mix
VCERA IMPLEMENTATION
In addition to using cash to move exposures closer to the Fund’s target
asset allocation, short futures positions can be utilized for rebalancing
purposes. Additionally, if the Fund’s exposures deviate from target by a
predetermined threshold, a full rebalance trade is implemented
1 Returns are through 4/30/2017 and gross of management fees.
Please refer to disclosures in Appendices. The deduction of an advisory fee would reduce an investor’s return. Past performance is not indicative of future results. For illustrative
purposes only. Source: Parametric; Date: 6/6/2017
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PERFORMANCE SUMMARY
1 Benchmark index is a custom client defined blend of asset class exposure indices.
Returns are net of management fees and net of transaction costs. Information subject to change. It is not possible to invest directly in an index. All investments subject to loss.
Material provided is supplemental to the GIPS® compliant presentation. Please refer to the GIPS® compliant presentation and other disclosures at the end of this presentation.
Source: Goldman Sachs, Bloomberg and Parametric; Date: 6/7/2017
QTD YTD 1 Year 2 Year 3 Year 4 Year 5 Year Inception
VCERA Portfolio
(NET)0.68% 2.38% 2.84% 1.99% 2.52% 2.31% 4.32% 10.10%
Benchmark Index 0.63% 2.23% 2.76% 2.02% 2.57% 2.58% 4.55% 10.60%
Ventura County Employees’ Retirement Association1 Performance Summary (as of 4/30/17)
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VCERA GAIN / LOSS SUMMARY (4/30/17)
Returns are gross of management fees. The deduction of an advisory fee would reduce investor’s return. Information subject to change. It is not possible to invest directly in an index.
All investments subject to loss. Material provided is supplemental to the GIPS® compliant presentation. Please refer to the GIPS® compliant presentation and other disclosures at the
end of this presentation. Source: Goldman Sachs, Bloomberg, and Parametric; Date: 5/31/2017.
PIOS Incremental Return (Inception to Date)
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in a one-on-one presentation only.
RISKS
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OVERLAY SERVICES: WHAT ARE THE RISKS?
1 PIOS (Policy Implementation Overlay Service) is a trademark registered in the U.S. Patent and Trademark Office.
Risk Description How Parametric Mitigates
Market Market performs in a way that was not anticipated. For example,
cash outperforms capital markets.
Systematic market risk is an inherent part of the PIOS®1 program and can
neither be diversified away nor mitigated. Client specific policy guidelines
are established to clearly define desired market risk based on client asset
allocation targets.
Communication/
Information
Overlay index exposures are maintained based on underlying
investment values provided by one or more third parties. There
are often delays in the receipt of updated information which can
lead to exposure imbalance risks. Inadequate communication
regarding cash flow moves into and out of fund and manager
changes can lead to unwanted asset class exposures and loss.
Parametric establishes communication links with custodial, manager, and
other sources to obtain and verify positions and cash flow data as soon as
it is available. Suspect data may be researched and staff notified.
Margin/Liquidity Potential that the market moves in a manner adverse to the
overlay position causing a mark-to-market loss of capital to the
fund and a resulting need to raise liquidity or to close positions;
this situation could happen at a time when underlying fund or
positions are also declining in value.
Parametric strives to be aware of potential collateral and cash
requirements to reduce the risk of needing to remove positions. Additional
margin requirements are communicated via electronic mail and margin
adequacy is available to the client daily.
Tracking Error Futures (synthetic) index returns do not perfectly track
benchmark index returns. This divergence between the price
behavior of a position or portfolio and the price behavior of a
benchmark is tracking error and impacts performance.
Parametric seeks to minimize tracking error by utilizing liquid futures
contracts with sufficient daily trading volume and open interest. All
derivative contracts will have some tracking error that cannot be mitigated
by an overlay manager.
Leverage Creation of market exposure in excess of underlying collateral
value may lead to significant capital losses and result in position
liquidation.
Parametric obtains daily collateral pool values and adjusts beta overlay
positions to maintain the ratio of total exposure to collateral within a pre-
defined client determined band.
Counterparty Counterparty credit risk on OTC trading. Note: Bilateral centrally
cleared OTC counterparty risk is similar to the clearing risk of
holding futures investments.
Parametric can facilitate the negotiation of ISDA documentation that seeks
to reduce the potential credit risk associated with OTC counterparties.
Parametric monitors credit ratings and credit default swap spreads for all
counterparties used and will inform staff of developments which may
negatively impact credit risk.
Collateral The program may experience losses on the underlying
designated assets in addition to potential losses on the index
market exposure overlaying these assets.
This risk cannot be mitigated by an overlay manager. Parametric
discusses the potential for negative performance in the collateral used for
the overlay prior to alpha transport applications with client.
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in a one-on-one presentation only.
APPENDICES
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EXCHANGE TRADED FUTURES
Characteristics
• Standardized
• Regulated
• Small initial margin
• Marked to market daily (virtually eliminating credit risk)
• Liquid (on average, more notional dollar volume is traded in S&P 500 futures than the average daily volume
of the NYSE each day)
• Efficiently priced with very low transaction costs
• Commonly used by Money Managers, Fund Sponsors, Index Funds, and Hedgers
Counterparty Risk Controls
• All Futures Commission Merchants (“FCM”) (e.g. Goldman Sachs, Citigroup, etc.) post a performance bond,
or deposit, with the clearing house in order to trade
• Performance bonds help to ensure that the FCMs will meet the contractual obligations of the trades they
make
• Brokerage firms require performance bonds, in the form of initial margin, from both the contract buyer and
contract seller
• FCMs must post a security deposit and pledge their assigned shares and memberships to the relevant
exchange thus providing additional incremental credit protection
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SYNTHETIC INDICES
1 In the case of style asset exposure needs (i.e. small cap growth), Parametric can manage ETF
exposures to fulfill client needs. Customized nonstandard indexes can be replicated using swaps.
Please note that only broad market (e.g. versus style) futures are available and/or liquid enough for use. Individuals may not invest directly into indexes.
>Domestic Equity1
S&P 500® Index
S&P 400® Mid Cap Index
MSCI USA IMI Index
MSCI Small Cap USA Index
Russell 1000® Index
Russell 2000 ® Index
Russell 3000 ® Index
Wilshire 5000 Index
>Fixed Income
Bloomberg Barclays U.S. Aggregate Bond Index
Bloomberg Barclays U.S. Aggregate Gov/Credit Index
Bloomberg Barclays Intermediate U.S. Gov/Credit Index
Bloomberg Barclays U.S. Long Gov/Credit Index
Bloomberg Barclays U.S. Aggregate Long Treasury Index
Bloomberg Barclays U.S. Long Treasury Index
Bloomberg Barclays U.S. Universal Index
Citi U.S. Broad Investment-Grade (USBIG) Bond Index
BofA Merrill 1-3 Year U.S. Treasury Index
Various Constant Duration Benchmarks
>International Equity
MSCI EAFESM Index
MSCI ACWI ex. U.S.SM
MSCI ACWI ex. U.S. IMI
MSCI Emerging Markets Index
MSCI World ex. U.S.SM
S&P Global Broad Market Index
>Global Equity
MSCI ACWI IMI
MSCI WorldSM
>Commodities
S&P Goldman Sachs Commodity Index
Bloomberg Commodities Index (BCOM)
Custom Commodity Baskets
>International Fixed Income
Citigroup WGBI ex. US
Bloomberg Barclays Global Aggregate Index ex. U.S.
>Currency
Indexes
Individual Currency Exposure
The most often used index benchmarks are as follows:
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BIOGRAPHIES: PARAMETRIC
MINNEAPOLIS INVESTMENT CENTER
Orison “Kip” Chaffee, CFA
Managing Principal
Mr. Chaffee is responsible for formulating strategic direction and day-to-day management of the Minneapolis and Westport Investment Centers. Prior to joining Parametric
in 2008*, Kip held a number of executive positions within the financial services industry including VP of Corporate Strategy and Development for Ameriprise Financial
Services and President and COO of Hantz Financial Services. He earned his B.A. in Economics from Harvard University and an MBA with a finance concentration from The
Wharton School of Business. He is a CFA® charterholder and a member of the CFA Society of Minnesota.
Jack Hansen, CFA
Chief Investment Officer
Mr. Hansen leads the investment management department at the Minneapolis Investment Center. Since joining Parametric in 1985*, Jack has managed futures, swaps,
options, and other derivative based programs. He writes and lectures on the use of derivatives in portfolio management. He earned a B.S. degree in Finance and
Economics from Marquette University and a M.S. in Finance from the University of Wisconsin, Madison. He is a CFA® charterholder and member of the CFA Society of
Minnesota.
Justin Henne, CFA
Managing Director – Customized Exposure Management
Mr. Henne leads the investment team responsible for the implementation and enhancement of Parametric’s Customized Exposure Management product. Since joining
Parametric in 2004*, Justin has gained extensive experience trading a wide variety of derivative instruments in order to meet each client’s unique exposure and risk
management objectives. He earned a B.A. in Financial Management from the University of St. Thomas. He is a CFA® charterholder and a member of the CFA Society of
Minnesota.
Thomas Lee, CFA
Managing Director – Investment Strategy and Research
Mr. Lee leads the investment team that oversees investment strategies managed in Parametric’s Minneapolis and Westport Centers. In his current position, Tom directs the
research efforts that support existing strategies and form the foundation for new strategies. He is also chair of the Investment Committee that has oversight of these
strategies. Tom has co-authored articles on topics ranging from liability driven investments to risk parity. Prior to joining Parametric in 1994*, Tom spent two years working
for the Federal Reserve in Washington, D.C. He earned a B.S. in Economics and an MBA in Finance from the University of Minnesota. He is a CFA® charterholder and a
member of the CFA Society of Minnesota.
Jay Strohmaier, CFA
Managing Director
Mr. Strohmaier leads a team of investment professionals responsible for designing, trading and managing institutional portfol ios with an emphasis on Defensive Equity,
hedging, and other asymmetric strategies. He has extensive experience with futures and options-based strategies and has been active in the investment industry since
1984. Prior to rejoining Parametric in 2009*, Jay worked for Cargill, Peregrine Capital Management, and Advantus Capital Management. He earned a B.S. degree in
Agricultural Economics from Washington State University and an M.S. in Applied Economics from the University of Minnesota. He is a CFA® charterholder and a member of
the CFA Society of Minnesota.
*Reflects the year employee was hired by The Clifton Group, which was acquired by Parametric Portfolio Associates® LLC on December 31, 2012.
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BIOGRAPHIES: PARAMETRIC
MINNEAPOLIS INVESTMENT CENTER
Christopher Haskamp, CFA
Senior Portfolio Manager
Mr. Haskamp is dedicated to portfolio management and leading research projects in the area of risk management. Chris manages portfolios for the Liability Driven Investing
program as well as for the enhanced index programs. Prior to joining Parametric in 2006*, he spent three years as a scientist at the medical device firm Beckman Coulter
Inc. Chris earned a B.S. in Biochemistry from the University of Minnesota and a M.S. in Chemistry from the University of California, San Diego. Chris earned an MBA in
Finance from the University of Minnesota, Carlson School of Management in May of 2007 and started full time at Parametric in June of 2007. He is a CFA® charterholder
and a member of the CFA Society of Minnesota.
Clint Talmo, CFA
Senior Portfolio Manager
Mr. Talmo is responsible for designing, trading, and managing overlay portfolios with an emphasis on options and OTC swaps. Prior to joining Parametric in 2014, Clint was
a Partner at Aerwulf Asset Management. Previously, he worked for Interlachen Capital Group and EBF & Associates where his responsibilities included research, trading,
and portfolio management. He earned a B.S. in Finance from the University of Colorado. He is a CFA® charterholder and a member of the CFA Society of Minnesota.
Daniel Wamre, CFA
Senior Portfolio Manager
Mr. Wamre leads a team of investment professionals responsible for designing, trading, and managing overlay portfolios. He has extensive experience helping clients and
consultants manage portfolio exposures and risk through futures and options-based strategies. Prior to joining Parametric in 1995* as an intern, and full-time in 1998*, Dan
spent four years as a Platoon Commander/Executive Officer in the United States Marine Corps. Upon completion of graduate school, he spent ten months working as a
commercial banking credit analyst for U.S. Bank in Minneapolis. He earned a B.S. from North Dakota State University and an MBA in Finance from the University of
Minnesota. He is a CFA® charterholder and a member of the CFA Society of Minnesota.
Richard Fong, CFA
Portfolio Manager
Mr. Fong is responsible for designing, trading, and managing overlay portfolios in the Minneapolis Investment Center. Since joining Parametric in 2010*, Ricky has become
a valuable resource supporting management of client LDI and options-based risk management solutions. He earned a B.A. in Financial Economics from Gustavus
Adolphus College. He is a CFA® charterholder and a member of the CFA Society of Minnesota.
Alexander Gomelsky, CFA
Portfolio Manager
Mr. Gomelsky is responsible for designing, trading and managing overlay portfolios as well as serving as an IT leader for the investment area. Prior to joining Parametric in
2009*, Alex worked for Johnson Controls as a Business Analyst within Global Operations and FP&A departments. He earned a B.S. degree in Finance and History from
Boston College. He is a CFA® charterholder and a member of the CFA Society of Minnesota.
*Reflects the year employee was hired by The Clifton Group, which was acquired by Parametric Portfolio Associates® LLC on December 31, 2012.
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DISCLOSURE
Parametric Portfolio Associates® LLC (“Parametric”), headquartered in Seattle, Washington, is registered as an investment adviser with the U.S. Securities and Exchange
Commission under the Investment Advisers Act of 1940. Parametric is a leading global asset management firm, providing investment strategies and customized exposure
management directly to institutional investors and indirectly to individual investors through financial intermediaries. Parametric offers a variety of rules-based investment strategies,
including alpha-seeking equity, alternative and options strategies, as well as implementation services, including customized equity, traditional overlay and centralized portfolio
management. Parametric is a majority-owned subsidiary of Eaton Vance Corp. and offers these capabilities through investment centers in Seattle, WA, Minneapolis, MN and
Westport, CT. This material may not be forwarded or reproduced, in whole or in part, without the written consent of Parametric Compliance. Parametric and its affiliates are not
responsible for its use by other parties.
Parametric is divided into two segments: Parametric Investment & Overlay Strategies and Parametric Custom Tax-Managed & Centralized Portfolio Management. For compliance with
the Global Investment Performance Standards (GIPS®), the Firm is defined and held out to the public as Parametric Investment & Overlay Strategies. Parametric Investment &
Overlay Strategies provides rules-based investment management services to institutional investors, individual clients and registered investment vehicles, including Engineered Alpha
Strategies, Specialty Index, and PIOS® (Policy Implementation Overlay Service). The Firm has complied with the GIPS standards retroactive to January 1, 2000.
This information is intended solely to report on investment strategies and opportunities identified by Parametric. Opinions and estimates offered constitute our judgment and are
subject to change without notice, as are statements of financial market trends, which are based on current market conditions. We believe the information provided here is reliable, but
do not warrant its accuracy or completeness. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Past performance does not
indicate future returns. The views and strategies described may not be suitable for all investors. Parametric does not provide legal, tax and/or accounting advice or services. Clients
should consult with their own tax or legal advisor prior to entering into any transaction or strategy described here.
Charts, graphs and other visual presentations and text information were derived from internal, proprietary, and/or service vendor technology sources and/or may have been extracted
from other firm data bases. As a result, the tabulation of certain reports may not precisely match other published data. Data may have originated from various sources including but
not limited to Bloomberg, MSCI/Barra, FactSet, and/or other systems and programs. Please refer to the specific service provider’s web site for complete details on all indices.
Parametric makes no representation or endorsement concerning the accuracy or propriety of information received from any other third party.
Returns presented were generated using Parametric’s proprietary investment methodology as described in Parametric’s Form ADV Part 2A. Returns are unaudited, and may not
correspond to quarterly calculated performance for any other client account in the stated discipline. Returns are calculated in U.S. dollars using the internal rate of return, reflect the
reinvestment of dividends, interest, gains and other income, include transaction costs but exclude account and custodial services fees, and do not take individual investor tax
categories into consideration. After-tax estimates are a “best scenario” provision for illustrative purposes. Specific periods of returns are not meant to imply that the portfolio would
have been profitable had the client only invested in the market for this time period. All investments are subject to loss.
Derivatives such as futures, swaps, and other investment strategies have certain disadvantages and risks. Futures require the posting of initial and variation margin. Therefore, a
portion of risk capital must be preserved for this purpose rather than being allocated to a manager. Liquid futures may not exist for published benchmarks which may result in tracking
error. Also, some intra-period mispricing may occur. Swaps require periodic payments, may be less liquid than futures, and may have counterparty/credit risk. Some investment
strategies require a cash investment equal to the desired amount of exposure.
Benchmark/index information provided is for illustrative purposes only. Investors cannot invest directly in an index. Returns for indexes are calculated gross of management fees.
Deviations from the benchmarks provided herein may include but are not limited to factors such as: the purchase of higher risk securities, over/under weighting specific sectors and
countries, limitations in market capitalization, company revenue sources, and/or client restrictions. Parametric’s proprietary investment process considers factors such as additional
guidelines, restrictions, weightings, allocations, market conditions and other investment characteristics. Thus returns may at times materially differ from the stated benchmark and/or
other disciplines and funds provided for comparison
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DISCLOSURE
All contents copyright 2017 Parametric Portfolio Associates® LLC. All rights reserved. Parametric Portfolio Associates®, PIOS®, and Parametric with the iris flower logo are all
trademarks registered in the US Patent and Trademark Office.
Parametric is headquartered at 1918 8th Avenue, Suite 3100, Seattle, WA 98101. Parametric’s Minneapolis investment center is located at 3600 Minnesota Drive, Suite 325,
Minneapolis, MN 55435. For more information regarding Parametric and its investment strategies, or to request a copy of Parametric’s Form ADV, please contact us at 206.694.5575
(Seattle) or 952.767.7700 (Minneapolis), or visit our website, www.parametricportfolio.com.
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1190 S. VICTORIA AVENUE, SUITE 200 • VENTURA, CA 93003 PHONE: 805-339-4250 • FAX: 805-339-4269 • WWW.VCERA.ORG
June 19, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Avenue, Suite 200 Ventura, CA 93003 SUBJECT: BOARD APPROVAL OF (1) PROPOSED PRIVATE EQUITY INVESTMENT
POLICY AND (2) PROPOSED ANNUAL PLAN Dear Board Members:
At its meeting of May 1, 2017 the Board selected Abbott Capital to provide private equity (PE) investment management services including consulting, investment management, and back office support.
The next step in the program’s development is Board approval and adoption of a Private Equity Investment Policy (Policy) and an Annual Plan (Plan). The Policy and Plan documents presented by Abbott provide a framework for the management and oversight of the PE assets and commitments of VCERA. Once a structure has been approved by the Board, Abbott Capital may begin executing the program. Staff and NEPC have worked with Abbott in constructing these documents, and believe that the proposed structure is in the best interest of VCERA. As such, staff recommends that the Board approve and adopt both the Private Equity Investment Plan and the Annual Plan, as proposed and presented by Abbott Capital Management.
RECOMMENDATION: APPROVAL AND ADOPTION OF BOTH THE PRIVATE EQUITY INVESTMENT POLICY AND THE ANNUAL PLAN AS PROPOSED AND PRESENTED BY ABBOTT CAPITAL MANAGEMENT.
Respectfully submitted,
Dan Gallagher Chief Investment Officer
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ABBOTT CAPITAL MANAGEMENT, LLC | 1290 AVENUE OF THE AMERICAS, NEW YORK, NY 10104 | +1 212 757 2700
June 19, 2017
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2
Charles H. van Horne – Managing Director Mr. van Horne has over 31 years of experience in private equity and is responsible for managing the firm’s marketing and client services functions, including communicating with clients about Abbott’s investment practices and providing assistance to clients in the development of their private equity strategies. Prior to joining Abbott in 2001, Mr. van Horne was a founding Managing Director of AIG Capital Partners, Inc., responsible for AIG Capital Partners’ fund development and client services. Mr. van Horne also served on the investment committees for several AIG private equity funds. Prior to joining AIG, Mr. van Horne was Managing Director of Creditanstalt International Advisors, where he established and managed its private equity investment activities. He also worked for Bankers Trust and for UBS Securities, Inc. in various capacities including merchant banking, mergers and acquisitions and project finance. Mr. van Horne received his B.A. in Sociology from the University of Pennsylvania.
Matthew M. Smith – Managing Director Mr. Smith has over 16 years of private equity investment experience. Mr. Smith is responsible for reviewing investment opportunities with specific emphasis on analysis and due diligence for prospective investments and is engaged in the negotiation of business and legal issues, ongoing monitoring of investments and profit realization from distributed securities. Mr. Smith, as Abbott’s ESG Officer, is responsible for building upon the strong foundation Abbott has set in adopting the UN Principles for Responsible Investment and integrating ESG considerations into Abbott’s investment process. In addition, Mr. Smith oversees the operations of Abbott Capital (Europe), Ltd, Abbott’s subsidiary which is authorized and regulated by the UK Financial Conduct Authority and located in London. Prior to joining Abbott in 2000, Mr. Smith was a financial examiner at the Federal Reserve Bank of New York. He also worked for First Trust Washington and Bank of America as a trust officer.
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3
Following the Board’s decision to select Abbott Capital Management to implement and manage its private equity portfolio, Abbott has worked with VCERA Staff and NEPC to develop VCERA’s Private Equity Investment Policy and Private Equity Annual Plan for approval and implementation
The Private Equity Investment Policy provides the framework for the development, implementation, management, and administration of the portfolio, and: ⎼ Acknowledges VCERA’s current Private Equity Target Allocation of 10% ⎼ Establishes investment guidelines, including eligible investments and strategies, diversification,
performance measurement, risk objectives, and responsibilities of the Discretionary Investment Manager
The Private Equity Annual Plan summarizes the current funding level, projected funding position,
target portfolio structure, and: ⎼ Recommends commitment target and steps for the 2017 Private Equity Investment Plan ⎼ Develops longer term commitment pacing objectives
Objective: Abbott will work collaboratively with VCERA’s Board, Staff, and NEPC to meet its Private Equity Target Allocation
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4
Funding Position
Actual Funding Position 12/31/2016
Total VCERA Plan Market Value: $4,665.0m
% Target for Private Equity: 10%
Total Private Equity Target Allocation: $466.5m
Legacy Portfolio Net Asset Value: $188.4m
Direct (Abbott) Portfolio Net Asset Value: $0.0m
Total Net Asset Value: $188.4m
NAV in excess of (short of) Target: ($278.1m)
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Funding by Strategy
Legacy Portfolio 12/31/2016
Strategy NAV Undrawn Exposure
Venture Capital & Growth Equity (Global) $6.4m $22.0m $28.4m
North American Buyouts & Special Situations 55.8m 57.4m 113.2m
International Buyouts & Special Situations 39.1m 33.3m 72.5m
Secondary, Co-Invest, Private Debt 87.1m 118.4m 205.5m
Total Legacy Portfolio $188.4m $231.1m $419.6m
Direct (Abbott) Portfolio
Strategy NAV Undrawn Exposure
Venture Capital & Growth Equity (Global) $0.0 $0.0 $0.0
North American Buyouts & Special Situations 0.0 0.0 0.0
International Buyouts & Special Situations 0.0 0.0 0.0
Secondary, Co-Invest, Private Debt 0.0 0.0 0.0
Total Direct (Abbott) Portfolio $0.0 $0.0 $0.0
Grand Total $188.4m $231.1m $419.6m
Some figures estimated for Legacy investments
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Strategic Portfolio Structure
Total Private Equity Target 12/31/2021: $633.2m
Strategy Projected NAV and Exposure Range
Venture Capital & Growth Equity (Global) 20% 10%-30%
North American Buyouts & Special Situations 45% 35%-55%
International Buyouts & Special Situations 20% 10%-30%
Secondary, Co-Invest, Private Debt 15% 5%-25%
Total 100%
Projected Funding Position 12/31/2021
Total VCERA Plan Market Value: $6,331.7m
% Target for Private Equity: 10%
Total Private Equity Allocation: $633.2m
Note that the actual NAV and Exposure will depend on market conditions, investment opportunities available to VCERA and other factors
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Twelve-Year Pacing Illustration
Total Plan Projected Net Growth Rate 6.3%
Private Equity Target 10%
Pacing Analysis/Projected Cash flows (millions)
Year 12/2016 12/2017 12/2018 12/2019 12/2020 12/2021 12/2022 12/2023 12/2024 12/2025 12/2026 12/2027 12/2028
Total Commitments $0.0 $120.0 $150.0 $150.0 $150.00 $150.0 $150.0 $150.0 $150.0 $150.0 $150.0 $150.0 $150.0
Total PE Capital Calls 91.1 108.6 111.5 121.1 138.7 136.3 141.9 143.6 144.5 145.7 145.9 145.8
Total PE Distributions 45.6 69.9 92.9 108.0 125.7 142.5 156.6 155.3 169.3 184.2 210.1 227.5
Total PE Net Cash Flow (45.5) (38.7) (18.6) (13.2) (13.0) 6.2 14.7 11.7 24.8 38.5 64.3 81.8
Total PE NAV 188.4 256.4 324.5 384.9 456.5 541.3 617.6 690.0 766.0 838.1 907.5 956.8 988.9
Total Projected Plan Assets 4,665.0 4,958.9 5,271.3 5,603.4 5,956.4 6,331.7 6,730.6 7,154.6 7,605.3 8,084.5 8,593.8 9,135.2 9,710.7
Total PE NAV as % of Plan Assets: 4% 5% 6% 7% 8% 9% 9% 10% 10% 10% 11% 10% 10%
For illustrative purposes only. Information is not based on an actual client account, but is loosely based on Abbott’s experience and a review and assessment of VCERA’s private equity program. Actual cash flows and NAV will vary.
4.0%
5.2%
6.2% 6.9%
7.7% 8.5%
9.2% 9.6% 10.1% 10.4% 10.6% 10.5% 10.2%
0.0%
2.5%
5.0%
7.5%
10.0%
12.5%
12/31/2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Legacy NAV Abbott NAV Total NAV Target PE Allocation
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Investment Plan for 2017 and Beyond
2017 Private Equity Investment Plan
Commit approximately $150m through year-end ⎼ $30m committed to HarbourVest Co-Investment Fund IV ⎼ Six to eight further commitments
Active pipeline includes funds that focus on: ⎼ North American Growth Equity ⎼ North American Growth Oriented Buyouts ⎼ North American Buyouts ⎼ International Buyouts
Looking Ahead
Develop and present 2018 Private Equity Investment Plan in 1Q 2018 Update pacing model to reflect then-current conditions, state of the private equity portfolio, and the
overall VCERA Plan Preliminary modeling suggests $150m target for 2018
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Private Equity Annual Plan
The Private Equity Annual Plan provides the process for review and implementation of VCERA’s private equity strategy each year based upon updated funding levels and Pacing Analysis:
⎼ The 2017 Private Equity Investment Plan recommends commitments of $150m
⎼ Subsequent Private Equity Annual Plans will establish new investment plans for 2018 and beyond, reflecting then-current market conditions
Private Equity Investment Policy
The Private Equity Investment Policy establishes the framework and guidelines for the development of VCERA’s direct private equity program and managing its legacy investments towards the Private Equity Target Allocation, including:
⎼ Investment guidelines, performance measurement and risk expectations
⎼ Responsibilities of the Discretionary Investment Manager for investments and reporting
Implementation: Abbott looks forward to working closely and collaboratively with the Board, Staff, and NEPC to meet VCERA’s overall private equity objectives
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Past performance is not a guide to future results and is not indicative of expected realized returns. This presentation contains confidential and proprietary information regarding Abbott Capital Management, LLC (“Abbott”), its affiliates and investment program, funds sponsored by Abbott (the “Abbott Funds”) and Abbott’s managed account clients (collectively “Abbott Clients”) as well as underlying portfolio funds held by the Abbott Clients’ and portfolio companies held by these funds. This presentation and the information contained in this presentation may not be reproduced or distributed to persons other than the recipient or its advisors, to the extent they are bound by a duty of confidentiality. The views expressed and information provided are as of the date listed on the cover of this presentation unless otherwise indicated on a particular page or chart and are subject to change, update, revision, verification and amendment, materially or otherwise, without notice, as market or other conditions change. Since these conditions can change frequently, there can be no assurance that the terms and trends described herein will continue or that any forecasts are accurate. In addition, certain of the statements contained in this presentation may be statements of future expectations and other forward-looking statements that are based on Abbott's current views and assumptions and involve known and unknown risks and uncertainties (including those discussed below and in Abbott’s Form ADV, Part 2a., available on the SEC’s website at www.adviserinfo.sec.gov ) that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. These statements may be forward-looking by reason of context or identified by words such as “may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential or continue” and other similar expressions. Neither Abbott, its affiliates, nor any of Abbott’s or its affiliates' respective advisers, members, directors, officers, partners, agents, representatives or employees or any other person (collectively “Abbott Entities”) is under any obligation to update or keep current the information contained in this document. This presentation contains information from third party sources which Abbott has not verified. No representation or warranty, express or implied, is given by or on behalf of Abbott Entities as to the accuracy, fairness, correctness or completeness of the information or opinions contained in this presentation and no liability whatsoever (in negligence or otherwise) is accepted by Abbott Entities for any loss howsoever arising, directly or indirectly, from any use of this presentation or its contents, or otherwise arising in connection therewith. Abbott may have arrangements with certain or prospective investors pursuant to which those investors receive additional portfolio information. Past performance is not a guide to future results and is not indicative of expected realized returns. All investments are subject to risk, including the loss of the principal amount invested. This presentation is for informational purposes only and is not an offer or a solicitation to subscribe for any fund and does not constitute investment, legal, regulatory, business, tax, financial, accounting or other advice or a recommendation regarding any securities of Abbott, of any fund or vehicle managed by Abbott, or of any other issuer of securities. All investments are subject to risk, including the loss of the principal amount invested. Private equity related risks include, among others: those associated with leverage, illiquidity and restrictions on transferability and resale of the investment and the speculative nature of private equity investments in general. Fund of fund risks include dependence on the performance of underlying managers, Abbott’s ability to allocate assets incurred at the Abbott Client and underlying portfolio fund levels. Exchange rate fluctuations may affect returns. Diversification will not guarantee profitability or protection against loss. There is no assurance that an Abbott Client's objective will be attained. Performance may be volatile and the value of an investment(s) may fluctuate. Please refer to Abbott’s Form ADV, Part 2a for additional risk disclosures. This presentation is for informational purposes only and is not an offer or a solicitation to subscribe for any fund and does not constitute investment, legal, regulatory, business, tax, financial, accounting or other advice or a recommendation regarding any securities of Abbott, of any fund or vehicle managed by Abbott, or of any other issuer of securities. Interests in the Abbott Funds have not been and will not be registered under the U.S. Securities Act of 1933, as amended, any U.S. State securities laws or the laws of any non‐US Jurisdiction. None of the Abbott Funds are registered as an Investment Company under the U.S. Investment Company Act of 1940, as amended nor is it expected that they will be in the future. Interests in the Abbott Funds have not been approved or disapproved by The U.S. Securities and Exchange Commission or by any securities regulatory authority of any U.S. State or non‐U.S. jurisdiction and neither the SEC nor any such authority has passed upon the accuracy or adequacy of this communication or the merits of Abbott or any Abbott Fund, nor is it intended that the SEC or any such authority will do so. Investment in the Abbott Funds may not be suitable for all investors; investors should carefully consider risks and other information and consult their professional advisers regarding suitability, legal, tax and economic consequences of an investment. Copyright© Abbott Capital Management, LLC 2017. All rights reserved. This presentation is proprietary and may not to be reproduced, transferred or distributed in any form without prior written permission from Abbott. It is delivered on an “as is” basis without warranty or liability. All individual charts, graphs and other elements contained within the information are also copyrighted works and may be owned by a party other than Abbott. By accepting the information, you agree to abide by all applicable copyright and other laws, as well as any additional copyright notices or restrictions contained in the information.
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Abbott Capital Management Presentation to Ventura County Employees’ Retirement Association Proposed Private Equity Policy Private Equity Annual Plan
June 19, 2017
ABBOTT CAPITAL MANAGEMENT, LLC | 1290 AVENUE OF THE AMERICAS, NEW YORK, NY 10104 | +1 212 757 2700
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Proposed Private Equity Investment Policy
Ventura County Employees’ Retirement Association June 2017
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Private Equity Investment Policy Ventura County Employees’ Retirement Association
INTRODUCTION This document sets forth the framework for the management and oversight of the private equity assets and commitments of Ventura County Employees’ Retirement Association (“VCERA”). The purpose of this policy is to assist the Board of Retirement (the “Board”) in effectively supervising and monitoring the private equity investments of VCERA. This Private Equity Investment Policy (“PE Policy”) exists within the framework of VCERA’s total plan Investment Policy (“Policy”), and should be understood in connection with that Policy. A PRIVATE EQUITY INVESTMENT POLICY
I. Target Allocation
VCERA’s Asset Allocation Policy (as Appendix 1 to VCERA’s total fund Investment Policy) identifies VCERA’s Private Equity Target Allocation. This target reflects the desired level of net asset value. Net asset value plus any outstanding, unfunded commitment (“Exposure”) may be greater than the Target Allocation.
