Transcripts For SFGTV Retirement 20240704

Before meeting of august 17, 2023. At this time. Hey, just give me one second here. Get me organized. Im doing my survey. All right. Okay welcome, everyone. Thank you for all the participation on the board level and im madam secretary. Do you want to call the roll, please . Thank you, commissioner. Commissioner connor. Present mr. Thomas. Present. Present. Helfen. Present mr. Driscoll. Here mr. Gandhi. Present commissioner bridges and commissioner servais is not in attendance today. We do have a quorum right. Thank you. Can i ask you, madam secretary, to turn your volume up a little . Can you do that . Its sort of. Is that better . Better better. Item number two, communications. We welcome the publics participation during Public Comment periods. There will be an opportunity for general Public Comment at this meeting after closed session and there will be an opportunity to comment on each discussion or action item on the agenda. Each item each comment is limited to two minutes. Public comment will be taken both in person and remotely by calling for each item, the board will take Public Comment first. People attending the meeting in person and then from people attending the meeting remotely. Comments or opportunities to speak during the Public Comment period are available by phone by calling. 56550001. Access. Code 26605203021. Then pound, then pound again when connected you will hear the meeting discussion. But you will be muted and in listening mode only your item of interest comes up. Press star three to add to this speaker Line Best Practices are to call from a quiet location. Speak clearly and slowly then turn down your tv or radio. Please note that city policies, along with federal, state and local law, prohibit discriminatory or harassing conduct against City Employees and others during Public Meetings and will not be tolerated. Moreover, Public Comment is permitted only on matters within the jurisdiction of this meeting body. We thank you for joining us. Thank you, madam secretary. Will you call the next item . Item number three closed session at this time, the board will be moving into closed session. Item number three, fiscal year 20 2324. Ceo and cio performance evaluation. Okay were going to call for a Public Comment before we close. Thank you. We have no inperson Public Comment on this item. Callers, you have not already done so please press star three to be added to the queue. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Okay. Can i ask everyone to please enter the closed session and do we have a time that were going to estimate well be back in. Gov of tv, San Francisco government television. We. Commissioner bridges. Mr. Driscoll president. Mr. Gandhi. Present present. President. Fund. Present mr. Oconnor. Present and commissioner thomas. Present. A quorum is present. Right thank you. A motions in order for vote. Whether we disclose discussions held in closed session. Ill move not to disclose contents of closed session. Second, its a motion thats been made by president thomas. Commissioner thomas and seconded by commissioner driscoll to call for a Public Comment. Madam secretary. Thank you. We have no inperson Public Comment on this item. A reminder to callers to press star three to be added to the queue. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls. Public comment is now closed. Thank you. Do you want to call for police. To vote. A we havent voted. So all the emotion, its been made right. Weve been made those in person on the script. I dont. Okay motions been made by commissioner thomas and seconded by commissioner driscoll. All those in favor . Those opposed . Nay nay. Motion passes. Next item, please. Thank you. Item number four, general Public Comment. Do you want to call for a Public Comment . Madam secretary . Do we have inperson Public Comment . Any we could step up to the audience here. We have what, three or Public Comment. Morning my name is jordan. Fine. Im a lead Research Analyst with unite here local 11, which represents 32,000 hotel and Food Service Workers in Southern California and arizona, will be addressing the board today regarding offers investment manager Blackstone Group. Your fund has invested 150 million in Blackstone Real Estate partners. Eight the owner of the fairfield inn aloft hotels by lax airport and 100 million in blackstone. Real estate partners nine, which is the owner of the sheraton phenix hotel, contracts at all three hotels expired on june 30th, and workers at the fairfield in aloft went on strike in july to fight for family sustaining wages, affordable benefits and a safe and humane workload. Theres also an escalating labor dispute at the sheraton phenix as workers fight for a fair contract, they have Unaffordable Health insurance and a 401. Retirement instead of a defined benefit plan like spheeris and many other blackstone investors in response to strikes by employees at the fairfield and aloft the hotels brought in workers from a Third Party Agency to try to break the strike outrageously, these hotels have employed very few African American workers among their permanent unionized staff. In spite of the unions demands for more diversity and hiring. Yet when in need of