a request for a dlafrgs warren buffett is against the funds and warren buffett said two individual investors is different than a long term investors this is regarding the letter to warren buffett i was very, very contrary as a trustee of the san francisco retirement board the long term assumption 7 and a half and the allocations no doubt that response was directly to me in my role as a commission of the retirement board and way of the has the same position of hedge funds as individual for institutions i'll be going to the board meeting in may if i see him i'll ask him. >> this is page 8 of 24

all in favor, say i. of adoption. >> opposed it is 5 to one. >> there is no item 16 item 17 please. item 17 an action item approval the minutes retirement board retreat. >> this item commissioner, i will leave it up to our pleasure if we go forward with adopting the minutes i'll vote against them i don't think they will accurately reflect our retreat if we want to send them back if someone agrees with me they can come back more accurately

lettingthem the agenda didn't match if you read the minutes that cigarettes we were on the agenda so i think it should reflect what happened then that friday and saturday more accurately so i will leave it up to the group if someone makes a motion to continue versus adoption i'll open up for the will will of the commission. >> i ask we continue those minutes i firmly agree that that just as an example the meeting started at 4 o'clock it was sponsored to start at 3 o'clock this doesn't show the takeaways i'll be inclined to sustain than to vote against it. >> is there a second. >> second. >> decision open up for public comment on item 17. >> seeing i'll close public

comment all in favor, say i. >> any more discussion. >> i'm not opposed to sending it back if people think there should be things included and forward it to staff to make sure their incorporating there are 0 people that oppose this provide direction what the material should be constituent in that context all support it. >> i think everyone does. >> all in favor, say i. >> i. >> passes unanimously. >> item 18. >> action item review and approval of 2014 fdr s annual report. >> we've accept it as submitted it is a long document we've all reviewed that i'll entertain a motion to adoption. >> second. >> open up for public comment

seeing none mop have comments. >> beautiful pictures where's the first picture is that still or. >> cover. >> the cover page. >> the federal reserve. >> oh the federal reserve. >> all in favor, say i. passes unanimously thank you item number 19 please. >> item 19 an action item receive for the government consulting services. >> the current consulting was the that's the consultant for as long as i've worked here expires and in accordance with our selection policy we recommend that the retirement board approve issuing the attached rfp

for the services and i'll be happy to answer any questions you might note that is a tight schedule but the last time around we had very of you folks that met the qualifications so we believe that this is a reasonable schedule for those types of services. >> chair mr. entertain the motion. >> i'll make that motion. >> open up for public comment on item number 19 i support putting the rfp out there but i don't support that type of a timeframe to put out on rfp for a contact that's not out and allowing discussion in any profession and having turn around time i believe the come in a week it is a fast track we

had no advantage of fast tracking this for any personal value to our organization that no timeframe if we pushed it out a month we have a more honest response time to submit if someone was to creek with a contract for 10 years they want to see the contract and who responded at the previous bidding contract and as for copies of the bids so they understand what they're asking for and be a competitive bidder so i would vote against the motion based on that even though i believe the rfp should go on

the street. >> i'll say obviously that is not staffs purpose we're amenable to amending the timeline by 4 weeks and then we'll adapt it and issue that with all the dates being pushed but to be an additional month. >> is there a maker and second that accepts that. >> are you making a motion commissioner. >> no, i'm asking the maker and the second if they'll anticipate accept a thirty die. >> i'm fine with that. >> great. >> okay. we're great any discussion. >> i'd like to ask. >> i'd like to have a a little bit of a discussion that is i that ironic we are trying to cast a net to get people to apply for the arts to try to derail the process we had less people applying but in f this

context it is better to delay it for more responses and the system is better served by evaluate a wider range of candidates so it is a high respective issue based on qualifications not timing there's a substantial difference of setting the bar of qualifications rather than a one or two week response period time helps but i think everything wrong analysis all in favor, say i. >> i. >> opposed? passes unanimously thank you item number 20. >> item 20 the discussion for executive director report. >> i provided you a copy of an analysis of theappellant court

division and the city of san francisco lawsuit that was announced friday of last week we have the states is 45 days for either party to appeal we've received from protect our benefits as well as the city their potentially considering appealing the decision which is an appeal to the california supreme court is not a final order o a remantling to the superior court level to amend their position as far as answering your questions whether we're going to be doling e dealing with any time soon once we know if it is remand back without and the appeal once we have the court order we would be presented and we intend to be

presented to pay those to answer one of the questions are if the gentleman we had certify access earning in the fiscal year end june 30th, 2013, to pay the full supplemental colas from 2013 and july 1st, 2014, we jeanette has been working with operational staff and identified what groups of 26 thousand retirees would be eligible and we've come up with what we believe a reliable number of 17 thousand seven hundred so roughly 8 thousand folks are those folks who retired or separated city employment prior to november 6, 1996, the essence of the court not the seeps but the way we're

reading anyone that was employed by the city on or after november 67, 1996 is entitled to the promise of the supplemental cola and anyone who separated city employment or retired prior to november 6, 1996, and didn't work for the city awhile that provision of benefits was in place is not entitled to the - is not even if you didn't have a voiding reporter and can have a hurdle in any effect we've requested the calculations the last time it was calculated in 2011 and at this time they estimated the costs for the supplemental cola was $120 million we know that