II. INVESTMENT GUIDELINES Eligible Investments Investment types may include but are not limited to:
Private Equity funds (either by primary commitment or secondary purchase)
Co‐investments
Fund of Funds or Fund of One structures to facilitate VCERA’s participation in specialized strategies
Investments should be structured in such a manner as to provide limited liability to VCERA. Eligible Investment Strategies VCERA may invest in a broad range of Private Equity investment strategies including but not limited to:
Venture Capital
Growth Equity
Buyouts
Special Situations
Private Debt (funds focused on, e.g., Direct Lending, Mezzanine, Venture Debt, Distressed Debt, Royalty Income)
Secondary purchases in the above strategies
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Diversification VCERA’s private equity investments shall be diversified across multiple dimensions, including:
Strategy
Geography
Sector
Vintage Year
Manager Diversification across these dimensions is a long term goal for a mature portfolio. The actual diversification will depend, in part, on market conditions and the investment opportunities that will be available over time. Diversification shall be measured on a NAV basis. Annual Plans shall outline diversification on both a NAV and an Exposure basis for reference.
a. Strategy The portfolio shall be diversified by the broad strategies described below. Further, the portfolio shall be diversified by stage (in the case of Venture Capital), by target company size (in the case of Buyout and Special Situations), and by fund size. Venture Capital Venture capital is an investment strategy that provides primary capital for young companies aiming for, or already exhibiting, rapid growth. Venture investing can involve various stages from Seed and Early Stage to Later Stage, reflecting the development of the company. Regardless of stage, Venture Capital investments are generally made into companies that are not yet profitable. Venture capital funds may specialize in one or more stages of investment and/or sectors (e.g., information technology, healthcare/life sciences). Growth Equity Growth Equity blends characteristics of Venture Capital and Buyouts. The strategy can include investments made directly into a company (primary capital) or acquired from earlier shareholders, often the founder (secondary capital). The target portfolio company is generally profitable or near profitability. The primary capital provided by the Growth Equity fund is frequently used to expand the company quickly via investments in production, in sales and marketing or through acquisitions while the secondary capital received by the current shareholders (founders, angel investors) provides for a partial or full liquidity event. The investor may hold a minority or controlling interest in the company. Buyouts Buyout transactions involve the acquisition of a controlling or non‐controlling stake in the share capital of a company. These transactions are often also funded with a varying degree of debt (leveraged buyouts or LBOs), and/or alongside existing management (management buyouts or MBOs). Buyout transactions (and the funds that sponsor them) are further differentiated by size, including Small Buyouts (funds less than approximately $750 million), Mid‐Cap (funds up to $5 billion), Large (funds up to $10 billion) and Mega (funds larger than $10 billion). Special Situations Special Situations funds may incorporate a specific strategy (e.g., build‐ups or roll‐ups of existing industries), may focus on a specific industry, may invest across a wide spectrum from venture capital to large buyouts, or may focus on
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distressed or turnaround situations. These funds may incorporate a combination of minority and majority ownership structures. Special Situations also encompasses funds that may be not be easily classified in other strategies. Secondaries A Secondary purchase is the acquisition of a fund interest from an existing investor. The purchaser acquires the existing net asset value and assumes any remaining unfunded commitment. A Direct Secondary is the acquisition of one or more portfolio companies from a private equity fund. Co‐Investments A Co‐Investment is a direct investment into a company alongside a private equity sponsor. Private Debt Private Debt investments include loans, at various levels of seniority in the capital structure, to companies. This strategy can also include distressed debt investing. Other strategies with shorter average duration and predictable cash flows, such as the purchase of interests in royalty streams associated with intellectual property, could also be considered Private Debt. b. Geography The portfolio shall be weighted toward the developed Private Equity markets of North America and Western Europe and diversified within those markets. Investments in other geographies are permitted. c. Sector The portfolio shall be constructed to provide broad exposure to various sectors, without excessive exposure to any single industry. d. Vintage Year Vintage Year diversification shall be sought via careful pacing of commitments over time, at a rate consistent with the annual pacing model as expressed in an Annual Plan. Vintage Year is the year in which a fund first draws capital; it may be earlier or later than the year in which VCERA commits to a specific fund. e. Manager In the direct program (i.e., not with respect to Fund of Funds), Exposure to a single manager shall not represent more than 15% of VCERA’s Private Equity Portfolio at the time of commitment. This restriction shall not apply during the first three years of the direct program or until VCERA has committed to 15 funds, whichever is later. Any proposed changes to the guidelines in this Section II shall be addressed in an Annual Plan.
III. PERFORMANCE MEASUREMENT In addition to traditional performance measurement methods, the performance of individual private equity funds is measured using at least three metrics relevant to the asset class: Total Value to Paid‐In capital (“TVPI,” or the investor’s net multiple of investment), Distributed capital to Paid‐In capital (“DPI,” a measure of how much capital has been returned to the investor), and Net Internal Rate of Return (“Net IRR”). Performance of a fund is evaluated based on its TVPI, DPI and Net IRR quartile ranking for the fund’s strategy and vintage year, as reported by a recognized provider of private equity performance data.
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For the portfolio as a whole, the return objective over rolling five‐year periods is 300 basis points above an appropriate, broad public market index, net of all fees (including performance fees or carry) and expenses. This performance shall be measured using a cash flow matching methodology to make the index’s return comparable to private equity’s IRR measurement. Private equity funds (and portfolios of such funds) generally develop with a ‘J‐Curve’ in the early years of a fund’s life as managers draw capital for investment as well as for fees, which results in a temporarily negative return. As portfolio companies grow in value and positive returns begin to show, the net return also turns positive. For this reason, and the fact that such growth in both underlying value and reported value tend to lag in private equity, returns can only be measured in a meaningful way as a fund matures. In general, the performance of funds younger than three years of age is not meaningful. During the construction phase of a portfolio (i.e., when annual commitments are large relative to private equity net asset value), performance measurements are less meaningful.
IV. RISK EXPECTATIONS While underlying portfolio companies (i.e., the investments made by private equity funds) face numerous idiosyncratic risks, diversified portfolios of private equity funds are designed to reduce those risks by providing exposure to a large number of disparate companies operating in a wide variety of geographies and industries and at various stages in corporate development. There is a risk of capital impairment or loss at the underlying company level. Furthermore, there is a risk of capital loss at the private equity fund level. This risk is mitigated through due diligence, active monitoring of funds and managers, and appropriate diversification.
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B PRIVATE EQUITY INVESTMENT PROCEDURES: DISCRETIONARY INVESTMENT MANAGER RESPONSIBILITIES
I. GENERAL The Private Equity Manager (“Manager”), in consultation with VCERA’s Chief Investment Officer, shall have full discretion to effect investment transactions consistent with the PE Policy. Notwithstanding the foregoing, commitments to managers not yet in the VCERA portfolio shall not exceed $35 million, except with the explicit consent of the Chief Investment Officer. Commitments to managers already in the portfolio (“re‐ups”) shall not exceed $50 million. The Manager shall, at all times, adhere to the Duties of the Investment Managers, as outlined in the Policy. The Manager shall act as an oversight Investment Consultant with respect to VCERA’s overall Private Equity Program (including any private equity investments made prior to and/or outside of the Manager’s assignment).
II. ANNUAL PLAN
On an annual basis, the Manager shall submit an Annual Plan for review and approval by VCERA. The Annual Plan will include a review of the current state of the private equity portfolio including net asset value, Exposure, and diversification characteristics of the portfolio. The Annual Plan will include a pacing model and any recommended changes to pacing of commitments will be highlighted for review and approval. Changes to diversification guidelines, based on then‐current market conditions, relevant developments in the overall VCERA plan, or other factors, will be recommended in the Annual Plan.
III. PIPELINE DISCUSSIONS The Manager shall schedule periodic reviews and consultation with VCERA Investment Staff of the pipeline of funds under consideration. Pipeline reviews shall be held at least quarterly.
IV. DUE DILIGENCE The Manager shall conduct appropriate due diligence on investment opportunities and the existing portfolio, consistent with its existing due diligence process.
V. LEGAL REVIEW The Manager shall conduct appropriate legal review of investments under consideration, amendments, consents and similar items, consistent with its existing legal review process, and/or in coordination with Investment Staff and VCERA’s legal counsel.
VI. MONITORING The Manager shall maintain regular contact with existing managers in the portfolio, generally including but not limited to: review of quarterly and annual financial statements, attendance at annual meetings, periodic update meetings and on‐site visits, service on advisory boards (as appropriate) and ad hoc communication.
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VII. REPORTING
On a monthly basis, the Manager shall provide a report of current holdings, as well as supplemental reports of transaction activity, to allow for timely recordkeeping and reconciliation. The Manager shall provide comprehensive reporting on a quarterly basis and meet with VCERA as requested.
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Proposed Private Equity Annual Plan
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ANNUAL PLAN For the period 7/1/17 through 12/31/17
A. FUNDING LEVEL ANALYSIS
I. FUNDING LEVEL
Actual Funding Position 12/31/2016 Total Fund Market Value: $4,665.0 million % Target for Private Equity: 10% Total Private Equity Target Allocation: $466.5 million Legacy Portfolio Net Asset Value: $188.4 million Direct (Abbott) Portfolio Net Asset Value: $0.0 million Total Net Asset Value: $188.4 million NAV in excess of (short of) Target ($278.1 million) Projected Funding Position 12/31/2021 Fund Market Value: $6,331.7 million % Target for Private Equity: 10% Total Private Equity Allocation: $633.2 million 2017 Commitment Target: $150 million Actual commitment may be greater or less depending on market opportunities
II. FUNDING BY STRATEGY
LEGACY PORTFOLIO 12/31/2016
Strategy NAV Undrawn Exposure
Venture Capital & Growth Equity (Global) $6.4m $22.0m $28.4m
North American Buyouts & Special Situations 55.8m 57.4m 113.2m
International Buyouts & Special Situations 39.1m 33.3m 72.5m
Secondary, Co‐Invest, Private Debt 87.1m 118.4m 205.5m
TOTAL Legacy Portfolio $188.4m $231.1m $419.6m DIRECT (ABBOTT) PORTFOLIO
Strategy NAV Undrawn Exposure
Venture Capital & Growth Equity (Global) $0.0 $0.0 $0.0
North American Buyouts & Special Situations 0.0 0.0 0.0
International Buyouts & Special Situations 0.0 0.0 0.0
Secondary, Co‐Invest, Private Debt 0.0 0.0 0.0
TOTAL Direct (Abbott) Portfolio $0.0 $0.0 $0.0
TOTAL $188.4m $231.1m $419.6m
Some figures estimated for Legacy Portfolio; totals may not sum due to rounding.
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III. STRATEGIC PORTFOLIO STRUCTURE Abbott anticipates constructing the Private Equity Portfolio over time and in accordance with the diversification guidelines described in the Private Equity Investment Policy (“PE Policy”). The projected year‐end 2021 Private Equity Target Allocation is $633.2 million and Abbott projects that the NAV and Exposure by strategy will be approximately as shown in the table below. Note that the actual NAV and Exposure will depend on market conditions, investment opportunities available to VCERA and other factors.
Total Private Equity Target 12/31/2021: $633.2m
Strategy Projected NAV and Exposure Range
Venture Capital & Growth Equity (Global) 20% 10%‐30%
North American Buyouts & Special Situations 45% 35%‐55%
International Buyouts & Special Situations 20% 10%‐30%
Secondary, Co‐Invest, Private Debt 15% 5%‐25%
TOTAL 100%
B. 2016 INVESTMENT ACTIVITY: DIRECT (ABBOTT) PORTFOLIO
I. PRIMARY COMMITMENTS Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, Abbott made no primary commitments on behalf of VCERA during 2016.
II. SECONDARY PURCHASES Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, Abbott made no secondary purchases on behalf of VCERA during 2016.
III. OTHER INVESTMENT ACTIVITY Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, Abbott conducted no other investment activity on behalf of VCERA during 2016.
IV. DIVESTMENT, LIQUIDATION AND TERMINATION ACTIVITY Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, no funds were divested, liquidated or terminated during 2016.
V. PERFORMANCE COMMENTARY Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, there is no performance commentary for 2016.
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VI. SPECIFIC SITUATIONS REQUIRING ADDITIONAL MONITORING Abbott generally seeks advisory board or valuation committee seats for the funds to which we commit on behalf of our clients. Abbott’s practice is to attend the annual meetings for each of the funds in our clients’ portfolios. In addition, Abbott regularly visits managers in their offices as part of our ongoing monitoring and due diligence of new fund offerings, and managers frequently visit Abbott to provide us with updates. Beyond formal updates, Abbott speaks to managers on a regular basis using these opportunities to deepen our understanding of the general partner groups, as well as the performance of the underlying portfolio companies. This active monitoring enables Abbott to make informed decisions regarding whether groups in the portfolio should be supported in the future. Abbott also carefully evaluates requests for amendments to Limited Partnership Agreements that can occur over the life of a fund. Abbott was selected to assume responsibility for VCERA’s Private Equity Portfolio on May 1, 2017. As such, there are no situations requiring additional monitoring. C. 2016 INVESTMENT ACTIVITY: LEGACY PORTFOLIO
I. LEGACY PORTFOLIO SUMMARY PRE‐2016
Fund Year Focus Commitment Paid In UndrawnAdams Street Partnership Fund 2010 US Fund 2010 VC&PE FoF $42.5m $32.9m $9.6m
Adams Street Partnership Fund 2010 Non‐US Developed Markets Fund 2010 VC&PE FoF 25.5m 20.6m 4.9m
Adams Street Partnership Fund 2010 Non‐US Emerging Markets Fund 2010 VC&PE FoF 8.5m 6.6m 1.9m
Adams Street 2010 Direct Fund 2010 Co‐Invest 8.5m 7.9m 0.6m
Pantheon Global Secondary Fund IV 2010 Secondary 15.0m 10.0m 5.0m
Adams Street 2013 Global Fund 2013 VC&PE FoF 75.0m 44.3m 30.8m
HarbourVest Dover Street VIII 2013 Secondary 67.5m 56.4m 11.1m
Pantheon Global Secondary Fund V 2015 Secondary 50.0m 13.4m 36.6m
TOTAL $292.5m $192.1m $100.5mSome figures estimated for Legacy Portfolio; totals may not sum due to rounding.
II. FUND COMMITMENTS
In 2016, VCERA made follow‐on commitments to Adams Street Partners and HarbourVest, as well as a new commitment to Drive Capital as follows: Fund Year Focus Commitment Paid In Undrawn
Adams Street 2016 Global Fund 2016 VC&PE $60.0m $1.5m $58.5m
HarbourVest Dover Street IX 2016 Secondary 60.0m 2.4m 57.6m
Drive Capital II 2016 VC 15.0m 0.4m 14.6m
TOTAL $135.0m $4.3m $130.7m
III. OTHER INVESTMENT ACTIVITY There was no other investment activity in the Legacy Portfolio in 2016.
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IV. DIVESTMENT ACTIVITY No funds were divested, liquidated or otherwise terminated in the Legacy Portfolio in 2016.
V. CURRENT LEGACY PORTFOLIO
Fund Year Commitment Cumulative
Distributions NAV
Adams Street 2010 US Fund 2010 $42.5m $14.4m $34.5m
Adams Street 2010 Non‐US Developed Markets Fund 2010 25.5m 8.1m 17.0m
Adams Street 2010 Non‐US Emerging Markets Fund 2010 8.5m 0.7m 7.9m
Adams Street 2010 Direct Fund 2010 8.5m 5.7m 6.4m
Pantheon Global Secondary Fund IV 2010 15.0m 8.8m 5.9m
Adams Street 2013 Global Fund 2013 75.0m 3.1m 45.9m
HarbourVest Dover Street VIII 2013 67.5m 29.4m 48.3m
Pantheon Global Secondary Fund V 2015 50.0m 0.0m 17.3m
Adams Street 2016 Global Fund 2016 60.0m 0.0m 2.1m
HarbourVest Dover Street IX 2016 60.0m 0.8m 3.0m
Drive Capital 2016 15.0m 0.0m 0.2m
TOTAL $427.5m $71.0m $188.4mSome figures estimated for Legacy Portfolio
As of December 31, 2016, VCERA had committed a total of $427.5 million of which $196.3 million had been paid‐in. From inception through December 31, 2016, VCERA had received cumulative distributions of approximately $71.0 million, resulting in a DPI of 0.36. The reported remaining fair market value was $188.4 million and the TVPI was 1.32.
VI. MONITORING OF THE LEGACY PORTFOLIO Abbott will seek to collect performance data on VCERA’s Legacy Portfolio and to monitor developments within the portfolios. Abbott is not aware of any specific situations requiring additional monitoring at present.
D. 2017 INVESTMENT PLAN
I. POTENTIAL PIPELINE For the remainder of 2017 and over the next several vintage years, Abbott will begin to establish the foundation of VCERA’s direct private equity portfolio with a goal of achieving the targeted 10% allocation by the end of 2021. Consistent with Abbott’s longstanding approach to building portfolios that have withstood market cycles, Abbott will seek to build a portfolio that is diversified over multiple vintage years with commitments being made that Abbott believes will lead to achieving the Strategic Portfolio Structure (see page 2). The pipeline of potential investments is discussed with Staff on a regular basis.
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II. DOLLAR AMOUNT TO BE INVESTED Based on the current state of the portfolio, the projected capital calls, distributions, NAV appreciation, and overall Plan growth rate, VCERA should commit approximately $150 million per year for the next several years in order to reach the Private Equity Target Allocation. Thus far in 2017, VCERA has committed $30 million to HarbourVest Co‐Investment Fund IV. Abbott will seek to commit a total of $120 million in the remainder of 2017 to six to eight primary partnerships. Commitments are likely to range from $10 million to $30 million. Strategies such as Secondaries and Co‐Investments in the near term will help VCERA reach the Target Allocation, even as the foundations of a direct portfolio are being laid. Abbott will continue to focus on larger dollar commitments to top‐tier private equity partnerships. It should be noted, however, that access to high‐quality funds is frequently a significant barrier for limited partners. As such, Abbott recommends that VCERA remain flexible with respect to commitment sizes, which will provide the portfolio the widest possible access to high‐quality private equity partnerships. Subject to an acceptable pipeline of opportunities, Abbott will seek to prudently commit capital on VCERA’s behalf at an average annual level of $150 million over the next several vintage years. We note, however, that the fundraising market is cyclical and no assurances can be made that the stated commitment goals will be attained in any given year. E. SUMMARY
Abbott will seek to begin making commitments immediately with a near‐term objective of committing approximately $120 million during the remainder of 2017 to approximately six to eight primary partnerships, with commitment sizes ranging from approximately $10 million to $30 million per commitment. VCERA should continue to receive some level of distribution activity from its Legacy Portfolio but the overall Private Equity Portfolio still remains in its development phase. Thus, capital calls are expected to continue to exceed distributions for the foreseeable future from the Legacy Portfolio. As Abbott begins to build the Direct Portfolio, capital calls are expected to exceed cash distributions for several vintage years, assuming Abbott is able to maintain a fairly consistent pace of committing approximately $150 million per year. As always, Abbott will maintain its rigorous selection criteria with the goal of building a diversified portfolio across Global Venture Capital and Growth Equity, North American Buyouts and Special Situations, International Buyouts and Special Situations, as well as other private equity strategies.
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APPENDIX 1 2016 Private Equity Market Review
I. VENTURE CAPITAL & GROWTH EQUITY
Investment activity within venture capital and growth equity remained robust in 2016 with $122.1 billion invested globally, a slight decrease from $138.7 billion in 2015. While 2016 saw a nominal decrease in venture capital investing, the total invested amount remains well above the $64.3 billion average invested between 2001 and 2013. Venture investments from corporate investors, benefitting from strong balance sheets, continue to increase and accounted for more than 13% of all venture capital deals in the U.S. last year compared to 10% in 2015. Global venture capital fundraising continued to remain healthy, with many larger, experienced general partners raising capital for new funds, and investors willing and able to deploy capital into venture capital and growth equity strategies. Corporate acquisitions and private equity mergers and acquisitions have continued to account for the largest portion of venture‐backed exits, accounting for over 94% of all exits. Strategic acquirers that are not traditionally associated with technology have been able to look to the venture market to find companies that are operationally additive and bring fresh technological innovation. Walmart and Unilever are good examples as evidenced by their large purchases of Jet.com and Dollar Shave Club, respectively. Furthermore, major private equity firms have raised rather large tech‐focused funds that will bolster venture‐backed M&A exits. The acquisitions of Marketo, Qlik Technologies, and Ping Identity are examples of large sales to private equity in 2016. Venture capital public offerings produced $4.2 billion of total transaction value in 2016, a 64% decrease from $11.8 billion in 2015. A total of 39 venture‐backed companies went public in 2016 which is approximately half the number of IPOs from 2015. Furthermore, this is the lowest number of public offerings since 2009 when there were only 10 venture‐backed IPOs following the global financial crisis. IPO activity is projected to increase in 2017 with around 20 venture‐backed companies currently in registration. The successful and highly‐anticipated IPO of Snap is expected to serve as a bellwether of market reception for additional venture‐backed public exits yet to occur in 2017. The past year saw the highest amount of venture capital raised for funds in at least a decade with $59.0 billion raised in 2016 compared to $47.0 billion in 2015, a 25% increase. Despite the increase in capital raised by venture and growth equity funds, the total number of funds closed in 2016 declined slightly for the second consecutive year. At a total of 405 funds seeking capital, there were 2% fewer funds in the market than in 2015. Larger venture firms came back to the market in 2016 closing $1 billion+ funds which coincided with more capital being managed by fewer funds, leading to an increased concentration of capital in the venture industry. U.S. funds raised $42.0 billion in capital, a 20% increase over the $35 billion raised in 2015. Although global venture capital and growth equity investments decreased 9%, the number of transactions decreased at a higher rate of 16% from 2015 to 2016. Private valuations and deal sizes grew or stayed flat during 2016 keeping deal value high on a relative basis. However, outsized venture funding rounds were returned to a more manageable level as there were 40% fewer $100 million+ financings in 2016 than in 2015. A trend throughout the venture capital and growth equity industry during 2016 focused on investors setting a higher benchmark for startup funding with a return to evaluating core company fundamentals rather than simply growth metrics. This is in contrast to the venture activity in 2014 and 2015 that saw massive funding rounds for Uber, Airbnb, and Snap.
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II. Buyouts and Special Situations Distribution activity was again the headline from 2016 within the buyout and special situations segment, continuing a trend that has been in place since 2013. Portfolio liquidity was brought about by a strong year for mergers and acquisitions, dominated by strategic purchases by corporate buyers. Buyout IPO activity was mixed globally with NAPE transaction value down 52% vs. 2015, but ex‐NAPE transaction value up 61% and SBO transaction value up 45% vs. 2015. In general, distributions continue to exceed capital calls. Leverage and shadow capital also continues to be available in the current low interest rate environment. Buyout and special situations firms globally raised $178.7 billion, a 14% increase from 2015. Approximately $50 billion went to small‐and‐medium buyout funds globally. North America based firms raised 6% more capital compared to 2015, accumulating $98.4 billion, while ex‐North America domiciled firms raised $30.0 billion in 2016, roughly flat compared to the prior year. Demand was driven by U.S. pensions seeking to fund growing liability gaps, sovereign wealth funds similarly seeking to fill funding gaps in a prolonged low commodity price environment as well as growing demand from retail high net worth investors. All in, dry powder reached another record level in 2016 and deal prices accordingly reached the highest levels since 2006. Despite the influx of capital, global investment activity within buyouts fell nearly 29% from 2015. NAPE buyouts experienced a 21% decline in capital invested in the most recent election year and ex‐NAPE buyouts experienced a 27% decline in capital invested due to concerns about Brexit and slowing emerging market growth. Globally, buyout and special situations firms invested $15.6 billion in nearly 855 companies.
III. Secondary Activity Secondary transaction volume declined in 2016 to $37 billion following two record years of over $40 billion in annual transaction volume. A primary driver of volume compression was smaller average transaction size, which declined from approximately $200 million in 2015 to $180 million in 2016. While the trade of limited partner positions still dominates the type of secondary sales at 75% of all volume, general partner‐led transactions such as secondary directs, fund restructurings, recapitalizations, spin‐outs, and tender offers have expanded, composing 25% of activity versus 22% in 2015. The secondary market continues to be highly concentrated, with the top 10 largest buyers accounting for approximately 58% of transaction volume in 2016, down from 62% in 2015. The estimated level of dry powder for secondaries rose to a record high of over $70 billion at year‐end 2016, up from $65 billion in 2015. The price of secondary deals remains competitive given sustained buy‐side demand, although prices appear to have moderated slightly in 2016 due to public market volatility and a higher proportion of tail‐end funds that were sold in the secondary market in 2016 compared to prior years. Pricing of buyout interests increased modestly to 95% of NAV in 2016, up from 94% in 2015. Furthermore, venture capital pricing increased by 3% to 78% of NAV in 2016. The increase in pricing for venture and buyout assets is largely a result of buyers demonstrating a flight to quality and an increased appetite for more recent vintage funds with strong perceived upside. Endowments and foundations were the most active seller type, representing 24% of 2016 deal count yet only 11% of total volume. In terms of volume, public pensions continued to be the largest seller type accounting for almost one‐third of deal flow in 2016. Buyout and venture funds continued to represent the bulk of the interests that trade on the secondary market accounting for 54% and 21% of funds sold in 2016, respectively.
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The information presented in this Market Review was generally sourced from the following materials.
Bain & Company: Global Private Equity Report 2017. Greenhill Cogent: Secondary Market Trends Outlook, January 2017. McKinsey & Company: McKinsey Global Private Markets Review, February 2017. Lazard: Secondary Market – Lazard Review 2016. Pitchbook: Venture Monitor, 4Q 2016. Pitchbook: 2016 Annual, PE & VC Exits. Setter Capital: Volume Report FY 2016. Thomson Reuters/Thomson ONE database (Fundraising, Investments, M&A, IPOs). Data retrieved from Thomson Reuters is continuously updated and is therefore subject to change. All data in Thomson One derived from either Thomson Financial sources or public filings.
Venture Capital Journal: January 2017, Issue 1. “What to Expect in 2017.”
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Preliminary Performance Report Month Ending May 31, 2017
Anthony Ferrara, CAIA, ConsultantAllan Martin, Partner
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Market Value($)
% ofPortfolio Policy % 1 Mo
(%)3 Mo
(%)YTD(%)
FiscalYTD(%)
1 Yr(%)
3 Yrs(%)
5 Yrs(%)
10 Yrs(%)
Return(%) Since
_
Total Fund 4,910,417,833 100.0 100.0 1.2 3.0 6.9 12.1 12.8 5.4 9.8 5.1 8.0 Apr-94Policy Index 1.3 3.2 7.2 12.5 12.9 6.3 10.1 5.3 8.1 Apr-94
Over/Under -0.1 -0.2 -0.3 -0.4 -0.1 -0.9 -0.3 -0.2 -0.1Allocation Index 1.3 3.0 7.2 12.9 13.3 5.8 9.5 4.9 -- Apr-9460% MSCI ACWI (Net) / 40% CITI WGBI 2.0 4.3 8.4 8.9 10.1 3.0 6.8 3.9 -- Apr-94Total Fund ex Parametric 4,836,879,846 98.5 -- 1.2 3.0 6.9 11.5 12.4 5.3 9.6 5.0 8.0 Apr-94Total Fund ex Private Equity 4,724,731,119 96.2 -- 1.2 3.0 7.1 12.2 12.9 5.2 9.2 -- 9.1 Jan-12
Policy Index 1.3 3.2 7.2 12.5 12.9 6.3 10.1 5.3 9.8 Jan-12Over/Under -0.1 -0.2 -0.1 -0.3 0.0 -1.1 -0.9 -0.7
Total US Equity 1,568,464,156 31.9 28.0 1.2 2.3 8.1 17.8 18.0 9.8 15.5 6.8 9.1 Dec-93Russell 3000 1.0 2.2 8.0 17.4 17.7 9.6 15.2 7.0 9.4 Dec-93
Over/Under 0.2 0.1 0.1 0.4 0.3 0.2 0.3 -0.2 -0.3Western U.S. Index Plus 175,265,778 3.6 1.6 2.9 8.9 18.2 18.8 10.7 16.5 5.0 5.0 May-07
S&P 500 1.4 2.6 8.7 17.2 17.5 10.1 15.4 6.9 6.9 May-07Over/Under 0.2 0.3 0.2 1.0 1.3 0.6 1.1 -1.9 -1.9
Blackrock Russell 1000 Index 1,338,921,365 27.3 1.3 -- -- -- -- -- -- -- 1.3 May-17Russell 1000 1.3 2.4 8.5 17.2 17.5 9.8 15.4 7.0 1.3 May-17
Over/Under 0.0 0.0Blackrock Russell 2500 Index 54,251,704 1.1 -1.1 -- -- -- -- -- -- -- -1.1 May-17
Russell 2500 -1.1 -0.4 3.4 16.9 16.9 7.7 14.3 7.0 -1.1 May-17Over/Under 0.0 0.0
Policy Index: Currently, 28% Russell 3000, 20% Barclays Aggregate, 15% MSCI ACWI ex U.S., 10%MSCI ACWI, 10% DJ U.S. Total Stock Market Index + 3%, 10% CPI+4% Index, and7% NCREIF ODCE Real Estate Index.
Prior to January 2016 the Total U.S. Equity Benchmark was a dynamic hybrid using the respective managers' market value weights within the U.S. Equity component toward theirbenchmark. Prior to May 2013, the Dow Jones U.S. Total Stock Market Index. Prior to May 2007, the Russell 3000 Index.
CPI+4% and CPI+5% are estimated due to CPI monthly lag.
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BlackRock Equity Index Fund had a residual amount of $25,309 as of May 31st.
