TRS - Permanent Handicap - TDA Transfer

Last year I wrote about a persistent negative cash flow at the NYC Teachers Retirement System (TRS).

Just recently someone pointed out to me the impact of something I vaguely knew about but not really. Every year TRS pulls money out of the pension fund and transfers it to the TDA plan that it runs separately from the pension plan. The TDA plan is a defined contribution plan, a 403(b) plan in IRS speak. Information about this transfer is buried in the TRS annual CAFR. The city, however, has never identified the transfer in its annual CAFR. That is until FY-2014.

This is why TRS has had a negative cash flow for the last 15 years. In the last eight years (2007-2014) TRS has paid $33.3B in benefits but $6.8B went to the TDA plan and not pension benefits. The employers' contributions for the 2007-2014 period were only $19.2B. This is a big problem. It is never discussed publicly. I have no idea how Bob North, the TRS actuary, values this liability for the TRS pension fund. This is a huge leak in the funding pipeline for the TRS pension plan.

If you look at the table below it appears that North is reporting a funding level for TRS based only on the liability based on the pension benefits paid and ignores the TDA transfer.

Funding Status for TRS and NYCERS for FY-2013

System	Actuarial Assets	Actuarial Liabilities	Funding Level	Members	Pensioners	Pension Benefits Paid	TDA Transfer
NYCERS	$42.4B	$65.3B	65.0%	212,347	137,987	$3.9B	$0.0B
TRS	$33.6B	$57.7B	58.2%	132,017	76,539	$3.6B	$1.1B

TRS Benefit Payout Since 2007

Fiscal Year	Employer Contributionds	All Benefits Paid	Pensions Paid	TDA Skim	Other Benefits Paid	Pension Paid %	TDA Skim %	Other Benefits %
2005	$1.23B	$3.13B	*	*	*	*	*	*
2006	$1.32B	$3.34B	*	*	*	*	*	*
2007	$1.60B	$3.58B	$2.89B	$0.55B	$0.14B	80.7%	15.4%	4.0%
2008	$1.92B	$3.78B	$3.02B	$0.65B	$0.11B	79.9%	17.2%	3.0%
2009	$2.22B	$3.78B	$2.92B	$0.77B	$0.10B	77.2%	20.4%	2.6%
2010	$2.48B	$4.12B	$3.20B	$0.82B	$0.10B	77.7%	19.9%	2.4%
2011	$2.47B	$4.33B	$3.38B	$0.85B	$0.10B	78.1%	19.6%	2.2%
2012	$2.67B	$4.49B	$3.44B	$0.95B	$0.10B	76.6%	21.2%	2.3%
2013	$2.86B	$4.67B	$3.54B	$1.05B	$0.08B	75.8%	22.5%	1.7%
2014	$3.00B	$4.58B	$3.82B	$1.15B	nr	76.9%	23.1%	*
2007-2014	$19.22B	$33.72B	$26.21B	$6.78B	$0.73B	*	*	*

The FY-2013 Pension Investment Fee Increases Hit the Newspapers

In early November, I wrote about the large increase in investment fees in FY-2013 for the five city pension funds

At the end of last week Bloomberg News and the NY Post caught up with this story.

The following is an extract from the NY Post article

“Fees rose in FY 2013 consistent with the recent expansion into alternative asset classes that diversify the portfolio against events like the stock-market collapse in 2008,” said Liu spokesman Matthew Sweeney.
...
Over the fiscal year, the value of the city’s pension funds rose by 12.1 percent, from $122 billion to $137 million as of June 2013.
...
Liu’s successor, Scott Stringer, said he plans to take a “hard look” at how much the outside pension managers are getting paid.
“He believes we need to limit costs, ensure payments are commensurate with performance and leverage our size and relationships with other pension funds to negotiate lower fees,” said a Stringer spokesman.

The excuse given by the Comptroller's office for the FY-2013 increase is not supported by the numbers. With respect to NYCERS, the largest fund, the numbers are as follows:

• 2011: alternate assets equaled $4.5B with total expenses of $145M
• 2012: alternate assets equaled $6.3B with total expenses of $129M
• 2013: alternate assets equaled $7.2B with total expenses of $183M

There appears to be no correlation to the size of the alternative assets classes and the the total investment expenses. In addition, there is always a good amount of skepticism about the quoted values of the alternative asset classes. There is no no market value for them and NYCERS must depend upon "estimates" from the asset managers.

