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Civil grand jury urges pension board to reassess investment risk and assumed returns; trustees defend long‑term strategy
Summary
A civil grand jury report criticized the San Francisco Employees' Retirement System for underfunding and for relying on what the jury called an unrealistically high assumed investment return, recommending an independent review and lower assumed returns. SFERS staff and trustees defended the board's long‑term approach, explained actuarial and asset‑liability processes, and said the board is already phasing down the assumption to 7.5%.
The civil grand jury presented a report arguing the San Francisco Employees' Retirement System (SFERS) remains underfunded and urged the retirement board to prioritize preservation of principal, review its assumed investment return methodology and analyze alternative, lower‑volatility strategies. Grand jury members said the fund's assumed return (7.66% through 2013,then 7.5%) contributes to an actuarial view that understates pension liabilities and warned that higher assumed returns can reduce the City's estimated liabilities and shift costs to taxpayers.
"The jury believes…
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