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Ventura County Employees’ Retirement AssociationTotal Fund Performance Detail Net of Fees
Market Value($)
% ofPortfolio Policy % 1 Mo
(%)3 Mo
(%)YTD(%)
FiscalYTD(%)
1 Yr(%)
3 Yrs(%)
5 Yrs(%)
10 Yrs(%)
Return(%) Since
_
Total Non-US Equity 800,820,736 16.3 15.0 3.0 8.2 13.7 20.6 19.4 2.3 9.0 1.6 6.5 Mar-94MSCI ACWI ex USA 3.2 8.1 13.7 20.1 18.2 1.3 8.4 1.2 5.2 Mar-94
Over/Under -0.2 0.1 0.0 0.5 1.2 1.0 0.6 0.4 1.3MSCI EAFE 3.7 9.2 14.0 20.5 16.4 1.5 10.2 1.1 4.9 Mar-94MSCI ACWI ex USA Local Currency 1.9 5.8 8.9 21.6 18.7 6.9 12.0 2.5 -- Mar-94MSCI EAFE Local Currency 2.1 6.0 8.4 23.1 18.4 7.4 13.9 2.1 4.9 Mar-94BlackRock ACWI ex-U.S. Index 389,754,812 7.9 3.2 8.3 14.1 20.3 18.3 1.8 8.9 1.7 2.4 Mar-07
MSCI ACWI ex USA 3.2 8.1 13.7 20.1 18.2 1.3 8.4 1.2 1.9 Mar-07Over/Under 0.0 0.2 0.4 0.2 0.1 0.5 0.5 0.5 0.5
MSCI ACWI ex USA Local Currency 1.9 5.8 8.9 21.6 18.7 6.9 12.0 2.5 3.1 Mar-07Sprucegrove 207,693,302 4.2 1.2 6.3 12.2 25.2 24.0 1.7 8.9 2.0 7.6 Mar-02
MSCI ACWI ex USA 3.2 8.1 13.7 20.1 18.2 1.3 8.4 1.2 6.6 Mar-02Over/Under -2.0 -1.8 -1.5 5.1 5.8 0.4 0.5 0.8 1.0
MSCI EAFE 3.7 9.2 14.0 20.5 16.4 1.5 10.2 1.1 6.1 Mar-02MSCI ACWI ex USA Local Currency 1.9 5.8 8.9 21.6 18.7 6.9 12.0 2.5 5.4 Mar-02MSCI EAFE Local Currency 2.1 6.0 8.4 23.1 18.4 7.4 13.9 2.1 4.6 Mar-02
Hexavest 89,946,705 1.8 4.1 8.8 12.3 16.0 14.9 2.4 8.9 -- 4.9 Dec-10MSCI EAFE 3.7 9.2 14.0 20.5 16.4 1.5 10.2 1.1 5.1 Dec-10
Over/Under 0.4 -0.4 -1.7 -4.5 -1.5 0.9 -1.3 -0.2MSCI EAFE Local Currency 2.1 6.0 8.4 23.1 18.4 7.4 13.9 2.1 8.3 Dec-10
Walter Scott 113,425,917 2.3 4.8 11.3 16.3 17.4 18.2 5.1 9.0 -- 5.8 Dec-10MSCI ACWI ex USA 3.2 8.1 13.7 20.1 18.2 1.3 8.4 1.2 3.6 Dec-10
Over/Under 1.6 3.2 2.6 -2.7 0.0 3.8 0.6 2.2MSCI ACWI ex USA Local Currency 1.9 5.8 8.9 21.6 18.7 6.9 12.0 2.5 7.0 Dec-10MSCI EAFE 3.7 9.2 14.0 20.5 16.4 1.5 10.2 1.1 5.1 Dec-10
Total Global Equity 535,306,369 10.9 10.0 2.3 5.2 11.2 19.0 18.3 4.2 10.6 3.0 5.7 May-05MSCI ACWI 2.2 5.1 11.0 18.2 17.5 5.3 11.5 3.6 6.7 May-05
Over/Under 0.1 0.1 0.2 0.8 0.8 -1.1 -0.9 -0.6 -1.0BlackRock MSCI ACWI Equity Index 535,306,369 10.9 2.3 5.2 11.2 18.7 18.0 5.8 -- -- 10.9 Aug-12
MSCI ACWI 2.2 5.1 11.0 18.2 17.5 5.3 11.5 3.6 10.5 Aug-12Over/Under 0.1 0.1 0.2 0.5 0.5 0.5 0.4
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Please Note:Private Equity performance is shown on a time-weighted return basis. Values are cash adjusted with current month cash flows. Drive Capital Fund, funded 9/1/2016
Market Value($)
% ofPortfolio Policy % 1 Mo
(%)3 Mo
(%)YTD(%)
FiscalYTD(%)
1 Yr(%)
3 Yrs(%)
5 Yrs(%)
10 Yrs(%)
Return(%) Since
_
Total Private Equity 185,686,714 3.8 10.0 0.5 2.8 4.0 11.4 10.6 13.0 12.8 -- 13.5 Jan-12DJ U.S. Total Stock Market Index + 3% 1.3 2.9 9.3 20.6 21.1 12.9 18.6 -- 18.4 Jan-12
Over/Under -0.8 -0.1 -5.3 -9.2 -10.5 0.1 -5.8 -4.9 Adams Street Global Fund Series 114,088,728 2.3 0.0 1.7 1.7 8.3 7.5 10.7 10.9 -- 11.9 Jan-12
DJ U.S. Total Stock Market Index + 3% 1.3 2.9 9.3 20.6 21.1 12.9 18.6 -- 18.4 Jan-12Over/Under -1.3 -1.2 -7.6 -12.3 -13.6 -2.2 -7.7 -6.5
Harbourvest- Dover Street VIII 48,914,468 1.0 2.1 4.2 8.9 15.1 14.9 18.8 -- -- 18.7 Aug-13DJ U.S. Total Stock Market Index + 3% 1.3 2.9 9.3 20.6 21.1 12.9 18.6 -- 14.9 Aug-13
Over/Under 0.8 1.3 -0.4 -5.5 -6.2 5.9 3.8 Pantheon Global Secondary Funds 22,007,565 0.4 0.0 6.0 6.0 24.6 20.6 12.8 11.1 -- 11.0 Jan-12
DJ U.S. Total Stock Market Index + 3% 1.3 2.9 9.3 20.6 21.1 12.9 18.6 -- 18.4 Jan-12Over/Under -1.3 3.1 -3.3 4.0 -0.5 -0.1 -7.5 -7.4
Drive Capital Fund 675,953 0.0 -12.1 -28.5 -28.5 -- -- -- -- -- -49.5 Sep-16DJ U.S. Total Stock Market Index + 3% 1.3 2.9 9.3 20.6 21.1 12.9 18.6 -- 15.1 Sep-16
Over/Under -13.4 -31.4 -37.8 -64.6 XXXXX
May 31, 2017
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Ventura County Employees’ Retirement AssociationPrivate Equity Limited Partnership Performance
May 31, 2017
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Ventura County Employees’ Retirement AssociationTotal Fund Performance Detail Net of Fees
Reams Custom Index: Merrill Lynch 3 Month Libor Constant Maturity Index, prior to February 2013 the Barclays Aggregate.
Loomis Custom Index: 65% Barclays Aggregate, 30% Citigroup High Yield Market Index and 5% JPM Non-US Hedged Bond Index.
Market Value($)
% ofPortfolio Policy % 1 Mo
(%)3 Mo
(%)YTD(%)
FiscalYTD(%)
1 Yr(%)
3 Yrs(%)
5 Yrs(%)
10 Yrs(%)
Return(%) Since
_
Total US Fixed Income 943,780,242 19.2 20.0 0.7 1.6 2.7 2.1 3.5 2.7 3.2 5.7 6.0 Feb-94BBgBarc US Aggregate TR 0.8 1.5 2.4 -0.2 1.6 2.5 2.2 4.5 5.4 Feb-94
Over/Under -0.1 0.1 0.3 2.3 1.9 0.2 1.0 1.2 0.6 BlackRock U.S. Debt Fund 220,470,875 4.5 0.8 1.5 2.4 -0.2 1.6 2.6 2.3 4.5 5.3 Nov-95
BBgBarc US Aggregate TR 0.8 1.5 2.4 -0.2 1.6 2.5 2.2 4.5 5.3 Nov-95Over/Under 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 0.0
Western 291,564,134 5.9 1.1 2.3 3.7 1.8 3.9 3.6 4.0 5.5 6.3 Dec-96BBgBarc US Aggregate TR 0.8 1.5 2.4 -0.2 1.6 2.5 2.2 4.5 5.3 Dec-96
Over/Under 0.3 0.8 1.3 2.0 2.3 1.1 1.8 1.0 1.0 Reams 306,207,051 6.2 0.3 1.0 1.6 2.2 3.0 1.8 2.4 5.9 5.5 Sep-01
Reams Custom Index 0.1 0.3 0.5 0.9 1.0 0.6 0.6 3.6 4.0 Sep-01Over/Under 0.2 0.7 1.1 1.3 2.0 1.2 1.8 2.3 1.5
BBgBarc US Aggregate TR 0.8 1.5 2.4 -0.2 1.6 2.5 2.2 4.5 4.5 Sep-013-Month LIBOR + 3% 0.4 1.0 1.7 3.7 4.0 3.6 3.5 4.1 4.8 Sep-01
Loomis Strategic Alpha 45,150,080 0.9 0.1 0.7 1.4 5.0 5.0 2.4 -- -- 2.7 Jul-13BBgBarc US Aggregate TR 0.8 1.5 2.4 -0.2 1.6 2.5 2.2 4.5 3.1 Jul-13
Over/Under -0.7 -0.8 -1.0 5.2 3.4 -0.1 -0.4 3-Month LIBOR + 3% 0.4 1.0 1.7 3.7 4.0 3.6 3.5 4.1 3.5 Jul-13
Loomis Sayles Multi Strategy 80,388,101 1.6 0.8 2.6 5.0 6.6 8.1 3.6 5.9 6.6 6.6 Jul-05Loomis Custom Index 0.8 1.5 3.0 3.4 5.0 3.1 3.7 5.3 5.3 Jul-05
Over/Under 0.0 1.1 2.0 3.2 3.1 0.5 2.2 1.3 1.3 BBgBarc US Govt/Credit TR 0.8 1.6 2.6 -0.4 1.8 2.6 2.3 4.5 4.3 Jul-05
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Total Real Estate Benchmark: NCREIF ODCE; prior to January 2006, the NCREIF Property Index. Real Estate managers and NCREIF ODCE are valued on a quarterly basis. Performance is not applicable in mid-quarter months, therefore 0% return is shown. CPI+4% and CPI+5% is estimated by carrying the last available month forward. Real Estate Valuation is as of 12/31/2016.
Market Value($)
% ofPortfolio Policy % 1 Mo
(%)3 Mo
(%)YTD(%)
FiscalYTD(%)
1 Yr(%)
3 Yrs(%)
5 Yrs(%)
10 Yrs(%)
Return(%) Since
_
Total Real Estate 386,654,349 7.9 7.0 0.0 1.1 1.1 4.3 6.0 9.9 9.8 3.1 7.8 Mar-94NCREIF ODCE Net 0.0 1.5 1.5 5.3 7.4 10.8 10.9 4.6 8.1 Mar-94
Over/Under 0.0 -0.4 -0.4 -1.0 -1.4 -0.9 -1.1 -1.5 -0.3 Prudential Real Estate 136,969,399 2.8 0.0 1.4 1.4 5.6 7.5 11.4 11.2 4.3 6.0 Jun-04
NCREIF ODCE Net 0.0 1.5 1.5 5.3 7.4 10.8 10.9 4.6 7.0 Jun-04Over/Under 0.0 -0.1 -0.1 0.3 0.1 0.6 0.3 -0.3 -1.0
NCREIF ODCE 0.0 1.8 1.8 6.1 8.3 11.8 12.0 5.6 8.0 Jun-04UBS Real Estate 249,504,786 5.1 0.0 0.9 0.9 3.6 5.2 9.0 9.0 4.7 7.4 Mar-03
NCREIF ODCE Net 0.0 1.5 1.5 5.3 7.4 10.8 10.9 4.6 7.2 Mar-03Over/Under 0.0 -0.6 -0.6 -1.7 -2.2 -1.8 -1.9 0.1 0.2
NCREIF ODCE 0.0 1.8 1.8 6.1 8.3 11.8 12.0 5.6 8.2 Mar-03RREEF 180,164 0.0 0.0 -0.7 -0.7 -13.6 -12.9 2.6 9.0 -- -6.1 Sep-07
NCREIF ODCE Net 0.0 1.5 1.5 5.3 7.4 10.8 10.9 4.6 3.9 Sep-07Over/Under 0.0 -2.2 -2.2 -18.9 -20.3 -8.2 -1.9 -10.0
NCREIF ODCE 0.0 1.8 1.8 6.1 8.3 11.8 12.0 5.6 4.8 Sep-07Total Liquid Alternatives 416,167,280 8.5 10.0 -1.3 -1.0 3.0 5.8 10.1 -0.6 -- -- 4.9 Apr-13
CPI + 4% (Unadjusted) 0.6 1.7 3.2 5.5 6.2 5.1 11.0 -- 6.4 Apr-13Over/Under -1.9 -2.7 -0.2 0.3 3.9 -5.7 -1.5
Bridgewater All Weather Fund 294,823,471 6.0 0.5 1.7 4.9 6.4 10.3 2.3 -- -- 4.9 Aug-13CPI + 5% (Unadjusted) 0.7 1.9 3.7 6.4 7.2 6.1 -- -- 6.3 Aug-13
Over/Under -0.2 -0.2 1.2 0.0 3.1 -3.8 -1.4 Tortoise Energy Infrastructure 121,343,810 2.5 -5.5 -7.0 -1.2 4.1 9.4 -6.5 -- -- 2.0 Apr-13
Wells Fargo MLP Index -4.8 -7.1 -2.9 3.5 9.0 -9.0 3.2 -- -2.7 Apr-13Over/Under -0.7 0.1 1.7 0.6 0.4 2.5 4.7
Overlay 73,537,987 1.5 0.0 Parametric 73,537,987 1.5
May 31, 2017
Ventura County Employees’ Retirement AssociationTotal Fund Performance Detail Net of Fees
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May 31, 2017
Ventura County Employees’ Retirement AssociationTotal Fund
Cash Flow Summary Month Ending May 31, 2017
BeginningMarket Value Contributions Withdrawals Net Cash Flow Fees Net Investment
ChangeEnding
Market Value_
Adams Street Global Fund Series $112,481,817 $4,240,000 -$2,633,111 $1,606,889 $0 $23 $114,088,728BlackRock ACWI ex-U.S. Index $377,478,397 $0 $0 $0 -$34,146 $12,276,415 $389,754,812BlackRock MSCI ACWI Equity Index $523,340,508 $0 $0 $0 -$19,510 $11,965,861 $535,306,369Blackrock Russell 1000 Index $1,321,979,752 $0 $0 $0 -$11,574 $16,941,613 $1,338,921,365Blackrock Russell 2500 Index $54,858,247 $0 $0 $0 -$904 -$606,543 $54,251,704BlackRock U.S. Debt Fund $218,739,475 $0 $0 $0 -$10,682 $1,731,400 $220,470,875Bridgewater All Weather Fund $293,220,739 $0 $0 $0 -$94,755 $1,602,732 $294,823,471Drive Capital Fund $576,768 $178,326 $0 $178,326 $0 -$79,141 $675,953Harbourvest- Dover Street VIII $49,567,866 $0 -$1,691,512 -$1,691,512 $0 $1,038,114 $48,914,468Hexavest $86,359,284 $0 $0 $0 -$34,149 $3,587,422 $89,946,705Loomis Sayles Multi Strategy $79,690,157 $0 $0 $0 -$25,930 $697,944 $80,388,101Loomis Strategic Alpha $45,074,515 $0 $0 $0 -$15,050 $75,565 $45,150,080Pantheon Global Secondary Funds $22,922,565 $0 -$915,000 -$915,000 $0 $0 $22,007,565Parametric $86,000,313 $4,777,922 -$17,380,230 -$12,602,308 -$7,170 $139,982 $73,537,987Prudential Real Estate $136,969,399 $0 $0 $0 $0 $0 $136,969,399Reams $305,130,545 $0 $0 $0 -$44,526 $1,076,506 $306,207,051RREEF $180,164 $0 $0 $0 $0 $0 $180,164Sprucegrove $205,143,030 $0 $0 $0 -$62,853 $2,550,272 $207,693,302Tortoise Energy Infrastructure $128,356,697 $0 $0 $0 -$63,200 -$7,012,888 $121,343,810UBS Real Estate $249,504,786 $0 $0 $0 $0 $0 $249,504,786Ventura County US Equity $24,926 $0 $0 $0 $0 $383 $25,309Walter Scott $108,160,047 $0 $0 $0 -$78,588 $5,265,870 $113,425,917Western $288,472,860 $0 $0 $0 -$48,946 $3,091,275 $291,564,134Western U.S. Index Plus $172,451,351 $0 $0 $0 -$34,408 $2,814,427 $175,265,778Total $4,866,684,206 $9,196,248 -$22,619,853 -$13,423,605 -$586,392 $57,157,232 $4,910,417,833
XXXXX
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Ventura County Employees’ Retirement System
Fourth Quarter 2016 Private Markets Review
Business Meeting Agenda - VI.A. INVESTMENT INFORMATION: NEPC INVESTMENT REPORTS
MASTER PAGE NO. 90 of 202
Q4 2016
Table of Contents Page Summary Letter 1 Trailing Period Returns 6 Portfolio Value 7 Portfolio Value by Lifecycle 8 Portfolio Value by Vintage Year 9 Portfolio Value by Strategy 10 Transaction Summary 11 Information Disclosure
• NEPC, LLC uses, as its data source, the plan’s fund manager and custodian bank or fund service company, and NEPC, LLC relies on those sources for all transactions, including capital calls, distributions, income/expense and reported values. While NEPC, LLC has exercised reasonable professional care in preparing this report, we cannot guarantee the accuracy of all source information contained within.
• The Investment Performance Analysis is provided as a management aid for the client’s internal use only. Portfolio performance reported in the Investment Performance Analysis does not constitute a recommendation by NEPC, LLC.
• Information in this report on market indices and security characteristics is received from sources external to NEPC, LLC. While efforts are made to ensure that this external data is accurate, NEPC, LLC cannot accept responsibility for errors that may occur.
Business Meeting Agenda - VI.A. INVESTMENT INFORMATION: NEPC INVESTMENT REPORTS
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June 13, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Ave., Suite 200 Ventura, CA 93003 RE: Fourth Quarter 2016 Private Markets Review – Private Equity Dear Board of Retirement Members: We are pleased to present the December 31, 2016 Private Equity Performance Report for the Ventura County Employees’ Retirement Association (“VCERA” or the “Plan”). The report provides a variety of performance analyses for the overall portfolio in addition to trailing period performance and performance by investment stage, vintage year, and investment strategy. VCERA’s private equity portfolio experienced a positive quarter, earning a nominal IRR of 3.39% and a one year return of 10.29%. The annualized IRR of the private equity portfolio since inception (May 2010) was 14.31% at quarter end. Since inception, the Total Value to Paid In multiple (current valuation plus cumulative distributions, divided by total capital calls) was 1.32. The following table presents the status of the VCERA private equity portfolio as of December 31, 2016:
Total Terminated Paid In Cumulative Reported Call DistributionCommitments Commitments Capital Distributions Value Ratio Ratio$427,500,000 $0 $196,258,141 $71,060,194 $188,447,016 46% 0.36
Total Fund Private Reported MarketUnfunded Market Value Equity Value Exposure
Commitment as of Target as a % of as a %12/31/2016 Total Fund Total Fund
$231,241,859 $4,668,717,739 10% 4.0% 9.0%
1.32
Internal Rate of Return(IRR), Since Inception
(May 2010)14.3%
Total ValueTo
Paid In Ratio$259,507,210
$419,688,875
Market Exposure (Reported Value +
Unfunded Commitment)
Total Value(Reported Value + Cumulative Distributions)
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At quarter end, VCERA had commitments totaling $427.5 million to 11 private equity funds. Of the 11 funds in the portfolio, 10 are in the investing stage and 1 is in the harvesting stage. The following charts illustrate the program’s current life cycle.
The following chart illustrates the commitment history of the private equity program since inception.
Investing, $419,000,000
Harvesting, $8,500,000
Commitment $427,500,000
Investing, $230,621,359
Harvesting, $620,500
Capital to be Funded $231,241,859
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
$140,000,000
$160,000,000
2010 2011 2012 2013 2014 2015 2016
Commitment History
Secondaries Fund of Funds Venture
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The following chart illustrates the cumulative commitment history, cumulative capital calls, cumulative distributions and reported value of the private equity program since inception.
The following chart provides an analysis of vintage year performance, comparing capital calls to distributions and reported value since inception.
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
$350,000,000
$400,000,000
$450,000,000
Cumulative Commitments, Capital Calls, Distributions and Total Value
Distributions Reported Value Capital Called Total Value Total Commitments
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
$140,000,000
$160,000,000
2010 2011 2012 2013 2014 2015 2016
Vintage Year Analysis of Commitments, Value and Cash Flows Since Inception
Capital Called Distributions Reported Value Total Commitments
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During the fourth quarter of 2016, the private equity portfolio funded 9 investments and received distributions from 8 funds. The summary of the cash flows is shown below.
Amount Funded for the
Quarter
Number of Funds Calling Capital
Distributions for the Quarter
Number of Funds Making Distributions
Net Cash/Stock Flows for the
Quarter $20,663,675 9 $9,748,883 8 $10,914,792
Since inception, the private equity program has added $63.28 million in value. The value-add by investment strategy follows: Secondaries, $31.49 million; and Fund of Funds, $32.0 million. Venture lost value at ($0.21) million.
-$5,000,000
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
Value-Add By Investment Strategy
Secondaries Fund of Funds Venture
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At quarter end, the private equity portfolio was diversified by investment strategy as shown below.
We value the relationship that we have with the Ventura County Employees’ Retirement Association and look forward to continued success in the future. Best regards, Allan Martin Anthony Ferrara, CAIA Partner Consultant
Secondaries40%
Venture0%
Fund of Funds60%
Investment Strategy Diversification($188.45 million Reported Value)
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Ventura County ERA
Executive IRR Summary
12/31/2016
Investment Name Vintage Year
Commitment Amount
QTD YTD 1 Year 3 Year 5 Year Inception
Adams St 2010 Direct Fund 2010 8,500,000 -2.30 -3.41 -3.41 11.02 12.13 11.93
Adams St 2010 Non-US Dev Mkts Fund 2010 25,500,000 1.59 11.26 11.26 7.40 8.64 8.12
Adams St 2010 Non-US Emg Mkts Fund 2010 8,500,000 0.63 4.93 4.93 13.22 10.69 9.56
Adams St 2010 US Fund 2010 42,500,000 1.73 10.41 10.41 13.64 13.82 14.31
Adams St 2013 Global Fund 2013 75,000,000 3.50 7.93 7.93 6.41 6.37
Adams St 2016 Global Fund 2016 60,000,000 269.97 36.85
Drive Capital Fund II 2016 15,000,000 -23.72 -48.28
HarbourVest - Dover Street IX 2016 60,000,000 354.87 62.50
HarbourVest – Dover Street VIII 2013 67,500,000 1.51 6.93 6.93 16.20 23.90
Pantheon Global Secondary Fund IV 2010 15,000,000 3.76 5.27 5.27 6.17 13.57 14.17
Pantheon Global Secondary Fund V 2014 50,000,000 9.61 34.88 34.88 26.25
Total: Ventura County ERA 427,500,000 3.39 10.29 10.29 12.50 14.38 14.31
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Ventura County ERA
Performance Analysis
12/31/2016
Investment Name Vintage Year
Commitment Amount
Paid in Capital Capital to be Funded
Additional Fees
Cumulative Distributions
Valuation Total Value Net Benefit Call Ratio
DPI Ratio
TVPI Ratio
IRR
1 Adams St 2010 Direct Fund 2010 8,500,000 7,879,500 620,500 6,697 5,660,562 6,408,768 12,069,330 4,183,133 93% 0.72 1.53 11.93%
2 Adams St 2010 Non-US Dev Mkts Fund 2010 25,500,000 20,591,249 4,908,751 1,589 8,141,472 17,004,917 25,146,389 4,553,551 81% 0.40 1.22 8.12%
3 Adams St 2010 Non-US Emg Mkts Fund 2010 8,500,000 6,621,500 1,878,500 0 738,789 7,882,770 8,621,559 2,000,059 78% 0.11 1.30 9.56%
4 Adams St 2010 US Fund 2010 42,500,000 32,852,500 9,647,500 15,213 14,394,035 34,463,147 48,857,182 15,989,469 77% 0.44 1.49 14.31%
5 Adams St 2013 Global Fund 2013 75,000,000 44,250,000 30,750,000 10,728 3,108,905 45,870,101 48,979,006 4,718,278 59% 0.07 1.11 6.37%
6 Adams St 2016 Global Fund 2016 60,000,000 1,500,000 58,500,000 0 0 2,054,581 2,054,581 554,581 3% 0.00 1.37 36.85%
7 Drive Capital Fund II 2016 15,000,000 449,382 14,550,618 3,210 0 244,730 244,730 -207,862 3% 0.00 0.54 -48.28%
8 HarbourVest - Dover Street IX 2016 60,000,000 2,400,000 57,600,000 0 841,532 3,035,942 3,877,474 1,477,474 4% 0.35 1.62 62.50%
9 HarbourVest – Dover Street VIII 2013 67,500,000 56,362,500 11,137,500 84,954 29,369,898 48,274,491 77,644,389 21,196,935 84% 0.52 1.38 23.90%
10 Pantheon Global Secondary Fund IV 2010 15,000,000 9,960,000 5,040,000 0 8,805,001 5,922,596 14,727,597 4,767,597 66% 0.88 1.48 14.17%
11 Pantheon Global Secondary Fund V 2014 50,000,000 13,391,510 36,608,490 -150,048 0 17,284,973 17,284,973 4,043,511 27% 0.00 1.31 26.25%
Total: Ventura County ERA 427,500,000 196,258,141 231,241,859 -27,657 71,060,194 188,447,016 259,507,210 63,276,726 46% 0.36 1.32 14.31%
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Ventura County ERA
Lifecycle Performance Analysis
12/31/2016
Investment Name Vintage Year
Commitment Amount
Paid in Capital Capital to be Funded
Additional Fees
Cumulative Distributions
Valuation Total Value Net Benefit Call Ratio
DPI Ratio
TVPI Ratio
IRR
2 Investing
1 Adams St 2010 Non-US Dev Mkts Fund 2010 25,500,000 20,591,249 4,908,751 1,589 8,141,472 17,004,917 25,146,389 4,553,551 81% 0.40 1.22 8.12%
2 Adams St 2010 Non-US Emg Mkts Fund 2010 8,500,000 6,621,500 1,878,500 0 738,789 7,882,770 8,621,559 2,000,059 78% 0.11 1.30 9.56%
3 Adams St 2010 US Fund 2010 42,500,000 32,852,500 9,647,500 15,213 14,394,035 34,463,147 48,857,182 15,989,469 77% 0.44 1.49 14.31%
4 Adams St 2013 Global Fund 2013 75,000,000 44,250,000 30,750,000 10,728 3,108,905 45,870,101 48,979,006 4,718,278 59% 0.07 1.11 6.37%
5 Adams St 2016 Global Fund 2016 60,000,000 1,500,000 58,500,000 0 0 2,054,581 2,054,581 554,581 3% 0.00 1.37 36.85%
6 Drive Capital Fund II 2016 15,000,000 449,382 14,550,618 3,210 0 244,730 244,730 -207,862 3% 0.00 0.54 -48.28%
7 HarbourVest - Dover Street IX 2016 60,000,000 2,400,000 57,600,000 0 841,532 3,035,942 3,877,474 1,477,474 4% 0.35 1.62 62.50%
8 HarbourVest – Dover Street VIII 2013 67,500,000 56,362,500 11,137,500 84,954 29,369,898 48,274,491 77,644,389 21,196,935 84% 0.52 1.38 23.90%
9 Pantheon Global Secondary Fund IV 2010 15,000,000 9,960,000 5,040,000 0 8,805,001 5,922,596 14,727,597 4,767,597 66% 0.88 1.48 14.17%
10 Pantheon Global Secondary Fund V 2014 50,000,000 13,391,510 36,608,490 -150,048 0 17,284,973 17,284,973 4,043,511 27% 0.00 1.31 26.25%
Subtotal: 2 Investing 419,000,000 188,378,641 230,621,359 -34,354 65,399,632 182,038,248 247,437,880 59,093,593 45% 0.35 1.31 14.54%
3 Harvesting
1 Adams St 2010 Direct Fund 2010 8,500,000 7,879,500 620,500 6,697 5,660,562 6,408,768 12,069,330 4,183,133 93% 0.72 1.53 11.93%
Subtotal: 3 Harvesting 8,500,000 7,879,500 620,500 6,697 5,660,562 6,408,768 12,069,330 4,183,133 93% 0.72 1.53 11.93%
Total: Ventura County ERA 427,500,000 196,258,141 231,241,859 -27,657 71,060,194 188,447,016 259,507,210 63,276,726 46% 0.36 1.32 14.31%
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Ventura County ERA
Vintage Year Performance Analysis
12/31/2016
Investment Name Vintage Year
Commitment Amount
Paid in Capital Capital to be Funded
Additional Fees
Cumulative Distributions
Valuation Total Value Net Benefit Call Ratio
DPI Ratio
TVPI Ratio
IRR
2010
1 Adams St 2010 Direct Fund 2010 8,500,000 7,879,500 620,500 6,697 5,660,562 6,408,768 12,069,330 4,183,133 93% 0.72 1.53 11.93%
2 Adams St 2010 Non-US Dev Mkts Fund 2010 25,500,000 20,591,249 4,908,751 1,589 8,141,472 17,004,917 25,146,389 4,553,551 81% 0.40 1.22 8.12%
3 Adams St 2010 Non-US Emg Mkts Fund 2010 8,500,000 6,621,500 1,878,500 0 738,789 7,882,770 8,621,559 2,000,059 78% 0.11 1.30 9.56%
4 Adams St 2010 US Fund 2010 42,500,000 32,852,500 9,647,500 15,213 14,394,035 34,463,147 48,857,182 15,989,469 77% 0.44 1.49 14.31%
5 Pantheon Global Secondary Fund IV 2010 15,000,000 9,960,000 5,040,000 0 8,805,001 5,922,596 14,727,597 4,767,597 66% 0.88 1.48 14.17%
Subtotal: 2010 100,000,000 77,904,749 22,095,251 23,499 37,739,859 71,682,198 109,422,057 31,493,809 78% 0.48 1.40 12.27%
2013
1 Adams St 2013 Global Fund 2013 75,000,000 44,250,000 30,750,000 10,728 3,108,905 45,870,101 48,979,006 4,718,278 59% 0.07 1.11 6.37%
2 HarbourVest – Dover Street VIII 2013 67,500,000 56,362,500 11,137,500 84,954 29,369,898 48,274,491 77,644,389 21,196,935 84% 0.52 1.38 23.90%
Subtotal: 2013 142,500,000 100,612,500 41,887,500 95,682 32,478,803 94,144,592 126,623,395 25,915,213 71% 0.32 1.26 16.03%
2014
1 Pantheon Global Secondary Fund V 2014 50,000,000 13,391,510 36,608,490 -150,048 0 17,284,973 17,284,973 4,043,511 27% 0.00 1.31 26.25%
Subtotal: 2014 50,000,000 13,391,510 36,608,490 -150,048 0 17,284,973 17,284,973 4,043,511 27% 0.00 1.31 26.25%
2016
1 Adams St 2016 Global Fund 2016 60,000,000 1,500,000 58,500,000 0 0 2,054,581 2,054,581 554,581 3% 0.00 1.37 36.85%
2 Drive Capital Fund II 2016 15,000,000 449,382 14,550,618 3,210 0 244,730 244,730 -207,862 3% 0.00 0.54 -48.28%
3 HarbourVest - Dover Street IX 2016 60,000,000 2,400,000 57,600,000 0 841,532 3,035,942 3,877,474 1,477,474 4% 0.35 1.62 62.50%
Subtotal: 2016 135,000,000 4,349,382 130,650,618 3,210 841,532 5,335,253 6,176,785 1,824,193 3% 0.19 1.42 296.65%
Total: Ventura County ERA 427,500,000 196,258,141 231,241,859 -27,657 71,060,194 188,447,016 259,507,210 63,276,726 46% 0.36 1.32 14.31%
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Ventura County ERA
Investment Strategy Performance Analysis
12/31/2016
Investment Name Vintage Year
Commitment Amount
Paid in Capital Capital to be Funded
Additional Fees
Cumulative Distributions
Valuation Total Value Net Benefit Call Ratio
DPI Ratio
TVPI Ratio
IRR
100 Venture
1 Drive Capital Fund II 2016 15,000,000 449,382 14,550,618 3,210 0 244,730 244,730 -207,862 3% 0.00 0.54 -48.28%
Subtotal: 100 Venture 15,000,000 449,382 14,550,618 3,210 0 244,730 244,730 -207,862 3% 0.00 0.54 -48.28%
140 Secondaries
1 HarbourVest - Dover Street IX 2016 60,000,000 2,400,000 57,600,000 0 841,532 3,035,942 3,877,474 1,477,474 4% 0.35 1.62 62.50%
2 HarbourVest – Dover Street VIII 2013 67,500,000 56,362,500 11,137,500 84,954 29,369,898 48,274,491 77,644,389 21,196,935 84% 0.52 1.38 23.90%
3 Pantheon Global Secondary Fund IV 2010 15,000,000 9,960,000 5,040,000 0 8,805,001 5,922,596 14,727,597 4,767,597 66% 0.88 1.48 14.17%
4 Pantheon Global Secondary Fund V 2014 50,000,000 13,391,510 36,608,490 -150,048 0 17,284,973 17,284,973 4,043,511 27% 0.00 1.31 26.25%
Subtotal: 140 Secondaries 192,500,000 82,114,010 110,385,990 -65,094 39,016,431 74,518,002 113,534,433 31,485,517 43% 0.48 1.38 21.92%
170 Fund of Funds
1 Adams St 2010 Direct Fund 2010 8,500,000 7,879,500 620,500 6,697 5,660,562 6,408,768 12,069,330 4,183,133 93% 0.72 1.53 11.93%
2 Adams St 2010 Non-US Dev Mkts Fund 2010 25,500,000 20,591,249 4,908,751 1,589 8,141,472 17,004,917 25,146,389 4,553,551 81% 0.40 1.22 8.12%
3 Adams St 2010 Non-US Emg Mkts Fund 2010 8,500,000 6,621,500 1,878,500 0 738,789 7,882,770 8,621,559 2,000,059 78% 0.11 1.30 9.56%
4 Adams St 2010 US Fund 2010 42,500,000 32,852,500 9,647,500 15,213 14,394,035 34,463,147 48,857,182 15,989,469 77% 0.44 1.49 14.31%
5 Adams St 2013 Global Fund 2013 75,000,000 44,250,000 30,750,000 10,728 3,108,905 45,870,101 48,979,006 4,718,278 59% 0.07 1.11 6.37%
6 Adams St 2016 Global Fund 2016 60,000,000 1,500,000 58,500,000 0 0 2,054,581 2,054,581 554,581 3% 0.00 1.37 36.85%
Subtotal: 170 Fund of Funds 220,000,000 113,694,749 106,305,251 34,227 32,043,763 113,684,284 145,728,047 31,999,071 52% 0.28 1.28 10.86%
Total: Ventura County ERA 427,500,000 196,258,141 231,241,859 -27,657 71,060,194 188,447,016 259,507,210 63,276,726 46% 0.36 1.32 14.31%
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Ventura County ERA
Transaction Summary
10/1/2016 - 12/31/2016
Date Paid in Capital Additional Fees Distributions Net Cash Flow
Ventura County ERA
Adams St 2010 Direct Fund
12/29/2016 828,605.00 -828,605.00
Total: Adams St 2010 Direct Fund
828,605.00 -828,605.00
Adams St 2010 Non-US Dev Mkts Fund
12/16/2016 1,045,500.00 1,045,500.00
12/16/2016 488,229.00 557,271.00
Total: Adams St 2010 Non-US Dev Mkts Fund
1,045,500.00 488,229.00 557,271.00
Adams St 2010 Non-US Emg Mkts Fund
12/23/2016 424,353.00 -424,353.00
12/23/2016 510,000.00 85,647.00
Total: Adams St 2010 Non-US Emg Mkts Fund
510,000.00 424,353.00 85,647.00
Adams St 2010 US Fund
11/09/2016 3,629,554.00 -3,629,554.00
11/09/2016 3,187,500.00 -442,054.00
Total: Adams St 2010 US Fund
3,187,500.00 3,629,554.00 -442,054.00
Adams St 2013 Global Fund
10/21/2016 2,550,000.00 2,550,000.00
10/21/2016 410,370.00 2,139,630.00
12/01/2016 2,775,000.00 4,914,630.00
Total: Adams St 2013 Global Fund
5,325,000.00 410,370.00 4,914,630.00
Adams St 2016 Global Fund
12/22/2016 1,500,000.00 1,500,000.00
Total: Adams St 2016 Global Fund
1,500,000.00 1,500,000.00
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Ventura County ERA
Transaction Summary
10/1/2016 - 12/31/2016
Date Paid in Capital Additional Fees Distributions Net Cash Flow
Ventura County ERA
Drive Capital Fund II
10/13/2016 83,243.00 83,243.00
Total: Drive Capital Fund II
83,243.00 83,243.00
HarbourVest - Dover Street IX
12/16/2016 2,400,000.00 2,400,000.00
12/30/2016 841,532.00 1,558,468.00
Total: HarbourVest - Dover Street IX
2,400,000.00 841,532.00 1,558,468.00
HarbourVest – Dover Street VIII
11/04/2016 751,783.00 -751,783.00
12/29/2016 1,879,457.00 -2,631,240.00
12/29/2016 675,000.00 -1,956,240.00
Total: HarbourVest – Dover Street VIII
675,000.00 2,631,240.00 -1,956,240.00
Pantheon Global Secondary Fund IV
12/27/2016 495,000.00 -495,000.00
Total: Pantheon Global Secondary Fund IV
495,000.00 -495,000.00
Pantheon Global Secondary Fund V
12/15/2016 5,950,000.00 5,950,000.00
12/29/2016 -12,568.00 5,937,432.00
Total: Pantheon Global Secondary Fund V
5,950,000.00 -12,568.00 5,937,432.00
Total: 20,676,243.00 -12,568.00 9,748,883.00 10,914,792.00
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Glossary of Terms
A glossary of terms used to evaluate performance is found below.
