Calpers

The nation's largest public pension fund, the California Public Employees' Retirement System, posted a 1.1% return on its investment portfolio in 2011, Chief Investment Officer Joseph Dear told his board. The 2011 performance was well below the estimated average annual return of 7.75% that the fund's actuaries say is needed to meet current and future obligations to its members. The $229.5-billion CalPERS provides retirement and other benefits for 1.6 million state and local government employees and their families.

SACRAMENTO -- The nation's biggest public pension fund is taking a stand against gun violence by voting to sell all its investments in two firearms manufacturers: Smith & Wesson Holding Corp. and Sturm, Ruger & Co. On Tuesday, the Investment Committee of the California Public Employees' retirement System voted to sell about $5 million worth of the gun makers' stock and other securities. Some of the two companies' products -- particularly assault weapons and cheap handguns, known as Saturday night specials -- are illegal in California.

The nation's two biggest public pension funds reported meager returns for the last fiscal year, raising the prospects that state and local governments and school districts may have to contribute more toward their workers' retirements. The California Public Employees' Retirement System posted a 1% return on its investments for the fiscal year that ended June 30. The smaller California State Teachers' Retirement System reported a 1.8% annual return. CalPERS' performance, announced Monday during a board meeting, missed the fund's self-imposed benchmark of 1.7% growth for its $234.3-billion portfolio, Chief Investment Officer Joseph Dear said.

The California Public Employees' Retirement System, the third-largest purchaser of health benefits in the country, approved a 9.6% increase in health premiums next year for its nearly 1.3 million members. The new rate takes effect Jan. 1. The hike represents a sharp rise over the 4.1% increase in premiums this year and topped 2011, when premiums rose 9.1%. CalPERS said the 2013 increase amounts to an additional $30 a month per member. Some health-policy experts were surprised at the size of the increase given CalPERS' purchasing power and the slowdown in healthcare spending nationally during a weak economy.

The value of real estate investments held by the nation's largest public pension fund has plummeted, and the California Public Employees' Retirement System is moving to terminate some of its investment managers as a result, new documents show. FOR THE RECORD: CalPERS investments: An article in Business on Wednesday about real estate investments by the California Public Employees' Retirement System said the value of those investments dropped 30% in the quarter ending Sept. 30. The losses occurred in the previous quarter, which ended June 30. The article also said that an investment in the Stuyvesant Town-Peter Cooper Village apartment complex in New York was threatened by a collapse of the residential property market and by the prospect of bankruptcy by CalPERS' partners in the venture, Blackrock Inc. and Tishman Speyer Properties.

A question of pay Re "L.A. posts city employee salaries," Aug. 7 Mayor Antonio Villaraigosa makes only $232,425 a year. That's dwarfed by salaries of over $300,000 for the police chief, and the general managers of the airports and the harbor. Even the city administrative officer earns more. No wonder Villaraigosa needs freebies from the Lakers and Dodgers. At his low salary, it's a matter of survival — or becoming a couch potato, watching the teams on TV. Seriously, while Bell gave salaries beyond imagination, L.A.'s salaries aren't so far behind.

A Nevada businessman was paid $17 million by two private equity firms to help them win business from California's giant pension fund at the same time he was working for a La Jolla company that was advising the fund on those investments. The board of the California Public Employees' Retirement System had been informed about the arrangement during a closed-door meeting. Its legal staff determined there was no conflict of interest, and the board approved $1 billion in investments with private equity funds Apollo Global Management and Aurora Capital Group.

Directors of the California Public Employees' Retirement System are expected to vote next week on a staff recommendation to cut its target for investment returns, raising the prospect that state and local governments may have to boost their contributions to the pension fund. In a memo to the CalPERS board, actuary Alan W. Milligan suggested lowering the assumed annual rate of return to 7.25% from 7.75%, a decade-old benchmark, as the state continues to grapple with the slow recovery from the Great Recession.

The California Public Employees' Retirement System is claiming significant success with a nearly year-old initiative to pressure companies in which it invests to require a majority vote of shareholders to elect directors. The $221-billion pension fund, the largest in the nation, now is setting its sights on Apple Inc. . CalPERS, which has a long history of corporate-governance activism, said it plans to introduce shareholder majority-vote resolutions at Apple and three other companies next year.

The California Public Employees' Retirement System said it would no longer prohibit its managers from investing in China, Russia, Pakistan, Colombia and Egypt. CalPERS, the largest U.S. public pension fund with $245 billion in assets, had kept those countries off-limits based on their rankings in a survey of the suitability of emerging markets for investors. Now, CalPERS said, managers will use a set of principles to determine whether to invest in companies in those countries.