In addition, the comptroller's office gives no objective evidence to support the theory that illiquid alternative asset classes diversify and therefore protect the pension fund portfolio against a stock market collapse. In fact there is a concerted effort by the Comptroller's office to hide the details of these investments.

Secondly, the quoted value of the city's pension funds is incorrect. In FY-2013 the value rose from $111.3B to $124.8B. That was a an increase of 10.5% factoring in a positive cash flow of $1.8B. The 12.1% increase was not correct. Interestingly, the stock index/core bond return was 12.26% for 2013 and would have cost far less than $473M in fees.

Thirdly, Scott Stringer has been on the NYCERS Board of Trustees since 2006. The NYCERS investment fees in 2006 were $69M versus $183M last year. Why has he not taken action against this runaway growth over the last eight years? Why hasn't mayor-elect Bill de Blasio taken action over the last four years? As Public Advoctae he has been a trustee on the NYCERS board since 2010.

To be fair, de Blasio and Stringer were not the key players in the investment decisions at NYCERS. That falls to the Comptroller and the major unions on the board with the mayor's representative acquiescing to their decisions.

The Worker’s Compensation Nightmare Keeps on Coming.

On November 30, 2012 NYCERS sent an unsigned letter to a former subway conductor. NYCERS has been sending this disabled retiree $283.30 a month for the last 21 years.

The letter notified the retiree that 1) his benefit is subject to an offset of any Workers’ Compensation payment and 2) since he has been receiving $150 a week from the Workers’ Compensation Board that his pension will be suspended as of January, 2013. NYCERS provides no detail about how this Workers’ Compensation information came to light 21 years after the member retired. No statutory reference was given.

NYCERS will graciously continue to pay him a “nominal” amount so that he may retain his health insurance.

In addition NYCERS stated that since he has been receiving the $150/week Workers’ Compensation payment since 12/01/1991, his NYCERS disability benefit was and is equal to $0.00 per month.

While this can be argued to be legally correct, such a draconian result demands a close legal interpretation of the statute. This retiree contributed 3% of his salary to NYCERS for eight years before becoming disabled. This interpretation of the statute provides this member with nothing for the money he contributed. It is hard to conclude that this was the legislative intent.

The final thrust of the NYCERS letter is a claim by NYCERS against the retiree of a repayment of $99,355.18 for the monthly payment of $283.30 over the last 21 years. NYCERS states that it may take action to recoup the money. Of course, NYCERS offers the retiree the option of sending a check or money order payable to NYCERS for the full amount. It appears that the $99,355.18 includes all the cost of living adjustments (COLA) that the retiree received. I am almost certain that NYCERS does not have specific directions from the Law Department to deny COLA payments to such retirees. Of course NYCERS sent no calculations supporting the $99,355.18 amount.

Again, NYCERS graciously advises the retiree that if he has any questions he can call the pension payroll unit or visit customer service at Jay Street.

No one signed the letter.

I never cease to be amazed at how secretive, clumsy, insensitive and unprofessional NYCERS can be. This is especially true for an agency that has a budget that is free from the constraints that other city agencies have to work under.

The Mayor and the New Pension Investment Board

At the NYCERS investment meeting on Tuesday, 11/15/2011, Liu's first deputy comptroller, Mr. Eric Eve, had to sit and take a pounding from the NYCERS trustees who were left out in the cold about the 10/27/2011 press release announcing the "proposal" for a new pension investment board. The press release was lead by the mayor with the comptroller in tow.

So why was everyone throwing verbal rocks at Eric Eve while Ms. Ranji Nagaswami, the mayor's appointed NYCERS trustee, sat comfortably at the head of the table? You would think that the mayor had nothing to do with trying to cut two major unions, the Public Advocate, and the five borough presidents out of the the investment decision process at NYCERS.

How did Bloomberg dump this pile of garbage in Liu's lap and walk away with clean hands?

Of course, Mr. Eve did not give any specific details of the how this new board would be structured and operate. I suspect that is because either he had no details or because any hard details would have pissed the hell out of the trustee who had not been consulted. But I think it's was really equal parts of both. For example, it was very "unprofessional" of him to say that passion was going to be one of the requirements for membership on the new investment board. How do you evaluate passion?

You wonder where elected officials find these staff people.