strikebreakers, they were somehow able to find and hire a number of black workers, but only as temporary agency employees. We request that add an information agenda item to the upcoming september meeting concerning spheeris investments and blackstone managed limited partnerships and asked that the fund not reinvest with blackstone until the contract disputes are resolved and blackstone can guarantee labor peace at its hospitality investments. And the company demonstrates inclusive hiring practices, including with respect to African American workers. Were going to have some other speakers and laura will translate for them. Wednesday numbers. Graciela navarro, trabajo para trabajadores durante anos de housekeeping in a Hotel Sheraton del centro de phenix motel is propiedad con dinero de sus fondos gracias por escuchar. Mr. Good morning. My name is Graciela Navarro and i work. Ive worked for 14 years as a housekeeper at the Sheraton Hotel in downtown phenix. My hotel is owned by blackstone with money from your fund. So thank you for listening to my story. The principles assistant de mi familia porque me esposa se informa as varios anos tuvieron carrion plaza en el otro mas de se cientos dollars durante cuatro anos porque el Segundo Seguro de la hotel de serato era demasiado caro incluyendo tuvimos vender nuestros pagar. I am 70, 72 years old and im the primary breadwinner of my family because my husband got sick several years ago, he had to have his kidneys replaced in 2018 and we were paying over 600 per month for medicaid for four years because the Sheraton Hotel insurance was too expensive. We even had to sell our car to pay medical bills. So ensenada cuando hotel. Okay okay, ill recuperar el trabajo. Pero voy one per porque al regresar. No no, quieren dar trenta arbitrations para limpia las habitacion mas diferentes the limpia porque el hotel. After the pandemic. I was excited when the hotel reopened and i got my job back. But it was even worse than before. They tried to give us 30 rooms to clean and the rooms were harder to clean because as theyd renovated the hotel, the trabajo se agua mucho mas dificil pero despues de trabajo solamente de la hora tengo pagar mil cientos dollars de los estan viviendo. The check and check in. No, no tengo una Buena Calidad de vida. The workload has gotten much harder. But after 14 years working there , i make only 17 per hour per month. I have to pay 1,100 for my mortgage and 300 for electricity. And im living paycheck to paycheck and i do not have a good quality of life. Second remaining estoy con con despues de trabajar no nos yaman el corazon de la otra pero no stratum como se for more on los pues. I am exhausted and in pain after work they call us the heart of the hotel, but they treat us like were the feet. You know who we como lo los miembros de de su fondo pero el hotel. No tiene un una pensione Seguro Social no pagar los officiant asi tengo seguir trabajando. I want to retire like the members of your fund. But the hotel doesnt have a pension and Social Security wont pay me enough, so im still working. Thank you. Next. Next so its a company. The grand de nuestro de nuestro grand. And mr. De Nuestro Mundo con un trillion puede permitir panos de manera justa darle atencion medica asi lanza e processor un pension por favor de nos ayuda por rectum. Black blackstone is the largest Investment Company in the world, with 1 trillion. They can afford to pay us fairly, give us Affordable Health care and provide a pension. Please tell them to do the right thing. Thank you. Buenos dias, mi nombre de Rosalba Sanchez de domestika. Uno de los dias. Me estoy a hacer cuando la jubilation pero tengo trabajando porque no tengo una pension. You know, suficiente como para pagar la renta yara para la jubilation. My name is Rosalba Sanchez, and ive been a housekeeping worker at the Sheraton Hotel since 2010. Im approaching retirement age, but i have to keep working because i dont have a pension and dont earn enough money to both pay for rent and save for retirement. An el costo de la vivienda may fuerte la casa durante anos de se siento. 70. The rising cost of housing has hit me extremely hard. The home i rented for years at around 600 a month was suddenly sold. Desde pago cientos de la de un mesa estado casillas tres quarters parte de ingresos en renta. I now rent an apartment where i pay 1,200 in rent by myself for one month from one month to the next. My rent doubled and i have i have to spend nearly three fourths of my income on rent. The incluso comprar comida puede ser un desafio educational saltado comida y quedado sin comida porque no habia suficiente dinero ing even buying food can be a challenge. And i have occasionally skipped meals and gone without food because there wasnt enough money. Reducir mis gastos no puedo viajar, no puedo tomar vacations, no puedo hacer ninguna actividad brinda alegria. Ive had to reduce my other expenses cause i cant travel, cant take vacations and cant do any leisure activities that bring me joy. Trabajando toda mi vida tengo muchas ganas pero no se cuando poder porque no tengo dinero, no tengo una pension. Ive worked my whole life and im looking forward to retirement. But i dont know when i can ever retire because i dont