Foley: increase in payments that are to our retirees?
What should we be aware of that's happening?
8% assumption on return, coming in much lower
Allen: the one account that seemed unclear to many, what the future looked like for the retirement account
"this is the assessment provided to us by the city...what the long-term projections would look like"
DelSignore: 2008 was a horrible year, it "could have increased 50%"
"assets moving" smoothing both gains and losses
anticipating investment income is going to be lower than it has been
formula based on when they were hire
"I wish I had good news for you, but I don't"
schedule comes out almost identical to last year, expect an 8% increase for this year (how much we have to make up)
28.25% of the City
"benefit increases have not gone on recently"
"we have one more year of smoothing to go...another $56 million to smooth out"
a couple of years of gains, another year of actuarial loss in 2011
whatever amount; over 8% or under 8%
Foley: is that 8% return a reasonable expectation?
DelSignore: city has always met its annual expectation
8% has historically been a reasonable number (not now)
others thought a discount rate of 4%; assessment rate would double
"should have faith in the markets"
problem with oversight agency; now has been resolved
alternative investments continue to do very well
"could already have been a lot worse if we didn't use assest smoothing"
$56 million to overcome...would have to earn 15% this year
probably going to increase 8% every year for awhile
impressed rating agencies were very impressed
stretched out the assessment, but you have to pay it sooner or later
"if the market recovers, does better, it won't"