Not Ready for Prime Time - Proposal for Central Investment Board for City Pension Funds

The Proposal

On October 27, 2011 the mayor and the comptroller issued a joint press release. The release announced an agreement in principal to reform investment governance and management of the five city pension funds. Any joint policy initiative by two political rivals is usually a significant event. Six union trustees joined in the announcement.

In the past I have commented on the lunacy and high risk investment decisions which specifically the NYCERS trustees have engaged in since 2000. NYCERS is the largest of the five city pension funds. The NYCERS trustees are established by statute and include the mayor’s representative and the comptroller, the public advocate, the five borough presidents, and three major city unions. There are definitely changes that the pension funds need to make. This proposal, however, misses the mark completely. The tools are already there but no one wants to use them.

As a rationale, the mayor's press release stated:

The proposal is intended to insulate management of pension assets from any political office, further professionalize it and make it more consistent with industry best practices. The proposal aims to increase investment returns, lower the City’s pension costs, protect and strengthen pensions for current and future retirees, enhance accountability and guard against the possibility of fraud and corruption.

Current Investment Authority

The mayor seems to be unaware that the city pension trustees already have the authority and resources to depoliticize the investment process, professionalize the investment staff, and implement "best practices". For the last ten years the mayor has not used that authority. It is significant that he chose Martha Stark be his representative at the pension boards for his first seven years in office.

The five city pension systems currently delegate, on a annual basis, their investment authority to the comptroller (Section 13-702 of the NYC Admin Code). This creates a centralized investment system managed by the comptroller. The comptroller usually hires a CIO who reports to him. The comptroller also has a permanent investment staff within his Bureau of Asset Management (BAM). The five pension systems subsidize the comptroller's operating budget to cover the costs of running these investment operations.

Section 13-702 also permits the trustees of any of the city pension funds to rescind their delegation of the comptroller at anytime. If the trustees are unhappy with interference of political forces in the investment process or the lack of investment performance, they can assume direct responsibility of their own investment process. They can hire necessary support staff. In addition, each of the five city pension already has its own outside investment consultant which the trustees have hired. These consultants could easily provide the expertise needed by the trustees to operate their own investment function.

Loss of Power for the Comptroller

The proposed investment board would clearly accomplish one thing. It will reduce the status of the comptroller in the investment process and impact his ability to raise campaign contributions. From a purely political point of view, political actors never willingly surrender power. There is a funny smell in the air here. It may not be a coincidence that federal authorities are investigating the comptroller's campaign fund raising activities.

Performance

With regards to investment performance no one with any certainty can say that the new investment board will be able to improve performance by 1% or more over the current arrangement. It is just as likely that the new board would produce a 1% drop in performance. This is the standard type of delusional comments you find in marketing propaganda.

Structure of New Board

Who will sit on the new board? It will be particularly difficult determining who will be members of the new board and what the voting structure will be. I can not imagine any trustee not wanting to be on the investment board. So much for a more simple and effective board. It is clear that the Public Advocate and the five borough presidents will want to remain involved. I am sure that the same will be true for all unions currently involved.

There will also be pressure from unions currently not on the boards. I know for a fact the Correction Force and Sanitation Force unions would love to have a seat at the table.

As seen in subsequent news articles, the mayor failed to check with at least seven of the NYCERS trustees, a majority of the NYCERS board. These trustees have made it clear that they have serious questions about the proposal.

Each of the five city pension funds has a distinct financial profile which impacts investment decisions . For example, as of June 30, 2010, the FDNY pension fund was 56% funded and NYCERS was 80% funded, a significant difference. They have different cash flow demands. The funds will continue to be separate accounting entities and trusts. The trustees of each fund are the prime legal fiduciaries of the funds. It will not be possible to remove their responsibility for the investment process of their associated fund assets.

The NYCERS fund, specifically, has other significant participating employers besides the city. In the past OTB was a major participant. There are some really complex issues embedded in these pension systems.

There is no mention in the proposal how this new investment board will be funded. There was no mention of the current civil service of the the existing staff at BAM. Who would approve the investment board's annual operating budget and the fees paid to outside managers? Assets of any of the pension funds can only be disbursed upon the public approval of the associated board of trustees.

Staff for the New Board

There is always a presumption that the compensation for investment staff should be free of government compensation limits. This opinion is tied into what type of investing you want to do. I have expressed my opinion that public pension funds should follow a lower risk/lower cost strategy. This strategy would allow the pension board effectively manage their assets with staff paid within the city pay structure. The 2008 financial crisis taught us all how irresponsible and incompetent highly paid investment professionals can be.