have money saved and i do not have a pension. Tanto trabajando para una empresa tan rica estoy lista para por lo. Vamos ganado blackstone firme un contrato justo para nosotros. I should not have to struggle so much working for such a rich company. Im ready to fight for what i deserve and i wont stop until weve won. Please tell blackstone to settle a fair contract for us. Thank you. Morning, commissioners. My name is on and sing. Im the president of unite here local two. Were the union of over 15,000 hospital workers here in San Francisco, San Mateo County , and in the east and the north bay. 2500 of our members of local. Two members from seven hotels went out on strike against the Marriott Corporation for over two months back in 2018, San Francisco city and county officials in that time supported our members. They were fighting for the same things that the two women you just heard from were fighting for basic necessities for working people, things like living wages, Affordable Health care, retirement benefits, a safe and humane workload. We were successful. We want a transformative contract for our members. At the end of that strike and workers returned to their jobs. Let me just say that we may be a different local union here in San Francisco, but there is no space between our organizations and attack on the workers. We just heard from is akin to an attack on San Francisco Hotel Workers. And we treat it in that way. And so were asking for your fund support because, hey, its the right thing to do. And i challenge anyone who just heard their stories not to believe that. But this fund also has a fiduciary responsibility to mitigate the risks associated with strikes, boycotts and picket lines. Many of blackstones Hotel Workers are living in poverty. Theyre unable to afford the rising cost of housing and basic necessities. And in 2019, the United Nations special rapporteur on the right to adequate housing accused blackstone of exploiting tenants, wreaking havoc in communities and helping to fuel a Global Housing crisis. So we requested the fund add an information agenda item to the upcoming september meeting. Concern your investments in blackstone, manage limited partnerships and ask the fund not to reinvest with blackstone until the contract disputes are resolved. And blackstone can guarantee labor peace at its hospitality investment. So thank you very much for your time. Good morning. My name is laura perez and im an organizer with unite here, local 11, based in arizona. As you heard from rosalba workers at blackstone owned hotels are asking for living wages, Affordable Health care and a safe and humane workload. In july, black stone became the first 1 trillion private equity manager. Yet many workers at its hotels still live in poverty. Blackstones usage of African American strike breakers at the aloft and Fairfield Hotels has also generated concerns from clergy. On july 18th, passed pastor william smart, president and ceo of the Southern California, our southern christian Leadership Conference of Southern California, wrote to a loft in Fairfield Hotel management and blackstone executives expressing, quote, profound concern about your companys commitment to decent labor practices and inclusivity and requesting a meeting to discuss how the hotels can demonstrate respect for the workers they employ and the communities in which they operate. It is particularly concerning that Blackstone Group continues to confront labor concerns given that blackstone owned Packer Sanitation Services inc paid a 1. 5 million fine in february for employing more than 100 teenagers in jobs at meatpacking plants in eight states through a Blackstone Fund affiliated with sfr ers. The children reported worked overnight shifts and use hazardous chemicals to clean dangerous Meat Processing equipment such as briskets sores. 30s remaining. We request that sfrs add an ad, add an information agenda item to the upcoming september meeting concerning learning as a First Investment in blackstone managed limited partnerships and we ask that as staffers not reinvent it with blackstone until the contract disputes are resolved and blackstone can guarantee labor peace as at its Southern California and arizona, hospitality investors. Thank you. Thank you. A reminder to callers to press star three to be added to the queue for those already on hold, please continue to wait until the system indicate you have been unmuted. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Thank you. Thank you for the presentations. Madam secretary, do you want to call it item number five, please . Yes. Item number five, action item. Approval of the minutes of the july 2023 retirement Board Meeting. I move adoption of the minutes as submitted. Thank you. Is there a second . Second. Great so its motions been made by commissioner chris and seconded by commissioner thomas. Any Public Comment, madam secretary . We have no inperson Public Comment. Callers. And reminder to press star three to be added to the queue. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Okay. The motions been made and seconded. All those in favor say aye. Those opposed say nay. Motion passes. Thank you, madam secretary. Next item. Item number six. Action item consent. Calendar. Okay commissioners, everything consent calendar is in your pocket. Motion to approve or any comments. I move adoption of the consent calendar as submitted. Thank you. Second, its moved and seconded. Moved by commissioner driscoll. Seconded by you. Commissioner connor, is there any Public Comment . We have no inperson Public Comment. Moderator do we have any callers on the line . Madam secretary, there are no callers on the line. Thank you. There are no calls Public Comment is now closed. Moved in second. And those in favor say aye. Those opposed say no. Motion passes. Thank you. The next item, please. Item number seven action item review and acceptance of report. Independent actuarial review. Okay. Good morning, commissioners. The actuarial review is undertaken every five years to have an independent set of eyes. Look at our actuaries work. Chiron has performed 15 valuations for spurs, and this is the third review of their work by three different actuarial firms. And it resulted for the third time in a clean report course. There are suggestions for improvement, and karen and i will respond with recommendations at the boards november meeting, which will be the same meeting. The board will be selecting assumptions for the 2023 actuarial valuation. Danny white and cassie rapoport are two members of the grs team and they are here to present their findings and answer board questions. And i just like to say that it was a very smooth process and i want to thank grs for their work. Thank you, mr. Chairman. Members of the board, its a pleasure to be here today. Um, we submitted a very detailed report of an audit that was or review that was conducted over the summer. We have a presentation that i just go over the highlights or summary of those results. We go to the next slide please. Um, give you some Background Information on this. You chiron, your actuary, provides a lot of very Important Information in terms of funded status, um, changes in financial condition, and very importantly, the actuarial determined contribution rate, which once the board certified, thats what the employers actually pay. So its very specialized work. Its not always transparent. A lot of calculations very complex calculations go in. And so from time to time its important to do a review or background. If we go to the next slide. Actuarial review or audit, i kind of use those term synonymously is a process where you retain an outside independent firm to go in and review the review of actuarial calculations, assumptions on periodic basis. What we find is your past practice of having reviews every five years is appropriate and Good Governance follows the guidelines and i think its most systems are on a similar type basis in terms of review process. We go to the next slide in terms of perspective. We go in and were doing a detailed review. We of the calculations and the data years and the output, the assumptions for validity comply with the standards of practice actuarial standards of practice, but also we try to bring forward some new perspective of our an outside perspective of suggest of possible improvement. Just consideration. And thats thats how id put it today is when we go through youre going to see a report, a clean audit and just some considerations for kind to consider next time just in industry prevalence processes. If we go to the next slide, the scope of the review which cassie, my associate, will go through in more detail, but weve we go through, we take the census data that out as far as provides chiron. We get a corresponding copy. They do a number of processes weve replicate or validate those processes and compare results for differences. We review spent a lot of time reviewing the actuarial assumptions used in the valuation as probably the most where theres some give and take, you know, different perspectives and most often um, comments of suggestions also a team go through and does a sample test sniff audit. So what we do is if you think of an actuarial valuation, we calculate a liability. That liability is the sum of the liability for each member in the system. Thats due to benefit. And so we request a sample of liability calculations for each member, whether our active member or retired. And we compare results using the same assumptions, methodologies and processes and we should match. So the idea is if you match on a sample basis, then things should match in a in an aggregate basis. If you sample. The other thing is the review of the calculations. So we got the liabilities. Are they calculating the contribution rates appropriate and accordance with city charter and then appropriately reflect actual standards of practice, which there are number about 5 or 6 that apply to perform public valuations . Weve got the next slide. Um this is the big takeaway and if theres any highlight in here is based on our view, the census data experience study, test life replicate in the valuation reports. We believe that the 2022 valuation, which was the scope of the audit, was reasonable and, and complies with actual standards of practice. In other words, this was considered a clean audit. You know, in light of the complexity of the system and you know, you can rely on it for sound business making decisions. So