Commitment Amount – The amount an investor has committed to invest with theGeneral Partner
Paid In Capital – The amount an investor has contributed for investments andmanagement fees
Capital to be Funded – The remaining amount an investor contractually has left tofund its commitments
Additional Fees – Fees that are outside the capital commitment, also includesinterest paid/received due from subsequent closings of the fund
Cumulative Distributions – The amount an investor has received from realized andpartially realized investments
Valuation – Sum of the fair market value of all investments plus cash
Call Ratio – Calculated by dividing Amount Funded by Capital Committed
DPI Ratio - Calculated by dividing Amount Distributed by Amount Funded
Market Exposure – Calculated by adding Reported Value plus UnfundedCommitments
Reported Value of Total Fund – Calculated by dividing Reported Value by Total FundComposite
Market Exposure as % of Total Fund – Calculated by dividing Market Exposure byTotal Fund Composite
Total Value – Calculated by adding Amount Distributed and Reported Value.Represents the total amount an investor should expect to receive from theirinvestments
Net Benefit – Calculated by subtracting Total Value by Capital to be Funded plusAdditional Fees
Total Value to Capital Call Ratio – Calculated by dividing Total Value by AmountFunded. Represents the multiple of the overall cash invested that an investor isexpected to receive
IRR - The calculation of the IRR (Internal Rate of Return) takes into considerationthe timing of cash contributions and distributions to and from the partnerships, thelength of time the investments have been held and the sum of the Reported Value
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1190 S. VICTORIA AVENUE, SUITE 200 • VENTURA, CA 93003 PHONE: 805‐339‐4250 • FAX: 805‐339‐4269 • WWW.VCERA.ORG
June 19, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Avenue, Suite 200 Ventura, CA 93003 SUBJECT: EVALUATION OF COUNTY OF VENTURA’S PROPOSAL OF A PUBLICLY AVAILABLE PAY
SCHEDULE FOR MARKET BASED PREMIUM PAY (MBPP) AND REVIEW OF NEW INFORMATION ON MBPP SINCE BOARD ACTION OF OCTOBER 15, 2015
Dear Board Members: On March 13, 2017, the Board authorized staff to conduct, in consultation with outside counsel, a further review of the County’s most recent submission of a proposed publicly‐available pay schedule of market‐based premium pay (“MBPP”) items and to examine new or additional information on MBPP obtained subsequent to the Board action of October 15, 2015 to settle the matter of its pensionability. Further, the Board requested further guidelines for inclusion/exclusion of discretionary pay items in pensionable compensation under PEPRA. Specifically, staff has considered the following questions/issues in regard to MBPP1: 1) Has the County of Ventura complied with the VCERA Board of Retirement’s request for a
publicly‐available pay schedule for MBPP? 2) Given the developments and additional information gathered or received since October 2015,
are MBPP and other discretionary pay items within the Board’s discretion to include in pensionable compensation under PEPRA and the Board’s Resolution? If yes, see Question #3 below. If no, see Question #4 below.
3) If it is permissible for discretionary pay items within a group or class, such as MBPP, to be included in pensionable compensation, what guidelines/parameters may be applied by the VCERA Board and staff to evaluate such pay items in the future?
4) If it is not permissible for discretionary pay items, such as MBPP, to be included in pensionable compensation, what specific changes could be made to allow for future inclusion?
Background/History At its October 19, 2015 business meeting, the Board of Retirement of the Ventura County Employees’ Retirement Association (“Board”) took action on individual pay codes pursuant to its November 2014
1 Staff’s answers to questions begin on page 12 after analysis.
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resolution interpreting “pensionable compensation” under Government Code section 7522.34. That action identified pay codes to be included in, and excluded from, “pensionable compensation” applicable to VCERA members who first join the retirement system (without reciprocal eligibility) on or after January 1, 2013 (PEPRA members). The resulting addenda to the Board’s original Pensionable Compensation Resolution was provided to the County of Ventura after that meeting. Prior to the Board’s adoption of both the original Resolution in 2014 and its addenda in October 2015, the County of Ventura advocated for market‐based premium pay items (“MBPP”) to be included in pensionable compensation under PEPRA. While Counsel’s October 15, 2015 memorandum to the Board recommended exclusion of MBPP from pensionable compensation, it opined that exclusion was not expressly mandated by PEPRA. The Board ultimately included MBPP items, but as part of the action, the Board requested that the Ventura County Board of Supervisors create a publicly available schedule of MBPP pay codes, as required by PEPRA, by July 1, 2016. Producing a publicly available pay schedule in response to the Board’s request proved problematic. The County submitted documents on three different occasions (4th time pending); for the first 2 submissions, the objective criteria originally presented to VCERA – date of hire ‐ was missing. Date of hire was also dismissed in correspondence from the County as simply one of several things considered in granting MBPP. Later with the 3rd submission, County HR Director Shawn Atin stated that VCERA was placing too much emphasis on date of hire; this was confusing given the County’s prior characterization of date of hire as the primary objective criteria for MBPP the previous October. The following reflects the 3 attempts by the County to publish a publicly‐available pay schedule for MBPP:
May 9, 2016: a list of the ten (10) MBPP pay codes and a matrix of non‐MBPP earnings codes and the different categories of members, showing which categories have those codes included in pensionable compensation. (Attachment A)
June 6, 2016: an update to the County Job Code & Salary Listing by Job Title showing a page insertion listing the job title/classifications eligible receive MBPP with the job codes, union, and MBPP range. (Attachment B)
June 30, 2016: additional update to the Job Code & Salary Listing by Job Title to include a link to an alphabetical list of 161 employees, along with their dates of hire which range from 1979 to 2016. (Attachment C)
Staff was unable to report to the Board that any of the above listed submissions fulfilled the Board’s request. Specifically, the submissions lacked the requirements of the Board of Retirement’s Resolution to identify the conditions for payment and the means of identifying a similarly‐situated group or class of employment. Staff responded to the County that identifying individuals who receive MBPP does not adequately identify why their group was selected to receive it. Staff requested that if date of hire was not the criteria and basis by which those receiving MBPP were deemed to be “similarly situated members of the same group or class of employment”, an alternate objective criteria be provided.
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The County disagreed, responding after the June 6th posting that it believed its submission represented a good faith effort at full compliance. Then, on June 30th, the County added a list of the 161 employees in the job classifications eligible for MBPP with their hire dates – regardless of whether or not they actually received MBPP. In September 2016, with a pending staff recommendation to the Board to reconsider MBPP as pensionable under its Resolution in absence of the required publicly available pay schedule, staff agreed to meet with County Human Resources to discuss the requirements of a publicly available pay schedule, and subsequently met twice for these discussions. During those meetings, Mr. Atin suggested that a potential solution would be for base pay ranges to be increased in the pay schedule with such increase bearing g an asterisk/footnote which explained that MBPP was paid in accordance with the MOA. Staff did not believe this would meet the requirement; however, the most recent submission uses this approach. Recent Submission (Attachment D) Human Resources recently proposed a different approach for providing a publicly available pay schedule for MBPP. They have provided materials to staff to illustrate the approach, which consist of the following:
Expand the table on page 3 of the County of Ventura’s Classification and Salary Listing document, to include 9 classifications whose employees are not receiving MBPP but eligible for it according to the MOA. (Previously, the table only included the 17 classifications where some or all employees received MBPP.)
Insert the following notation/paragraph above the table: *The classifications listed below have been designated eligible to receive Market Based Premium Pay (MBPP) per Section 622 of the Service Employees International Union (SEIU) Memorandum of Agreement (MOA). The top of each salary range has been increased by the hourly amount indicated below in the form of MBPP and will be paid in accordance to the provisions of the MOA.
For the positions for which the County has discretion to pay MBPP, the individual job descriptions documents would have nearly identical text added (only with specific maximum MBPP hourly amount indicated). The maximum amounts of the base pay ranges listed on the documents would be adjusted to accommodate the maximum possible amount of MBPP the County may choose to grant under the separate MOA agreement.
VCERA staff has reviewed this proposed approach, specifically in the context of the criteria for a publicly available pay schedule under Government Code 7522.34 and Resolution of the Board of Retirement of Ventura County Employees’ Retirement Association (VCERA) Regarding Pensionable Compensation Determination. Our difficulty in assessing the latest approach is that modifying a base pay range to include compensation not available to all who are similarly situated within the job classification seems to
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undermine the entire purpose of a pay schedule. From staff’s perspective, such an approach implies that the additional compensation provided to particular individuals is available to other similarly situated employees, which is not the case. Put simply, staff cannot reconcile how discretionary pay components can be listed in a schedule or document designed for describing objective criteria when the pay items themselves are not, by nature, objective. Further, extending the base pay range for only some within a classification seems in conflict with the MOA’s Sections 516 – 519, which describe the conditions for salary increases under specific conditions based on performance, and consisting of approximately 5% within the range. (See Attachment M.) Because the Board requested that staff work with the County on reaching a resolution, VCERA looked at the data closely to try to detect patterns; in reviewing that data, the original concerns and arguments against inclusion of MBPP intensified as the data showed multiple applications of MBPP that were contrary to the information submitted by the interested parties to the Board in 2015. The Board’s MBPP Decision: Then and Now During the 2015 review, Counsel agreed with VCERA staff that inclusion of MBPP and discretionary pay items in general was problematic under both PEPRA and the Board’s Resolution, and thus, recommended exclusion. However, Counsel’s memorandum opined that because exclusion was not absolutely mandated by PEPRA, the Board of Retirement had discretion to include as pensionable. This conclusion was based largely on information provided by stakeholders, which asserted: County of Ventura
The date of hire determined receipt of MBPP, and commonality in hire date ranges constituted “similarly situated”.
SEIU
The conditions for payment of MBPP are clearly defined, and not flexible;
MBPP items are established and/or modified based on a mathematical calculation triggered by the market average pay rate for comparable classifications issued through a periodic labor market survey report from the Hospital Association of Southern California (“HASC study”);
MBPP is issued to all employees in a County classification, including both existing employees and new hires. Further, the HASC study is an external factor, thus removing any risk of arbitrary payment;
Reduction or discontinuation of MBPP may only occur if the total hourly rate (base plus MBPP) paid to an employee exceeds the market average pay rate by more than 5%.
In the course of reviewing the County of Ventura’s pay schedule submissions, VCERA conducted a more thorough analysis of payroll data and made additional inquiries of HR to determine how MBPP was being administered. As a result, staff cannot ignore apparent conflicts between the actual administration of MBPP and the information provided and available to the Board in October 2015. Taken with the compelling data indicating the application/payment of MBPP currently and over time, the conflicts become even more problematic. Much of this information – particularly the data of how MBPP is paid in actuality ‐ was certainly not available to SEIU when its feedback was submitted. In
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short, SEIU’s understanding of how MBPP is paid and administered by the County of Ventura appears inconsistent with the manner in which the County is actually administering the benefit. Inconsistency #1: Date of Hire It is now clear that the date of hire criteria does not directly correlate with receipt of MBPP. In fact, subsequent to the Board’s action in October 2015, the County has retreated from its initial position that date of hire was the primary objective criteria for determining eligibility for MBPP. This may be in part from personnel changes; staff initially worked with Assistant County Executive Officer Paul Derse, who retired in January of 2016. He served as the County’s point of contact, and met with VCERA staff and spoke to the Board on MBPP in open session on separate occasions. After the Board’s October 2015 action, incoming Human Resources Director Shawn Atin became the primary point of contact for submission of the requested pay schedule. In 2015, Assistant CEO Derse related that payment of MBPP was based on date of hire of a particular individual, which served to establish a similarly‐situated sub group or class eligible to receive MBPP payment within a given job title. (See Attachment H) A comprehensive review of payroll data of how MBPP is actually paid to employees across job classifications, however, provides no clear connection between receipt of MBPP and hire dates. (See Attachment L.) Mr. Atin’s statements and explanations about MBPP in Board meetings and in his written correspondence do not conflict with staff’s findings, but they present a noted departure from the statements and explanations made by his predecessor Mr. Derse in 2015. Mr. Atin asserts that MBPP is indeed discretionary, but that this does not preclude it from being pensionable under PEPRA. He has reasoned that base pay itself is discretionary, as the employer has discretion to place an employee anywhere within the posted range; and because the County sees MBPP to be “akin” to base pay, its discretionary nature is not a hindrance to pensionability. Inconsistency #2: Lack of Defined Process The results of the independent HASC study (to which the County subscribes) were credited by SEIU as the trigger for MBPP adjustments; however, the data does not support this in either timing or substance. Rather, while application/payment is typically applied to all in a classification at establishment of a pay item (though not always), modifications to an existing MBPP do not appear to trend towards the post‐HASC study period. In fact, the data shows no common time for MBPPs to increase for existing employees, and our feedback from HCA staff indicates that MBPPs may be added or modified at an individual level at any time or as needed, without a tie to the study. In its stakeholder feedback (Attachments I and J), SEIU referenced Section 622 of the SEIU Local 721/County Memorandum of Understanding, which describes the terms for MBPP. Section 622, which refers to the premium pay as a “recruitment and retention bonus,” references a market study. However, the study in no way binds the County in regard to the payment of MBPP. So while the statement that MBPPs are reviewed in light of the study’s results is likely correct, the results do not trigger any automatic increases or decreases in MBPP. Market studies may be used or disregarded at the County’s discretion. HCA also indicated that in practice, the study is just one of many factors
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considered, and that conditions such as a budget shortfall or surplus, or a potential resignation or retirement of a valuable employee (retention) can trigger action on MBPP. This information seems to undermine SEIU’s view of MBPP’s “automatic” adjustment as a result of the HASC study. It should be noted that neither the HASC market study itself nor a report/summary of the results with the corresponding impact on MBPP payment are publicly available. While the MOA used softer “may” language instead of stronger “shall” language, the consistency of MBPP’s application (as submitted by SEIU) served to “shore up” the weaker language originally. Now, however, with the County’s labeling of MBPP as discretionary and its clear exercising of that discretion on an employee‐by‐employee basis, it is clear that the softer “may” language prevails. Inconsistency #3: Not Applied Universally Further, the data does not support SEIU’s description of how it understands MBPPs are to be paid and managed. Rather, the data undercuts the case that: 1) MBPP is paid to all in a job classification; 2) Adjustments in the amount of MBPP will apply to all receiving it; and 3) Eliminations or suspensions do not occur without a subsequent market study. For more than half of the job classifications for which MBPP could apply, staff found no discernible pattern in the application of MBPP. That is, not all within a classification receive the pay, and among those who do, the amount or percentage of the payment is inconsistent. Staff examined not only date of hire, but also work location, longevity, and job assignments. Commonality in these other categories did not determine receipt of MBPP in the job classifications where only a portion of the population were paid MBPP. This is illustrated in Attachment L. One example of this is the Therapist MBPP (THRPST) which may be paid to any of the following 3 classifications: Senior Physical Therapist, Supervising Therapist II and Senior Occupational Therapist. These classifications became eligible for MBPP in 2008 when the code was established. Here is what the data showed in the most recent analysis (which is slightly more recent than the data shown in Attachment L): Senior Physical Therapist This classification has 21 employees with hire dates ranging from August 1990 to 2016. Of these, 3 are receiving MBPP in 3 different amounts, and their hire dates are 4/2001, 5/2011 and 2/2012. The first employee’s MBPP has diminished over time, with 3 separate decreases; however, the decreases occur in 4 different months of the year, which would make the HASC study results an unlikely trigger. Also, employees hired within months of these 3 employees were not receiving MBPP. Supervising Therapist II This classification became eligible for MBPP in 2008. At that time, 3 of the 4 incumbent employees began receiving it, in 3 different dollar amounts. Over time, the rates for each have decreased on the dates indicated below, with the exception of Employee 1 who received a significant increase in MBPP
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January 2010 when the others did not.
Hire date
Class. Hire
Sept 2008
Nov 2008
Aug 2009
Jan 2010
Emp 1 1/26/1981 Before 2008 $3.91 ↓ to $3.67 ↓ to $2.97 ↑ to $5.50 Emp 2 2/12/1992 Before 2008 $2.31 ↓ to $2.08 ↓ to $1.37 No change Emp 3 10/4/1999 Before 2008 N/A N/A N/A N/A Emp 4* 10/31/1999 12/21/2014 $2.48 ↓ to $2.25 ↓ to $1.56 No change
Note that Employee 4 began receiving MBPP as a Supervising Therapist I prior to promotion to Supervising Therapist II; at that time, no others in the “I” designation were receiving MBPP. In fact, an employee who was hired as a “I” the same day Employee 4 was promoted (12/21/14) has never received MBPP. Senior Occupational Therapist There are 13 in this classification and only 1 receives an MBPP of $5.61 which began when the employee was hired in January 2017. None of the other existing employees began receiving MBPP at that time. Inconsistency #4: Suspension of MBPPs – History and Practice Historically, some MBPPs have been suspended once payment began. Some of these instances are evident in the information presented under the previous 3 inconsistencies and Attachment L. Employees in various job classifications have MBPPs stop, start, increase and/or decrease with no tangible trigger. In its Position Statement dated October 2, 2015 and supporting Declaration, SEIU states: “The payment of the MBPP to a particular classification is dependent upon an external factor —the going market rate paid to employees in comparable positions in local hospitals and private pharmacies. That external factor is documented in the HASC survey, which means that the payment cannot be and is not made to employees for arbitrary reasons such as nepotism, favoritism or to enhance their retirement benefit.” [Emphasis added] In fact, when MBPPs were established in 2003 through the Ventura County Board of Supervisors, it was specified that premium pay “… can be reduced or eliminated if market conditions change.” However, despite this description and SEIU’s understanding that the HASC study is the exclusive determining factor, the seemingly random application from a payment perspective does not support this characterization of the role the study plays. SEIU refers to the Declaration from Angela Portillo as its basis for describing the conditions under which MBPPs may be discontinued:
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“Once paid, the MBPP may only be reduced or discontinued in a classification if a certain external and verifiable condition is met —that the total hourly rate (base pay plus any MBPP) paid to the employee exceeds the market average pay rate by more than 5% plus the percentage value increase of the salary offsets set forth in Article 5, Section 502C of the MOU. (See Exhibit A to Portillo Declaration, Section 622, page. 27.) In such an event, the amount of the reduction shall only be that by which the total hourly rate exceeds the threshold value. (Id.)”
While the MBPP payment amounts may fluctuate in all of the eligible classifications, three (3) MBPPs that were suspended since they were originally established and paid:
RADSPE – Radiologic Specialists
RADTEC – Radiologic Technicians
HISTO – Histologist For the 2 radiology‐related MBPPs, the MBPP suspensions appear to occur for everyone in a job classification at the same time. Radiologic Technicians’ MBPP stopped in June of 2007 and Radiologic Specialists’ stopped on May 18, 2008 – a date which also serves as the hire date into the position for around half of the current employees. The job family was apparently completely reworked during that time. If triggered by market factors, this would support the MBPPs being suspended in this way. Conversely, for the Histologist MBPP, there were 2 employees whose MBPP was suspended – but those occurred nearly 2 years apart. One employee’s ended in October 2005 while the other’s ended in July 2007. VCERA’s conclusion: if the suspension of MBPP was based on market conditions, the payment presumably would have stopped for all employees within a classification at the same time. Therefore, the facts set forth in the Portillo declaration do not comport with the payroll data. Inconsistency #5: Market‐Based Adjustments One of the arguments presented by SEIU in 2015 was that MBPP is comparable to a Market‐Based Adjustment (MBA), and because MBAs are pensionable, MBPPs should be as well. They point out that the MOA’s description of MBPP in Section 622 addresses the issue of market‐based adjustments to base pay.
“Employees receiving a MBPP shall be excluded from the MBA studies set forth in Sec. 502B and shall not be eligible to receive any MBA.”
SEIU in 2015 quoted this language, and said the following:
"In the most recent cycle of bargaining (2013), SEIU Loca1721 and the County negotiated wage increases for current and future employees in two different ways: (a) general across‐the‐board salary increases, and (b) market based adjustments. (Portillo Declaration, ¶9.) To implement Section 502B of the MOU, which provides for the Market Based Adjustments, the County conducted a total compensation market based average study and thereafter gave Market Based Adjustments to certain classifications based on the parameters established in 502B (i.e.,
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whether a certain classification is paid 3% or less than the market average). (Id.) Employees receiving a MBPP were excluded from receiving the Market Based Adjustment raises, as it was understood by both parties that those receiving MBPPs were being brought to market rates via the MBPP. (See Id., Exhibit A, Section 622, page 27.) It would be illogical to consider the negotiated general across‐the board salary increases and the Market Based Adjustments pensionable, but to consider the MBPPs non‐pensionable. (Portillo Declaration, ¶9.) Had the MBPP not been in effect already in a certain classification at the time that the 2013 Market Based Adjustments went into effect, the employees in the certain classification would have received the 2013 Market Based Adjustments. (Id.) Both the MBPPs and the Market Based Adjustments must be treated the same — as pensionable income.”
However, in contradiction to this, the last round of MBAs given in January 2017 were granted to all employees across entire classifications, including those already receiving MBPP. When VCERA pointed this out, the response from County HR indicated that payment of the MBA to those receiving MBPP was not accidental, but the result of a negotiation and that HR had failed to delete the “outlier sentence” in Section 622 prohibiting employees from receiving both. An email from County HR describes the payment of the MBA in this way:
“It is recognized that the single sentence that was carried over from the prior MOA in the fourth paragraph of Section 622 of the MOA would seemingly preclude those who are receiving the MBPP from receiving an MBA. However, that would not result in the employees receiving what was intended by the parties at the table. As is well established in Labor Relations, a contract is to be read not line by single line, but rather in total, so as to implement the true understanding of the parties at the table. In this instance, and in sharp contrast to the language found in 502‐B of the prior MOA, the language I wrote (as approved by County Counsel) to create 502‐B in the current MOA specifically provides that the MBAs be given not only to the subject classifications, but to all individuals employed therein…of great note is that there is no stated exclusion of those receiving the benefit of Section 622. Further, the MOA was costed and presented to the BoS as if all individuals within the classification were to receive the benefit, again, irrespective as to whether or not the individual also received MBPP.”
The restriction of receiving MBAs and MBPPs simultaneously was a primary SEIU argument for inclusion of MBPP as pensionable, but now this restriction has been lifted. –The lifting of the restriction without a corresponding update to the governing MOA – (to which VCERA has been referred repeatedly as the governing document for MBPP) is perhaps a further indication of the inconsistent treatment of MBPP. Analysis
The Board’s Resolution provides with respect to the “publicly available pay schedule” requirement of section 7522.34, that the County’s adopted schedule must “Indicate[] the conditions for payment of
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the item of Pensionable Compensation, including, but not limited to, eligibility for, and the amount of each component of pay.” (Resolution, p. 4, item 4(d), emphasis added.)
As described above, VCERA has repeatedly attempted to obtain a pay schedule from the County that complies with the Resolution’s requirements. In response, the County has provided a list of County job titles that are eligible for the MBPP, as well as the names of those individuals (which is unwarranted) and dates of hire of those individuals, which the County now disclaims as of “limited value” with respect to the conditions for payment of the MBPP. The County has not, however, identified on any of its submissions to VCERA the objectively verifiable “conditions for payment” of the specified amounts to its employees in the listed job positions.
Further, staff has determined through analyses of the available data that not all County employees in particular job positions receive the same, or any, MBPP, and staff has been unable independently to discern a pattern that would support a conclusion that there is a particular “condition for payment” that results in similarly situated members being provided the same MBPP. As noted above, Attachment L to this memo shows that twenty (20) out of twenty‐one (21) County employees in the Pharmacist II position receive a MBPP, and that such 20 employees, even with the same stated job assignments, receive different amounts from one another. Accordingly, objectively similarly situated members do not receive the same MBPP. That Attachment also shows that thirty‐one (31) out of thirty‐three (33) County employees in the Principal Respiratory Therapist position receive a MBPP, and that most of such 31 employees —with the same stated job assignments and no discernable differences in their job duties, work locations, collective bargaining units or other logical work‐related grouping — receive different MBPP amounts from one another. This pattern of similarly situated members being paid different MBPPs, or no MBPP at all in some instances, exists as to many of the positions that staff has analyzed since the Board initially considered the information presented to VCERA prior to its adoption of the Resolution. In light of this data showing how the MBPP is in fact paid to VCERA members, and that no “conditions for payment” are uniform as to payment of the MBPP, the MBPP appears now not to be pensionable compensation under section 7522.34, as implemented by the Resolution.
In addition, the County has provided an MBPP “range” from $0 to $10, $15, or $25 in the proposed “pay schedule’ it has provided to VCERA. Such a “range” is, by definition, not permitted to be pensionable compensation under the Resolution because (i) when the low end of a “range” is zero, then there is in fact no right to such a payment on a consistent, normal, basis by similarly situated members of the same grade or class; and (ii) there is no statement on the schedule as to the conditions that would warrant one amount within such range to be paid rather than another amount.
A key to inclusion in pensionable compensation, in addition to the County Board of Supervisors’ adoption of a compliant “publicly available pay schedule,” is that “similarly situated members” receive the payment. The statutory requirement is stated in paragraph 3(h) of the Resolution, which tracks section 7522.34, subdiv. (a) and subdiv. (c), paragraphs (10), (11) and (12), so as to exclude from pensionable compensation:
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Bonuses that are not part of normal monthly rate of pay of the member and similarly situated members for full‐time service during normal working hours pursuant to publicly available pay schedules (including, but not limited to, special non‐essential skills bonus; temporary promotion bonus; productivity bonuses; discretionary or temporary special assignment bonuses).
As discussed above and shown in Attachment L, members in seven (7) of the job positions the County identified as receiving MBPP receive differing dollar amounts of MBPP without any identified objective condition for payment warranting those differences other than that the County chose to pay the members different amounts, which qualifies those items as discretionary bonuses, not pensionable compensation. Of note, the California Public Employees’ Retirement System has proposed a regulation that defines “group or class of employment” for purposes of interpreting the “similarly situated members” rule as “a number of employees considered together because they share similarities in job
duties, work location, collective bargaining unit, or other logical work‐related grouping.”2 Further, it states that “[o]ne employee may not be considered a group or class.” Also, a very recently published court of appeal decision interpreting the “similarly situated member of a group of class of employment” requirement for pensionability as applied to CalPERS before PEPRA contrasted that statutory requirement with a longevity performance stipend that “required individualized, discretionary determinations and therefore was not available to all similarly situated members of the class.” DiCarlo v. County of Monterey, Sixth District Court of Appeal Case No. H041400 (cert. for
publication June 5, 2017) (p. 7).3 The same variability of a performance‐based stipend applies to the MBPP in its current form. Summary Since the Board took its October 2015 action, a good deal of new or additional information on the nature of MBPP has been developed. This information came to light primarily as VCERA followed the Board of Retirement’s direction to assist the County fulfill the request for a publicly‐available pay schedule. Subsequent discussions, memorandums, emails, and data queries suggest that information available to the Board in 2015 was incomplete – and in some cases, incorrect. Nearly all of the supporting arguments presented by SEIU and the County in 2015 have been unsupported by either the payroll data or subsequent communication and information.
2 CalPERS’ regulatory process regarding its implementation of PEPRA in or about 2013, and the proposed
regulation regarding pensionable compensation was considered most recently by its Pension and Health Benefits Committee on March 14, 2017. A copy of that proposed regulation is attached hereto as Exhibit 1, and is available at https://www.calpers.ca.gov/docs/board‐agendas/201703/pension/item5‐01.pdf. Once adopted, it would add Article 4, Section 571.1 of Chapter 2 of Division 1 of Title 2 of the California Code of Regulations.
3 Government Code section 20636, subdivision (c)(2) that was considered in DiCarlo provides in pertinent part: “Special compensation shall be limited to that which is received by a member pursuant to a labor policy or agreement or as otherwise required by state or federal law, to similarly situated members of a group or class of employment that is in addition to payrate.”
