Category: Newsroom

LAFPP welcomes Commissioner Kenneth Buzzell, the newly-elected Fire Department Retired Employee Member of the Board of Fire and Police Pension Commissioners! On October 5th, Commissioner Buzzell will be sworn-in at the Board meeting and fulfill his fiduciary responsibilities as a Board member.  

In September 2017, a special election was held to fill the vacancy created by former Commissioner Sam Diannitto, who retired from the Board after 42 years of unwavering service to System members. Commissioner Buzzell will serve the remaining 27 months of a 5-year term ending June 30, 2020.

Commissioner Buzzell retired from the Los Angeles Fire Department as a Fire Captain II, after 32 years of service. He served on the boards of the United Firefighters of Los Angeles City (UFLAC), Local 112; the International Association of Fire Fighters (IAFF); the Los Angeles Retired Fire and Police Association (LARFPA); and the National Conference on Public Employee Retirement Systems (NCPERS). 

Welcome Commissioner Buzzell and congratulations on your election!

Commissioner Ruben Navarro will serve the term of office from July 1, 2017 until June 30, 2022. Congratulations Commissioner Navarro!

The term of the Board’s Fire Department Employee Member, Commissioner Ruben Navarro, ends on June 30, 2017. An election was held on April 25, 2017 for this position. A candidate must receive a majority of all votes cast in order to win the election. Commissioner Navarro received 82.49% of the vote and will serve the term of office from July 1, 2017 until June 30, 2022.

Congratulations Commissioner Navarro!

The Board normally meets on the first and third Thursdays of the month at 8:30 a.m. at the Sam Diannitto Boardroom located at the Los Angeles Fire and Police Pensions building, 701 East 3rd Street, Suite 400, Los Angeles, CA 90013. Most meetings, including special meetings, are from one to four hours in duration.

The following is the current list of Board members:

Name	Appointed / Elected	Term Expires
Pedram Salimpour, MD, President	Appointed by the Mayor	6/30/2017
Ruben Navarro, Vice President	Elected by Active Fire Members	6/30/2017
George V. Aliano	Elected by Retired Police Members	6/30/2019
Corinne T. Babcock	Appointed by the Mayor	6/30/2020
Sam Diannitto	Elected by Retired Fire Members	6/30/2020
Adam Nathanson	Appointed by the Mayor	6/30/2020
Brian Pendleton	Appointed by the Mayor	6/30/2018
Belinda M. Vega	Appointed by the Mayor	6/30/2021
Robert von Voigt	Elected by Active Fire Members	6/30/2020

If you have questions concerning the election results, please call Wendy Kamayatsu, Administrative Services Section, at (213) 279-3080 or (844) 885-2377, ext. 93080#.

If you were in the Drill Tower or Police Academy training in 1994 to the present, you made mandatory contributions to the City’s Pension Savings Plan for part-time, seasonal and temporary employees. The Pension Savings Plan is a 457 Plan administered by the City’s Personnel Department, which is separate from the LAFPP System.

Participation in this Plan is mandatory for those employees who are not eligible to participate in one of the City’s three retirement/pension programs.  Upon your graduation, you became a member of the LAFPP System.

Most members are unaware that they may have a balance in the Pension Savings Plan after graduating and becoming full-time employees. Once you convert to full-time status, the contributions (made by both the employee and the City) to the Pension Savings Plan cease. Thereafter, you may elect one of two options regarding the balance:

1. Enroll in the City’s Deferred Compensation Plan (457 plan) to continue contributing to a tax-deferred plan and transfer all the money from your Pension Savings Plan account to the Deferred Compensation Plan, or
2. Leave the funds in your Pension Savings Plan account until you separate from City service. The funds earn an interest-bearing rate at about 2% per year.

Participants who have account balances in the Pension Savings Plan but have terminated City employment may take distribution of their account at any time.

For additional information on the Pension Savings Plan, please contact the Personnel Department, Deferred Compensation at (213) 978-1601.

Personnel Department – Pension Savings Plan

The Cost of Living Adjustment (COLA) effective July 1, 2017 is +2.7% and all eligible pensions will be adjusted accordingly beginning with the pension payment dated July 31, 2017.

The 2017 COLA of 2.7% was presented and approved by the LAFPP Board at its regular meeting on April 6, 2017. The COLA will be effective July 1, 2017, and eligible pensioners and DROP participants will receive an increase of up to 2.7% beginning with their July 31, 2017 monthly pension payment.

