Loading...
Each pension or retirement department or plan set forth in this Article shall be governed by the following:
(a) provisions specific to each department or plan set forth in this Article or elsewhere in the Charter; and
(b) these General Provisions for Pension and Retirement Systems.
(a) Departments of the City. The following pension and retirement system departments, created in Section 500, are included within this Article:
Fire and Police Pension System
Los Angeles City Employees’ Retirement System (LACERS)
(b) Plan Created. The following retirement system is created within the Department of Water and Power and included within this Article:
Water and Power Employees’ Retirement Plan (WPERP)
(c) Boards Created. Each of the pension and retirement system departments or plans set forth in subsections (a) and (b) shall be under the management and control of a board of commissioners. The boards shall have these names:
Board of Fire and Police Pension Commissioners
Board of Administration of the Los Angeles City Employees’ Retirement System
Board of Administration of the Water and Power Employees’ Retirement Plan
(a) Board of Fire and Police Pension Commissioners. The Board of Fire and Police Pension Commissioners shall consist of nine members. Five shall be appointed by the Mayor, subject to the approval of the City Council. One shall be an active sworn member of the Fire Department as defined in this Article and elected by the members of the Fire Department. One shall be an active sworn member of the Police Department as defined in this Article and elected by the members of the Police Department. One shall be a retired member of the Fire Department as defined in this Article and elected by the retired members of the Fire Department. One shall be a retired member of the Police Department as defined in this Article and elected by the retired members of the Police Department.
(b) Board of Administration for LACERS. The Board of Administration for LACERS shall consist of seven members. Four members, one of whom shall be a retired member of the system, shall be appointed by the Mayor subject to the approval of the Council. Two members shall be active employee members of the system elected by the active employee members. One shall be a retired member of the system elected by the retired members of the system.
(c) Board of Administration for WPERP. The Board of Administration for the WPERP shall consist of seven members. Three members shall be ex officio, three members shall be elected, and one member shall be appointed. The ex officio members shall be the General Manager of the Department, the Chief Accounting Employee of the Department, and one Board of Water and Power Commissioner selected by that board. Three elected members shall be active employee members of the system elected by the active employee members. One member shall be a retired member of the system appointed by the Board of Water and Power Commissioners.
(d) Terms of Board Members. For the Board of Fire and Police Pension Commissioners and the Board of Administration for LACERS, each elected board member shall serve for a term of five years. For the Board of Administration for WPERP, the appointed retired member and each elected board member shall serve for a term of three years. The terms of board members on all boards shall be staggered as determined by each board. In case of a vacancy of an appointed seat on any board, the appointing authority for the seat shall appoint a member to serve out the unexpired term of office. In case of a vacancy of an elected seat on any board that has more than six months remaining before expiration of the term, the applicable board shall conduct an election to select a member of the group represented by the vacant seat to serve out the unexpired term of office.
(e) Restrictions on Board Membership. No person who is employed in any capacity by the LACERS or by WPERP shall be eligible to file for election to or be appointed to the board of their respective systems.
Consistent with Article XVI, Section 17 of the California Constitution, and any successor constitutional provision, and subject to the limitations set forth elsewhere in the Charter concerning anything other than pension and retirement system administration and control over system investments, each pension and retirement board of the City shall:
(a) Administration of the Pension or Retirement System. Have sole and exclusive responsibility to administer its system for the following purposes:
(1) to provide benefits to system participants and their beneficiaries and to assure prompt delivery of those benefits and related services;
(2) to minimize City contributions; and
(3) to defray the reasonable expenses of administering the system.
The duty to system participants and their beneficiaries shall take precedence over any other duty.
(b) Assets. Have sole and exclusive fiduciary responsibility over the assets of its system which are held in trust for the exclusive purposes of:
(1) providing benefits to system participants and their beneficiaries; and
(2) defraying the reasonable expenses of administering the system.
(c) Prudent Person Standard. Discharge its duties with respect to its system with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims.
