Disaster prepairdedness committee thmpt cochair which is myself. The ddpc had 2 meetings and i did have notes from september and november because of time constraints ill review the november notes. Hold on, please. Mayor Disabilities Council subcommittee on disaster prepareardsness met november 6, 2015 and focused on el 9o. The meeting was well attended and included memberoffs city deerment pas, public helt, emergency management, human sunchss as well as Community Organizations in home support services, public support, sf card, aging and disability, friendly sf. The first part the meeting including a presentation from roger [inaudible] from National Weather service in monterey who shared the updates on the el 9ee information. We cant be concern certain on the mass of storms expected from late december and up to manch. For San Francisco some of the implications can include lands slide power outage due to fallen trees or flooding, city aijss pg e and Public Utilities are hard at work preparing for increased rain. The Human Service ages talked about efforts topoid Emergency Support for the Homeless Population that resist comes into the homeless filter system. Some of the ideas included ericting temporary structures that provide a dry and warm place for anyone to come in during days of anticipated storems. The next meeting will be helds friday january 8, 2016 from 1 30 to thre3 30. Room 141. This will include information on for superbowl 50. Everyone is welcome to attend. For more information about the disability Disaster PreparednessCommittee Contact the Mayors Office on disability at 14155546789. Email, mod San Francisco gov. Org. Thank you. This concludes the reports. Now well go on to item 12, Public Comment. Is there any Public Comment on todays agenda but within the jurisdiction of the Mayors Disability Council . Anyone on the bridge line . Any Public Comment . No . Okay. Thank you. We will go ahead and close Public Comment. We will go to information item 13 any correspondence no correspondence item 14, discussion. Council member wong. It is a very simple comment just like to wish everybody happy holidays and looking forward to seeing you all in 2016. Cochair supanich. I believe there will be no ndc meeting in december in lou of that there may or may not be a holiday party, we have yet to decide, but call mod office the number we have given you 10 times today, 5546789. And many of you will receive invitations as well so look forward to that. Thank you. Thank you everyone. So, the last agenda item which i know there wont be changing is to adjourn and thank you everyone for being here and have a nice weekend. [meeting adjourned] general Public Comment item no. 3. Please come on up. I have one card in front of me. Mr. John furlan okay thank you, president cohen. First off, im disturbed about the trend of moving closed session to the front of the agenda and having members of the public have to wait for an hourandahalf and two hours to wait for you to get through the investment calendar. And i would respectfully request that you move the investment calendar back to the agenda, so members of the public dont have to cool their heels while you are dealing with that. Okay. If necessary if you could move it to a special meeting each month, rather than jampack your agenda, so you are not out of here before 5 00 or 6 00 or 7 00; that would be even better. I would like to correct the record last month, ke walker inappropriately and inaccurately quoted that the program for the dalt investment would yield 9. 4 . She misread bob shaws analysis. She was quoting percentage for the loans that have already been repaid, and i believe more accurate number of 5. 2 yield on that proposed investment. Im also a little disturbed that you guys have not scheduled a threshold vote on whether that investment in mohcd is even appropriate to be considered . You will remember that i testified about this several times already. That i think its a conflict of interest for this retirement board to be investing in other city departments. I think you should have that conversation as the preliminary threshold matter even before you go back to considering the soundness of such an investment. Thank you. Thank you. Next speaker is john farland. I dont have a statement. I will reiterate two or three themes i have made over the past five, sich meetings. No. 1, regarding hedge funds, i again urge you to proceed with all due haste in implementing the february resolution to increase invest 5 of those funds and i would encourage you to look into increasing that to 10 . Since there has been since there was a very strenuous opposition to the 5 resolution. I would encourage you to figure out a way to reach out to what would be opponents of the 10 allocation. And try to head that off before it gets rolling again. No. 2 hedge funds are not an asset class. They can invest in any asset class. So in theory, if they really were as good as they purport to be, you should be 80 invested in hedge funds and 20 in private equity, and venture capital. But that is not going to happen. So you have 50 of your public funded equities and the big risk your pension fund issue faces is not the hedge funds, but how to hedge the 50 equity. I would again encourage you to think outside of the box and not think of the yale model per se, but to keep on increasing the alternative assets. Think of a way to directly hedge that 50 public equity. And i would encourage you to consider hiring an expert to do so. You can use put spreads, calls, whatever. It would be far more Cost Effective to do it that way than to pay fees to hedge funds. No. 3 the point i want to make, i would encourage you to strongly consider for example the position i just mentioned about hedging your public equity