COLAs are made to eligible pension benefits effective July 1 of every year. Pursuant to the City Charter and the Administrative Code, the COLA is based on the annual change in the Consumer Price Index (CPI) as published by the Bureau of Labor Statistics.  Specifically, we look at the change in the CPI for All Urban Consumers in the Los Angeles-Riverside-Orange County Area for the prior 12-month period ending February.  As of February 2017, the change in the CPI is +2.7%.

How does this affect LAFPP Pensioners?

COLAs can increase or decrease one’s pension benefit, or have no effect. For example, in 2009 the 12-month CPI change yielded a flat COLA (0.00%) for pensioners for the first time in LAFPP history.  Also, please note that your monthly pension can never be reduced to less than your original pension amount as a result of a negative COLA.

For illustrative purposes, the following is an example of how an average monthly LAFPP pension benefit of $5,326 would be affected by a 2.7% COLA:

If 2.7% of $5,326 = $143.80

($5,326 x 0.027)

Then the monthly pension benefit would be increased to $5,469.80.

($5,326 + $143.80)

For more detailed information on the calculation of the CPI, please visit the Bureau of Labor Statistics website at http://www.bls.gov/cpi/.

Persons receiving monthly pensions, including LAFPP retired members, may be targeted by salespersons offering immediate cash in exchange for rights to future retirement or disability retirement payments. These pension loans, or “advances,” may be offered with unlawful or unfair terms, including exceedingly high interest rates and fees.  Some pension loan agreements may also require borrowers to purchase life insurance with the lender named as the beneficiary.

On February 16, 2017, Los Angeles City Attorney Mike Feuer filed a lawsuit against an individual and multiple companies allegedly involved in a predatory lending scheme targeting vulnerable California pensioners.

The City Attorney’s lawsuit alleges that Scott Kohn, the owner and manager of a complex web of companies in California and across the country, including Cash Flow Investment Partners, LLC, Future Income Payments, LLC, London Square Specialty Services, LLC, Buysell Annuity, Inc., Pension Advance, LLC, and PAS California, LLC,  marketed and issued predatory loans to retirees in need of money to pay for unexpected expenses, securing the loans with those individuals’ pensions.  Among other things, Kohn allegedly charged interest rates as high as 96%, far above California’s 10% usury limit, and allegedly threatened borrowers (falsely) that defaulting on the loans could subject them to criminal liability.  According to the lawsuit’s allegations, Kohn also subjects pensioners in default to illegal and harassing debt collection practices, such as repeated telephone calls starting as early as 5:30 a.m.   

City Attorney Feuer seeks, among other things, an injunction prohibiting Kohn from collecting on the predatory loans issued to California pensioners, as well as selling unlawful and fraudulent loans to California investors.  In addition, the lawsuit seeks restitution for pensioners, as well as civil penalties. 

If you or someone you know has been targeted by Scott Kohn or the companies listed above, or by companies who may be engaged in similar predatory pension loan businesses, please contact the Office of the Los Angeles City Attorney at ATTpensions@lacity.org or call (213) 978-3347.

A new mural titled, “Bloom” will be painted by the artist Hueman on Neptune Building’s east-facing wall. The mural will commemorate Joel Bloom, a pioneering community activist who dedicated his personal time and energy over twenty years into creating the Arts District.

Before moving to the area in 1986, Bloom, originally from Chicago, graduated from the Pasadena Playhouse’s School of Theater Arts and served in the Air Force during the Vietnam War, where he documented the soldiers’ daily life on film. While living in the Arts District, Bloom fought to bring light-rail projects to downtown neighborhoods, advocated for affordable housing, organized a neighborhood watch program, led downtown neighborhood councils, and fought to prevent the Los Angeles Unified School District from building a massive distribution warehouse in the area. Ever the playwright and actor, Bloom also wrote and staged productions to entertain those seeking a more unique experience, like live theater that could be enjoyed from the comfort of an automobile – laughs and boos would be signaled by honking the car’s horn.

The corner of Hewitt Street and Traction Avenue, where Bloom founded Bloom’s General Store in 1994, came to be known as the heart of the community. This humble storefront provided basic everyday necessities and classic video rentals to neighborhood artists, in addition to being a local hangout.  Joel Bloom passed away on July 13, 2007 at the age of 59. “He gave the Arts District its personality, and he was unabashed in his great love for it,” said Councilwoman Jan Perry when describing Bloom as the neighborhood’s unofficial mayor. 