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MBPP Board Letter June 19, 2017 Page 12
In hindsight, had all of this information been available in October 2015, we believe that MBPP would have been more aptly placed in the “situational” category, rather than “recommend exclusion”. The situational category (Exhibit 5 from October 2015) contained codes the Board excluded in absence of pay code distinctions because the codes were being used for both situations that were deemed pensionable, and for situations that were not. An example is bilingual pay which would be pensionable under PEPRA if required for the position, but not pensionable if not a requirement. Conclusion Given these facts and the comprehensive information now available regarding the nature and payment of MBPP, staff has reached the following conclusions on the above‐referenced questions: 1) Has the County of Ventura complied with the VCERA Board of Retirement’s request for a publicly‐available pay schedule for MBPP? ANSWER: No, the County has not complied with the Board request for a publicly available pay schedule, as that term is defined by applicable law and the Resolution, for MBPP. 2) Given the developments and additional information gathered or received since October 2015, are MBPP and other discretionary pay items within the Board’s discretion to include in pensionable compensation under PEPRA and the Board’s Resolution? If yes, see Question #3 below. If no, see Question #4 below. ANSWER: No, the Board does not have the discretion to include MBPP in pensionable compensation because MBPP is not provided to similarly situated members of the same group or class of employment. Rather, MBPP items are discretionary bonuses not provided to similarly situated members of the same group or class, and a publicly available pay schedule has not been provided that complies with applicable law as implemented by the Resolution. 3) If it is permissible for discretionary pay items within a group or class, such as MBPP, to be included in pensionable compensation, what guidelines/parameters may be applied by the VCERA Board and staff to evaluate such pay items in the future? ANSWER: Not applicable 4) If it is not permissible for discretionary pay items, such as MBPP, to be included in pensionable compensation, what specific changes could be made to allow for future inclusion? ANSWER: MBPP would be within the Board’s discretion to include in pensionable compensation under PEPRA and the Board’s Resolution only if it were in fact part of the normal monthly rate of pay for a member and provided on the same terms to all other similarly situated members, e.g., those with similar job duties, work locations, collective bargaining units or other logical work‐related grouping, and provided that the County adopted a publicly available pay schedule indicating the conditions for payment of the MBPP, including, but not limited to, eligibility for, and amount of each component of pay, and such conditions are able to be verified objectively by VCERA, rather than varying on a discretionary basis between otherwise similarly situated members. That publicly available pay schedule would of course also need to be consistent with labor policies or agreements applicable to the impacted members.
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MBPP Board Letter June 19, 2017 Page 13
Final Comments and Recommendation As VCERA has communicated to both the County and SEIU, we recognize the need to recruit and retain employees to perform vital services – and MBPP serves as an effective tool in that regard. In no way does VCERA oppose the payment of MBPP to eligible employees; we simply are seeking to apply both the law and the Board of Retirement’s Resolution to determine pensionability under PEPRA. RECOMMENDED ACTION: EXCLUDE MBPP FROM PENSIONABLE COMPENSATION DUE TO DEFICIENCY IN MEETING PEPRA CRITERIA. Staff will be happy to answer any questions on this item at the June 19, 2017 business meeting. Sincerely, Linda Webb Retirement Administrator Attachments: Attachment A: COV P.A.P.S. Submission of May 9, 2016 Attachment B: COV P.A.P.S. Submission of June 6, 2016 Attachment C: COV P.A.P.S. Submission of June 30, 2016 w/Cover Letter Attachment D: COV Pending Proposed P.A.P.S. Submission Attachment E: Memorandum from Webb to Atin July 14 2016 Attachment F: Memorandum from Atin to Webb Aug 2016 Attachment G: COV Pensionable Comp Feedback Memo Oct 2015 Attachment H: Summary of Sept 23 2015 Meeting with COV Attachment I: SEIU Position Statement from Kerianne Steele Attachment J: Declaration of Angela Portillo, SEIU Worksite Organizer Attachment K: VCERA to COV on P.A.P.S. Jan 2016 Attachment L: MBPP Payment Application Data Attachment M: MOA Sections 516‐519 Attachment N: HR Email of May 3 2017 Attachment O: MBPP Summary Table
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MARKET‐BASED PREMIUM PAY ITEMS (COUNTY OF VENTURA)
EARNINGS CODE
EARNINGS CODE DESCRIPTION
CLS123 Clinical Laboratory Scientist I/II/III Premium Pay HISTOL Histologist Premium Pay LPTAST Licensed Physical Therapy Assistant PHARM Pharmacy Premium Pay PRNRES Principal Respiratory Therapist Premium Pay PSYCH Psychologist Premium Pay RADSPE Radiologic Specialist Premium Pay RADTEC Radiologic Technologist Premium Pay SPEECH Speech Pathologist Premium Pay THRPST Therapist Premium Pay
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Employees Eligible to receive a Market Based Premium Pay (MBPP)
Name Hire DateAdelman,Thomas 3/31/2002Alvarez,Marbeli 5/8/2016Alvarez-Rittmaste,Monica 5/13/2002Amburgey,Jamie Alexis Freeman 4/27/2014Amini,Sheida 3/15/2015Anspaugh,Rodger 7/2/2006Anunwah,Jessica Flumunanya 9/27/2015Archibald,Jeffrey Lee 1/6/2013Ash,Morgan Lenzi 12/7/2014Barcena,Kathrina Abdon 8/14/2005Barrientos,Sandra I 10/3/2010Bishop,Jenelle H 4/24/2016Bloom,Guiana May Astadan 12/6/2015Boghossian,Torri Jean 5/29/2002Burciaga,Armando 3/17/2013Burkhart,Caitlin Jeanne 12/14/2015Cachu Andrade,Beatriz Elena 11/9/2014Candara,Leon Claud 7/14/2013Cash,Daniel Joseph 5/30/2010Chan,Sharon Lee 4/10/2016Comstock,Tonya Louise 6/8/2014Conboy,Linda Elizabeth 5/7/2006Contreras,Julia Christine 7/30/2009Cox,Elizabeth Arlene 1/17/1989Crenshaw-Upah,Katrina Yolanda 6/5/2016Crismond,Lance 4/1/2015Crouse,Philip A 5/18/2011Cruz,Pitchie 6/15/2014Curran,Christopher 12/2/2007Dao,Tony 10/7/2013Dinwiddie,Lori Amber 11/8/2015Estrada,Jaime 11/24/2003Evangelista Jr.,Francisco B. 1/11/2009Fennell,Faith P 12/20/2015Frias,Catherine Elydia 9/28/2014Gallardo,Karen G 4/5/2015Garcia,Alexandra Elizabeth Irene 7/25/2010Gobran,Fadi Adel 10/12/2014Godfrey,Ethel Jacosalem 5/26/2015Gotwals,Kirk R. 4/5/2009Gray,Scott Peter 1/27/2008Greene,Susan 2/17/2015Griffin,Natasha Marie 8/3/2014Guthrie,Frances A 12/8/2013
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Employees Eligible to receive a Market Based Premium Pay (MBPP)
Hackett,Vanessa Renee 3/12/2014Hanin,Genine Ivy 11/7/1993Hannah,Carol 10/5/1981Hartson,Holly Frances 2/5/2001Hickey,Cynthia Marie 2/19/2013Hofius,James Gordon 2/5/2012Hoppe,Ioulia A 11/30/2008Hosford,Marion 1/2/1985Jacobson,Brian E 3/3/2013Janda,Richard C. 1/15/2012Javaheri,Pejman 7/24/2011Joaquin,Janene Renee 7/5/2015Jung,Sul Ran 10/13/2009Kadin,Jennifer Anne 5/29/2011Kim,Lance Steven 6/23/2013King,Shannon Patrice 10/15/2015Klock,Suzann E 3/31/2013Koester,David R 4/26/2015Kuiken,Crystal Anna 5/15/2016LaCroix,Jacob Stephen 5/1/2016Landen,David Wayne 4/8/2007Lata,Melissa Simonette Reyes 7/26/2015Lau,Joanne S 1/4/2015Lauron,Lori Go 3/29/2015Leanos,Hector 4/22/2007Lee,Corey B 11/3/2010Livingston,Ronya Rafeedie 6/14/2015LoneElk,Jessica Renee 1/4/2015Lopez,Sandra 6/17/2013Lougee,Bonni J 10/2/2011Lyons,Wendy 9/25/2005Madden,Amber Brook 4/19/2009Mahmoudi,Rouhanguiz 2/22/2015Mares,Ramiro 6/8/2014Martinez,David E 11/9/2014Mata,John 7/25/2010McFarlane,Gilbert John 2/12/1995Medina,Myra 7/31/2005Mendoza,Oscar 5/30/2010Mercy,Helena Elaine 5/31/2009Meshreky,Samah S 4/5/2015Mikhail,Amira A 4/18/2010Miller,Jason B 2/5/2001Milligan,Denise K 1/5/2014Miyasaki,Debra Lynn 4/29/2001
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Employees Eligible to receive a Market Based Premium Pay (MBPP)
Mongiello,Simone Alexandra 10/4/1999Moody,Holly Ann 2/3/2013Morrow,Michael Lee 10/5/2008Moura,Janeane 4/7/2013Munesato,Jeanne 9/18/1989Myers,Christian D 9/19/2010Nantes,Bella Balinos 6/4/2006Newman,Audrey Juliana 3/31/2015Nguyen,Aaron Quang 4/15/2015Nicolas,Ricsan Sombilon 12/2/2015Ninomiya,Kathleen 11/9/2003Norman,Linda 11/28/2010Obina,Niko Clemente 6/22/2014O'Hea,Joseph Patrick 11/11/2012Oliver,Jaime M. 1/22/2013Omega,Crisane P. 10/2/2011Oneill,Janette Reid 12/2/2002Ontiveros,Joann 2/12/1992Ota,Marjorie 9/17/2000Palma,Maria Theresa 7/12/1998Patel,Rajesh Tushar 1/22/2001Patterson,Annette Jocelyne 11/11/2012Pendleton,Sara Therese 8/18/2015Perez,Concepcion 8/10/2008Pimentel,Yvonne Roberta 11/18/2007Preston,Wendy Lynn 7/16/2006Raabe,Kevin Roy 6/9/2013Ramirez,Alma Yanira 3/1/2015Rentschler,Kevin S 11/24/2013Riazzo,Rick 4/17/2011Richmond,Johnny Mark 5/7/2006Ritter,Carla Jean 10/31/1999Robledo,Patricia 5/30/2010Rodriguez,Marcos G 1/19/2014Rodriguez,Pablo 9/17/2001Russell,Keith Mathew 10/5/2011Saekoh,Sandy 4/6/2013Salgado,Audrey Marie 2/14/2016Sampilo,Soledad 6/8/1992Searles,Kelly R 12/20/2015Sharma,Susan Davies 11/4/2007Siegman,Scott Howard 3/17/2013Sikula,Lacey Noelle 8/3/2014Smith,Mary 1/26/1981Smitherman,Elizabeth Esther 9/8/2015
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Employees Eligible to receive a Market Based Premium Pay (MBPP)
Sotero,Jocelyn G 5/26/2003Stark Jr.,Joseph Eric 3/17/2013Stompe,Lauren Margaret 1/19/2016Sweitzer,Vickie L. 2/8/2009Takara,Tamara Pratummas 10/12/2014Talabucon,Omar David 11/11/2012Taylor,Georgina 8/30/1993Tien,Kevin 6/23/2013Tippett,Jennifer Marie 11/23/2014Tokar,Cindy 8/13/1990Tseng,Sheng-Wen 3/18/2012Verboomen,Amanda Rae 10/19/2008Vergel,Jennifer 9/15/2002Villarreal,Jose Mauricio 1/20/2015Walker Hill,Tricia Alicia 10/3/2010Wall,Mercedes Manosca 5/24/1999Weber,Rose Mary 8/22/2010Weissman,Ellen Khamistos 9/21/2008Williams,Kenneth Avery 3/19/2000Winter,Craig J 10/4/2009Wu,Ya-Whey 12/19/2011Yoshida,Patti A 9/30/1979Zaferis,Paul C 6/8/2014Zanolini,Shanna 1/11/2009Zarrabian,Simin 7/11/2010Zavala,Baltazar Alonzo 10/23/2005Zoll,Kevin Daniel 7/15/2007
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CURRENT PROPOSED
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CLINICAL LABORATORY SCIENTIST I
Bargaining Unit: Service Employees
International Union
Class Code: 00164
VENTURA COUNTY Established Date: Aug 20, 2000 Revision Date: Aug 2, 2002
SALARY RANGE $22.80 - $31.89 $46.11Hourly
$1,824.13 - $2,551.36 $3,688.76 Biweekly $3,952.29 - $5,527.94 $7,992.33 Monthly
$47,427.43 - $66,335.31 $95,907.90 Annually DEFINITION: Note: This classification is designated eligible for MBPP per Section 622 of the Services Employees International Union (SEIU) Memorandum of Agreement (MOA). The top of the salary range has been increased by $15/hour in the form of the MBPP and will be paid in accordance to the provisions of the MOA.
Agency: Health Care Agency Under direction of the Pathologist and Laboratory Manager, to perform a variety of standardized chemical, microscopic and bacteriological tests for examination, obtaining data for use in the diagnosis and treatment of diseases; orient new employees; and, perform other related duties as required. Distinguishing Characteristics: Clinical Laboratory Scientist II differs from Clinical Laboratory Scientist I in that the latter is considered entry level to the Clinical Laboratory Scientist series, while the II is experienced and can work with less-direct supervision. These classes differ from Clinical Laboratory Scientist III/IV in that the latter provide supervision to a specialized area in the laboratory. Employees at the IV level with specialized certificates may be hired for special projects requiring specialized skills, knowledge and abilities.
EXAMPLES OF DUTIES: Duties may include, but are not limited to the following:
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Performs a variety of tests in any or all of the fields of medical technology.
Completion of technical testing/reporting in serology, blood bank, microbiology, hematology, chemistry, special chemistry and urinalysis.
Performs venipuncture as required.
Assists in maintaining the laboratory and equipment in a clean and orderly condition.
Maintains basic records and operates the numerous pieces of electronic equipment.
QUALIFICATION GUIDELINES: Knowledge, Skills, and Abilities: Thorough knowledge of: the standardized tests performed in Hematology, Serology, Chemistry, Blood bank, Microbiology, Urinalysis. Working ability to: perform all the above standardized tests; work cautiously and accurately; establish and maintain effective working relationships with others; work with and understand operation of technical equipment.
RECRUITING STANDARDS: Education/Experience: Clinical Laboratory Scientist I: No experience required
OTHER REQUIREMENTS: Special Requirements: Possession of a valid Clinical Laboratory Scientist, Clinical Chemistry Scientist, Clinical Microbiologist, Clinical Immunohematologist Scientist, or Clinical Hematologist Scientist license issued by the State of California Department of Health Services.
CLASS SPEC TITLE 7: Reviewed: 1/23/13
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July 14, 2016 Shawn Atin, Human Resources Director Hall of Administration L#1970 800 South Victoria Avenue Ventura, CA 93009 SUBJECT: COUNTY OF VENTURA PUBLIC POSTING OF INFORMATION RELATED TO
MARKET-BASED PREMIUM PAYMENTS IN RESPONSE TO REQUEST FROM BOARD OF RETIREMENT
Dear Mr. Atin: Thank you for your letter dated June 30, 2016 and the accompanying documents and public posting in response to the Board of Retirement’s request. In your letter, you indicated that you believe that too much emphasis has been placed by VCERA Administration on date of hire in our review of the Market-Based Premium Pay (MBPP). I would like to respond and also provide some background information that I believe will help explain why date of hire has been a focus for MBPP. Put simply, date of hire was the only objective criteria offered to VCERA by the County of Ventura for eligibility for MBPP during the 2015 discussions and feedback period.
Background In your remarks to the Board of Retirement on June 20, 2016 you indicated that you did not participate during the analysis and discussions leading up to the October 2015 Board action on inclusion or exclusion of specific pay codes as pensionable compensation under PEPRA (Government Code section 7522.34 subdivision (a) – “pensionable compensation”.) I hope the following background information will be of help. Before the Board of Retirement took action in October of 2015 on pay code categories, the review and preparation process performed by staff and outside Counsel involved feedback from the County of Ventura and other stakeholders. At that time, VCERA staff and Counsel were in agreement with the County on the majority of pay codes in terms of pensionability under PEPRA. So, the discussions were focused on the remaining categories of disagreement. On September 23, 2015, a formal discussion took place, and MBPP was discussed at length. VCERA explained that there were three (3) main “sticking points” preventing a recommendation to the Board of Retirement that MBPP be included in pensionable compensation.
1) Both the definition and the application of the codes appeared contrary to “not only to the member but also to similarly situated members of the same group or class of employment,” and “for services rendered on a full-time basis,” and “for services rendered during normal working hours” in the BOR Resolution because no objective basis was identified by which similarly situated members of the same group or class would receive it.
2) The MBPP items have a discretionary component and may be withheld at a later date without a change in duties.
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3) VCERA could not discount instances where the practical application of codes appeared contrary to the purpose/definition provided. (Example: of the 21 Senior Physical Therapists, only 2 were receiving MBPP. Conversely, of the 34 Principal Respiratory Therapists, all but 2 were receiving MBPP.)
We asked for some sort of objective criteria as a basis by which those receiving MBPP could be considered “similarly situated members in the same group or class of employment.” The only one given was date of hire; or more specifically, that the market forces in effect on the date of hire determined who was eligible to receive MBPP. VCERA and Counsel’s perspective was that such a basis did not meet the test; the County believed it DID meet the test. (That meeting summary is attached, supporting this basic area of disagreement.1) So, at the October 19, 2015 meeting, VCERA recommended exclusion for MBPP. County CEO Michael Powers submitted a formal letter for that meeting. In it, in regard to this disagreement on MBPP he said:
“VCERA’s explanation is that these payments are based solely on an employee’s date of hire, and date of hire is not a similarity that can be considered in determining whether an employee is part of a group of ‘similarly situated employees.’ The County disagrees with this analysis.”
When the Board of Retirement took action on MBPP, it accepted COV’s argument that date of hire could be enough of a basis to pass the “similarly-situated group or class” test. However, the MBPP language in the MOAs (which the Board had previously deemed acceptable as a publicly-available pay schedule) did not have information on date of hire that would objectively identify the similarly situated group that would all be eligible to receive it. After a lengthy open-session discussion about the unavailability of the payment criteria in the MOU and the requirements of both PEPRA and the Board’s Resolution, the Board of Retirement’s took action to include MBPP while also requesting that the Board of Supervisors create a public available pay schedule for MBPP.
Summary of Events since the Board of Retirement Action
May 9, 2016: I received an email from the Auditor-Controller’s office that said the response to the Board of Retirement’s request could be found at http://www.ventura.org/auditor-controller/payroll-information where we saw:
1) a list of the ten (10) MBPP pay codes; 2) a matrix of earnings codes and the different categories of members, showing which
categories have those codes included in pensionable compensation (matrix did not include the 10 MBPP items.)
May 13, 2016: I emailed Auditor-Controller Jeff Burgh that I planned to update the Board on
May 16th, but that I did not believe the posting was what they were expecting to see. I suggested a schedule with either dollar amounts or percentages, position titles, effective dates, etc. and asked if he would like to update the posting. He indicated he would look into expanding the information.
May 20, 2016: I met with Jeff to discuss this topic among others. I gave him a list of publicly-available pay schedule elements. He offered to pass that information on to your office.
May 31, 2016: At your request, VCERA’s Board Counsel Lori Nemiroff met with you and County Counsel so that you could better understand VCERA’s posting expectations.
1 Meeting summary was distributed to all attendees to allow for corrections; COV submitted no corrections.
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June 1, 2016: I emailed you, Ms. Nemiroff, County Counsel and Jeff Burgh to further clarify our
understanding of the posting requirements, and suggested the CEO’s office send VCERA a written request to ask what additional information VCERA believed was required for compliance.
June 6, 2016: VCERA received your letter that County had responded to the Board of
Retirement’s request for a publicly available schedule of MBPP items, referencing an update to the County Job Code & Salary Listing by Job Title at http://vcportal.ventura.org/CEO/HR/docs/classsalary.pdf.
June 20, 2016: At VCERA’s business meeting, I provided the Board with the County’s June 6th response and communicated that staff believed the missing piece was still missing; to illustrate this, my letter listed elements of a publicly available pay schedule, showing each item as met except one:
d) Indicates the conditions for payment of the item of Pensionable Compensation, including, but not limited to, eligibility for, and amount of each component of pay;
Does Not Meet Criteria
Staff comment: The conditions for payment, which have previously been identified as the date of hire, is not provided in either the MOAs or the Job Listing table. The date of hire is what has been presented as the distinction/establishment of the sub group or class who are eligible to receive the payment within a given job title. Receipt of a pay item cannot in itself be the only criteria for establishing a similarly situated group or class.
VCERA Counsel supported this analysis in a letter to the Board, saying, “The value of this information in order for VCERA to be able to monitor, and correct, improper inclusions of discretionary ad hoc pay items in pensionable compensation should not be understated.”
When addressing the Board on June 20th, you indicated your office believed the posting represented a good faith effort at full compliance. After discussion, you said you would take the most recent information to your Counsel and respond via a communication.
June 30, 2016: I received your communication that, responsive to my request, the Job Code and Salary Listing by Job Title now includes a link to the date of hire for all employees eligible to receive an MBPP (http://vcportal.ventura.org/CEO/HR/docs/MBPP_eligible.pdf). The 2-column table provides an alphabetical list of 161 employees, along with their dates of hire which range from 1979 to 2016. Your letter said you believed this addition to be of little value and VCERA Administration had placed too much emphasis on date of hire. You further stated, “While the date on which an employee is hired will be a factor in the determination of the MBPP payment, it is by no means the only factor.”
Current Challenge We do not believe the COV’s June 30th posting of the MBPP-eligible individuals and their dates of hire answers the “conditions for payment” question. In your letter, you discount the original 2015 date of hire criteria and further suggest that changing labor market conditions and employee skill sets weigh more heavily in MBPP eligibility.
Request for Clarification and Additional Information Identifying the individuals who are receiving the benefit does not adequately identify why their group was selected to receive it. It appears that the County of Ventura is now agreeing with SEIU (letter attached) in which they state, “[The employees’] date of hire does not determine the MBPP”. If this is the case, and date of hire is not the criteria and basis by which those receiving Market-Based Premium
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Pay (MBPP) are deemed to be “similarly situated members of the same group or class of employment”, then we ask for an alternate objective criteria to be provided. If you disagree with SEIU on this point, then please indicate the date ranges on which market conditions warranted eligibility for MBPP for employees entering employment in those particular classifications. As we have stated, receipt of MBPP cannot in itself be the criteria. Staff will be updating the Board of Retirement about this issue at the July 18, 2016 Business meeting. Sincerely,
Linda Webb Retirement Administrator CC: Michael Powers, County Executive Officer Board of Retirement, VCERA Enclosures:
(1) Summary of September 23, 2015 meeting of representatives of VCERA, Nossaman, LLC (VCERA Outside Counsel) and the County of Ventura
(2) October 2, 2015 Letter from Kerianne R. Steele, attorney for SEIU, Local 721, with accompanying Declaration from Angela Portillo, SEIU worksite organizer
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SUMMARY OF MEETING OF SEPT 23 ON PENSIONABLE COMPENSATION FOR PEPRA MEMBERS
County of Ventura and VCERA are in agreement in the analysis of the pay codes in the majority of cases. For the codes on which there is disagreement, the County of Ventura (COV) and VCERA have a different approach to the concept of what is the “normal” monthly rate of pay or base pay of “similarly situated” employees of the “same group or class of employment,” regarding the categorization of such sub groups. This plays out specifically in the following areas: Market‐based premium pay codes VCERA = exclude; COV = include COV feels that this is essentially base pay of people who are paid this premium, and is applied as such on a practical basis. Specifically, COV noted that incentives that are percentage‐based are calculated on the combination of salary and this premium pay, and they believe those who receive it should be deemed to meet the definition of “similarly situated” to one another. VCERA’s administrative recommendation of exclude is based on the understanding that there is not a subgroup of “similarly situated’ employees in the same grade or class who receive this premium pay; rather, the premium is based on date of hire of a particular individual, may be taken away without change of duties of that individual at any time, and may not be paid to the next person hired at a later date into the same job. VCERA does not believe that PEPRA’s requirement that in order to be pensionable a pay item must be paid to “similarly situated individuals” should be interpreted to include premiums paid in addition to normal salary that are tied only to date of hire and are not necessarily paid to others hired into the position later. Y‐Rating VCERA = exclude; COV = include COV feels Y‐rates should be included as part of the “base pay” of those who receive it. Generally, it is applied when a reclassification takes place and an entire group continues to be paid the same total compensation although the salary of their reclassified position has decreased resulting in different pay for those subsequently hired into the same position. VCERA’s administrative recommendation to exclude is based on the understanding that there is not a subgroup of “similarly situated” employees in the same grade or class who receive the premium pay; VCERA staff brought up examples of when Y‐rating is used where only one individual is impacted in a demotion situation. Holiday VCERA = exclude; COV = included This was not discussed at length, but generally COV feels all holiday pay should be included as normal rate of pay, and VCERA considers this pensionable only if it’s straight‐time payment of holiday within an employee’s schedule that is not FLSA pay, otherwise it is excluded by PEPRA as either compensation for overtime work other than FLSA, or as payments for additional services rendered outside of normal working hours, or as payments for compensatory time off, or as variable non‐periodic payments that should not be pensionable compensation because they are subject to manipulation to enhance pensions. On the other hand, if it’s a guaranteed payment for a certain number of holidays required to be worked per year in a particular unit, then it may be considered payments within normal working hours for individuals in the same group or class and on that basis could be pensionable. However, VCERA does not currently have information to support the conclusion that holiday pay as currently provided qualifies as pensionable compensation because it appears not to be paid on the same
Attendees: COV: Paul Derse, Garrick Leedy, Sharlene Matney & Ronda McKaig VCERA: Linda Webb, Julie Stallings, & Shalini Nunna NOSSAMAN: Ashley Dunning & Michael Toumanoff
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
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normal and consistent terms to all similarly situated people in the same classes or grade. If it is provided in that manner and is non‐discretionary, and also is not able to be accrued and cashed out, then the determination may be different. Bilingual VCERA = situational; COV = exclude COV considers bilingual pay codes to be special compensation that in no event become part of the normal monthly rate of pay of its employees, and asserts they all should be excluded from pensionable compensation. VCERA considers these situational, based on whether or not this skill is a requirement or normal duty for all in the position or assignment such that the payment is made to all such similarly situated individuals in the same class or grade. Assignment Pay & Assignment Bonuses VCERA = include; COV = exclude COV considers assignment pay codes (ex: motorcycle officers, bomb squad assignments, etc.) to be excludable based on it being an assignment from within a broader group of employees, and according to COV the assignment does not constitute a sub group. COV also said such assignments are potentially temporary, and view these as “extra” compensation. VCERA considers those who are similarly assigned who are receiving this pay to be “similarly situated” when there is an identifiable subgroup regularly assigned to a position (generally at least 1 year) with additional job‐related responsibilities. Supervisory Differential VCERA = exclude; COV = include VCERA believes it is conditional, in that it is lost when the subordinate’s position is vacated or a subordinate receives lower pay than the supervisor’s pay without this differential. Thus, it is temporary and not paid to an identifiable subgroup of similarly situated individuals within a class or grade. Initially, COV indicated they feel this to be part of the normal rate of pay; however, upon further discussion, they tentatively accepted VCERA’s point regarding it being conditional. Nurses’ Certification Bonuses VCERA = include; COV = exclude VCERA believed these payments to be includable, as they appeared to be related to the duties being performed (ex: mental health certification while working in mental health unit, neo‐natal certification when in that unit). The MOU language supports this conclusion. However, COV said that this certification is not applied this way, and that nurses who have various certifications receive this pay, regardless of where they are assigned. VCERA indicated they would follow up and research these types of codes further before finalizing a recommendation for the VCERA Board. Items of Agreement Needing Adjustment In some instances, COV agrees with VCERA on the analysis of codes, but the current practice does not reflect this. COV indicated they would follow up internally for these adjustments.
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STEWART WEINBERGDAVID A. ROSENFEI~WILLIAM A. SOKOLBLVTHE MICKELSONBARRV E. HINKLEJAMES J. WESSERANTONIO RUIZMATTHEW J. GAUGERASHLEY K. IKEDALINDA BALDWIN JONESPATRICIA A. DAMSALAN G. CROWLEYKRISTINA L. HILLMAN .•EMILY P. RICHBRUCE A. HARLANDCONCEPCION E. IOZANO-BATISTACAREN P. SENCERANNE I. YENKRISTINA M. ZINNENJANNAH V. MANANSALAMANUEI A. 80(GUES ...KERIANNE R. STEELE ••GARY P. PROVENCHEREZEKIEL D. CARDER....MONICA T. GUIZARSHARON A. SEIDENSTEINLISA R SOTO
WEINBERG, ROGER & ROSENFELDA Professional Corporation
1001 Marina Village Parkway, Suite 200Alameda, CA 94501
TELEPHONE (510) 337-1001FAX (510) 337-1023
October 2, 2015
VIA OVERNIGHT MAIL
Mr. Tracy Towner, Chairman of VCERA Boardand VCERA Board Membersc/o Ms. Linda Webb, Retirement AdministratorVentura County Employees' Retirement Association1190 South Victoria Avenue, Suite 200Ventura, CA 93043
Re: Service Employees International Union, Loca1721's Position Statementre Preliminary Report on PEPRA Pensionable Compensation Analysis
Dear Chairman Towner, Members of the Board, and Ms. Webb:
JACOB J. WHITESEAN D. GRAHAMJOLENE KRAMERSTEPHANIE I. MARN•ANTHONY J. TUCCIR08ERT E. SZVKOWNYMICHAEL D. BURSTEINAIEJANDRO F. DElGA00MINSU D. IONGIRRU .....CAROLINE N. COHENBENJAMIN K. TARZYNSKIXOCNITL0. LOPEZ
VINCENT A. HARRINGTON, Of CounselPATRICIA M. GATES, Of CounselROBERTA D. PERKINS, Of CounselNINA FENDEL, Oi CounselTRACY L. MAWGUY, Of CounselANA GAILEGOS, Of CounselCHRISTIAN 1. RAISNER, Of CounselSANpRA RAE BENSON, Of CounselTHEODORE FRANKLIN. Of Counsel
• Admitletl in Hawaii•. Also admitled In Nevada... q~so admitted in Illinois•.•. Also admdted in New York and Alaska•.... peso admitted in New York antl Michigan
We are attorneys for the Service Employees International Union, Local X21 ("SEIU Loca1721"). Wesubmit this position statement on behalf of our client.
We respectfully request that the Ventura County Employees' Retirement Association ("VCERA"}Board consider Market Based Premium Pay, Bilingual Pay, and Shift Differential Pay to be"pensionable compensation." Those pay codes meet the definition of "pensionable compensation"set forth in Government Code section 7522.34(a) and your November 17, 2014 Resolutionimplementing that Government Code section.
This position statement draws largely from the enclosed sworn written testimony of SEIU Loca1721Worksite Organizer Angela Portillo, who is familiar with the Memorandum of Understanding("MOU") between SEIU Loca1721 and the County of Ventura ("County") and has personalknowledge of the County's pay and scheduling practices.
L MARKET BASED PREMIUM PAY
Contrary to the VCERA Staff's preliminary analysis, the Market Based Premium Pay ("MBPP") isnot an "ad hoc payment" or "bonus." Also, the MBPP is to be paid at an equal rate to all employeesin a specified classification regardless of an employee's date of hire.
LOS ANGELES OFFICE SACRAMENTO OFFICE HONOLULU OFFICE800 Wilshire Boulevard, Suite 1320 428 J Street, Suite 520 Union Plaza
Los Angeles, CA 90017-2607 Sacramento, CA 95814-2341 1136 Union Mall, Suite 402TEL 213.380.2344 FAX 213.443.5098 TEL 916.443.6600 FAX 916.442.0244 Honolulu, HI 96813-4500
TEl 808.528.8880 FAX 808.528.8881
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A. THE MARKET BASED PREMIUM PAY IS NOT AN AD HOC PAYMENT
Government Code section 7522.34 excludes from the definition of "pensionable compensation""[a]ny one-time or ad hoc payments made to a member." (Government Code section 7522.24(c)(3).)
"Ad hoc" means "for this" in Latin. Black's Law Dictionary defines "ad hoc" as "for this; for thisspecial purpose." The term "ad hoc" is often used colloquially in connection with committees thatform for a special purpose, and then disband after the purpose of the committee is fulfilled. The term"ad hoc" often refers to things more generally that are flexible or determined on a case-by-case basis.
There is nothing "ad hoc" about the MBPP. The conditions that must be met for a Countyclassification to receive MBPP are clearly defined in advanced, and set forth in writing in the SEIULoca1721/County MOU. As Section 622 of the SEIU Loca1721/County MOU provides, the VenturaCounty Health Care Agency ("VC HCA"} obtains a report from the Hospital Association of SouthernCalifornia ("HASC"). (See Declaration of Angela Portillo ("Portillo Declaration"), ~5, Exhibit A,Section 622, pages 26-27.) That report is a labor market survey of comparable positions in localhospitals and private pharmacies, which reflects whether a number of SEIU Loca1721-representedclassifications are underpaid compared to counterpart classifications elsewhere. (Id.) The MBPPsare reviewed in light of the results of that report. {Id.) VC HCA determines from the report if aM$PP is necessary to: (a) recruit new employees, and (b) retain existing employees by providingcompetitive wages. (Id.) If VC HCA determines that a MBPP is appropriate for a particular Countyclassification —because the market average pay rate paid to the comparable classification in localhospitals or private pharmacies exceeds that which is paid to the County classification. —then MBPPwill. be issued to all employees (that includes existing employees and any new hires) in the Countyclassification. (Id.) For example, if the top of the County pay scale for a Speech Pathologist is $35an hour, but the HASC study determines that the 50th percentile of pay for speech pathologists acrosssouthern California is $45, all County Speech Pathologists will receive a $10 an hour MBPP in orderto raise the total hourly wage to $45. (Id.)