(d) Investments. Diversify the investments of the system so as to minimize the risk of loss and to maximize the rate of return, unless under the circumstances it is clearly not prudent to do so.
(1) Investment Statement The board of each pension and retirement system shall adopt a statement of investment objectives and policies for the system. The statement shall include at least the desired rate of return and acceptable levels of risk for each asset class, asset allocation goals, guidelines for the delegation of authority, and information of the types of reports to be used to evaluate investment performance. At least annually, the board shall review the statement and change or reaffirm it. After each annual review, the board shall forward the statement to the Mayor and Council for informational purposes.
(2) Performance Evaluation. At least annually, the board of each pension and retirement system shall retain an outside performance evaluation firm to calculate the returns on all of the system investments.
(e) Actuarial Services. Have the sole and exclusive power to provide for actuarial services in order to assure the competency of the assets of its systems in accordance with recognized actuarial methods.
(f) Rules and Regulations. Have the power to adopt any rules, regulations, or forms it deems necessary to carry out its administration of a pension or retirement system or assets under its control.
(a) Applicability. Except as provided in this section, the provisions regarding general managers contained in Article V shall apply to the general managers of the pension and retirement systems of the City.
(b) Appointing Authority. The Board of Fire and Police Pension Commissioners and the Board of Administration of the Los Angeles City Employees’ Retirement System shall appoint their respective general manager subject to confirmation by the Mayor and Council and shall remove their respective general manager subject to confirmation by the Mayor. A general manager removed pursuant to the provisions of this section may appeal the removal to the Council in the manner provided in Section 508(e).
(c) Annual Review. The Board of Fire and Police Pension Commissioners and the Board of Administration for the Los Angeles City Employees’ Retirement System shall evaluate their respective general manager at least annually and shall set or adjust the compensation of the general manager with guidelines established by Council. Each board shall forward a copy of its performance evaluation and salary determination to the Mayor and Council.
(d) Temporary Appointments. If a vacancy arises in the position of general manager, until the vacancy is filled, the board may appoint a temporary general manager for six months, which period may be extended with the consent of the Mayor and Council for an additional six months.
SECTION HISTORY
Amended by: Subsec. (d) added, Charter Amendment HH, approved November 5, 2024, effective January 8, 2025.
(a) Special Funds. Each pension and retirement board shall have a special trust fund or funds on deposit with the Treasurer for the purpose of segregating its revenues from the other money of the City.
(b) Control of Special Funds. The board of each pension and retirement system shall have control over their respective funds. Transfers or expenditures shall be drawn upon funds only upon demands signed by the chief accounting employee of the board. All payments from the funds shall be made upon demands prepared and approved in accordance with the provisions of the Charter.
(c) Master Trustee or Custodian. Each pension and retirement board, in its sole discretion, may designate one or more master trustees or custodians to hold securities and funds of the system for the purpose of carrying out the investment policies and decisions of the board.
(d) Fund Earnings. The money in any pension or retirement system fund shall be invested at the sole and exclusive direction of the respective board and all earnings shall be credited to the respective funds by the Treasurer or the Master Trustee or Custodian designated by the respective board.
(a) Conduct of Audit. The Mayor, Council, and Controller at least once in every five years, shall jointly require a management audit to be made of the business and property of each of the pension and retirement systems by an independent qualified management auditing firm. Each audit shall examine whether the pension or retirement system is operating in the most efficient and economical manner and shall evaluate the asset allocation of the system. The firm employed to conduct the audit shall be selected by the Mayor, Council and Controller.
(b) Audit Results. A copy of the report of each audit shall be transmitted to the Mayor, Council and the board of the audited pension or retirement system. Upon receipt of the audit, Council may request that some or all of the audit recommendations be implemented by a board, but the board shall retain sole and exclusive authority over administration of its system and assets to the extent provided in Article XVI, Section 17 of the California Constitution.
The right of Council to veto board decisions provided in Section 245 shall not apply to decisions of the City’s pension and retirement boards.
Loading...