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This BLOG is for LLNL present and past employees, friends of LLNL and anyone impacted by the privatization of the Lab to express their opinions and expose the waste, wrongdoing and any kind of injustice against employees and taxpayers by LLNS/DOE/NNSA. The opinions stated are personal opinions. Therefore, The BLOG author may or may not agree with them before making the decision to post them. Opinions not conforming to BLOG rules are deleted. Blog author serves as a moderator. For new topics or suggestions, email jlscoob5@gmail.com

Tuesday, January 6, 2015

Good thing we split out!

UC Pension Troubles. Might be a good thing that TCP-1 was split out...

http://www.nationalreview.com/article/395685/ucs-pension-fiasco-lawrence-j-mcquillan

30 comments:

Anonymous said...

Won't affect current UC retirees.

Anonymous said...

12:07, let's hope that is the case. If the funds are not there I believe NNSA is under obligation to step in. Same scenario for LLNS retirees.

Anonymous said...

Looks like a hit piece by a pension plan opponent, full of unsubstantiated claims.

Anonymous said...

Just keep puttin' your 8%.

Anonymous said...

January 6, 2015 at 7:03 PM
It does not look like it is. Afet all it is the national review

Anonymous said...

Same story (essentially) is in SFGate and various campus newspapers.

Anonymous said...

Not good if you retired with UC and took TCP-2 when LANS took over.

Anonymous said...

Not good if you retired with UC and took TCP-2 when LANS took over.

January 7, 2015 at 7:27 PM

Indeed, however it is even worse if you took TCP-1 when LANS took over. I guess either it is not good. It will only get worse with the new contract change in 2017.

Anonymous said...

Many people said that TCP-1 would be in weaker shape than the UC pension plan because TCP-1 doesn't have any "new blood" in the way of younger workers coming in to make contributions to the plan. But as far as I can tell, it appears that TCP-1 is actually doing quite a bit better than the UC pension plan. Why? I thought that when the split occurred a "fair share" of funds depending on the number of TCP-1 people was taken from the UC pension plan to start up TCP-1. If that was the case then shouldn't both TCP-1 and UC pension plan be performing about the same?

Anonymous said...

"If that was the case then shouldn't both TCP-1 and UC pension plan be performing about the same?

January 8, 2015 at 10:31 PM"

It appears that TCP-1 is being managed better than UCRP. It has been 15 years since the UC Regents outsourced management of UCRP to their friends in the financial industry. Before that, it was being managed out of UC Presidents Office, and doing so well that we didn't need to contribute, and were the recipients of huge windfalls on more than one occasion. Now, it's annualized return is barely keeping up with inflation! See Charlie Schwartz'(UC, Berkeley) articles for details of this fiasco: http://socrates.berkeley.edu/~schwrtz/

Anonymous said...

"The University of California’s Board of Regents recently voted to increase student tuition up to 25 percent over the next five years."


While at the NNSA labs, any need to increase funding of the TCP1 pension will come from the hide of TCP1 employee salaries. It could get even more painful for some lab workers if TCP1 finds is necessary to further boost pension assets.

Anonymous said...

"...While at the NNSA labs, any need to increase funding of the TCP1 pension will come from the hide of TCP1 employee salaries. It could get even more painful for some lab workers if TCP1 finds is necessary to further boost pension assets...."

Increase in TCP1 funding will be collected from the employee and the employer correct? If you have reason to believe LLNS won't share the pension funding burden in the future please explain why. I know there were concerns with LLNS in the past over their contribution amount and its timing. It would be useful to have real TCP1 pension fund transparency instead of just TCP1 rehearsed talking points from management.

Anonymous said...

@ 7:56 AM

Parney acted in a responsible manner and paid attention to the LLNL TCP-1 funding levels. As a result, they are in a pretty good condition now. Since it looks like LLNS will be around for several more years, then the burden remains on them to maintain the health of the balance.

LANL TCP-1 is about to be in a world of hurt, due to the upcoming contract change. It will take a busload of accountants to determine which organization will pay what into the plan. No matter the result, as soon as LANS is gone, then the problem belongs to whatever group follows on. It is hard to see any good news anywhere in this scenario for those that opted for TCP-1 at the time of UC transition.

Anonymous said...

"... Since it looks like LLNS will be around for several more years, then the burden remains on them to maintain the health of the balance..."

All good points, but if we are not situationally aware, "maintain" could simply mean anything from increased employee pension contributions to reduced pension benefits in some manner.

Let's acknowledge though, that someone or a team of knowledgable LLNS pension managers have done a pretty good job with the fund so far. A point sometimes lost.

I worry less about the track record and skill set of the direct TCP1 pension managers and more about the LLNS "for profit" bean counters, that are not necessarily one in the same.

Anonymous said...

The worst part of this is the Nappy-headed leader of UC has reduced the California resident admits to Berkeley and UCLA by 1/3, from 3000 per year to 2000 per year, so she can auction the seats to non-residents and collect the $20 per person per year difference in tuition.... to pay for the UCRS shortfall.