exposure. Strongly consider paying Incentive Fees to your staff. Your fund has been in the top quartile according to your documents, the first quartile over the past 1,3, 5, and 10 years. You should figure out some way of rewarding that performance, and encouraging 30 seconds. And encouraging that performance. For example, the private equity portion is doing great than figure out some way to pay for that performance. That is it for now. Thank you. Thank you very much. Mr. Clark, let me ask you a question, are you able to turn up the volume on this microphone, so everyone can hear . Do we have that ability . We have it up as far as it will go right now. Thank you very much. Next speaker is ms. Martha hawthorne followed by david williams. Dont count this to my 3 minutes, please. Hi, Martha Hawthorne from seiu 101 and fossilfree San Francisco. I share the first speakers disappointment that there is say closed session all of a sudden. We are busy people and come to attend a meet and not comment and leave and i hope you will reconsider the closed session and put it at the end instead of the beginning of the meeting. That is the first point. Second point, as you know most of the members of our union were in favor of the zero hedge funds. So i respectfully disagree with the last speaker that the increase should be from 5 up. 5 is actually too much. So keep that in mind, and dont go back to increasing it. Third point, divestment from fossil fuels. Our union passed a resolution i think two years ago hoping that this would be a fast process. Climate change, i dont need to remind you is really, really bad. Im commenting on this because i see on the agenda no. 10 and 11 is divestment report from sudan, sudan and tobacco, i believe. I look forward, actually, to that discussion although i cant return for it, unless you change the agenda. But want to know what the progress is on fossil fuel divestment . Our union passed a resolution supporting level 2 and we havent heard a report as a recall on the progress lately. And level 3 is what we really want and we want it quickly. I also look forward to tomorrow at the board of supervisors rules and means committee, i believe. A Committee Meeting has requested the attendance of the board to report to the board or supervisors on the progress of divestment and there will be members and interested members members of the union and members of the Community Interested in hearing your report. Thank you. Thank you. Mr. Williamsing work. David williams seiu 1022 and i want to echo what martha just had to say, but the main thing i wanted to menace mention the last two meetings you have manufactured into closed session after the comments at the beginning of the meeting which were very concerned about. Its disconcerting because there are those of us who think its actually an attempt, an attempt to make it so that members of the system cannot participate in open discussion. We come to a meeting and then were going to have wait for an hourandahalf, four hours . How long will it be in these close d meetings that we have to wait to make comments on particular agenda items and were very upset that you have done this twice in a row and hope that you do not do it again. Thank you. Thank you, next speaker. Yes, i echo what martha said, seiu and i intend to work with seiu about the hedge funds. I dont know about the background of this gentleman, but think he might have ties with the hedge funds because according to all of the research i have done, you can look at the internet. I have remailed to all of you that the largest hedge funds yeartodate they have lost 17 and a lot of them have gone out of business. So im definitely strongly against hedge funds, and i just cannot accept that. I will work with seiu and reject that because even 1 is 1 billion. This gentleman was talking about 5 , 8 , 10 , that is ridiculous, that is our hardearned money going down the drain. Secondly, i remain concerned about the performance of deferred compensation. I dont know what our consultant angeline is doing. We would like to the deferred compensation manager who is working with angeline . The performance is just terrible, okay . The goalmaker prudential claim they are not responsible they are what . Just Record Keeping and who is responsible, okay . I honestly believe the Interest Rate increase in september, but they will not save us forever. Next year according to all of the reports that we see, a recession is coming. Even though they dont increase the Interest Rate, but its going to go down. They cant even handle a minor correction, 10 last time. Its coming back up and its going back down again, okay . So what are they doing . Angeline . I would like to know what is the topten holdings in the mutual fund . And are they doing anything to conserve cash . I am doing it myself for myself. I have raised cash in stable value. I have raised questions about the stable value . Why the insurance cost is sew high . So high . You can negotiate with all of the alternatives im sure there are alternative money market funds out there that we can invest in and increase the yield and lower lower Expense Ratio of 38 basis points. That is ridiculous. Why cant someone do anything about it . Its our hardearned money. As far as the pension goes, i talked to malia about the pension. I dont think 30 seconds. I dont think San Francisco city is going to go bankrupt and, in fact were doing very well. I wish we could do better, because its your duty and your responsibility and getting the hedge fund is absolutely disaster for all of us. Thank you. Thank you. Is there any other member of the public who wishes to comment at this time . Seeing none, Public Comment is closed. Thank you, ladies and gentlemen for your comments, mr. Clerk