The mayor wants the pension funds to emulate Harvard and Yale. Pension funds are very different from endowment funds in that pension funds must make mandatory annual payouts no matter what the pension fund earns on it investments. Without mandatory payouts, endowments can tolerate higher risk profiles than pension funds. This is where higher compensation might become an issue. But then again, higher risk is not a guarantee of higher return.

The Chief Investment Officer

The proposal envisions a permanent CIO described below:

A Chief Investment Officer will lead the new investment management entity. The Chief Investment Officer will report to the new pension investment board – not to any individual elected official – and will be appointed to a fixed term that will not coincide with citywide election cycles

It will be no easier for the investment board to hire a new CIO than it is for the comptroller . The CIO will clearly be an at-will employee. There will definitely be a certain level of politics associated with the investment board. An truly independent CIO is not logical when the trustees are the fiduciaries of the five pension funds.

The Comptroller's Duties as Custodian and Disbursement Agent

By statute the comptroller is the custodian and the cash disbursement agent for the five pension funds. While the custodian function has been contracted out for many years, the disbursement function means that the comptroller is responsible for the cash management operations for the five pension funds. This separation of control is a very sound arrangement. It is a good accounting practice and guards against fraud. It should not be changed. It should, however, be reinforced. The accounting control of investment management fees is a disaster.

Recap

The more I think about this proposal, the more I am convinced that it is a public relations effort with no connection to reality.

NYC Department of Investigation – Can You Trust DOI?

In the spring of 2009, two and half years ago, I reported to both the Department of Investigation (DOI) and the NYCERS trustees an act of perjury (deliberately giving a false statement under oath) by Felita Baksh (aka Ramsami) during a sworn DOI interview.

In response to my notice, one of the trustees, the former Public Advocate, asked that DOI investigate the matter and report back to the Public Advocate and to me. The Public Advocate was the only party to take any action or acknowledge my allegation. In response, DOI notified the Public Advocate that it was forwarding the matter to the Department of Finance IG for review. DOI did not notify me of this action but the Public Advocate did.

I provided all parties with a copy of the verbatim testimony of the DOI interview of Baksh from July, 2004. The interview was given under oath. In a very careful manner, the DOI interviewers gave Baksh a second chance to correct her original false testimony after warning her that she was under oath. She did not change her testimony. The false testimony related to the help Baksh received from Karen Mazza, a staff attorney at NYCERS, in regards to Baksh’s fraudulent appointment as HR director at NYCERS in 2004.

You might be wondering how DOI managed to miss this almost certain act of perjury during one of its own interviews. In 2004, DOI chose not to make a verbatim transcript from the audio tape of the interview. DOI chose, instead, to allow the lead investigator, Carol DeFreitas, to make a summary from the audio recording of the interview. DeFreitas was not one of the DOI investigators who interviewed Baksh. DOI had put her in charge of the investigation even though she was only a temporary employee recently on loan from Martha Stark. DeFreitas was actually a Department of Finance employee receiving a pay check from Finance and not DOI.

Subsequently, DeFreitas became involved with Mazza in an effort to hide the extent of the help that Mazza gave to Baksh. In addition, Mazza pulled another NYCERS employee, Kin Mak, into the cover up. Mak, an IT staffer, enabled Mazza to hide incriminating emails but not before Mak made copies of all the emails that pertained to the events surrounding the investigation.

Those copies are safely tucked away at Mak’s home in Pennsylvania. Those emails, I suspect, cast a wide net and have crippled the investigation into the Baksh perjury charge because of the people implicated by the emails.

I previously reported all of this in a series of postings: perjury, DOI, and sleeping trustees.

Recently, in response to a FOIL request for DOI’s closing memo for the investigation of the perjury charge, DOI refused to release any information. DOI claims that the information is exempt under FOIL because it would be an “unwarranted invasion of personal privacy” and it was “compiled for law enforcement purposes and would identify a confidential source or reveal confidential information relating to a criminal investigation”.

It is clear that the perjury charge against Baksh is public record. There is no personal privacy to protect in this case. If DOI finds that this public charge is untrue, it should at least clear Baksh’s name. But I am very certain that DOI found the charge to be true. It appears that DOI does not want to deal with the charge and the web of corruption that goes along with it.