The payment of the MBPP to a particular classification is dependent upon an external factor —thegoing market rate paid to employees in comparable positions in local hospitals and privatepharmacies. That external factor is documented in the HASC survey, which means that the paymentcannot be and is not made to employees for arbitrary reasons such as nepotism, favoritism or toenhance their retirement benefit.
Once paid, the MBPP may only be reduced or discontinued in a classification if a certain external andverifiable condition is met —that the total hourly rate (base pay plus any MBPP) paid to the employeeexceeds the market average pay rate by more than 5%plus the percentage value increase of the salaryoffsets set forth in Article 5, Section 502C of the MOU. (See Exhibit A to Portillo Declaration,Section 622, page. 27.) In such an event, the amount of the reduction shall only be that by which thetotal hourly rate exceeds the threshold value. (Id.)1///////
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B. THE MARKET BASED PREMIUM PAY IS NOT A "BONUS"
Government Code section 7522.3(c)(10) excludes from the definition of "pensionable compensation""[a]ny bonus paid in addition to the compensation described in subdivision (a)." (Government Codesection 7522.34(c)(10).) MBPP is not a "bonus."
Although the SEIU Local 721/County MOU inaptly refers to the MBPP in one sentence as a"recruitment and retention bonus," it is not a "bonus" in the typical sense. (See Portillo Declaration,~(8, Exhibit A, Section 622, page 26.) The same section of the MOU also refers to the payment as a"premium pay adjustment." (Id.) That is the accurate way of describing the payment. (PortilloDeclaration, ~8.) The language of Section 622 of the SEIU Loca1721/County MOU defines anemployee's total hourly rate to be the base pay plus any MBPP. (Id.) Therefore, the total hourly rate(base pay + MBPP) functions as the employee's normal hourly rate of pay. (Portillo Declaration, ¶8,Exhibit B, redacted paycheck of a County employee who receives MBPP.)
The MBPP is treated by the County to be comparable to the Market Based Adjustment, which isindisputably pensionable income. (Portillo Declaration, ~j9.) The parties negotiated the MarketBased Adjustment in 2013 to help bring the hourly wages of all SEIU Loca1721 classifications tomarket levels. (Id.) Per Section 622 of the MOU: "Employees receiving a MBPP shall be excludedfrom the MBA [Market Based Adjustment] studies set forth in Section 5028 [of the MOU] and shallnot be eligible to receive any MBA." (Id., Exhibit A, page 5.) In the most recent cycle of bargaining(2013), SEIU Loca1721 and the County negotiated wage increases for current and future employeesin two different ways: (a) general across-the-board salary increases, and (b) market basedadjustments. (Portillo Declaration, ¶9.) To implement Section 502B of the MOU, which providesfor the Market Based Adjustments, the County conducted a total compensation market based averagestudy and thereafter gave Market Based Adjustments to certain classifications based on theparameters established in 502B (i.e., whether a certain classification is paid 3% or less than themarket average). (Id.) Employees receiving a MBPP were excluded from receiving the MarketBased Adjustment raises, as it was understood by both parties that those receiving MBPPs were beingbrought to market rates via the MBPP. (See Id., Exhibit A, Section 622, page 27.)
It would be illogical to consider the negotiated general across-the board salary increases and theMarket Based Adjustments pensionable, but to consider the MBPPs non-pensionable. (PortilloDeclaration, ¶9.) Had the MBPP not been in effect already in a certain classification at the time thatthe 2013 Market Based Adjustments went into effect, the employees in the certain classificationwould have received the 2013 Market Based Adjustments. (Id.) Both the MBPPs and the MarketBased Adjustments must be treated the same — as pensionable income.
C. THE MBPP IS PAID TO SIMILARLY SITUATED MEMBERS OF THE SAMEGROUP OR CLASS OF EMPLOYMENT
Government Code section 7522.34(a} requires pensionable pay to be "paid in cash to similarlysituated members of the same group or class of employment..." (Government Code section7522.34(a).) It has been reported to SEIU Local 721 that VCERA staff and advisors may believe that
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employees in the same classification are offered different MBPPs based on their date of hire with theCounty. (Portillo Declaration, ¶6.) This is incorrect. (Id.)
All current/existing employees and any new hires in the same classification receive the same MBPP.(Id.) Their date of hire does not determine the MBPP. (Id.) Rather, the MBPP is determined by theresults of the annual HASC study. (Id.) Some employees may receive a higher MBPP as a result of askill set and/or assignment. (Id.) For example, all Pharmacists receive a MBPP based on the HASCstudy results. (Id.) However, Pharmacists assigned to the Oncology unit receive a slightly higherMBPP because it is a hazardous assignment and there is an additional skill set required to work in theunit. (Id.)
There may also be differing rates. of MBPP paid to employees within a particular classificationbecause, in the past, when SEIU Loca1721 negotiated a general across-the-board wage increase forall of its bargaining unit members, the classifications that were already being paid a MBPP receivedthe general across-the-board wage increase and the County subtracted the amount of that increasefrom the MBPP. (Id., ¶7.) In the past, that employee's hourly wage did not go up, even though theSEIU Loca1721 bargaining unit had just received a general across-the-board increase. (Id.) Someemployees in classifications that were being paid MBPP complained that, practically speaking, theydid not receive the benefit of SEIU Loca1721's negotiated general across-the-board increasesbecause their wages remained the same. (Id.) In 2013, SEIU Local 721 and the County negotiatedcontract language that expressly requires the County to pay the general across-the-board wageincrease to classifications that receive MBPP (and implicitly, to not subtract the amount of thegeneral across-the-board wage increase from the MBPP). (Id.) The contract language says: "If anemployee is receiving a MBPP on the effective date of the general salary increases set forth in Article5, Sec. 502A, his or her MBPP sha11 not be reduced as a result of the implementation of said salaryincrease." (See Id., Exhibit A, Section 622, page 27.) The County's historical practice of subtractingthe general across-the-board wage increase from the MBPP makes it look on paper as thoughemployees in the same classification are receiving different MBPP rates based on their date of hire,but that is not the case. (Id.) The County has pledged to correct this historical practice of subtractingpast general across-the-board salary increases from employees' MBPP, and to instead pay allemployees in a classification the same MBPP. (Id.) County Management Representatives haveassured SEIU Loca1721 that the County is in the process of transitioning all employees in aclassification to the same MBPP rate. (Id.) It is possible that it has not yet accomplished thistransition process. (Id.) The process is underway. (Id.)
II. BILINGUAL PAY
We agree with Steve Silver's September 10, 2015 letter, which states that page 3, paragraph 2c) ofthe VCERA Board's Resolution — i.e., the requirement that "[s]pecial assignment payments ordifferentials, and payments for possessing specified certificates, certifications or licenses will beincluded only if the assignment, certification or license is part of a member's regularly assignedresponsibilities on a matter that is a normal or essential function of the job..." (November 17, 2014Resolution, page 3, paragraph 2c), emphasis in original) — is overly-restrictive and not supported bystatute. We incorporate by reference Mr. Silver's arguments in that respect into this positionstatement.
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We appreciate that the VCERA staff have recommended that the County's practice of categoricallydeclining to report any bilingual pay as pensionable compensation should come to an end.
VCERA staff have, instead, recommended that the pay be "[i]ncludable only if bilingualism [is] aregularly assigned normal or essential job function of an identifiable subgroup of similarly situatedmembers within this group or class of employment." (Chart of recommended changes.) A shorthandway of describing this inquiry is whether the employee's position "requires" the bilingual skill. Webelieve this approach is too narrow and unmanageable. An employee's bilingualism is useful to theemployer at any time, even if the employee is not in a position that technically requires proficiency ina non-English language. The employee can be called upon at a moment's notice to helpcommunicate with anon-English client, patient or member of the public. Additionally, in somecircumstances, it may be difficult to measure whether bilingualism is a "regularly assigned normal oressential job function." How often must the employee use the non-English language in the course oftheir work to satisfy this standard?
Assuming for the sake of argument that it is appropriate for the VCERA Board to determine whetheran employee's position "requires" the bilingual skill, we take this opportunity to point out to theVCERA Board that the County is only paying bilingual pay to those SEIU Loca1721-representedemployees who are in positions that require the bilingual skill. The best evidence of this is the MOU.Section 601 of the MOU states that a bilingual premium is paid to "[e]mployees whose positionsrequire the use of bilingual skills..." (Portillo Declaration, ¶10, Exhibit A, page 16.) Therefore, ifthe County employee is currently receiving bilingual premium pay, then the County has alreadydetermined that the employee's position requires bilingual skills. (Portillo Declaration, X10.)
We therefore ask VCERA to consider bilingual pay pensionable for all employees in the SEIU Local721 bargaining unit who receive it.
III. SHIFT DIFFERENTIAL
Again, we appreciate that VCERA staff have recommended that the County no longer categoricallycarve out all differentials from pensionable income.
The VCERA staff recommended acase-by-case approach to determining the pensionability of shiftdifferentials that is similar to its approach to bilingual pay. VCERA staff suggest that the queryshould be whether the employee is "regularly assigned" to work the off-shift that results in thepayment of the shift differential.
Our comments regarding the overly-restrictive nature of Paragraph 2c) of the VCERA Board'sNovember 17, 2014 Resolution, and regarding the difficulty of interpreting and applying thatstandard, apply equally to shift differentials.
VCERA's recommended approach would be particularly hard to manage in workplaces that operate24-hours a day, 7 days a week. As Angela Portillo explains in her declaration, there is no such thingas a "regular schedule" in the VC HCA setting. (Portillo Declaration, ¶11.) VC HCA is a 24-hour a
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day, 7 days a week operation. (Id.) Management representatives always tell the employees and SEIULocal '721 that they can change employees' schedules at any time. (Id.) Also, it is not uncommon foran employee to regularly workaday shift at some point during the week, and then a swing orgraveyard (non-overtime, straight-time pay) shift at some other point during the week, as their so-called regular schedule. (Id.) How often must the employee work the off-shift before that off-shift isconsidered their "regular schedule"?
We respectfully suggest that a better approach, which is consistent with Government Code section7522.34(a), is to deem all shift differentials to be pensionable if the differential is based on straight-time hours the employee worked.
IV. CONCLUSION
We urge the VCERA Board to consider MBPP, bilingual pay, and shift differentials to be"pensionable compensation" for "new members." If this position statement raises any questions orpoints of discussion, SEIU Loca1721 would be happy to address them at the October 19, 2015business meeting. If the VCERA Board believes that further evidence of pay practices or contractualintent is necessary for it to make a decision, we request additional time for SEICT Local 721 to gathersuch evidence.
Si cerely,
_o
'anne R. Steele.~ tl ~' ' —t
KRS:notEnclosure —Declaration of SEIU Local 721 VVorksite Organizer Angela Portillocc: Joe Kahraman, Director of SEIU Local 721 (email only)
Angela Portillo, Worksite Organizer of SEIU Loca1721 .(email only)1/832288
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PROOF OF SERVICE(CCP §1013)
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28WEINBERG, ROGER &
RO5ENFELDA Professional Cor}wraiion
1001 Marina ~iileg. Pnrkwry, Suite 200Aiyncin, California 9a501
f510)3l'l.1001
I am a citizen of the United States and resident of the State of California. I am employed
in the County of Alameda, State of California, in the office of a member of the bar of this Court,
at whose direction the service was made. I am over the age of eighteen years and not a party to
the within action.
On October 2, 2015, I served the following documents in the manner described below:
POSITION STATEMENT OF SEIU LOCAL 721
❑ (BY U.S. MAIL) I am personally and readily familiar with the business practice ofWeinberg, Roger &Rosenfeld for collection. and processing of correspondence formailing with the United States Parcel Service, and I caused such envelopes) withpostage thereon fully prepaid to be placed in the United States Postal Service atAlameda, California.
❑ (BY FACSIMILE) I am personally and readily familiar with the business practice ofWeinberg, Roger &Rosenfeld for collection and processing of documents) to betransmitted by facsimile and I caused such documents) on this date to be transmitted byfacsimile to the offices of addressees) at the numbers listed below.
Q (BY OVERNIGHT MAIL) I am personally and readily familiar with the businesspractice of Weinberg, Roger &Rosenfeld for collection and processing ofcorrespondence for overnight delivery, and I caused such documents) described hereinto be deposited for delivery to a facility regularly maintained by United Parcel Servicefor overnight delivery.
❑ (BY ELECTRONIC SERVICE) By electronically mailing a true and correct copythrough Weinberg, Roger & Rosenfeld's electronic mail system [email protected] to the email addresses set forth below.
On the following parties) in this action:
Ms. Linda WebbVentura County Employees' Retirement Association1190 South Victoria Avenue, Suite 200Ventura, CA 93003
I declare under penalty of perjury under the laws of the U~~nited dates of America that theforegoing is true and correct. Executed on October 2, 015, at~t~lameda,~California.
,~~~" _.~Stephanie ~ 1 i ~uliara
PROOF OF SERVICE
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BEFORE THE BOARD OF THEVENTURA. COUNTY EMPLOYEES' RETIREMENT ASSOCIATION
DECLARATION
I, Angela Portillo, do hereby declare as follows:
1. I have personal knowledge of the following facts and am competent to and would
testify as to the truth of these facts if called as a witness.
2. I am a resident of Ventura County ("County"), California.
3. I am a Worksite Organizer for SEIU Loca1721. I have worked for SEIU Loca1721
since 2014. Prior to working for SEIU Loca1721, I was a County employee. I worked for 5 years
as a County employee in the Child Support Services Specialist classification, in the Child Support
department.
4. I have been assigned to the Ventura County Health Care Agency ("VC HCA")
worksite since 2014. My duties as a Worksite Organizer include being knowledgeable regarding
the provisions of the Memorandum of Understanding ("MOU") between SEIU Local 721 and the
County, and regarding existing payment and scheduling practices in the VC HCA workplace.
5. Over the course of the last year, in connection with my duties as a Worksite
Organizer, I have had multiple conversations with VC HCA Management Representatives,
including representatives in Human Resources, about the Market Based Premium Payment
("MBPP") that is set forth in Section 622 of the SEIU Loca17211County MOU. Attached and
marked as Exhibit A to this declaration is a true and correct copy of excerpts of the SEIU Local
721/County MOU, having the term of September 10, 2013 through August 9, 2016. In
conversations with Management Representatives, we have discussed how the amount of MBPP is
determined and how it is implemented. From those conversations I have learned that every year
VC HCA obtains a report from the Hospital Association of Southern California ("HASC"). That
report is a labor market survey of comparable positions in local hospitals and pharmacies, which
reflects whether a number of SEIU Loca1721-represented classifications (Pharmacist, Speech
Pathologist, Senior Speech Pathologist, Physical Therapist, Senior Physical Therapist,
Occupational Therapist, Senior Occupational Therapist, Supervising Physical Therapist I and II,
Declaration of Angela Portillo in Support of SEIU Local 721's October 2, 2015 Submission to VCERA Board
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Staff Psychologist, Senior Psychologist, Pharmacy Technician, Clinical Laboratory Scientist I, II,
and II, Histologist, Radiologic Specialist, Radiologic Technologist, Licensed Physical Therapy
Assistant, Principal Respiratory Therapist, and Certified Occupational Therapy Assistant) are
underpaid compared to counterpart classifications elsewhere. (See Exhibit A, Section 622, pages
26-27.) The MBPPs are reviewed in light of the results of that report. VC HCA determines from
the report if a MBPP is necessary to: (a) recruit new employees, and (b) retain existing employees
by providing competitive wages. If VC HCA determines that a MBPP is appropriate for a
particular County classification —because the market average pay rate paid to the comparable
classification in local hospitals or private pharmacies exceeds that which is paid to the County
classification —then MBPP will be issued to all employees (that includes existing employees and
any new hires} in the County classification. For example, if the top of the County pay scale for a
Speech Pathologist is $35 an hour, but the HASC study determines that the 50th percentile of pay
for speech pathologists across southern California is $45, all County Speech Pathologists will
receive a $10 an hour MBPP in order to raise the total hourly wage to $45.
6. It has been reported to me that VCERA staff and advisors may believe that
employees in the same classification are offered different MBPPs based on their date of hire with
the County. This is incorrect. All current/existing employees and any new hires in the same
classification receive the same MBPP. Their date of hire does not determine the MBPP. Rather,
the MBPP is determined by the results of the annual HASC study. Some employees may receive a
higher MBPP as a result of a skill set and/or assignment. For example, all Pharmacists receive a
MBPP based on the HASC study results. However, Pharmacists assigned to the Oncology unit
receive a slightly higher MBPP because it is a hazardous assignment and there is an additional skill
set required to work in the unit.
7. There may also be differing rates of MBPP paid to employees within a particular
classification because, in the past, when SEIU Local 721 negotiated a general across-the-board
wage increase for all of its bargaining unit members, the classifications that were already being
paid a MBPP received the general across-the-board wage .increase and the County subtracted the
amount of that increase from the MBPP. In the past, that employee's hourly wage did not go up,
-2-Declaration of Angela Portillo in Support of SEIU Local 721's October 2, 2015 Submission to VCERA Board
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 154 of 202
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even though the SEIU Loca1721 bargaining unit had just received a general across-the-board
increase. Some employees in classifications that were being paid MBPP complained that,
practically speaking, they did not receive the benefit of SEIU Loca1721's negotiated general
across-the-board increases because their wages remained the same. In 2013, SEIU Loca1721 and
the County negotiated contract language that expressly requires the County to pay the general
across-the-board wage increase to classifications that receive MBPP (and implicitly, to not subtract
the amount of the general across-the-board wage increase from the MBPP). The contract language
says: "If an employee is receiving a MBPP on the effective date of the general salary increases set
forth in Article 5, Sec. 502A, his or her MBPP sha11 not be reduced as a result of the
implementation of said salary increase." (See Exhibit A, Section 622, page 27.) The County's
historical practice of subtracting the general across-the-board wage increase from the MBPP makes
it look as though employees in the same classification are receiving different MBPP rates based on
their date of hire, but that is not the case. The County has pledged to correct this historical practice
of subtracting past general across-the-board salary increases from employees' MBPP, and to
instead pay all employees in a classification the same MBPP. County Management
Representatives have assured me that the County is in the process of transitioning all employees in
a classification to the same MBPP rate. It is possible that it has not yet accomplished this
transition process. The process is underway.
8. Although Section 622 of the MOU describes the payment as a "recruitment and
retention bonus," it is not a "bonus" in the typical sense. The same section of the MOU also refers
to the payment as a "premium pay adjustment." That is a more accurate way of describing the
payment. The language of Section 622 of the SEIU Local 721/County MOU defines an
employee's total hourly rate to be the base pay plus any MBPP. Therefore, the total hourly rate
(base pay + MBPP) functions as the employee's normal hourly rate of pay. Attached and marked
as Exhibit B to this declaration is a true and correct pay stub belonging to a current Ventura
County employee in the Pharmacy Technician II classification. The base hourly wage (NAHRLY)
and the MBPP (PHARM) are added to create the total hourly wage (Total). A11 other hours and
earnings are itemized in a separate section of the pay stub. Percentage based premiums, such as
-3-Declaration of Angela Portillo in Support of SEN Loca1721's October 2, 2015 Submission to VCERA Board
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 155 of 202
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bilingual pay, are paid on the total hourly wage, not on the base hourly wage. This reaffirms that
the total hourly rate (base pay + MBPP) functions as the employee's normal hourly rate of pay.
9. The MBPP functions to effectively bring wages of the classifications outlined in
section 622 of the MOU to market levels. Per Section 622 of the MOU: "Employees receiving a
MBPP sha11 be excluded from the MBA [Market Based Adjustment] studies set forth in Section
502B [of the MOU] and shall not be eligible to receive any MBA." In the most recent cycle of
bargaining (2013), SEIU Local 721 and the County negotiated wage increases for current and
future employees in two different ways: (a) general across-the-board salary increases, and (b)
market based adjustments (MBAs). To implement Section 502B of the MOU, which provides for
the MBAs, the County conducted a total compensation market based average study and thereafter
gave MBAs to certain classifications based on the parameters established in 502B (i.e., whether a
certain classification is paid 3% or less than the market average). Employees receiving a MBPP
were excluded from receiving the MBA raises, as it was understood by both parties that those
receiving MBPPs were being brought to market rates via the MBPP. (See Exhibit A, Section 622,
page 27.) Bath the general across-the-board salary increases and the MBAs outlined in Sec 502A
and Sec 502B are pensionable under PEPRA. It would be illogical to consider the negotiated
general across-the board salary increases and the MBAs as pensionable, but to consider the MBPPs
non-pensionable. Had the MBPP not been in effect already in a certain classification at the time
that the 2013 MBAs went into effect, the employees in the certain classification would have
received the 2013 MBAs. Also, the County clearly regards the MBPPs as a payment for regularly
assigned normal or essential job functions of an identifiable group or subgroup within similarly
situated members within this group or class of employment.
10. I am personally familiar with SEIU Loca1721/County contract language regarding
bilingual pay. Section 601 of the MOU states that a bilingual premium is paid to "[e]mployees
whose positions require the use of bilingual skills..." (Exhibit A, page 16.) Therefore, if the
County employee is currently receiving bilingual premium pay, then the County has already
determined that the employee's position requires bilingual skills.
11. I have reviewed the VCERA analysis regarding who should be eligible for shift
-4-Declaration of Angela Portillo in Support of SEN Loca1721's October 2, 2015 Submission to VCERA Board
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 156 of 202
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differentials, i.e., "employees regularly assi~ed to work" on the shift.. I am personally aware,n
from talking to V~ HCA employees and rnanage~nent representatives and viewing schedules, that
there is no such think as a "regulax schedule" in the VC HCA setting. ~C HCA is a 24-hour a day,
7 days a week operation. Management representatives always tell the employees and SERI Local
721 that they can change empi~yees' schedules at any time. Also, zt zs not uncommon far an
employee to regularly workaday shift at some paint during t1~e week, and then a swing car
~-avey~rd (non-overtime,. straight-time pay) shift at some other point during the week, as their so-
eal.led re~,ular se~~d~3e.
iI declare under penalty of perjury that the foregoixlg is true ai d correct, and ghat this declaration
vas executed in Ventura, California on 4ctober.~ 2Q15.~.
Signed: ,%`
Angela Port~llo
i~~~a2s7
_S-i Decla~-atian of Angela Portilto in Suppoat of SEIU Local 721's Octat~er 2, 2015 Submission to VCER A Board
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 157 of 202
SEIU LOCAL 721 /COUNTY OF VENTURAVENTURA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION
Preliminary Report on PEPRA Pensionable Compensation Analysis
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MASTER PAGE NO. 158 of 202
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MASTER PAGE NO. 159 of 202
of seven hundred fifty dollars ($750). Employees employed less than full-time (regularly scheduled to work less than 64 hours biweekly) shallreceive cone-time. payment of six hundred ($600) dollars.
Sec. 502 PAY/SALARY WCREASES:
A. General Salar~lncreases
Effective August 17; 2Q14, employees covered by this agreement shall beeligible for a general salary increase of one percent (1 %).
Effective August 16, 2015, employees covered by this agreement shall beeligible for a general salary increase of two percent. (2%).
B. Market Based Adjustments
The County. shall conduct a single total compensation .market-basedaverage study (based on the survey structure that was. provided to SEIUon 7/22/13) by .April. 30, 2014. The results of that survey shall. be used todetermine market-.based salary adjustments as follows
a. If the total compensation study results reveal that. a benchmarkclassification is three: percent (3%) or less than the market average,then that classification benchmark and all other classificationsbenchmarked to it shall. not be eligible for any MBA.
b. Effective August 17, 2014, if the total compensation study resultsreveal that a benchmark classification is more ,than three percent{3%) below the market average, then that classification benchmarkand all other classifications benchmarked to it shall be eligible toreceive a MBA of one percent (1%).
c. Effective August 16, 2015, if the total compensation study resultsreveal that a benchmark classification is more than six percent (6%)below the market average, then that .classification benchmark andall other classifications benchmarked to it shall be eligible to receive.a MBA of one percent (1 %).
C. Salary Offsets for Increased Employee-Paid Retirement Contributions
Effective July 6, 2014, salary: of represented employees affected by thechanges to Sec. 401 .and 402 shall be increased as follows
a. The percentage amount equal to the percentage. value ofeliminating the retirement pick-up; and .
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MASTER PAGE NO. 160 of 202
5. Temporary assignments will not exceed twenty three (23)working days. .
Sec. 525 BASE HOURLY RATE OF PAY/SALARY — VCMC TWELVE (12) HOURSHIFT -METHOD OF COMPUTATION: Employees in Nursing CareCoordinator classifications who are assigned to the Ventura CountyMedical.Center and who are regularly assigned to twelve (12) hour shiftsshall have their base hourly rate of pay/salary. rate computed as follows
12 Hour Rate = 8 hour base hourly rate of pay/salary .Rate times 41divided by 36.
In order to be eligible for the twelve (12) hour rate, an employee mustwork a minimum of .four (4), twelve. (12) hour shifts in a biweekly payperiod.
Sec: 526 ADVANCED HOURLY RATE OF PAYISALARY PLACEMENT ANEWHIRES): Upon recommendation `of :the.. appointing authority and theDirector-Human Resources, the County :Executive Officer may :approvehiring a new employee. beyond ..the midpoint of the. pay/salary range:provided that:
A. Reasonable proof has been presented #hat no qualified person canbe recruited. to fill a position below the midpoint of the pay/salaryrange; or,
B. Reasonable. proof has been .presented that an applicant hasqualifications deserving a stacking hourly rate. of pay/salary higherthan .the midpoint of the pay/salary range.
Appointments made above .the midpoint of the pay/salary range and inaccordance with the above-listed criteria for. APCD employees may beapproved by the APCD Executive Officer.
Local 721 shall be notified in writing of appointments .made. above themidpoint of the pay/salary range.
ARTICLE 6OTHER BENEFITS ANDPREMIUM PAY
Sec. 601 BILINGUAL PREMIUM PAY:
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MASTER PAGE NO. 161 of 202
A. Employees whose positions require the use of bilingual skills shallbe allocated for bilingual premium pay at the I, II, or III level. Theallocation of .positions among the respective levels shall be madeby the Agency/Department Head, based .upon the criteriaestablished by, and subject to approval by, the .Director-HumanResources. An .employee's bilingual proficiency at Levels I .and. JIshall ` be determined by an examination administered andcertification issued by the Director-Human Resources or otherapproved county or city employer or educational:.facility at .theemployee's expense. Level III proficiency examinations :shall bedeveloped and, administered solely by the Director-HumanResources. The level of an employee's bilingual proficiency. shallbe determined by an examination administered by the Director —Human Resources. Employees assigned to such. positions. shall beeligible for bilingual premium. pay. at the level of their position orlevel of their proficiency, whichever is less, subject to the conditionsset forth herein.
The rates for the respective levels are:
Bilingual bevel Premium Pavt $ .65/hour11 $ .80/hourIII $ .90/hour
Employees in positions eligible. to receive this .premium pay shallreceive the appropriate rate per hour: compensated per biweeklypay period, not to exceed eighty (80) compensated hours per payperiod.
Such premium pay shall be in addition to #heir base. pay. To beeligible to receive this .premium pay, upon the recommendation ofthe Agency/Department Head and the Director-Human Resources,the County Executive Officer must designate that such. payment willbe made.
The provisions of this Section. shall not apply to the classification ofInterpreter-Translator.
B. Employees in the Non-Supervisory Social Services Unit whocurrently .receive ..bilingual premium .pay shall .continue to receivesaid payment throughout the life of this contract except in caseswhere an employee accepts a voluntary transfer or is promoted to aposition which. does not qualify for such premium. Nothing in this
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Section precludes management from transferring employees toother worksites in .order to provide adequate caseload coverage..
Sec. 602 STANDBY PREMIUM PAY:
A. Should an ; FL.SA non-exempt employee be placed on formalstandby duty (as is meant under. the. FLSA), said employee shall becompensated for. actual time on call at one-quarter (114) of his/herregular rate of pay/salary or at the State minimum wage, whicheveris greater, and .for time :worked as a result of a callback to duty athis/her hourly wage when funds for such purposes have beenspecifically appropriated by the Board after specific inclusion in thedepartment/agency budget. In no instance shall a callback to dutybe considered as less than two (2} hours .for .pay purposes. Noemployee shall be paid for. call back time and standbysimultaneously. All employees excluded from the :overtimeprovisions of these Articles are also excluded from the provisions of#his Section..
S. No more than three (3) HS Child Welfare Social Workers (at the.discretion of the .Director-.Human Services .Agency) .and two NSAdult.. Protective Services Social Workers assigned to emergencyresponse duty is authorized to be paid .the standby. premium inaccordance with provided by 602-A. Should that CSSW or APSSWbe called back while on formal ..standby duty, he/she shall beeligible to .receive the callback premium pay.. in accordance . withSection 602(A).
All other employees excluded from the overtime provisions of theseArticles are also excluded from the provisions of this Section.
Sec:.603 NIGHT SHIFT DIFFERENTIAL PREMIUM PAY:
A. Except as otherwise provided herein, the night shift differential forregular employees whoare regyired to work half of a shift plus one(1) hour between the .hours: of 3:00 p.m. and 7:00 a.m. shall becalculated. at the rate of fivepercent (5%) of the base pay of saidemployee.
B. Any .person employed as a Jail Cook who is..assigned to a shiftbetween the hours of .3:00 a.m. to 11:00 a.m. or 1.1:00 a.m.. to 7:00p.m. shall be eligible to receive a five percent (5%) premium (basedon his/her hourly base rate of pay).
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MASTER PAGE NO. 163 of 202
D. Benefits potentially dueunder this.Section shall not apply to PublicSafety Dispatchers who are in training prior , to .successfulgraduation from the Academy.
The policies that direct .the. Emergency Medical Dispatch program are.those of the County of Ventura, Health Care .Agency, Emergency MedicalServices Policies and Procedures, including. Policy.#910.
Sec 620 ENVIRONMENTAL HEALTH RESPONSE TEAM PREMIUM:Environmental Health .Employees who ..are assigned by the ..Director-RMAor his/her .designee to the .Environmental Health . Response Team shallreceive a biweekly. premium of $192.00. Employees receivingcompensation pursuant to this provision are. not eligible to receiveovertime, standby, or callback,pay.
Sec. 621 UCMC PSYCHIATRIC INPATIENT UNIT ASSIGNMENT DIFFERENTIAL:Any regular, non-physician, non-psychiatric technician, and/or non-nursingemployee specifically.. assigned to work in the Ventura County MedicalCenter's Unit .and specifically designated by .the HCA Director to provideacute inpatient mental health care shall receive a five...percent (5°l0)differential for work performed. Depending an the overtime status of .theemployee, said differential .shall. be based on, and paid in addition to, either.the base hourly wage or base biweekly hourly rate of pay/salary of theemployee. Eligibility for this differential is at the sole .discretion of the HCADirector.
Sec. 622 MARKET BASED. PREMIUM PAY :Upon recommendation of the Director:.Health CarE Agency, the. Director-Human Resources may approve apremium pay for Pharmacists, Speech Pathologist,: Senior SpeechPathologist, Physical ..Therapist, Senior .Physical Therapist, .OccupationalTherapist, Senior Occupational Therapist, Supervising Physical Therapistand II, Staff. Psychologist and Senior Psychologist, Pharmacy. Technicians,
::Clinical Laboratory Scientist I, II, .III, Histologist, Radiologic Specialist,Radiologic .Technologist, Licensed Physical Therapy Assistant, PrincipalRespiratory Therapist, and Certified Occupational Therapy Assistant fas arecruitment and retention bonus? The amount of the premium pay.adjustment will be calculated as needed according to the changing labormarket survey of comparable positions in local hospitals and privatepharmacies and will be up to $25.00 per hour for Pharmacists, SpeechPathologist, Senior Speech Pathologist, Physical Therapist, SeniorPhysical :Therapist, Occupational Therapist, Senior OccupationalTherapist, Supervising Physical Therapist I and ll, :Staff Psychologist and.Senior Psychologist and up to $15.00 per hour for Pharmacy Technicians,
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Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 164 of 202
Clinical Laboratory .Scientist I, 11, III, Histologist, Radialogic Specialist,Radiologic Technologist, Licensed .Physical .Therapy Assistant, PrincipalRespiratory Therapist, and Certified Occupational Therapy Assistant. Thepremium pay may be reduced or eliminated should a survey as describedabove show that reduction/elimination is warranted.