please call the me item. Item 4 action item closed session. Thank you. How long will this closed session last . Closed session doesnt have a time limit on it. You need to put a time limit that is unfair to us. Thank you. Were going into closed session now. [ inaudible ] i cannot. [ gavel ] good afternoon everyone were about to resume our meeting. All right ladies and gentlemen, thank you for bearing with us. We have completed our closed session. Is there a motion not to disclose what was discussed in closed session . Is there a motion not to disclose what was shared in closed session . All right, ill make the motion not to disclose what was shared in closed session. I will make the motion and i move that we do not disclose what was discussed closed doors in closed session. I will second the motion. All those in favor, say aye . Aye. All those opposed say no . Thank you the ayes have it and motion passes unanimously. Mr. Clerk, could you please call the next item, thank you. Item 5, action item approval of the minutes of september 9th, 2015 retirement Board Meeting. Thank you very much. Is there any comments or discussion on the minute from the september 9th Board Meeting . All right, lets take Public Comment. Public comment . All right, Public Comment is closed on this item. Is there a motion to approve the minutes . So moved. Thank you. Thank you. All those in favor . Aye. Excuse me, is there a second . Second. Seconded by commissioner bridges. All those in favor, say aye . Aye. All those opposed . Excellent. Ayes have it and this motion passes. Mr. Clerk, could you please call item no. 6. Item no. 6, an action item on the consent calendar. Is there any discussion, colleagues, on the consent calendar . Any concerns . Any member of the public who wishes to comment on the consent calendar at this time . Seeing none, Public Comment is closed. May i have a motion to accept item 6 . So moved. Is there a second . Is there a second . Second. Thank you. Commissioner bridges. Can you do a lets do all those in favor say aye . Aye. All those opposed . Thank you this motion passes unanimously. Mr. Clerk would you call item no. 7. Action item recommendation to issue revised request for proposals for Global Custody and securities lending. Mr. Coaker. Thank you, mr. Coaker. [ inaudible ] thank you, chairwoman. This custody was original back in 2013, and then approved by the board or reapproved . January 2014 and canceled last month and were bringing back to the board for approval this month and we also have our colleagues. Robert shaw managing director of public markets. To my left isbu, and mark from Cowan Associates who are assistinging as you consultants for this particular rfp. With that i think well open for questions regarding the revised rfp with the only comment being throughout the rfp you will see the highlighted yellow sections. These are the new questions added as a result of feedback we received from the board at the last Board Meeting. Thank you. Colleges colleagues any discussion for staff on this item . No . Well, lets go to Public Comment. Thank you, president cohen. I was glad that commissioner meiberger served with me to report the black swan. I didnt bring it with me to have the full title of it. Im hoping that some of you may have read it. Its a jawdropping, edgeofyourseat report. I was shocked to reading it in 2008 Northern Trust closed our cash account and that the retirement system had to sell off securities to raise oh, yeah, cash to pay pensions. Imagine being in a cashcrunch when a retiree wants their check . In the process the system lost 27 million bucks. And combine that 27 million with the 62 million loss in the concepts hedge fund investment, which people now want to wave the emperors new clothes and retend sfs concepts was not a hedge fund. So were up to 89 million. Plus problems you are having with the deferred comp. I mind myself wondering, reading the black swan report, whether commissioner paskinjordan cuts the relationship with Northern Trust, who furloughs our assets in 2008. It caused me to lose a lot of sleep for several nights. Im surprised at this rfp issued two years ago and nothing has progressed with it. And you only got around last month to canceling it and requesting a new rfp. So im hoping that the outcome of this process is said Northern Trust will not earn your trust again, and that the relationship that the retirement system has had with them will come to an end. After all, how do you lose 27 million and then climb back into bed . 30 seconds. Thank you. Thank you. Is there anyone else who would like to speak on this item . Seeing no further Public Comment, Public Comment is closed. At this time, colleagues this is an action item. Is there any other discussion for staff . Yes, i have one. Yes . I heard the statement before, i do know the step fund was frozen. Did we have to sell any assets to pay pension checks . Did we have to sell any assets to make the commitments to our real estate or general partnerships . Did we have to sell any assets or our managers have to sell to do any of the stuff that they wanted to buy . I was with the retirement system at that point in time and joined one month prior, and my recollection is no. We maintained usually 23 months worth of cash for benefit payments. That is a separate line item you will see in the monthly reports and there was no selling of assets such that we could or had to in order to pay benefits, or operating expenses. The freeze is correct, but the impact is not as what was described by our audience or by another board member here as well. Thank you very much. Commissioner meiberger. I beg to differ. My recollection is that the chief Investment Officer at that time, mr. Dave kushner if you would kindly respond and fol