LAFPP Funded Status - Updated 08-25-10

Los Angeles Fire and Police Pensions (LAFPP) is 96.2% funded for pension benefits on an actuarial basis for the period ending June 30, 2009. We are among the highest-funded systems in the state and the best funded of the City’s three retirement systems. We are also one of the few pension plans that pre-fund health benefits.  Health subsidy benefits are 39.7% funded.  The combined funded status of health subsidy and pension benefits is 89.4% as of June 30, 2009.  The following table summarizes our funded status and the City contributions over the last two years:

Our return was -19.97% for the one-year period ending June 30, 2009.  However with a professionally managed asset allocation plan, we have achieved positive returns for 21 of the past 25 years with an average gain of 9.39%. As of August 24, 2010 our assets total $12.7 billion.

We are very mindful of the City’s financial condition.  They have implemented an Early Retirement Incentive Program (ERIP) for civilian employees to provide a humane way to reduce the civilian workforce by 2,400 employees and find real, long-term savings to help resolve the City's budget crisis.  The actions taken by the City will affect us in a number of ways.  As all our positions are civilian City employees, from a base of 104 budgeted positions, we will lose key staff with tremendous institutional knowledge and skill sets.

Specific actions have been taken to cross-train and develop staff to assume positions that have been and continue to be vacated due to ERIP. We are confident that we will be able to maintain our service level to the members and in our ability to properly manage our investments. We will also vigorously pursue any options necessary to provide you the benefits you have earned.

If you should have any questions or concerns on this matter, please contact the Communications and Special Projects Section at (213) 978-4530 or (800) 787-CITY, ext. 84530#.