San Diego County Employees Retirement Association has sued San Diego County to allow it to set the salary of all of the $10 billion pension fund’s employees, a complaint filed in San Diego Superior Court on Sept. 5 shows.
Currently, salaries of county employees are limited by an ordinance that sets salary caps. The pension board has been trying to provide raises and bonuses to SDCERA’s CEO Brian White, but each time the county’s board of supervisors declined to approve the added compensation.
The county compensation ordinance provides a salary range for each position within San Diego County, Tammy Glenn, assistant director of communications for the county, said in an e-mail. The top range for the CEO of the SDCERA is $249,745.60 annually.
“The issue of whether the board of retirement has authority to set the compensation of SDCERA’s own staff is an important one to the governance of the fund,” a SDCERA statement said. “SDCERA and the county have been unable to resolve the issue between themselves, so it must be resolved in court. … SDCERA expects that SDCERA and the county will cooperate in the litigation so that the issue is presented to the court in a fair and efficient way.”
Mr. White currently earns the top range for base pay plus $125,000 in benefits. By comparison, Salient Partners, SDCERA’s outsourced CIO, will be paid a fee of 11.5 basis points of assets under management for the first six months and 10 basis points after that each year for four years, with two one-year options to renew. The contract is effective Oct. 1. The 10-basis-point fee represents about $10 million a year.
In June, the pension fund’s board outsourced its entire investment function to its portfolio strategist, Salient Partners. The firm had been performing the work of an outsourced CIO for all asset classes except for private markets.
Ms. Glenn said county officials cannot comment on pending litigation.