The majority of DOI’s work is allegedly for law enforcement purposes. DOI is claiming the closing memo would identify a confidential source. That can’t be it. I publicly supplied them with all the information they need to reach a conclusion on the charge. In addition, after two and half years, I don’t think that there is any criminal investigation going on. It is completely reasonable to conclude that DOI is protecting one or more people.

Unfortunately, DOI has not given a report on the investigation to the Public Advocate or to me.

Even more unfortunately, the current Public Advocate has made no effort to obtain the closing memo from DOI even after being questioned about the investigation.

In closing, the perjury allegation is almost certainly true and therefore, almost certainly the NYCERS trustees are allowing three criminals to continue to work at NYCERS. This raises suspicions about the judgement and integrity of the trustees.

Does Private Equity Make Sense for NYCERS? No.

Recently the Comptroller as part of his effort to increase transparency has started posting the full agendas of investment meetings held by the NYCERS Board of Trustees. NYCERS has ten of these meetings every year in addition to the ten regular meeting where administrative and disability issues are handled.

Prior to these postings NYCERS had refused my FOIL requests for these full agendas. NYCERS reason for the denial was that some of the material was discussed in executive session. Of course that is not a valid reason for denial but I didn’t have the financial resources to file a court challenge. It will be interesting to see if the Comptroller continues to make these items and future items available on his web site

What I was looking for in particular in the full agendas were the reports on private equity and real estate performance produce by the two consulting firms monitoring the partnerships.

The reports have some interesting data which allowed me to approximate the actually performance of the partnerships. The data includes the total cash-in, the total cash-out, an estimate of the “market” value of NYCERS portion of the partnership, and an estimate of the internal rate of return (IRR) for each partnership. I used quotes around the word market because there is no open market for the buying and selling of limited partnerships.

To perform an exact internal rate of return (IRR) for these partnerships you would require a full date specific history of each cash transaction between NYCERS and the partnership including all fees and the partnership would have to be dissolved with a final closing cash-out to NYCERS. I know that NYCERS is not currently maintaining the transaction data and therefore is not able to confirm the IRR of any of its partnerships. I don’t know what method the consultants are using to produce their IRR’s.

In order, however, to do some cross checking on the consultant’s estimated IRR’s I used the data from the report and the history of the estimated market values of the partnerships. This allowed me to estimate an IRR that I have more confidence in.

For example, NYCERS oldest private equity partnership, VS&A Communications Partners III, first shows up in FY-1999. As of March 31, 2011 it had a reported value of $14.56M. The consultants quoted an IRR of 6.2% for VS&A for the period from 12/15/1998 to 10/30/2010.

Not very impressive but, I suspect, overly optimistic.

The cash-in amount for the 13 years was $50.23M and the cash-out amount was $53.43M. Assuming a final cash-out payment on 6/30/2011 of $14.56M("value" as of 3/31/2011), my estimate of their IRR is a 4.3% annual rate of return.

In addition, NYCERS has paid $5.9M in fees to VS&A from FY-1999 trough FY-2011.

As a comparison, NYCERS government bond managers have an annual rate of return over the last 15 years of 7.13%. The fees in FY-2010 for NYCERS government bond portfolio with an asset value of $994.66M were $255,000. These assets are total liquid and have minimum risk.

VS&A is a typical private equity manager. With the explosion of the number of private equity partnerships in business to service the public pension arena, the rates of return will become locked into average market returns at best and more likely will average worse than the S&P 500 index but with obscenely higher fees. NYCERS has 140 private equity contracts, 4 of which have closed down without any public report by NYCERS.

I have professional opinions on what is happening here but I will let the numbers speak for themselves.

Let Sleeping Dogs Lie.

I just received my quarterly pension PR letter from Comptroller Liu. Liu couldn't resist the temptation to claim credit along with the trustees for the pension funds' good investment performance during FY-2011 (June 30, 2011).

Number one, this is like taking credit for the sunshine. The S&P 500 index went from 1030 (6/30/2010) to 1320 (6/30/2011) during FY-2011, a 28% increase.

Number two, this also means the trustees and the Comptroller are responsible for losses when they occur, like the $3.5B that NYCERS lost in the last 3 months.

The best we can hope for from the trustees is not to screw things up too much. They are the last people in the world that anyone would willing trust money to. Of course, Bloomberg has managed to raise his own personal net worth to $19.5B from $4.5B since coming to office.