because this is a impounded cola woefd had two colas increases 3 increases in the interim and wouldn't begin to try to speculate what this will be but with the break out of 8 thousand folks not obey eligible it is substantial settlement the city and we get to recognize the cost of the cola for the cost of it over 5 years and we would if it was paid retroactively to july 2013 we're not going to redo any penny of the elevation and only reflected in the year we pay them we actually pay them so our evaluations stays and obviously with the additional liability an impact to the

employer contribution i'll tell you we're recognizing because of our past performance over $700 million in excess expected earnings been the smoothly of our investment returns over the prior 4 years i wish i had better answers but we're working on it and be presented if the order becomes final we'll be presented to communicate as well as paying obviously we have the money to pay them and so we're presented to make sure we made did correct selection of those folks that are entitled to it. >> great questions by the director. commissioner driscoll >> the court process the clock is running so many things can

happen that's correct, however the issue even if the city didn't say not appealing the appeal with and when any of those numbers trigger a number in the contribution rate what year that might happen didn't work to - this is work to get ready for if we pay it before june 30th of 2015 it had been reflected in the evaluation report as an unseptember cost and an unaccepted payment we made which would be contribute to the contribution rate for 2016-2017. >> it will reflect it may reflect contribution rates. >> contribution rate for 2015-2016 are set by the last evaluation if we have to pay those colas before june thank

god of this year it will be reflected in 2016-2017 if it is detailed a year it will go back 10 months before we have to do something. >> other questions. >> commissioner meiberger there are two conditions for the cola to earn more than the actual rate of return and fully fund based on the market rate of the portfolio and that's correct i'll say we need to earn more than what we took in but have enough money to pay in expose of 4.5 percent. >> or whatever for whatever year. >> and the supplemental cola provides for half percent it is i'll state in 2013 and 2014 the folks who were impacted most of

them got a 2 percent basic cola we're only talking about the basic 1 percent not the full 3 and a half a percentage it is the market rate funding needs to be one hundred percent. >> the other question that was council he asked about the number of eligible. >> seven hundred and 18. >> and 8 thousand were before 1996. >> right retirees that retired before 1996 and continuance for the qualified survivors of retirees that retired or died prior to november 6, 1996. >> that dual is only for the 8 house. >> there's no cola prior to the

1496 folks when we get it to the one hundred per. >> the according to the justs discussion 17 thousands are post 9 of. >> based on the judges opinion. >> the pre96 is appropriate. >> that will be appealed. >> the only other thing i want to announce we have posted a job announcement for the deferred manager position if you have folks you believe might be qualified please refer them to the new sf website has the application process is attached. >> i'll open open up for public comment on item 20. >> close public comment

commissioner meiberger for the third time. >> yes. this was an unrelated question to the cola there was a question from one of the members r r retiree health care fund they wanted to know when they can piggyback on san francisco's investments because we decisions this before in terms of having a separate account to manage those trust assets can you give us a status report. >> the retiree board selected as an investment option for $50 million if they have a hold in their trust if they would to invest in the same things we invest in and cap equity and real estate as it turned out

we've negotiated northern trust is sort of picking backinging with a separate custody agreement off our contract and it turns out there are restrictions there be a 401 a which the retirement board is not, however northern trust has found a substitute equality for them as far as timeline we hope they'll get the money invested by june 30th of this year, however, not anything invested in what we invest in other than our own s&p 500 x tobacco we invest in. >> just duo to clarify only the s&p 500 fund. >> right the only thing they'll

be co-investing with us the concept of co-investing as we went into the legal issues they determined because qualified we can't be co-milked they can't be a counterpart they're not available to very investing in some of the funds they thought they wanted to but building they've found equivalent fund. >> just the x tobacco. >> right. >> okay thank. >> thank you very much will you call item number 21. >> item 22 retirement board member order commissioner makras. >> i'm open up for public comment seeing i'll close public comment this is the go of the order of mr. director it this

where we should give us some disconnection on candidates for level 3. >> right. >> i direct the staff and report back to the board on level 3. >> is thatcoincidence of the board. >> commissioner meiberger. >> thank you. >> this is really to the order i had overwhelms and communication from many of the members regarding the san francisco xomg plan they've not been responded to so some of the members mentioned some issues regarding the fees etc. let me just address one of the issues in terms of 6 we've

discussed this in terms of the insurance the defenders cottage bid because the fees are higher some of the overwhelms mentioned the fees are how and decided the various ones there's is a dissatisfaction are in terms of investing i want to put that on the table one of the insurance characteristics those are the variable nantsz and fixed amenities is there a characteristic associated with them and that's number one and number 2 who regulates those they sent me articles i'll quote from the market street journal stating fixed amenities like amenity equalities fall into the state insurance variable contract for both state and

federal jurisdictions they regulate the fcc claims jurisdiction over the separate sub accountants if it's a fixed amenity it is regulated by itself insurance industry so i'm seeing this published inreliable sources they site anecdotal evidence since the carries in 1979 horrifying and i have a question >> we get the gift of the question and number one the - who regulates this. >> item new 22. >> item 22 action item closed session. >> i'll open up for public comment on the commission going 0 into closed session seen i'll

close public comment into closed session. >> okay. we're back on record is there a motion. >> i move we come back into public session. >> i'd like to move we don't close what we discussed during our private session. >> is there a second. >> all in favor, say i. >> i. >> okay. that's a unanimous vote. >> call the next item on the