2024 Documents
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Wisconsin Coalition of Annuitants
March 18,2024 Minutes
Meeting called to order by the Chair Diane Wilcenski at 9:31a.m.
DIRECTORS & ALTERNATES PRESENT: Willie Backes, AFSCME24; Robert Beglinger, AFT-R; Barbara Bird, DOT; James Blank, Bay Lakes United Educators-R; Sandy Drew, SWIB Retiree;Paul Haubrich, UW Milwaukee Retiree’s Assoc.; BrianHolmes, Epsilon Sigma Phi;Bruce Johnson, SWIB Retiree; Allen Knop, WEAC-Retired; Dick Kratz, WI Retired Corrections Personnel; Jack Lawton, ACE;JohnMaydak, West Allis Retirees;Dee Pettack, WSAA; Elaine Reiter, Kettle Moraine Retired; SAA; Robert Schaefer, WI Assoc of Retired Conservationists and State Engineering Association; Roger Springman, WFT/AFT Retirees; JeanneStangl,Dodge County Area REA; Diane Wilcenski, WREA; Rick Wojciak, DNR; Christopher Wren, Wisconsin State Attorneys Association; and wicoa.org
DIRECTORS & ALTERNATES NOT PRESENT: Dave Bosanko, Retired Professional Fire Fighters of WI;Tom Broman, UW Madison Retirement Association; Robert Brooks, Central Wisconsin Center Retirees; Ed Frank, WI Assoc of Retired Conservationists; Rick Klemme, Epsilon Sigma Phi; Kathy Kreul, WFT/AFT Retirees;Jean Grosklaus, West Allis Retirees; TaraLeithold, Kettle Moraine Retirees; Lucrecia Mattson, UW-Eau Claire Emeritus; Fred Nepple, OCI; Jim Palmer, WI Professional Police Association Retired; Tom Speranza, Retired Professional Fire Fighters of WI; Joe Strohl, Retired Professional Fire Fighters of WI; Jim Thiel, Association of Career Employees; and Clara Welch, Beloit Area REA
DIRECTORS & ALTERNATES EXCUSED;
Roll Call: Taken by Rick
Approval of the February Minutes: Approved as printed
Guest: Chris Preisler, Senior Communications Specialist, SWIB
Chris introduced our guest:
Rochelle Klaskin, Deputy Executive Director and Chief Operating Officer, SWIB
To view the slides of Rochelle’s presentation,
https://www.wicoa.org/images/2024/WiCOAquarterlyupdate3_18_24.pdf
Preliminary numbers as of February 29, 2024
Core 1.19% Variable 4.57% Benchmarks have not been determined as of today.
Cost Effectiveness
CEM a benchmarking company from Canada that collects data points globally and determines how SWIB is managing its costs. Internal management costs significantly less than External management. There is a need for both. SWIB has had very positive returns from the external partners. For 2023, Internal Management was $139.2M and the cost of External Management was $479.4M, These figures are just costs and not net returns. SWIB has saved $536 million versus peers from 2013-2022. When adjusted for performance fees, CEM found that in CY2022, SWIB’s costs are equal to the US Peer Median, slightlyhigher than the Benchmark, and lower than the US Public Universe. CEM’s analysis is always lagged by one year.
Asset Allocation Changes
In October, SWIB asset consultants and WRS actuarial consultants do a deep dive into the system by doing stress testing. https://www.swib.state.wi.us/stresstesting . In December the SWIB Board reviewed the results and adjusted the asset allocations. The changes are below:
Public Markets Allocation
Reduce Public Equity from 48% to 40%
Increase Fixed Income from 25% to 27%
Private Markets Allocation
Increase Private Equity and Debt from 15% to 18%
Leverage Level
Reduce Leverage Level from15% to 12%
SWIB needs to balance amount of risk and the amount of return. As of December 31, 2023, the WRS is one of the only fully funded public pensions in the US.
70% of assets are managed actively by SWIB.
Incentive Compensation
Compensations will be discussed at the SWIB Board March Meeting. The 2023 compensation payments represent less than 5% of all SWIB’s costs for managing the WRS,
A total of 263 employees are eligible for incentive compensation.
90 staff members are Investment Management Staff and 173 staff members are Investment Service Staff.
Over the last twenty years, SWIB’s active management and diversified holdings generated $29.5 billion for the Core Fund above what it would have earned investing in a passive 60/40 portfolio.
SWIB Press Release March 22, 2024
New Podcast – Episode 27
How SWIB’s Co-Investment Portfolio Benefits the WRS, with Chris Eckerman and Kirk Wolff from SWIB’s Private Equity and Co-Investment Team
https://www.swib.state.wi.us/podcasts
Rochelle responded to Dick Kratz’s question on how recruitment is going at SWIB. She stated that there are approximately 20 positions open at SWIB and that the technology and data positions are still difficult to fill as many want full time remote jobs. SWIB has an in-office requirement for staff to foster collaboration and innovation. Rochelle mentioned that Jeff Yoder is the new recruiting manager at SWIB and is a great addition. She also reported that Cefe Quesada has been added as the Chief Technology Officer who will report to her. Cefe begins working at SWIB on April 15. He is coming from Parametric in Seattle.
GUEST: Tarna Hunter, Director of Budget and Management, ETF
The Senate wrapped up the legislative session on March 12. Two technical changes that were requested by ETF (Bill 1048) passed. All other bills are likely dead and will need to be re-introduced in the next session which begins January 2025.
The ETF Board is scheduled to meet on Thursday, May 28 to approve annuity adjustments for the next year. The Core Fund will receive a 3.6% increase. The Variable Fund with receive a 15% increase. Additionally, CFO Cindy Klimke will give projections on various investment return scenarios that could impact annuity adjustments.
https://etf.wi.gov/news/wrs-retirees-receive-annuity-increases-2024
The Group Insurance Board set the dates for Open Enrollment (September 30, 2024, through October 25, 2024). The Board also approved some benefit changes and clarified the contract language for some issues including nutritional counseling and a lifetime eye treatment.
The IAS project team recommended, and ETF leadership approved a delay for the Insurance Administration System until 2025. We believe a delay is necessary based on customer experience considerations and the inability to fully test an end-to-end solution prior to a 2024 implementation.
Correspondence:
Diane recommended that we read the following article and share it with our members.
https://urbanmilwaukee.com/2024/03/12/murphys-law-state-pension-system-is-a-huge-success/
April 2 is Voting Day. There are two questions on the ballot with the sole purpose of reducing the number of people to vote and limiting who can work the polls. It has been recommended that you vote NO on both issues. Dee Pettack also recommended a NO Vote.
Annual WCOA Conference
The Annual Conference is set to go. It will be on Zoom
May 22, 2024 – 9:30 to Noon: Edwin Denson, SWIB
Dale Knapp, Trends in Wisconsin’s Workforce
Closing Remarks – Diane Wilcenski, WCOA President
May 23, 2024 – 9:30 to Noon: John Voelker, ETF
Douglas Poland, Gerrymandering in Wisconsin: Origins,
Challenges and the Governor’s Maps
Blair Testin Award Presentation
Closing Remarks – Diane Wilcenski, WCOA President
Treasurer Report:
No income or expenses were recorded for the month of February.
Then balance as of February 29, 2024 is $7881.33
Treasurer’s report accepted.
Next Meeting:
Monday, April 15, 2024 at 9:30AM
Meeting Adjourned at 10:14 AM
Respectfully submitted by Jeanne Stangl, WIOCA Secretary