A reduction to the MBPP may occur if the total hourly rate (base pay plusany MBPP) paid to the employee exceeds the market average pay rate bymore than 5% plus the percentage value increase of the salary offsets setforth in Article, 5, Sec. 502C (threshold value). In such a case, the amountof the reduction shall be the amount by .which the tofal hourly rate thatexceeds the threshold value.
Jf an .employee is receiving a MBPP on the effective . date of the generalsalary increases set forth in Article 5, Sec. 5Q2A, his or her,MBPP shall notbe reduced as a result of the implementation of said salary ..increase.Employees receiving a MBPP shall be excluded from the MBA studies setforth in Sec. 5026 and shall not be eligible to receive any MBA.
The County agrees.. to meet and consult with the Union on theimplementation procedures of the Market Based Premium program todetermine the original intent of Section 622 and to modify as necessary forimplementation by January 1, 2006..Thereafter the County willmeet and.consult on any changes in application of Section 622 prior toimplementation. The County will conduct an internal review of the use ofMBPP and discuss the results with SEIU.
Sec. 623 LICENSE ENDORSEMENT REIMBURSEMENT: An employee in any ofthe classifications Jisted below.. who, in order: to meet the minimumrequirements .for his/her position, renews his. /her :Class °1" or Class "A"California Drivers license within .ninety {90) days of the expiration date andis directed by the County to obtain a Tank andlor Hazmat LicenseEndorsement shall. be reimbursed .for. the .cost of the initial endorsementso~ as follows:
1. $25.00 when the endorsements) is obtained ..concurrent with therenewal of his/her Commercial Drivers License; or,
2. $25.00 plus $10.00 per endorsement when, through no fault of theemployee, he/she renewed hisJher Commercial Drivers License andwas subsequently advised by the County .that the endorsement isrequired.
3. $25.00 if, on the effective date of this MOA he/she. already holds aClass "A" license and the endorsements) if helshe is subsequently
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Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 165 of 202
SEIU LOCAL 721 / COUNTY OF VENTURAVENTURA COUNTY EMPLOYEES' RETII2EMENT ASSOCIATION
Preliminary Report on PEPRA Pensionable Compensation Analysis
t ~r ~
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 166 of 202
'~ -,
JEF'T~ERY S. L~`URGFI Pay Gre~ssp: SFII Sun-Sat Holiday Btcseeess Unit: HCAVC .~A~ t(~i7 n.R-CCiN SROLL~R Pay Y3egii~ ll~te: 48i10/ZU i 7 Chcck i~: OOtI0U30069'7?SA9COUNTY OF VENTURA Pay End Date: d9i12'2615 Chcck Date: 09/l8(2015
~--- ~~.,:-,~o:~cctD:, ~1AIiRLY ~pI8.4961?94 T.~UATA: l~eduraa 5tafe4 A ; ~rtmei~t;33zts-Yharntaay p~~gttA~ ~2 7613$7 Mnrittti Sta~us: Single Single, o~ Married with
Location:VenturaCounty Medical Center ~ Aliowances; I 1706 Titic:l'harmacp Technician II '[otal: $21.257461 Add1. Pct
Addl. Amt:
}7t>U1tSA;VDEARNTNGS TAXF,S ----CurrenE._.,_._... __.y7"p
~eeerintitsn a# ~~~dtf ~ ~: ~3d~ ~SZ'n...t~p~.i,ig l
rr 7' t.tD9 3Rssociate's Degiee 42.52 7&$.SG F`e~l R"
Bilin~uaiLevel2 54 Q6 f.2lS.OQ PadML;>;cE 2~'.c. 466.2bFl~xCredit 297.00 5,643.00 FedQA9DTfF.E 107.11 f,~93:67Ke~ular 21.257461 64.7 1.37fi.~2 l,;S$.92 24,Q8Q.'31 CA~~'ithholting 39.97 717.14Vacation Hoarty NonkLSA 23.257461 7.25 154.12 22Q58 4,5$2.~iS GA OASDI%E~ IS.SS 289,A0Fiatiday - Ho~uly Non FLSA 21.257Abt 8.06 170.06 56.00 1,164.56Sick -Personal Haurty NonFLSA O.p~ 67.25 I,s"93.34Sick Leave AdjuStrnCnt (7.OU -19SU O.pOStrttighiTimeOvettime 0.00 2.50 57..30Lcpve 4Vithouc Pay Hourly 6.OQ 1.75 0.€1QFamily Sick-HourlyidonFLSA -0.OQ &.00 tb5,75Floaric~ Holiday Non PLSta O.UO 8.00 t65.?5
TQTAL: BQ.Uft 2,]A4.iZ t,5U3.50 39,251.45 TOTAL: 355.47 6,573.9$~F`()~R~;;,'FAX T7 ' D1 :"~'T_~}~,S L~ET~:R-TA}t i)F.I?~,cTTC3YsC F`MPf, lV..~R P TT} BF'iV .Fi`i`R
n ,t+^n ~y[ 13escrtotinn ~r Y3'~ Descriutivn Ct. ~rrent Y„~'DVC2leaLtbCarePSzn 333.97 6,3 5.43 gp~~;~oarti 91.73 1284.22 anikI>cduction 29.76 5 2.22
4l31k Deduction Z9.7(i 577.04 SEIU FT Reg with 16,75 326,75 Retirement Cnry COL Find S5.]4 63 .90
Fidei1ty45TPlan 10.00 19b.OQ Paliti~alCazat - Rericam~ntk,arnings2~inal ~,lOA.IZ 39,t99.6S
1lealthCacal~'!ax 4L.67 750.06 401k Loan 2 p,pp t ~,~7.~,y i~eeirement Cnty Iteg Fund 3S7.A9 6;569,45
Spensl~ng AcCkItec T:E COL $efotc SS.~4 1,031.01TaxRet EE Reg Iiefam Tom. 148.01 2,177.40
TdTAL: 618.'77 71,67tl.94 TOTAL: 108.48 3,558.6b "TAXABLETO'.CAL GRASS F~fl TAYABI.E C:T2OSS TOTAT, TAXES TC?T.A~L DEDUCTIONS NET PAX
Current 2,IE14. t2 1,9&5.35 356.4? 727.25 l„02D.40YTfl 34,251A> 27,5$0. ! (,,57590 15,229.~i0 17,445.95
Sick Hours YTD 4aratlnn kCours Y"Tll Ftcsatin F3ntidav YTD Cpm Time Y`I'U Holida P"FO YT17Start 6aia~xie 18.9Q Stan Balance 725.A3 SfaR Bat~nce 0.00 Start Balanee O.W Stare Balance 0.44+E.~uned 3.08 +Harned 5.85 +L•an~ed 0.00 +~.arned 4.p0 +Fittnked 0.00+IIaagl~i 0.00 +Dou~ht Q.00 0.00- Taken 0.00 -Taken 7.25 -Taken 0.00 -Talon -Taken 0.00
Sn1d 0.(3D - Sald 0.60 - Exp"ued 0.00+ Ad'usm3encs 0:0() +Ad'ustments 0.00 = Adjusm~enu 0.06acid IIatan? e: 22.07 End Ba3ance 12A.Q3 Erid IIa ante: Q.00 End Balance: 0.40 En~i HalAnce: 0.0~
b2~SSAGC: NET PAY Ak57'RIBCfT[ONDept NTessage: (;heck #000003000477SA9 1,620.40
Tota7:_ _ 1,020.AD
AUDITOR.-C ON'1'It0 LLERCOUNTY OF VEIVTURAVENTURA, CA 930Q9-1544
~18~009/'1812019
CtiCC~C NO.3ftfl097'~549
CheCkAntount: 82,020.40 *****
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
MASTER PAGE NO. 167 of 202
PROOF OF SERVICE(CCP §1013)
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I am a citizen of the United States and resident of the State of California. I am employed
in the County of Alameda, State of California, in the office of a member of the bar of this Court,
at whose direction the service was made. I am over the age of eighteen years and not a party to
the within action.
On October 2, 2015, I served the following documents in the manner described below:
DECLARATION OF ANGELA PORTILLO
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28WEINBERG, ROGER &
ROSENFELDA Pmiessionat Corporntion
1601 Mari~ie Viliagc Parkway, Sure 2aoNamsda. CaliEomin 9Y501
(510)JJ'1.1a01
❑ (BY U.S. MAIL) I am personally and readily familiar with the business practice ofWeinberg, Roger &Rosenfeld for collection and processing of correspondence formailing with the United States Parcel Service, and I caused such envelope{s) withpostage thereon fully prepaid to be placed in the United States Postal Service atAlameda, California.
❑ (BY FACSIMILE) I am personally and readily familiar with the business practice ofWeinberg, Roger &Rosenfeld for collection and processing of document{s) to betransmitted by facsimile and I caused such documents) on this date to be transmitted byfacsimile to the offices of addressees) at the numbers listed below.
Q (BY OVERNIGHT MAIL) I am personally and readily familiar with the businesspractice of Weinberg, Roger &Rosenfeld for collection and processing ofcorrespondence for overnight delivery, and I caused such documents) described hereinto be deposited for delivery to a facility regularly maintained by United Parcel Servicefor overnight delivery.
D (BY ELECTRONIC SERVICE) By electronically mailing a true and correct copythrough Weinberg, Roger & Rosenfeld's electronic mail system [email protected] to the email addresses set forth below.
On the following parties) in this action:
Ms. Linda WebbVentura County Employees' Retirement Association1190 South Victoria Avenue, Suite 200Ventura, CA 93003
I declare under penalty of perjury under the laws of the U ' e~~tates of America that theforegoing is true and correct. Executed on October 2, 20 ~ at,~lameda,; California.
Stepham.;=tili~ull~;~
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PROOF OF SERVICE
Business Meeting Agenda - VII.A. OLD BUSINESS: RECOMMENDATION TO EXCLUDE MBPP FROM PENSIONABLE COMP.
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January 29, 2016 Michael Powers County Executive Officer County of Ventura 800 South Victoria Avenue Ventura, CA 93009 SUBJECT: VCERA BOARD OF RETIREMENT REQUEST FOR PUBLICLY AVAILABLE
SCHEDULE OF MARKET-BASED PREMIUM PAY ITEMS Dear Mr. Powers, As you are aware, at its October 19, 2015 business meeting, the Board of Retirement of the Ventura County Employees’ Retirement Association (“Board”) took action on individual pay codes pursuant to its November 2014 resolution interpreting “pensionable compensation” under Government Code section 7522.34. That action identified pay codes to be included in, and excluded from, “pensionable compensation” applicable to VCERA members who first join the retirement system (without reciprocity) on or after January 1, 2013 (PEPRA members). The resulting addenda to the Board’s original Pensionable Compensation Resolution was provided to the County of Ventura after that meeting. Prior to the Board’s adoption of both the original Resolution in 2014 and its addenda in October, the County of Ventura advocated for market based pay items be included in pensionable compensation under PEPRA. The Board ultimately included those items. As part of the action to include market based premium pay in pensionable compensation, the Board requested that the Ventura County Board of Supervisors create a publicly available schedule of these items, as required by PEPRA, by July 1, 2016. Attached is a list of those pay items. Please contact me with any questions regarding the Board’s action and accompanying request. Sincerely,
Linda Webb Retirement Administrator Attachment CC: Board of Supervisors, County of Ventura Board of Retirement, VCERA
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MARKET‐BASED PREMIUM PAY ITEMS (COUNTY OF VENTURA)
EARNINGS CODE
EARNINGS CODE DESCRIPTION
CLS123 Clinical Laboratory Scientist I/II/III Premium Pay HISTOL Histologist Premium Pay LPTAST Licensed Physical Therapy Assistant PHARM Pharmacy Premium Pay PRNRES Principal Respiratory Therapist Premium Pay PSYCH Psychologist Premium Pay RADSPE Radiologic Specialist Premium Pay RADTEC Radiologic Technologist Premium Pay SPEECH Speech Pathologist Premium Pay THRPST Therapist Premium Pay
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APPLICATION OF MBPP CODES AS OF 2016
CODE Position # Receiving Range Variance COMMENTS
CLS123 Clinical Lab Scientist I 2 ALL NO
CLS123 Clinical Lab Scientist III 9 ALL NO
PHARM Pharmacy Tech I 5 ALL NO
PSYCH Senior Psychologist 14 ALL NO
SPEECH Senior Speech Pathologist 1 ALL* NO
SPEECH Speech Pathologist 1 ALL* NO
PSYCH Staff Psychologist 4 ALL NO
THRPST Supervising Therapist I 6 NONE** NO
*Senior SP & SP can be deemed similar situated. **Was previously paid to one employee who has since been promoted to Supervising Therapist II.
CODE Position # Receiving Range Variance COMMENTS
CLS123 Clinical Lab Scientist II 21 ALL $6.35/hr (19) $6.71 (2) 1/85‐1/16 $6.35
B500 (15) HCA_VCMC (Clinical Lab Svcs)
2 at higher rate only ones hired in FY13‐14
B500 (1) HCA_SP_HOS (Clinical Lab Svcs)
B510 (3) HCA_SP_HOS (Clinical Lab Svcs – SP)
12/13‐6/14 $6.71 B500 (2) HCA_VCMC (Clinical Lab Svcs)
LPTAST Licensed Physical Therapy Asst.
3 ALL $4.20 ‐ $5.40
9/17/01 4.21 B775 HCA_SP_HOS (Heritage Valley)
4/5/09 5.15 B770 HCA_VCMC (Eastman PT)
9/28/14 5.40 B770 HCA_VCMC (Eastman PT)
PHARM Pharmacist II 21 20/21 $11 ‐ $21 9/30/79 $0 3201 (1) HCA_QA_MGT (MHL Admin)
12/11‐8/15 $11 C390 (7) HCA_VCMC (Pharmacy IP)
C392 (1) HCA (Pharmacy Infusion)
4/10/09 $13 C390 (1) HCA_VCMC (Pharmacy IP)
11/08‐4/16 $14
C390 (5) HCA_VCMC (Pharmacy IP)
C392 (2) HCA (Pharmacy Infusion)
C395 (1) HCA_SP_HOS (Pharmacy IP – SPH)
4/15/15 $16.50 C390 (1) HCA_VCMC (Pharmacy IP)
5/29/02 $17 C390 (1) HCA_VCMC (Pharmacy IP)
1/27/08 $21 C392 (1) HCA_VCMC (Pharmacy Infusion)
PHARM Pharmacy Tech II 13 ALL $3.24 ‐ $4.70
5/10‐4/15 $3.24*
C390 (4) HCA_VCMC (Pharmacy IP)
C390 (1) HCA_SP_HOS (Pharmacy IP)
C392 (2) HCA (Pharmacy Infusion)
C395 (1) HCA_VCMC (Pharmacy IP – SPH)
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CODE Position # Receiving Range Variance COMMENTS
4/07‐3/14 $4.23 C390 (3) HCA_VCMC (Pharmacy IP)
C395 (1) HCA_SP_HOS (Pharmacy IP – SPH)
6/23/13 $4.70 C390 (1) HCA_VCMC (Pharmacy IP)
PRNRES Principal Respiratory Therapist
33 31/33 $0 (2) $6.31 ‐ $9.92
3/15‐4/15 $0 C794 (2) HCA_KNOLLH (Catch Grant) The 2 not receiving both are at KNOLLH (CATCH GRANT)
116488 changed from 6.36 to 9.36 on 7/3 w/o chg in job class
1/15‐4/16 $6.31
B720 (2) HCA_VCMC (Respiratory Therapy)
B720 (1) HCA_SP_HOS (Respiratory Therapy)
$6.36
B720 (7) HCA_VCMC (Respiratory Therapy)
B725 (2) HCA_VCMC (Respiratory Therapy SPH)
B720 (2) HCA_SP_HOS (Respiratory Therapy)
$6.71 B720 (2) HCA_VCMC (Respiratory Therapy)
$7.52 B720 (1) HCA_SP_HOS (Respiratory Therapy)
$7.70 B720 (1) HCA_VCMC (Respiratory Therapy)
$7.91 B720 (1) HCA_SP_HOS (Respiratory Therapy)
$8.36 B720 (1) HCA_SP_HOS (Respiratory Therapy)
$8.98 B720 (1) HCA_VCMC (Respiratory Therapy)
$9.36
B720 (6) HCA_VCMC (Respiratory Therapy)
B720 (2) HCA_SP_HOS (Respiratory Therapy)
$9.71 B720 (1) HCA_VCMC (Respiratory Therapy)
$9.92 B720 (1) HCA_VCMC (Respiratory Therapy)
LPTAST Senior Physical Therapist 20 2 of 20 $1 & $1.39 5/18/11 $1 B770 HCA_VCMC (Heritage Valley PT)
4/29/01 $1.39 B775 HCA_VCMC (Heritage Valley PT)
THRPST Supervising Therapist II 4 3 of 4 $1.37 ‐ $5.50 4/10/99 $0 3141 HCA_GONCMS (CA Children’s Services)
12/2/92 $1.37 (1)
B770 HCA_VCMC (Eastman Physical Therapy)
10/31/99 $1.56 B775 HCA_SP_HOS (Heritage Valley PT)
1/26/1981 $5.50 B770 HCA_VCMC (Eastman Physical Therapy)
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Webb, Linda
From: Dembowski, JimSent: Wednesday, May 03, 2017 11:25 AMTo: Webb, Linda; Atin, Shawn; Stallings, JulieCc: Reynolds, MichelleSubject: RE: MBPP
Linda: Shawn asked that I respond as I led the bargaining effort with SEIU that resulted in the current MOA. It is recognized that the single sentence that was carried over from the prior MOA in the fourth paragraph of Section 622 of the MOA would seemingly preclude those who are receiving the MBPP from receiving an MBA. However, that would not result in the employees receiving what was intended by the parties at the table. As is well established in Labor Relations, a contract is to be read not line by single line, but rather in total, so as to implement the true understanding of the parties at the table. In this instance, and in sharp contrast to the language found in 502-B of the prior MOA, the language I wrote (as approved by County Counsel) to create 502-B in the current MOA specifically provides that the MBAs be given not only to the subject classifications, but to all individuals employed therein…of great note is that there is no stated exclusion of those receiving the benefit of Section 622. Further, the MOA was costed and presented to the BoS as if all individuals within the classification were to receive the benefit, again, irrespective as to whether or not the individual also received MBPP. Obviously, the failure to delete that outlier sentence has resulted in some confusion and need be corrected by a letter to the BoS. That will occur in the near future. It is thought the above should allay any confusion regarding the application(s) of 502-B and 622.
J. A. Dembowski Sr. Deputy Executive Officer - Human Resources County of Ventura | County Executive Office 800 South Victoria Avenue, L #1970 Ventura, CA 93009 (805) 654-2568 [email protected] NOTICE/CONFIDENTIAL: This e‐mail message and the attached document(s), if any, are intended only for the official and confidential use of the individual(s) or entity to which it is addressed. If the reader of this e‐mail message is not the intended recipient, or the employee or agent responsible for delivering the message and/or attached document(s) to the intended recipient(s), you are hereby given notice that any unauthorized use, dissemination, forwarding or copying of this communication is strictly prohibited. If you have received this communication in error, please contact the sender by reply e‐mail or telephone and delete the original message and any attached document(s) from your system. Thank you.
From: Webb, Linda Sent: Wednesday, May 3, 2017 10:05 AM To: Atin, Shawn <[email protected]>; Stallings, Julie <[email protected]> Cc: Reynolds, Michelle <[email protected]>; Dembowski, Jim <[email protected]> Subject: RE: MBPP Shawn, The reason we are asking is that you’ve referred us to the MOA for the provisions which guide MBPP. Regarding MBAs, it says that those receiving MBPPs get the GSIs without an MBPP reduction, but are not be eligible for MBAs.
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From: Atin, Shawn Sent: Wednesday, May 03, 2017 9:21 AM To: Stallings, Julie Cc: Webb, Linda; Reynolds, Michelle; Dembowski, Jim Subject: RE: MBPP Julie – We have made the case that the HCA Fiscal Premium Pay is similar to MBPP and as such should be included as pension compensation. Regarding the MBA and MBPP, in this round of negotiations MBAs have been provided to all employees in eligible classifications. I am unclear how this impacts the pension compensation question before you. Please clarify.
Shawn Atin Human Resources Director County of Ventura | County Executive Office 800 South Victoria Avenue, L #1970 Ventura, CA 93009 (805) 654-2561 [email protected] NOTICE/CONFIDENTIAL: This e‐mail message and the attached document(s), if any, are intended only for the official and confidential use of the individual(s) or entity to which it is addressed. If the reader of this e‐mail message is not the intended recipient, or the employee or agent responsible for delivering the message and/or attached document(s) to the intended recipient(s), you are hereby given notice that any unauthorized use, dissemination, forwarding or copying of this communication is strictly prohibited. If you have received this communication in error, please contact the sender by reply e‐mail or telephone and delete the original message and any attached document(s) from your system. Thank you.
From: Stallings, Julie Sent: Wednesday, May 03, 2017 8:43 AM To: Atin, Shawn <[email protected]> Cc: Webb, Linda <[email protected]>; Reynolds, Michelle <[email protected]>; Dembowski, Jim <[email protected]> Subject: RE: MBPP Shawn, I wanted to make sure you saw the separate question in the email string that we had asked Michelle regarding MBAs and MBPP. On the last round of MBAs, it appears to have been applied across entire classifications, including for employees already receiving MBPP. One additional question – is the HCA Fiscal Premium Pay considered a type of MBPP? If not, can you explain how it differs from them? Thanks, Julie From: Atin, Shawn Sent: Thursday, April 27, 2017 5:53 PM To: Stallings, Julie Cc: Webb, Linda; Reynolds, Michelle; Dembowski, Jim Subject: RE: MBPP
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We will review the individuals in question to determine specific facts and circumstances surrounding each. In general, as you point out, MBPP is related to market conditions. In the event of any unintentional discrepancies, we will of course make corrections as needed. Let me know if we can be of further assistance
Shawn Atin Human Resources Director County of Ventura | County Executive Office 800 South Victoria Avenue, L #1970 Ventura, CA 93009 (805) 654-2561 [email protected] NOTICE/CONFIDENTIAL: This e‐mail message and the attached document(s), if any, are intended only for the official and confidential use of the individual(s) or entity to which it is addressed. If the reader of this e‐mail message is not the intended recipient, or the employee or agent responsible for delivering the message and/or attached document(s) to the intended recipient(s), you are hereby given notice that any unauthorized use, dissemination, forwarding or copying of this communication is strictly prohibited. If you have received this communication in error, please contact the sender by reply e‐mail or telephone and delete the original message and any attached document(s) from your system. Thank you.
From: Stallings, Julie Sent: Thursday, April 27, 2017 1:48 PM To: Atin, Shawn <[email protected]> Cc: Webb, Linda <[email protected]>; Reynolds, Michelle <[email protected]>; Dembowski, Jim <[email protected]> Subject: RE: MBPP Shawn, We were asking Michelle about MBPP pay items via email and phone. Specifically, those that have stopped or been discontinued and we provided specific examples to illustrate. We understand there are 3 MBPPs that have historically stopped or been discontinued for all or some employees: Histologist Premium Pay, Radiologic Specialist Premium Pay and Therapist Premium Pay. The Radiologic Tech pay item has been inactive for some time, and we wanted to confirm that it was suspended as a result of a drop in the overall market rate. In looking at the histologist and therapist ones, the premium pay ended at different times for different people. For example: 105627 – Histologist premium pay ended 10/9/05 102039 – Histologist premium pay ended 7/15/07 122129 – Therapist premium pay ended 8/19/12 100740 – Therapist premium pay increased on 1/24/10, but no change in MBPP for the other two Supervising Therapist II who were receiving the premium (102789 and 105285). We asked Michelle about these specific circumstances, as well as the HASC study timing in general. In preparation of her memorandum to our outside counsel, Linda Webb asked us to identify MBPPs that had been reduced or discontinued and the circumstances that triggered it, such as the HASC study or other market data. Please let me know if you need any other information regarding our questions. Thank you, Julie Stallings Chief Operations Officer
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Ventura County Employees’ Retirement Association 1190 S. Victoria Ave., Ste. 200 Ventura, CA 93003 (805) 339‐4265 FAX: (805) 339‐4269
From: Atin, Shawn Sent: Wednesday, April 26, 2017 5:28 PM To: Stallings, Julie Cc: Webb, Linda; Reynolds, Michelle; Dembowski, Jim Subject: FW: MBPP Julie, Please direct all your questions regarding MBPP through my office. We will be happy to provide you the information you request; but we will need time to complete and review your information request. In summary, the SEIU MOA describes the provisions which guide the MBPP. Since I have just become involved, please enumerate your questions. Thank you
Shawn Atin Human Resources Director County of Ventura | County Executive Office 800 South Victoria Avenue, L #1970 Ventura, CA 93009 (805) 654-2561 [email protected] NOTICE/CONFIDENTIAL: This e‐mail message and the attached document(s), if any, are intended only for the official and confidential use of the individual(s) or entity to which it is addressed. If the reader of this e‐mail message is not the intended recipient, or the employee or agent responsible for delivering the message and/or attached document(s) to the intended recipient(s), you are hereby given notice that any unauthorized use, dissemination, forwarding or copying of this communication is strictly prohibited. If you have received this communication in error, please contact the sender by reply e‐mail or telephone and delete the original message and any attached document(s) from your system. Thank you.
From: Reynolds, Michelle Sent: Wednesday, April 26, 2017 5:21 PM To: Atin, Shawn <[email protected]> Cc: Dembowski, Jim <[email protected]>; McKinney, Katie <[email protected]> Subject: FW: MBPP
From: Stallings, Julie Sent: Tuesday, April 18, 2017 4:55 PM To: Reynolds, Michelle <[email protected]>; Nunna, Shalini <[email protected]> Subject: RE: MBPP We just discussed this with our administrator and she is willing to hold off until you’re able to respond, as long as it is soon. Sorry if we weren’t clear about the turnaround time frame. We appreciate your help with this!
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Julie
From: Reynolds, Michelle Sent: Tuesday, April 18, 2017 2:08 PM To: Stallings, Julie; Nunna, Shalini Subject: RE: MBPP Julie, I apologize that I did not understand that you needed the information right away. I need to run what I provide to you by Shawn first so you might not get it today. Michelle
From: Stallings, Julie Sent: Tuesday, April 18, 2017 1:57 PM To: Nunna, Shalini <[email protected]>; Reynolds, Michelle <[email protected]> Subject: RE: MBPP Hi Michelle, I just left you a message regarding the information below that we previously requested, but thought I’d follow‐up with an email. VCERA will be sending all relevant information related to MBPP to our outside Counsel for review today, and we were hoping to include this information. We would also like to include the reasoning behind the MBPP recipients receiving Market‐Based Adjustments in January 2017. Please let me know if you have any questions. Thanks, Julie
From: Nunna, Shalini Sent: Monday, April 10, 2017 5:12 PM To: Reynolds, Michelle Cc: Stallings, Julie Subject: MBPP Hi Michelle, Thanks again for the information that you provided. Just to summarize, here are the employees we are currently reviewing: 105627 – Histologist premium pay ended 10/9/05 102039 – Histologist premium pay ended 7/15/07 122129 – Therapist premium pay ended 8/19/12 100740 – Therapist premium pay increased on 1/24/10, but no change in MBPP for the other two Supervising Therapist II who were receiving the premium (102789 and 105285). As you mentioned on the phone, market based premium pay is somewhat discretionary and it’s based on more than the annual HASC study. Other factors that could affect MBPP include recruitment and retention challenges, annual budget, etc. If you could identify the criteria that is used to award MBPP, we would greatly appreciate it.
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Attached is an excerpt from the County Employees’ Retirement Law (CERL) regarding pensionable compensation – CA Government Code Section 7522.34. You can find the complete law book here: https://www.lacera.com/about_lacera/pdf/retirement_law_book.pdf Thanks again for your help! Shalini Nunna | Retirement Benefits Manager Ventura County Employees’ Retirement Association 1190 S. Victoria Avenue, Suite 200 | Ventura, CA 93003 Direct: 805‐339‐4264 | Department Fax: 805‐339‐4269 [email protected] I www.ventura.org/VCERA
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Count of ID Rate Code
Job Title CLS123 LPTAST PHARM PRNRES PSYCH SPEECH THRPST N/A Grand Total
Clinical Lab Scientist I 1 1
Clinical Lab Scientist II 25 25
Clinical Lab Scientist III 9 9
Histologist 3 3
Licensed Physical Therapy Asst 3 3
Pharmacist II 20 1 21
Pharmacy Technician I 4 4
Pharmacy Technician II 15 15
Physical Therapist 1 1
Principal Respiratory Therapst 33 2 35
Radiologic Specialist I 14 14
Radiologic Specialist II 11 11
Radiologic Specialist III 3 3
Radiologic Technologist 11 11
Senior Psychologist 13 13
Staff Psychologist 2 2
Senior Speech Pathologist 1 1
Speech Pathologist 1 1
Supervising Therapist I 6 6
Supervising Therapist II 3 1 4
Senior Physical Therapist 2 19 21
Occupational Therapist 1 1
Senior Occupational Therapist 1 11 12
Grand Total 35 3 39 33 15 2 6 84 217
Total Number of Employees Receiving MBPP 133 61%
Total Numer of Employees Not Receiving MBPP 84 39%
Total Number of Employees Eligible for MBPP 217 100%
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1190 S. VICTORIA AVENUE, SUITE 200 • VENTURA, CA 93003 PHONE: 805‐339‐4250 • FAX: 805‐339‐4269 • WWW.VCERA.ORG
June 19, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Avenue, Suite 200 Ventura, CA 93003 SUBJECT: EVALUATION OF HCA FISCAL PREMIUM PAY PENSIONABILITY UNDER PEPRA Dear Board Members: Background In January of this year, VCERA staff brought 9 new pay codes to the Board of Retirement for inclusion or exclusion in pensionable compensation under PEPRA. These codes were ones not originally included in the 2015 action, as they were established after the initial data was gathered. One of these pay codes was the Health Care Agency (HCA) Fiscal Premium Pay. It was the only code of the nine on which VCERA and the County did not agree. Section 410 of the County of Ventura Management Resolution provides:
“At the sole discretion of the Director‐Health Care Agency and upon his/her recommendation, the Director‐Human Resources may approve a premium pay at the rate of seven and one‐half percent (7.5%) of the employee’s base bi‐weekly pay (exclusive of other additions) for employees in the classifications of Fiscal Manager I‐IV and Assistant Chief Financial Officer‐HCA who are assigned to positions in the Ventura County Medical Center and/or Santa Paula Hospital. The premium provided by this section is “at will”, meaning it may be discontinued at any time without cause and without any pre‐deprivation process at the sole discretion of the Director‐Health Care Agency.” (Emphasis added.)
Staff recommended exclusion because HCA Fiscal Premium Pay is a discretionary pay item that may be withheld at a later date without a change in duties. It is comparable to items previously excluded from pensionable compensation by the Board of Retirement in its October 19, 2015 action, such as supplemental pay for attorneys (pay code TSC). The pay description for this attorney premium in the Management Resolution also indicates it is at the sole discretion of the Appointing Authority, and may be discontinued at any time without cause and without any pre‐deprivation process; it also expires in one year unless renewed.
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HCA Fiscal Premium Pay Letter June 19, 2017 Page 2
Ultimately, after hearing comments from VCERA staff and County HR, the Board asked for HCA Fiscal Premium Pay to be brought back for consideration at a later date, after the parties were able to discuss. Since then, the County has continued to contend that HCA Fiscal Premium Pay is similar to MBPP and thus should be included as pensionable compensation. Complicating the situation further is that the underlying authority for paying HCA Fiscal Premium Pay is in question. It was originally implemented in September 2015 and presented as a measure to be taken immediately, but that the long‐term plan was to examine the HCA specific positions overall. When that examination occurred, the classification titles changed with corresponding increases, and yet the premium pay remained attached. (See Attachments) The result is that HCA Premium Pay is now paid to job classifications not approved by the Board of Supervisors to receive it. This was brought to HR’s attention, but no explanation has been provided to VCERA. While the question of legal authority to make the payment remains with the County and its Board of Supervisors, the question of legal authority to include the payment in pensionable compensation resides with VCERA and this Board. Because the Director‐HCA has reserved complete discretion over the payment, and ability to discontinue the payment of the HCA Fiscal Premium Pay and payment that is not provided to all similarly situated members of the same group or class of employment, staff categorizes it as ad hoc and a discretionary bonus. Such a payment is not within the Board’s discretion to include in pensionable compensation. RECOMMENDED ACTION: EXCLUDE MBPP FROM PENSIONABLE COMPENSATION DUE TO DEFICIENCY IN MEETING PEPRA CRITERIA. Staff will respond to any questions at the June 19, 2017 business meeting. Sincerely, Linda Webb Retirement Administrator Attachments: 1. Management Resolution Excerpt – Section 410 2. HCA Fiscal Premium Pay Inception in Board of Supervisors’ Letter 3. HCA Fiscal Positions Reworked and Retitled
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Board of Supervisors September 22, 2015 Page 11
restructured into three distinct sections: Recruitment, Labor Relations, and Support Services.
