A new Chief Executive Officer at OCERS.

 In January, 2008 the Orange County Employees Retirement System (OCERS) welcomed Steve Delaney as our new Chief Executive Officer (CEO).   

 Steve comes to OCERS from the Oregon Public Employees Retirement System ($62 Billion fund with 330,000 members) where he last served as Deputy Director.  He began his career at the public pension system in 1992 as a Retirement Counselor, going on to serve as Supervisor of the Employer Relations Unit (1994-1998) and Administrator of the Policy Planning and Legislative Analysis Division (1998-2004) before assuming the Deputy Director post in 2005.

 Mr. Delaney was hired by the OCERS Board of Retirement after a seven-month long nationwide search process conducted by an Ad Hoc Selection Committee for which I served as chair and with the assistance of EFI Associates, a national executive search firm. 

 At our December monthly meeting, the OCERS Board of Retirement expressed our gratitude and appreciation to Julie Wyne, OCERS General Counsel and Government Affairs Officer, for her service as the OCERS Interim CEO during the executive search process. 

History of Public Sector Pensions

 In June, 2007 the State Association of County Retirement Systems (SACRS) partnered with the U.C. – Berkeley Haas School of Business for an intensive three-day course in public pension fund investment and management which I was fortunate enough to be able to attend.  The course was taught by facility members of the Haas School and was held at the business school on the northern California campus. 

 One of the introductory sessions contained a small segment on the history of pension benefits and how they were developed in the private and the public sector.  I found the historical information interesting and very relevant to some of the issues we currently face “with certain elected types” and as a matter of perspective I thought I would share some of what I learned about how pension benefits came about.

The post-depression era saw an increase in legislation that began to provide for post-employment benefits and in 1935 the National Labor Relations Act was passed.  This act established pensions as a form of remuneration for workers and as legal obligations of the employer to fund and pay.

 Deferred compensation is necessary to support the war effort.

 During World War II, federal legislation passed that mandated wage freezes on employees and other restrictions on the way business was conducted -- all of which was designed to support the war effort.

 Corporations were taxed on excess corporate profits but were granted tax relief if they had pension funds for their employees.  The combination of the mandatory wage freeze and tax incentives for companies that established pension benefits resulted in a greatly expanded use of pension benefits as a form of “deferred compensation” for workers. And, by offering pension benefits for employees companies were also able to benefit their bottom line. 

 Pension benefits serve the interests of employees and employers. 

 Today, pension and other post-employment benefits continue to be a vital component of a compensation package for employees and are especially important for those of us who work in public service to our communities!

 The point that benefits are a part of the compensation package for public sector workers was repeated and emphasized by the Governor’s Public Employee Post-Employment Benefits Commission in their recently released report on post-employment benefits for public sector employees in this state. 

 Much of the current statewide and local debate about pension benefits is focused on the cost of pension benefits and certainly this debate is fair.  Benefits should be affordable to our employers.  But the context of how and why pension benefits expanded to their use as “deferred compensation” by employers is still applicable today – yet somewhat lost by public pension benefit antagonists who focus only on the cost-side.  Pension benefits were developed as a rationale and necessary compensation tool which benefitted the employers that established them as much as they benefitted the employees who earn them!  

This mutual benefit continues today.  The Commission report decisively stated that pension and health care benefits are an “integral component of retirement planning” and “are part of deferred compensation packages used to attract and retain qualified individuals for government service.”

 Conclusion.

It has been an on-going privilege to serve as the elected safety member on the OCERS Board of Retirement and the recent action taken by the O.C. Board of Supervisors regarding our pension benefits has afforded me the opportunity to work very closely with the administration of the Sheriff’s Department, the leadership of ACLEM and the entire team at AOCDS to define and delineate the issues surrounding our “3% @ 50” pension benefit formula. 

And since it is almost baseball season, the advice of the sage of the Yankees is important.  Yogi Berra advised us that “it ain’t over until it’s over” which serves to remind us all to stay focused on our mission as law enforcement officers in providing exceptional service in keeping our communities safe.  The best team always wins and we are that team!