Month: January 2016

The 2015 Annual Report for Los Angeles Fire and Police Pensions is now available online!

As of June 30, 2015, the System’s assets totaled over $18.72 billion, while serving over 25,000 members, including 11,709 active members, 1,359 DROP members and 12,593 retired members and beneficiaries. The System’s pension benefits are actuarially funded at 91.5 percent and health subsidy benefits are funded at 45.4 percent. The combined funding status is now 85 percent. It is important to note that LAFPP has been pre-funding health subsidy benefits since 1989, and is one of the few public pension systems to do so.

The System is focused on achieving a 7.5 percent return over the long-term with the understanding that there are market fluctuations from year-to-year. The investment rate of return for Fiscal Year 2014-15 was 4.15 percent, less than our actuarial assumed rate of 7.5 percent.  However, over both the 3- and 5-year periods the System’s average return was 11.53%.  The System continues to work with our consultants to manage market volatility by investing in a variety of asset classes.

Our accomplishments throughout the past Fiscal Year include securing a new Headquarters Facility. We will be open for business in our new headquarters on March 21, 2016. In addition, the pension administration system replacement project is well underway.  We look forward to increasing our operational efficiency and the additional functionality we can provide to members.  All of these achievements ultimately support our mission – to advance the health and retirement security of those who dedicate their careers and risk their lives to protect the people of Los Angeles.

In addition to this report, our historical annual reports, actuarial valuations and financial statements are available in the Financial Reports section.

To LAFPP Members:

In light of recent market volatility, it’s only natural to be concerned about your personal financial circumstances – especially your retirement plan.  We know that each of you has a significant personal interest in the health and long-term stability of the Fire and Police Pension Plan.  Most of the time we rarely question its stability.  But during periods in which the stock market falls sharply, we sometimes need a reminder that our Plan’s assets and the investment strategy the LAFPP Board has put in place is specifically designed to benefit from a rising stock market – such as we have enjoyed throughout the 2009 to 2014 period, and to cope with the periodic declines that regularly occur.  While it is certainly true that market declines are unwelcome and represent hurdles we must overcome in the future to keep our Plan’s funding strong, the Board’s investment strategy contains multiple elements to mitigate the effect of those declines.  These include: 

• A highly diversified portfolio that is not solely dependent on the stock market but includes bonds, real estate, private equity, commodities and other assets. 
• A continuous monitoring program by the Board and staff to measure and place boundaries around the Fund’s dependence on stocks. Every three months the Board conducts an intensive review of the asset allocation of the Plan’s assets and fund performance and risk over multiple time periods.
• A rebalancing policy that encourages the gradual sale of stocks or other holdings when they exceed the Board’s upper boundary and begin to add exposure when values have fallen below long-term targets.
• A policy that avoids exposing large amounts of the Plan’s assets to high risk short-term trading strategies in favor of high quality long-term investments.
• A periodic asset/liability study that carefully monitors the cohesion between the benefits the Plan is obligated to pay to our pensioners and the long-term investment strategies in place.  The last asset/liability study the Board had conducted by our independent consultant concluded that our Plan’s funding level was “unquestionably strong” relative to most other public pension plans.
• A frequent examination of the Plan’s ability to ensure sufficient cash is on hand or readily available to pay benefits due today for the years to come.

The most important point of this message is that this short-term decline in the stock market – even though sudden, significant and certainly unwelcome – is one of many that the Plan has encountered since it was first established in 1899 and does not threaten the long-term financial stability of our Plan or the Plan’s ability to pay benefits to LAFPP members.

Los Angeles Fire and Police Pensions (LAFPP) is open for business at our new headquarters location.

The new address is 701 East 3rd Street, Los Angeles, California, 90013 (NE corner of East 3rd Street & Alameda Street) in the downtown Arts District.  

We occupied our current offices in Little Tokyo for nearly 30 years.  The new headquarters building purchased by LAFPP is a 54,000 square foot four-story office building constructed in 1924. LAFPP will occupy floors 2 through 4 and plans to lease out the 1st floor. The building has undergone a number of tenant improvements and will feature:

• Energy and Environmental (“Green”) Design – to reduce operating costs in the future and benefit the environment.
• Enhanced security – to include key card access to office space and a security guard.
• Larger & more counseling rooms – for private individual appointments with members.
• Upgraded Board Room – with technology to offer all stakeholders the benefits of improved viewing and audio of Board meetings.  This room will also be used for training sessions for members and staff.
• Ergonomic workstations that offer employees the ability to sit or stand while they work.

New LAFPP Phone Numbers

All LAFPP phone numbers, including our toll-free number, have changed.  Please take time to update your records.

Section	Phone No.
Toll Free Number	(844) 88-LAFPP (52377)
LAFPP Main Line	(213) 279-3000
Active Member ServicesFax No. – 2nd Floor	(213) 279-3140(213) 628-7716
Communications & Special ProjectsFax No. – 4th Floor	(213) 279-3155(213) 628-7720
DROP/Service PensionsFax No. – 2nd Floor	(213) 279-3100(213) 628-7716
Disability PensionsFax No. – 3rd Floor	(213) 279-3165(213) 628-7782
Medical and Dental BenefitsFax No. 3rd Floor	(213) 279-3115(213) 628-7782
Retirement ServicesFax No. – 2nd Floor	(213) 279-3125(213) 628-7716