Accounting Problems with Investment Fees at NYCERS

In May, 2010, in response to a FOIL request I received a copy of NYCERS internal accounting charts of investment expenses for FY-2008 and FY-2009.

This year NYCERS has chosen to deny my FOIL requests for the accounting charts for FY-2009, FY-2010, and FY-2011.

Each year, on December 31st, NYCERS files a Comprehensive Annual Financial Report (CAFR) for the previous fiscal year ending on June 30th. This report includes a detailed listing of all investment vendors under contract to NYCERS and the fees paid to the vendors. This reporting is on an accrual basis. In plain English, that means if you don’t have the billing data when you are closing the books, you make a best guess at the amount, enter that amount, and make offsetting entries in the next year report when the data comes in. You don’t leave the entry blank.

As I have mentioned in the past NYCERS does not control the payment process for the investment vendors. The Comptroller does. NYCERS is dependent on the Comptroller for the billing and payment data needed for the accounting function. It is very clear why you normally don’t run a business like this. You have no way of vouching for the correctness of your accounting statements.

In this defective arrangement, when NYCERS receives billing and payment notices from the Comptroller’s Office, it records that information in its internal spreadsheets. This should be the basis of what appears in the CAFR statement. That is not what is happening. While the CAFR amounts are incomplete, the internal charts at NYCERS are even more incomplete.

Here is what is happening at NYCERS.

NYCERS currently has 92 managers of registered securities, 141 private equity managers, and 39 real estate managers. On its face, having this many managers is a red flag of a system out of control.

The FY-2009 CAFR statement quoted investment expenses at $138.1M. The corresponding internal NYCERS accounting chart amount is $97.4M, a $40M shortage.

The FY-2010 CAFR amount was $175.2M. NYCERS is now refusing to disclose what amount is recorded in its internal accounting chart.

The FY-2009 CAFR listing was missing entries for

• 2 managers of registered securities
• 27 private equity partnerships
• 8 real estate partnerships.

The FY-2009 internal chart was missing

• 8 managers of registered securities
• 28 private equity partnerships
• 7 real estate partnerships.

The FY-2010 CAFR listing was missing entries for

• 2 managers of registered securities
• 31 private equity partnerships
• 6 real estate partnerships.

Again NYCERS will not disclose the internal accounting chart for FY-2010 and therefore we don’t know the number of missing managers for FY-2010 in this chart.

The bottom line is that NYCERS accounting for investment fees is out of control as seen from defects in both the CAFR and the internal accounting reports. Aggravating this lack of control is the enormous amounts of money at play in these fees. The fees for FY-2011 are on track to reach $220M.

The following is another sign of a system adrift. In a September 7, 2011 Bloomberg article, the Comptroller refused to disclose the recipients of $32M in fees that NYCERS paid in FY-2010 under the cover of organization fees for private equity and real estate partnerships.

The Comptroller claimed an exemption from the state Freedom of Information Law. The actual response was that the payments “are derived from information from the private equity companies and real estate partnerships which if disclosed would cause substantial injury to the competitive position” of the firms. This is the same reason NYCERS gave me for refusing my FOIL request this year for NYCERS internal accounting charts for Investment fees.

I can not imagine how disclosing what NYCERS paid a vendor would hurt the vendor’s competitive position. Independent of the state FOIL law, all NYCERS distributions are public record since they have to be approved by a resolution of the Board of Trustees. Such resolutions must be voted on in public session of a board meeting. This is all designed to protect against fraud and corruption.

As a point of reference, the NYC Teachers Retirement System does not report paying any organization fees.

All of this is a clear sign of an unacceptable risk to the integrity of the assets of the system.

The NYS Insurance Department just finished its multi-year examination of NYCERS. I will be curious if they comment on this glaring failure of financial control. The last report, unfortunately, covered only FY-2000 to FY-2002 and was only released in June, 2009.

Actual returns vs 8% returns

This is just a quick note inspired by the Comptroller's recent pension report. I will post a full analysis later.

The amount of employer contributions to the 5 city pension funds from 2000 to 2010 is $42.9B. If the funds made 8% each year in this period, the pension assets would be $168.9B, instead of $89.9B.

If the employers had contributed a flat line 4.5% of budget, the contributions would have been $28.1B. With this amount an 8% return would have raised the pension assets to $151.6B.

The Comptroller's 8% estimate assume an employer contribution of $11B over the 11 years producing a pension asset value of $139B. I actually estimated the asset value at $129.7B with this contribution assumption.