For a small fraction of UCs total budget (<1%) , California taxpayers children lose 2000 (1/3 of) seats the best two public Universities. Each year.

Fact check it. Unlike the lies that Tyler Pryzbylek weaves, this is true.

"Nappy-politano" is now another California politican/fool...

Anonymous said...

20 should read 20k above.

Anonymous said...

Why is UC stubbornly sticking with defined benefit plans instead of switching to defined contribution? Gov. Brown won't be giving in and funding the pensions on the backs of students is just wrong. The funds were clearly mismanaged; asking for a bailout instead of fixing the problem is just irresponsible. I don't think those who took TCP2 have anything to worry about as long as they have faith in NNSA. At least there is a backup plan, which is more than the other UC retirees have, right?

Anonymous said...

For a small fraction of UCs total budget (<1%), California taxpayers children lose 2000 (1/3 of) seats the best two public Universities. Each year.

The trend to increase out-of-state enrollment started well before President Napolitano joined UC. The majority of UC's budget is research funds, and the overhead on that provides a lot of added money to campuses. The instructional budget largely comes from state funds and tuition.

Another perspective:

The University of California receives $460 million less in state funding than it did in 2007–08, even though it enrolls more California students than ever...

I actually think Governor Brown will win this standoff, but I don't know that is a good thing.

Anonymous said...

Why is UC stubbornly sticking with defined benefit plans instead of switching to defined contribution? Gov. Brown won't be giving in and funding the pensions on the backs of students is just wrong.

January 10, 2015 at 2:43 PM

Ho hum, you are parroting the article without adding any value or bothering to think.

Anonymous said...

Actually I was asking for comments and any signs of reasoning regarding UC's decision to continue with defined benefits over the years given their situaion. If you find it boring, move on. If you care to take the time to think, perhaps you can contribute your opinion on the matter instead of your criticism of the post.

Anonymous said...

"...Why is UC stubbornly sticking with defined benefit plans instead of switching to defined contribution?..."

I may have a partial answer to your question. I believe effective ~July 2013 UC radically changed its pension and retirement medical benefits. If I recall correctly, those UC employees with age + service =>50 stay on the old pension terms (grandfathered), and everyone else falls under the new and significantly less attractive new pension and medical in retirement terms. Essentially they were age factor changes for pension and medical in retirement benefits. This was their answer back then to address UC pension shortfalls.

Anonymous said...

Glad to see they're making an effort to right the wrong. Interesting it wasn't mentioned in the article.

Anonymous said...

More UC pension and retirement medical changes effective July 2013:

http://ucrpfuture.universityofcalifornia.edu/news-updates/retiree-health-benefit-changes-coming-in-july/

Anonymous said...

"...The Regents also approved a new pension tier for employees hired or re-hired July 1, 2013 and later. The new pension tier does not apply to current employees unless they leave employment and return at a later date...".

Anonymous said...

Pay attention to what has happened overseas in countries were governments suddenly needed cash. When that happens here in America, they'll steal the money out of your pension just like they've done in those other countries.

I wouldn't worry about UC or LLNS or LANS. The real enemy of you pension will be your very own federal government. They make the rules and they'll take it all when they finally need another source of assets to save our bankrupt system. Don't think for a minute that they won't seize it and then replace it with something pretty much worthless. They can and they will when the time arrives.


Anonymous said...

ATT announced today a pension contibution of 7.2 B. Which was a significant fraction of the net earnings of the 4th quarter. They stated part of the contribution was required by reducing the expected future pensuon returns from if memory serves, from 4.9 % to 4.3%.

Anonymous said...

A major portion of the need for increased contributions in both UCRS and both TCP-1 pensions is the lower expected future returns.

UCRS and STRS are patticularly at risk, becausevthe are somewhat underfunded on a current basis and they use unusual expected returns of about 7 % because they are a government agency. ERISA forces private pension plans to use its number which is closer to 4.5%.

Anonymous said...

LLNL's TCP-1 is better off than LANLs due to the timing of the setting up of the two pensions, which were over a year apart. Markets were better off the year the LLNL pension was set up.

Anonymous said...

Employee and retiree presence in TCP1 meetings, access to TCP1 documentation, and any pension fund "contingency plans" would be useful.

An increase in employee paid TCP1 contributions, or other equally bad pension measures, could be taken off the shelf and un-shrink wrapped after any material market correction opportunity.

It would be nice not to be a "deer in the headlights" after NNSA and LLNS drop TCP1 pension fund contingency plan X on our collective laps.

Is closer and continual TCP1 examination unreasonable or unwarranted given the pension is doing well at the present time?

Anonymous said...

Agreed. The biggest shotrcoming of TCP-1 is the lack of transparency into decision making process.

I would sleep better if it a process open to members with open meetingvs, public record, and an elected a voting member representative on both the TCP-1 governing board and on the investment committee.

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