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The bulk of CalPERS' investments are indexed. CalPERS invests in the top 3,000 companies no matter how well or poorly they do. One of the best strategies for improving our performance is to improve corporate governance. Most of the work of moderator Jim McRitchie during the last few years has been in that area. See, for example, petition to the SEC to bring democracy to corporate elections. See also, Pensions&Investments (search "James McRitchie"). This is a much abbreviated list that I have tended to keep updated mostly when I have run for the Board.

2008

Underground Regulations Continue

As reported below, in 2007 CalPERS responded to 2007 OAL Determination No. 1, filed by James McRitchie, which found the CalPERS Notice of Election, governing CalPERS elections contains underground regulations and cannot be legally enforced. CalPERS then proposed amendments that increased the risk identity theft of members who would have been required to include at least six digits of their Social Security number on circulating nomination petitions.

Jim McRitchie submitted public comments on August 8, 2007. Most of his suggested changes were accepted. However, Board members voted to move forward with provisions which attempt to allow the Board to change the number of signatures required, without a 45 day comment period and other safeguards required by law. It is ironic that the Board's response to the Determination finding certain requirements to be "underground regulations" is to propose to be able to write new "underground regulations." See McRitchie's March 18, 2008 comments.

Jones Wins

We supported Henry Jones for the retiree's seat and are happy to report he was elected.

2007

CalPERS Board Votes to Exempt Itself From the Law

2007 OAL Determination No. 1, filed by James McRitchie, found that the CalPERS Notice of Election, governing CalPERS elections, contains underground regulations and cannot be legally enforced. To address that problem the CalPERS Board proposes Amended Board Election Regulations. Unfortunately, the newly proposed amendments risk identity theft of members who must include the last six digits of their Social Security number on circulating nomination petitions. Additionally, the proposed rules attempt to allow the Board to change nomination requirements, such as the number of signatures required, without a 45 day comment period and other safeguards required by law. It is ironic that the Board's response to the Determination finding certain requirements to be "underground regulations" is to propose to be able to write new "underground regulations." James McRitchie the moderator of PERSWatch.net and a member of CalPERS, submitted public comments on August 8, 2007, including proposed amendments in double underline and strikeout format.

CalPERS has a well deserved worldwide reputation for advocating good corporate governance practices, so why does the Board seek to exempt themselves from legal requirements that govern the rulemaking process? They have no authority to do so. Board members argued for years that the Constitution exempted them from rulemaking requirements. However, that argument was thoroughly rejected by the Superior Court in Connell v. CalPERS and 1999 OAL Determination No. 18, filed by James McRitchie. Board members also have a fiduciary responsibility to members. Why are they putting members at risk of losing thousands of dollars to identity theft by requiring that widely circulated nomination petitions include the last six digits of member Social Security numbers? If you know or can guess where the member lived when they registered, you know the whole number, since the first three digits are assigned on that basis.

If you agree that the CalPERS Board should both follow the law and not put their own members at risk from identity theft, send an email to Joe Parilo, Acting Regulations Coordinator, at joe_parilo@calpers.ca.gov. Mr. Parilo will present all comments, any proposed amendments, and suggested responses to the Board. The public comment period ends August 27, 2007.

2006

Legislative Counsel Opinion of 12/18/06 regarding the use of State facilities in CalPERS elections.

September 18th petition to place strict limits on campaign contributions

July 26 letter to Senator Richard Alarcón in support of SB 1207, which facilitates the use of majority vote requirements for directors of publicly-traded California companies in uncontested elections. The bill allow shareholders, such as CalPERS, to hold to hold corporate directors accountable by voting against them on the proxy. If voters owning more than 50% of the shares vote against the director, they don't get elected.

This isn't real democracy by a long shot but it is much better than we have now. Currently, California corporations are required to use plurality voting. That means in uncontested elections, even if 99% of shares are voted against a director (or withheld), the director is reelected.

July 24 petition to the Office of Administrative Law seeking a determination regarding the legality of underground CalPERS regulations governing elections.

July 15 e-mail to Rob Feckner on TIAA-CREF Survey: Applicability to CalPERS. Suggests that CalPES conduct surveys of members and taxpayers to determine baseline of knowledge and opinion concerning corporate governance and investments that yield collateral benefits.

June 23 Reconsideration response from CalPERS

June 19 letter on SB 1729, which proposed amendments concerning the Administrative Procedure Act (APA) exemption with the concurrence of Senator Soto (the author) and CalPERS. Now, as CalPERS implements a health care trust fund, which could eventually rival the size of its pension fund, members will have enjoy the protections of the APA, including:

• Public notice, disclosure of studies relied upon, opportunity for comment and a public response to comments for initially proposed regulations and subsequent amendments.
• Consideration and disclosure of fiscal and economic impacts.
• Review by the Office of Administrative Law for necessity, authority, clarity, consistency, reference and nonduplication.

May 26 letter to Fred Buenrostro requesting reconsideration of petiton to amend CalPERS election regulations. Attachments: 1. Petition for Reconsideration and 2. Draft Petition for Underground Regulations Determination

CalPERS Election Rules Petition (March 2006)

Earlier Correspondence

E-mail to Michael Flaherman on revised candidate statement rules (2/17/00)

Comments on rulemaking designed to silence critics of the Board (11/22/99)