In a recent government meeting, significant concerns were raised regarding the disconnect between the city and its pension fund management, particularly in relation to the Employee Retirement Fund (ERF). Councilman Willis initiated the discussion by questioning the feasibility of aligning the fund's target return rate with the ERF's current rate. This prompted a deeper examination of the longstanding lack of communication between the city and the fund's board, highlighted by a board member's revelation that he had not engaged in discussions with city representatives over his 15-year tenure.

The meeting underscored alarming issues with the fund's performance, particularly in private equity investments, which have reportedly underperformed for years. A consultant's report indicated that the selection of private equity managers has been problematic, leading to substantial losses. Council members expressed frustration over the slow pace of necessary changes, with some investments dating back to before 2016 still causing financial strain.

The board's current assumed rate of return is set at 6.5%, a figure deemed conservative given market conditions. However, there is a push for this target to be raised to 7.25%, which could improve the fund's financial outlook and reduce the city's annual contribution. The board's reluctance to adjust this target was attributed to a cautious approach based on historical performance data.

Governance issues were also a focal point, with calls for enhanced oversight and more frequent reporting on investment performance. Council members proposed that the board submit quarterly reports detailing investment allocations and financial statements to ensure transparency and accountability. The need for a more robust monitoring policy was emphasized, as current practices were deemed insufficient to prevent further losses.

As the city faces a looming $200 million payment to the fund, concerns about the effective management of these funds were paramount. The meeting concluded with a call for immediate action to rectify governance and performance issues, with the hope that improved management could alleviate the financial burden on taxpayers while ensuring the long-term viability of the pension fund.