To celebrate the “Father of the Arts District,” the proposed mural will depict a bouquet of flowers blooming and breathing with movement, and creates a living wall symbolizing the vibrant arts community that continues to grow.

The artist bringing the mural to life is Hueman. In 2013, Hueman was one of the first artists commissioned to paint a mural after Los Angeles lifted its street art ban, and was named one of LA Weekly’s People of the Year in 2014. Her most recent mural projects include: “Mermaid on Main” located on Main and 9th in Downtown Los Angeles, California; “Inner Child” created during the RFK Mural Festival curated by Branded Arts in Los Angeles, California; “Red String of Fate” created during the Murals in the Market festival in Detroit, Michigan; and “Haiti Walls” created at the Academy for Peace and Justice in Port-Au-Prince, Haiti of the two valedictorians from the school’s very first graduating class, Class of 2016.

Painting of the mural is projected to begin in early May 2017.

Active members, log in to MyLAFPP to view and/or print your 2016 Annual Benefit Statement. 

Once logged in, simply click on the Online Paper Statement icon and then select the year of your choice. This statement summarizes your individual pension-related information and provides personal information, pension estimates (if eligible to retire), contributions and interest, domestic partner information and beneficiary designation as of December 31, 2016.

For questions concerning your statement, contact the Active Member Services Section at (213) 279-3140.

A Mural Proposal Meeting for the upcoming artwork on the LAFPP building will be taking place on March 28, 2017 at 6:30 p.m., at LAFPP Headquarters, 701 E. 3rd Street, STE 400.

The mural will be titled “Bloom” to commemorate Joel Bloom. In his lifetime, Bloom dedicated twenty years of his personal time and energy into creating the Arts District. A bouquet of flowers blooming and breathing with movement, creates a living wall symbolizing the vibrant arts community that continues to grow.

REFERENCED DOCUMENTS: 

Public Notice – Mural Proposal Meeting

A new Rockefeller Institute pension model report on the Los Angeles Fire and Police Pension Plan (LAFPP) found that “LAFPP is much better funded than most public pension plans with a funded ratio of 91%” and is well positioned financially given the conservative amortization policies and contribution policy by the City of Los Angeles.

The Rockefeller Institute pension model report on LAFPP finds that even with volatility in annual returns, the risks of severe underfunding for pension funds are greatly reduced if contribution policy is conservative and participating governments pay their full actuarially determined contributions in all years. LAFPP was one of five public plans selected for detailed study by Rockefeller researchers. This is the sixth report of the Pension Simulation Project at the Rockefeller Institute, which examines the potential consequences of investment-return risk for public pension plans, governments, and stakeholders in government.

As highlighted in the study, LAFPP spreads its investment gains and losses over fixed 20-year amortization periods in accordance with the LAFPP Board’s funding policy, which is a more conservative funding methodology when compared to agencies that may amortize gains and losses over periods of 30+ years.  Researchers also acknowledge the City of Los Angeles for its diligence in paying the full contributions determined by LAFPP’s actuaries, in contrast to many other public agencies.  This disciplined funding approach is one of the items noted in the study to minimize a plan’s chance of facing a funding crisis even if investment returns are quite volatile.  In spite of this finding, the study notes that governments still face a risk of substantial contribution increases, particularly if the plan benefits are relatively expensive, when investment volatility is greater.

The detailed study examined the potential implications of investment return volatility for public pension plans by modeling the finances of LAFPP and contributions from the City under six different investment return scenarios (both deterministic, where the Plan achieves its investment return assumption each year, and stochastic, where returns are random but follow a specific distribution).  Researchers examined the six investment return scenarios under LAFPP’s current funding policy, as well as their impact under hypothetical policies that would arise if California voters were to approve statewide pension reform initiatives similar to previously proposed initiatives which would limit employer pension contributions for new hires (see former San Jose Mayor Chuck Reed’s proposed “Government Pension Cap Act of 2016” which failed to qualify for the ballot on June 17, 2016).

The study concludes that “if LAFPP’s investment return assumption is approximately correct over the long run, the plan has very little risk of becoming severely underfunded in the next thirty years, even if investment returns vary significantly from year to year.  The main reasons for this are LAFPP’s good current funded status, its relatively conservative method of determining contributions, and our assumption that the City of Los Angeles will continue its good track record of fully paying actuarially determined contributions.”