Five additional staff are requested. Support staff: One (1) regular Management Assistant 111-C will provide clerical and administrative support, freeing the time of professional staff to focus on the HCA's pressing recruitment and labor relations matters. Thus reducing the time-to-hire and time to resolve sensitive employment matters.
Professional staff: One (1) regular Personnel Management Analyst, two (2) regular Personnel Analyst l's, and one (1) regular Personnel Analyst II are requested to provide more timely recruitments, labor relations, and support services. The Personnel Management Analyst will be responsible for managing the Labor Relations unit, along with responding to and handling the most sensitive Labor Relations issues that arise. The position will also oversee the Return to Work/Leave of Absence subsection. The HCA typically has 140 employees on varying leaves at any one time. The Personnel Analyst I and II will be assigned to the recruitment section; this team accounted for 36% of all County recruitments during FY 14-15. Due to the highly specialized needs of the HCA, the HCA has a number of difficult to recruit classifications which, in addition to traditional recruitment methodologies, require extensive sourcing and outreach of potential qualified candidates, The other Personnel Analyst I will provide direction, guidance and coordination to staff within the Certification Unit, which supports recruitments by facilitating candidate testing and on-boarding.
Recommendation No. 7 — Amend the Management Resolution
Approve an amendment to the Management, Confidential Clerical and Other Unrepresented Employees Resolution to add Section 410, Health Care Agency Hospital Fiscal Premium Pay (page 21 of attached red-line Resolution). This change will have no material impact on the funding status of the retirement system.
Discussion for Recommendation No. 7 — Amend the Management Resolution
Central to the Health Care Agency is the Fiscal Department, and specifically the fiscal managers at the hospital who are responsible for leading and managing staff and whose goal it is to ensure regulatory compliance, accurate accounting, timely invoicing for services rendered, payments, and the compilation of a significant variety of required annual and periodic complex reports.
As previously noted, the significant growth of our healthcare system, combined with changes of the healthcare industry have led to a more complex work environment, with correspondent additional staff responsibility and workload.
CEO-HR reviewed the following California counties that have a healthcare fiscal classification comparable to the Ventura County benchmark classification of Fiscal Manager IV: Los Angeles, Riverside, San Bernardino, San Mateo and Santa Clara. These public entities were selected because they have significant healthcare
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Board of Supervisors September 22, 2015 Page 12
operations, specifically hospital operations, administered by each county and they have specialized healthcare fiscal management job classifications. Our review indicates that for classifications that are comparable to the benchmark Ventura County classification, Fiscal Manager IV, the market median base salary is at $11,450.80 monthly, which is 13.5% above the Ventura County classification of Fiscal Manager IV ($10,086.58 monthly). This survey suggests that other public entities recognize the relative additional complexity and responsibility associated with fiscal management in a hospital setting cornpared to non-hospital settings.
Additionally, our analysis shows that in the critical management positions, which are responsible for oversight of regulatory compliance, the average job tenure is only two years. High turnover in management positions leads to a loss of institutional memory and a greater risk of errors and omissions.
One step to enhance retention within the VCMC Fiscal department is the creation of a pay differential for hospital fiscal managers, which recognizes the increased complexity of fiscal management within hospital accounting. It is recommended that a 7.5% premium pay be established for fiscal management classifications assigned to the hospital in the Fiscal Manager series to include Fiscal Manager I, II, III, IV and Assistant Chief Financial Officer-HCA, excluding the hospital Chief Financial Officer-HCA.
It should be noted that further review of the classification will be undertaken to determine if, in the long-term, HCA specific fiscal job classifications are warranted. Additionally, CEO-HR will review additional fiscal management classifications within the HCA such as the Chief Financial Officer-HCA ("CFO-HCA") classification. A recent Hospital Association of Southern California survey indicates that the compensation for classifications similar to the CFO-HCA may be significantly higher than that currently offered by Ventura County which has remained unfilled for a period of nineteen (19) months. We will return to your Board at a later date to report our findings and recommendations on this matter.
There are six (6) positions, which include the two positions requested in this Board Letter, which are affected by this recommendation. The estimated annual cost impact including benefits as a result of this premium is approximately $72,000. The appropriation request is included in recommendation #4 above.
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Board of Supervisors September 22, 2015 Page 13
This letter has been reviewed by the County Executive Office, County Counsel, and the Auditor-Controller's Office. If you have any questions regarding this item, please contact me at (805) 654-2561.
Respectfully,
SHAWN ATIN Human Resources Director
s)— MICHAEL POWERS County Executive Officer
c: Jeff Burgh, Auditor-Controller Matt Carroll, Assistant County Executive Officer Leroy Smith, County Counsel
Attachments
Business Meeting Agenda - VII.B. OLD BUSINESS: RECOMMENDATION TO EXCLUDE HCA FISCAL PREMIUM PAY FROM PENSIONABLE COMP.
MASTER PAGE NO. 187 of 202
RESOLUTION NO. 16—Octq
EXHIBIT 1
RESOLUTION OF THE BOARD OF SUPERVISORS OF THE COUNTY OF VENTURA
CONCERNING CLASSIFICATION, CLASS CODES, AND ALLOCATIONS THEREIN PURSUANT TO SECTIONS 903
AND 908 OF THE COUNTY PERSONNEL RULES AND REGULATIONS
WHEREAS, Section 903 of the Ventura County Personnel Rules and Regulations requires that the number of positions and classifications of such positions within departments shall be established by resolution of the Board of Supervisors; and
WHEREAS, Section 908 of the Ventura County Personnel Rules and Regulations provides that the Ventura County classification listing all classes of positions in the general County Service designating class title, class code and salary ranges shall be established by resolution of this Board.
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ADOPTED AS FOLLOWS:
1 a. In accordance with Sections 903 and 908 of the Ventura County Personnel Rules and Regulations, the following fifteen (15) classifications and salary ranges are established, effective September 25, 2016:
Job Code
Classification FLSA Status
Union Code
Compensation Frequency
Hourly (H) / Salary (S) Range
00796 Accounting Technician-CC N MCC Hourly $20.892774 - $29.249880 (H)
00797 Senior Accounting Technician-CC N MCC Hourly $22.459731- $31.443625 (H)
00910 Accountant I-MB N MB4 Hourly $24.061048 - $33.685466 (H) 00911 Accountant II-MB N MB4 Hourly $26.734495 - $37.428293 (H)
00912 Senior Accountant-MB P MB4 Salaried $61,168.53 - $85,635.94 (S)
00913 Principal Accountant-MB P MB4 Salaried $70,343.81 - $98,481.33 (S)
00921 Finance Analyst I N MB4 Hourly $29.585115 - $40.457620 (H) 00922 Finance Analyst II P MB4 Salaried $68,374.49 - $95,724.28 (S)
00923 Senior Finance Analyst P MB4 Salaried $75,211.94 - $105,296.71 (S)
00946 Manager, Accounting I P MB3 Salaried $78,339.87 -$109,675.82 (S)
00947 Manager, Accounting II P MB3 Salaried $87,044.30 -$121,862.02 (S)
00948 Senior Manager, Accounting P MB3 Salaried $95,748.73 - $134,048.23 (S)
00957
Manager, Accounting-Treasurer Tax Collector P MB3 Salaried $87,044.30 -$121,862.02 (S)
Business Meeting Agenda - VII.B. OLD BUSINESS: RECOMMENDATION TO EXCLUDE HCA FISCAL PREMIUM PAY FROM PENSIONABLE COMP.
MASTER PAGE NO. 188 of 202
Upon motion of Supervisor
Supervisor
, seconded by
, the foregoing resolution was passed and
00959
Manager, Accounting- Auditor Controller P MB3 Salaried $91396.52- $127,955.13 (S)
00990
Manager, Accounting-Hospital P MB3 Salaried $98,251.26- $137,551.76 (S)
lb. In accordance with Sections 903 and 908 of the Ventura County Personnel Rules and Regulations, the following thirteen (13) classifications and salary ranges are deleted, effective September 25, 2016:
Job Code
Classification FLSA Status
Union Code
Compensation Frequency
Hourly (H) / Salary (S) Range
01297 Fiscal Assistant I-C N MCC Hourly $14.756613 — 20.659260 (H)
01298 Fiscal Assistant II-C N MCC Hourly
Hourly
Hourly
$16.507756 —23.110857 (H) .
$18.529194 — 25.940875 (H)
$19.797935 — 27.717111 (H)
01299 Fiscal Assistant III-C Fiscal Assistant IV-C
N
N
MCC
MCC 01301
01302 Fiscal Technician I-C N MCC Hourly
Hourly
$20.052240 — 28.075889 (H)
$21.502113 — 30.105908 (H) 01303 Fiscal Technician II-C N MCC
02092 Accounting Officer IV-MB P MB4 Salaried $64,713.99 — 85.494.39 (S)
$62,616.94 —82,714.85 (S) 02072 Financial Analyst I P MB4 Salaried 02071 Financial Analyst II P MB4 Salaried $68,824.37 —90,923.51 (S)
02070 Financial Analyst III P MB4 Salaried $75,648.53 —99,938.66 (S)
02069 Fiscal Manager I P MB3 Salaried $75,648.53 — 99,938.66 (S) 02067 Fiscal Manager III P MB3 Salaried $85,256.53 —112,632.61 (S) 02066 Fiscal Manager IV P MB3 Salaried $91,620.06 — 121,038.98 (S)
II H5-2 adopted on this 1.3 day of S-44-4.1412‘42 0 1 6 .
By: ir, Board of Supervisors
County of Ventura ATTEST: MICHAEL POWERS, Clerk of the Board of Supervisors, CourV ol Venturp, State of Califoknia
By:
Business Meeting Agenda - VII.B. OLD BUSINESS: RECOMMENDATION TO EXCLUDE HCA FISCAL PREMIUM PAY FROM PENSIONABLE COMP.
MASTER PAGE NO. 189 of 202
1190 S. VICTORIA AVENUE, SUITE 200 • VENTURA, CA 93003 PHONE: 805‐339‐4250 • FAX: 805‐339‐4269 • WWW.VCERA.ORG
June 19, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Avenue, Suite 200 Ventura, CA 93003 SUBJECT: RENEWAL OF HEARING OFFICER CONTRACTS FOR 2017‐2018 Dear Board Members: The contracts for members of VCERA’s Hearing Officer Panel will expire June 30, 2017. A list of these 11 members is provided below, all of whom have been actively hearing disability cases on VCERA’s behalf. • Irene P. Ayala • Deborah Z. Wissley • Catherine Harris • Paul E. Crost • Nancy T. Beardsley • Kenneth A. Perea • Humberto Flores • James P. Cloninger • John L. Rosenthal • Robert Klepa A Panel consisting of eleven members provides VCERA staff with options in managing disability case workloads that require the services of a Hearing Officer. Provided for your review is the pro forma Hearing Officer contract. Staff has completed contracts for the individuals named above, pending your approval. The contracts all expire on June 30, 2017 and the contract terms remain unchanged from the prior fiscal year, including the rate of hourly compensation. RECOMMENDATION: AUTHORIZE THE RETIREMENT ADMINISTRATOR TO EXECUTE FISCAL YEAR 2017‐2018 CONTRACTS FOR THE ELEVEN LISTED MEMBERS OF VCERA’S HEARING OFFICER PANEL. Staff will respond to any questions at the June 19, 2017 business meeting.
Sincerely,
Linda Webb Retirement Administrator
Business Meeting Agenda - VIII.A. NEW BUSINESS: RENEWAL OF H.O. CONTRACTS
MASTER PAGE NO. 190 of 202
REFEREE SERVICES AGREEMENT
THIS AGREEMENT, to be effective as of the 1st day of July, 2017, by and between the BOARD OF RETIREMENT (hereinafter referred to as “Board”) of the VENTURA COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION (hereinafter referred to as “Association”), and _________________________ (hereinafter referred to as “Contractor”).
Recitals
Pursuant to the provisions of section 31533 of the Government Code, the Board is authorized to provide for the conduct of hearings by a referee in connection with the determination of applications of members of the Association for disability benefits under the County Employees Retirement Law of 1937 (ch. 3 of div. 4 of tit. 3 of the Government Code).
Contractor has experience with respect to evidentiary hearings, and is a member of the State Bar of California (active membership no._____).
The Board intends to retain the services of Contractor as a referee to conduct said hearings.
IT IS THEREFORE AGREED:
Services to be Performed
1. Contractor agrees, when available, to act as a referee in connection with the conduct of hearings and the review of cases pursuant to section 31533 of the Government Code.
2. Such services shall be performed in accordance with the applicable provisions of the County Employees Retirement Law of 1937, as amended, and pursuant to any specific requirements imposed by the Board, and such services shall include, but shall not be limited to, the conduct of hearings, the review of evidence, and the rendering of a written report which shall contain proposed findings of fact, conclusions of law, and a recommended decision provided, however, that said written report shall be rendered within ninety (90) days after the case has been submitted to Contractor and include service of said written report to all parties.
3. Contractor may request an extension from the Board of any time limitation
established in this contract, on an individual case basis, when done in writing, and upon a showing of “good cause” as to said request.
4. Contractor shall be familiar with the Association’s “Disability Hearing
Procedures”.
5. The Board is under no obligation to submit cases to the Contractor, but may do so at its pleasure.
Business Meeting Agenda - VIII.A. NEW BUSINESS: RENEWAL OF H.O. CONTRACTS
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Compensation
rates:
6. Compensation to Contractor for the above services shall be at the following
(a) If the written report is rendered within ninety (90) days after the case has been submitted, or within any time extension granted by the Board pursuant to paragraph 3 above, Contractor shall be entitled to One Hundred and Seventy-Five Dollars ($175.00) per hour;
(b) Contractor shall be compensated for necessary and reasonable travel time to and from Ventura County pursuant to the rate set forth above;
(c) If the written report is not rendered within ninety (90) days from the date
the case has been submitted, or within any time extension granted by the Board pursuant to paragraph 3 above, the Board may transfer the case to another referee, in which event the original referee shall not receive any fee for services performed in connection with said case;
(d) If a hearing scheduled before the Contractor is continued or cancelled
less than fourteen (14) calendar days before the date agreed upon by all parties, or set by the Board, the Board shall pay to the Contractor the sum of Eight Hundred and Seventy-Five Dollars ($875.00) which includes all costs associated with the hearing including, but not limited to, travel, time, mileage reimbursement and other associated hearing costs.
Term of Contract
7. This agreement shall apply for all services provided by the Contractor, performed on or after July 1, 2016, and shall continue through the date of June 30, 2017, at which time it shall terminate. However, either party may terminate this agreement sooner upon ten (10) days written notice to the other party. Any cases pending before the Contractor at the time of termination shall be immediately transferred to the Board. If this agreement is terminated at the request of the Contractor, the Contractor shall not receive any fees for services performed in connection with any cases that are pending as of the effective date of the termination, except those wherein a written report has been provided to the Board. If this agreement is terminated at the request of the Board, the Contractor shall be entitled to the compensation earned prior to the effective date of termination as provided for in this agreement, computed pro rata up to and including that date. The Contractor shall be entitled to no further compensation as of the date of termination.
Dated: By: Linda Webb, Retirement Administrator
Dated: By: ________________________________ Contractor
Business Meeting Agenda - VIII.A. NEW BUSINESS: RENEWAL OF H.O. CONTRACTS
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1190 S. VICTORIA AVENUE, SUITE 200 • VENTURA, CA 93003 PHONE: 805‐339‐4250 • FAX: 805‐339‐4269 • WWW.VCERA.ORG
June 19, 2017 Board of Retirement Ventura County Employees’ Retirement Association 1190 South Victoria Avenue, Suite 200 Ventura, CA 93003 SUBJECT: PERIODIC REVIEW OF BOARD EDUCATION & TRAVEL POLICY Dear Board Members: The Education & Travel Policy is scheduled for Board review on an annual basis. The last formal review that resulted in changes to the policy language was in May of 2016. Staff is proposing several modifications to the policy, which are shown in the redline document provided. A summary and explanation of the proposed changes are below. Compliance with State Law
Add text to reflect legal requirements for training in ethics and sexual harassment prevention.
Travel Authorization
Remove reference to Board’s legal advisor, as General Counsel is now a member of VCERA staff.
Add language to reflect situations where a trustee or staff member has been given an investment advisory board seat.
Annual Travel Budget
Use “executive staff” instead of “management staff”.
Add wording to allow for investment‐related travel to be budgeted as an investment cost. Recommended Public Retirement System Meetings
Add text to include additional information in travel requests to reinforce content requirements.
Appropriate Topics
Cleanup grammar correction.
Business Meeting Agenda - VIII.B. NEW BUSINESS: REVIEW OF EDUCATION & TRAVEL POLICY
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Review of Travel Policy Page 2
Travel Arrangements
Insert text to reinforce process for ensuring lowest cost options are used, adding a pricing documentation requirement.
Tips
Insertion of “other” to clarify the $10‐per‐day limit for tips not related to meals. Reporting
Insertion of “or conferences” for clarity. RECOMMENDATION: APPROVE PROPOSED CHANGES TO THE EDUCATION & TRAVEL POLICY. Staff will be happy to answer any questions regarding the proposed changes at the June 19, 2016 business meeting. Sincerely, Linda Webb Retirement Administrator
Business Meeting Agenda - VIII.B. NEW BUSINESS: REVIEW OF EDUCATION & TRAVEL POLICY
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VENTURA COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION
BOARD OF RETIREMENT
EDUCATION AND TRAVEL POLICY
INTRODUCTION
Recognizing its fiduciary responsibility to plan participants, it is the desire of the Board of Retirement (Board) to encourage members of the Board, and its staff, to enhance their knowledge of the financial and benefit aspects of the retirement system by attending educational meetings, conferences and seminars. Attendance at such functions, as well as due diligence trips relating to the operation of the retirement system, is essential to ensure that Board members and staff are able to carry out their fiduciary responsibilities.
PURPOSE
The purpose of this policy is to set forth the guidelines to be followed to ensure Board members and staff members are allowed to cost effectively attend the educational meetings, conferences, and seminars the Board believes to be necessary for the performance of their duties.
COMPLIANCE WITH STATE LAW
Effective January 1, 2013, and in compliance with Section 31522.8 of the California Government Code, all Board members shall receive a minimum of 24 hours of trustee education within the first two years of assuming office, and for every subsequent two- year period the Board member continues to hold membership on the Board. Of the required 24 hours, 2 hours must be training in general ethics principles and ethics laws, and 2 hours must be training and education on sexual harassment prevention.1 Further, the Board will maintain a record of Board member compliance with the policy. This policy and an annual report on Board member compliance shall be placed on the Internet Web site.
ON-SITE DUE DILIGENCE
Regular on-site due diligence evaluations shall be scheduled with VCERA’s investment managers (within North America) every three years. For managers outside of North America, the frequency shall be every four years and whenever possible in conjunction with an educational opportunity to maximize the value of the overseas trip. More frequent evaluations shall be conducted if there have been materials organizational changes, significant underperformance of the investment or for any other reason deemed appropriate by the Board.
1 Training in sexual harassment prevention must be completed within a new trustee’s first 6 months.
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On-site due diligence evaluations may be conducted by one or more Trustees and may include the Chief Investment Officer (CIO), Administrator and/or the Administrator’s designee. The Administrator shall, in consultation with the CIO and Investment Consultant, agendize a proposed schedule for all on-site due diligence trips to be conducted in the upcoming year. The Board Chair shall, with Board consent, designate the Trustee(s) to participate in each on-site evaluation. Every effort shall be made to rotate due diligence responsibilities so no single Trustee, or group of Trustees, is conducting a majority of due diligence visits on VCERA’s behalf. The Trustee(s) and CIO, Administrator, or designee, shall be responsible for providing a written/oral report to the Board no later than the second subsequent regular Board meeting summarizing their findings and recommendations, if any.
LIMITATION ON MEETING FOR BUSINESS PURPOSES
Travel by multiple Board members shall be conducted in such a manner as to not violate the provisions of the Brown Act (Government Code Section 54950 et. Seq.). Board member attendance at educational meetings, conferences, seminars and related social events is not a violation of the Brown Act.
TRAVEL AUTHORIZATION
Approval for travel by a Board or staff member to an educational meeting, conference or seminar shall be made in an open meeting of the Board, except for attendance at the Spring and Fall State Association of County Retirement Systems (SACRS) conferences for which authorization by the Board will not be required. Additionally, the Retirement Administrator may approve Board or staff travel, including the Board’s legal advisor, for one-day meetings held within the State. The Administrator may also approve an overnight stay by a staff member if it is determined to be in the best interest of the Association in terms of economy and efficiency. In the event a Board member wishes to conduct an on-site due diligence visit, or attend a one-day seminar, of a VCERA investment manager or consultant without prior Board approval, the Administrator is authorized to reimburse travel expenses up to $350.00 upon submission of a verified claim. Although State law may permit gifts of travel to the System, if a third party offers to pay for some or all of the travel expenses associated with a particular conference, seminar or meeting, the Board shall decline the offer. However, the Board may consider authorizing attendance at the particular conference, seminar or meeting at VCERA’s expense if such attendance would be beneficial to VCERA. An exception may be made at the Board’s discretion if the trustee or executive staff member sits on an advisory board or committee for which the cost is reflected within fees already paid.
ANNUAL TRAVEL BUDGET
The Retirement Administrator shall include in the annual budget to be approved by the Board sufficient funding to allow each member of the Board, and staff, to attend the
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Spring and Fall SACRS conferences. Additionally, funds will be budgeted, based upon the information available on scheduled conferences and input from individual Board members during the budget preparation process, to allow each Board member and management executive staff to attend up to three additional conferences, educational meetings, seminars and site visits each fiscal year. This limitation shall not apply to on-site visits that are made with the consent of the Board, including in connection with the retention of a new manager, nor shall it apply to any conference, educational meeting, seminar or site visit where the cost to the Association can reasonably be expected to be less than $500.00. Travel expenses of Board members and staff shall be considered an cost of administration or investment cost, and may not be paid by any third party without the express written authorization of the Board.
RECOMMENDED PUBLIC RETIREMENT SYSTEM MEETINGS
It is the intention of the Board to establish a standard whereby attendance at educational meetings, conferences and seminars will be approved only if the agenda for the event contains an average of five (5) hours of substantive educational content per day. This standard would not apply to meetings with investment managers, consultants, etc., which would not be expected to last for five hours. The Board establishes the following as recommended educational meetings, conferences and seminars that qualify as trustee education.
1. State Association of County Retirement Systems (SACRS), including meetings of SACRS Board or Committees, on which a member of the Board or staff participates. The Board recognizes the importance of having its Trustees actively participate as members of the SACRS Board or its committees. Therefore, attendance at such meetings shall not count towards the three conferences, educational meetings, seminars, or site visits limitation set forth above, even if such cost exceeds $500.00.
2. Public Pension Investment Management Program (SACRS/Berkeley). (Attendance shall not count towards the three conference limit.)
3. California Association of Public Retirement Systems (CALAPRS) Annual General Assembly, trustee and staff roundtables, Advanced Board Leadership Institute, Administrators’ Institute and the Principles of Pension Management for Trustees course. (Attendance shall not count towards the three conference limit.)
4. Programs sponsored by the Institute for Fiduciary Education (IFE). 5. NCPERS Annual Conference. 6. Pension Funds and Money Management, and Alternative Investments and Real
Estate; The Wharton School, University of Pennsylvania. 7. Programs sponsored by the National Association of Police Officers (NAPO). 8. Client conferences sponsored by investment managers, asset custodians and
consultants with whom the Retirement System has a current professional relationship. (Attendance shall not count towards the three conference limit.)
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9. Client conferences sponsored by investment managers, asset custodians and consultants with whom the Retirement System has a current professional relationship (Attendance shall not count towards the three conference limit.)
10. National Association of Pension Fund Attorneys Conference. 11. California Retirement County Employees Association (CRCEA). 12. Nossaman LLC Annual Fiduciary Forum. (Attendance shall not count towards the
three conference limit.) 13. Council of Institutional Investors (CII)
Board members may request approval to attend the recommended, or any other, educational meetings, seminars and conferences by submitting a written request to the Retirement Administrator for inclusion on the next Board agenda. The request should confirm the training meets the average 5-hour-per-day standard, and indicate the number of hours of educational hours the training provides. Requests approved by the Board qualify as Board member education. Educational seminars sponsored by the state or national public pension fund organizations and seminars sponsored by accredited academic institutions shall be deemed to meet Board member education requirements.
APPROPRIATE TOPICS
Appropriate topics for Board member education, may include, but is are not limited to, the following:
1. Fiduciary responsibilities. 2. Ethics. 3. Pension fund investments and investment program management. 4. Actuarial matters. 5. Pension funding. 6. Benefits administration. 7. Disability evaluation. 8. Fair hearings. 9. Pension fund governance. 10. New Board member orientation.
TRAVEL ARRANGEMENTS
It is the preference of the Board to have travel arrangements made through VCERA staff. This would include processing of registrations, hotel accommodations and transportation. However, a Board member may arrange his/her own transportation if he/she is to be accompanied by a spouse or travelling companion. If the traveler selects a more expensive mode of travel, the traveler shall claim only the cost that would have been incurred had the lower cost option been utilized and shall provide documentation of the lower cost option. VCERA staff will not make travel arrangements for, or reimbursement to a Board or staff member for any costs associated with the attendance of a spouse or traveling companion to any function.
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TRAVEL COSTS
It is the policy of the Board that travel to educational meetings, conferences and seminars be achieved in the least expensive practical manner possible in order to reduce costs to the retirement system. When weighing the options or air transportation vs driving a personal or rented vehicle, comparison of total anticipated costs should be considered (ex: parking, mileage, shuttle costs, etc.) and the least expensive option should be favored whenever practical to do so. If the traveler chooses a materially higher cost transportation mode for personal reasons, reimbursement will be limited to the lower cost option. Reimbursement or payment for travel related expenses may not be made in certain instances. For travel to meetings within the State of California, lodging and other eligible travel related expenses will be paid for the evening prior to the start of the meeting only if the meeting starts at or prior to 9:30 a.m. Lodging for the night of the last day of the conference will not be paid by the Retirement System. For travel outside of the State of California, lodging and other travel related expenses will be paid by VCERA for the evening prior to the day the meetings starts. Lodging will not be paid by VCERA for the evening of the final day of the meeting unless the substantive portion of the meeting ends after 2:00 p.m. or it can be demonstrated that a reduction in airfare can be achieved by staying over for an additional day which will more than offset the cost for an additional night’s lodging and other travel related costs that would be incurred. In order to avoid unnecessary costs to the Retirement System, Board members should immediately notify VCERA’s Chief Financial Officer of the cancellation or other changes in their travel plans. Travel related costs which will be paid or reimbursed to a Board or staff member include the following: Air Transportation Every attempt should be made to make air travel reservations in advance to take advantage of available discounts. Airfare will be paid for coach/economy passage only, with the exceptions listed below:
Flight Time Seating level allowable Exceeds 4 hours 1 level above coach/economy Exceeds 8 hours Business class, with Board approval.
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Hotel Accommodations Payment for lodging will be at the single occupancy rate, plus applicable room tax. Any lodging costs in excess of the single occupancy room rate will be the responsibility of the Board or staff member. Meals & Beverages Reimbursement for the cost of meals and beverages for the Board and staff members while on travel will be made at the rates established by the County of Ventura for reimbursement to employees for such expenses, as shown in the following table. No meal allowance will be paid for any meal that is provided by the host or at the conference, unless for medical dietary restrictions.
Within California (Receipts Required)
Out-of-State (Receipts Required)
High-Cost Areas (HCA)*
Per Day (No Receipts Required)
Breakfast $19.50 $22.50 25.00 $57.00 $68.00 (HCA*) 75% of above for first & last days of travel
Lunch $19.50 $22.50 25.00 Dinner $19.50 $43.00 49.00
*as designated by the current federal General Services Administration Special Per Diem Rates publication.
Exception: for on-site due diligence evaluations, the amounts indicated on the table above are increased by 15%. Tips The gratuity for meals may not exceed 15 percent of the charge, rounded up to the nearest dollar, unless the establishment adds it to the bill. Other Ttips may be reimbursed for other legitimate services such as maid service, portage, and parking valet service paid in the scope of the traveler’s duty, not to exceed $10 per day. Rental Car Every attempt should be made to utilize public transportation, airport and hotel shuttle services which are reimbursable expenses. A rental car may be used if cost effective. The retirement system will not be responsible for any loss or damage resulting from the use of a rental car. Parking Reasonable automobile parking expenses are reimbursable.
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Mileage Retirement Board members and staff will be reimbursed for the use of their own automobile at the current mileage rate authorized by the Internal Revenue Service. Non-Reimbursable Expenses Expenditures, which are not substantive to VCERA business will not be reimbursed by VCERA, such as:
A. Any expenses related to alcohol and tobacco; B. Internet usage fees (unless the internet is used for VCERA business); C. Any expenses related to entertainment and recreational activities.
Documentation of Expenses and Submission of Reimbursement Claims All requests for reimbursement of travel costs shall be supported by detailed receipts or other documentation. Agendas from the training may be attached to the travel claims, along with notations of the sessions attended with the associated hours recorded on the face of the claim. All travel claims shall be submitted to the Retirement Administrator or VCERA’s Chief Financial Officer no later than the 60th calendar day after the expense is incurred by the Board or staff member. (A sample claim form is attached to this policy.) REPORTING Retirement Board members shall, no later than the 2nd subsequent Board meeting, provide a brief report on meetings or conferences attended on behalf of VCERA. The Retirement Administrator shall, no later than the second month of the calendar year, report on annual Board member compliance and post said report on the VCERA Web site. POLICY REVIEW In order to keep the provisions of this policy current, the Board will review this policy on an annual basis at a minimum. POLICY HISTORY The Board last reviewed and approved this policy on June 19, 2017 May 2, 2016. The Board previously approved this policy on May 2, 2016, June 15, 2015, February 23, 2015, June 2, 2014, June 17, 2013, January 28, 2013, July 2, 2012, June 20, 2011, June 21, 2010, June 15, 2009, September 15, 2008, April 16, 2007, May 1, 2006, October 17, 2005, April 19, 2004, April 21, 2003, May 6, 2002, April 16, 2001, and April 17, 2000. The Board originally adopted this policy on July 6, 1998.
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Tortoise Exploring Alternatives with Mariner
FOR IMMEDIATE RELEASE
LEAWOOD, Kan. – June 13, 2017 – Tortoise Investments, LLC has announced that it, along with its majority owner Mariner Holdings, has decided to explore strategic alternatives for Mariner’s majority stake in Tortoise.
The partnership, which dates back to 2009, has been beneficial to both companies. Tortoise believes that a recapitalization could further its growth. There are no expected changes to the team, process or investment approach. Both firms are committed to finding a partner with a strong cultural and team fit. Tortoise has established a number of growth platforms and the team is enthused about the opportunities to accelerate growth.
Tortoise does not have a defined timeline for the exploration of strategic alternatives and is not confirming that the evaluation will result in any strategic alternative being announced or consummated. Tortoise does not intend to discuss or disclose further developments during this process unless and until its Board of Directors has approved a specific action or otherwise determined that further disclosure is appropriate.
Contact Information
Zito Partners Deborah Kostroun [email protected] (201) 403 8185
About Tortoise
Tortoise is a leader in essential assets and income investing. Through its registered advisers, Tortoise provides investors access to differentiated active and passive investment solutions and market insights and had $20.2 billion assets under advisement as of May 31, 2017. Tortoise is indirectly majority owned by Mariner Holdings, LLC, which had more than $40 billion in assets across wealth and asset management as of March 31, 2017.
Forward-looking statements
This press release contains certain statements that may include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, included herein are "forward-looking statements." Although the Fund and Tortoise Capital Advisors believe the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Fund's reports that are filed with the Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required by law, the Fund and Tortoise Capital Advisors do not assume a duty to update any forward-looking statement. There is no assurance that any transaction will be completed.
Business Meeting Agenda - IX. INFORMATIONAL
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