with that, im going to turn it over to my colleagues to go over a little more detail of the processes and steps reviewed. All right. Thank you and good morning, everybody. Um, next slide, please. So as danny has mentioned, this was a clean audit. There were no major issues. Just a few minor comments, which ill cover over the next few slides. All of the main components of the report, including the methods and assumptions, the results themselves, as well as the content of the report we have deemed to be reasonable and in compliance with the actuarial standards of practice. Next slide, please. So as part of the audit, we do a review of the Evaluation Data process. So provides us with preliminary data files that are also provided to kyren. And then we also receive the final census data files from kyron that was actually used in the valuation using the preliminary data and information in the report, we reconcile the data on our own and then compare it against the summaries provided by kyron. So in this table here, we have a summary of the comparison in the second column, we have the data summary as provided by kyron in the next column over, we have our own data that we reconciled and then the difference in the column all the way to the right. So as you can see, the differences are very minor and could be due to Additional Information that kyron had that that we did not. But overall, we consider the data to be both reasonable and valid for valuation purposes. Next slide, please. So in addition to reviewing the Valuation Data process, we also want to look at the calculation of the liabilities. So we requested 51 sample lives. As you all know, theres quite a few plans that are part of sfrs, so we wanted to make sure we were covering all of them and getting a good idea of the calculations for both active members and then inactive members who are receiving benefits. So its important to make sure that the benefits and assumptions are being correctly and that liabilities are being calculated correctly on an individual basis. So using the assumptions and plan provision as know plan, provision summaries, we did calculate our own liabilities and compared those to the ones we received from kyron. So we have a couple tables here summarizing those. Again, the column all the way to the right has the percentage and overall, we concluded that the liability calculations were reasonable. Slide, please. So here we have some Additional Information on the investment return analysis that we did. Currently, the investment return assumption is 7. 2. So we looked at a few things here. As of 2022. We looked at the expected return as well as the probability of exceeding that 7. 2 return assumption. And we use the Asset Allocations provided by aws as well as Capital Market assumptions from 11 different investment consultants. So as of 2022, the expected return was about 6 over the next 7 to 10 years. And 7. 1 over the next 20 to 30 years. The probability of exceeding 7. 2 was about 39 over the next 7 to 10 years and 49 over the next 20 to 30 years. So i do want to mention, of course, this audit was based on the 2022 valuation. So it was this analysis does consider 7. 2 to be on the higher know the upper limit of the reasonable range for the best accurate assumption. However forward looking expectations did increase for 2023, so it should be easier to support the 7. 2 assumption moving forward. We just recommend you continue to monitor the assumption which im sure kyren you know, if i give one other comment, i do want to commend the retirement system on their process of reviewing the economic assumptions each year that is not common in large public retirement systems. So i think that provides additional prudence, you know, and shows the responsibility of this board as the system. So we want to commend you for that. All right. Next slide, please. So as i mentioned previously, we just had a few minor comments while going through the experience study and valuation reports. Our recommendations are for the next experienced study. We recommend that chiron consider a salary or amount weighted approach in setting both the termination and retirement rates. This can help to minimize the gains and losses the sf sees from year to year. Additionally, we noticed that some of the termination assumptions were based on five years of experience and for some plans they were based on ten years of experience. We would just recommend using ten years of experience for all plans across the board. We also find that females tend to have higher rates of termination than males, so it may be reviewing the termination assumption on a gender basis. And as i mentioned in the last slide, we would just continue to monitor the appropriateness of that 7. 2 return assumption. Again these are very minor. Yes in the grand scheme of things and all the complexity of the calculations, these are we would consider these very minor suggestions and these are in fact, suggestions for consideration. You know, so i think i think its important at this point to give a shout out to our actuarial director, mr. Brazelton, who leads this cause, and also to the staff to for putting this together and supporting. Please and next slide, please. So we do want to say thank you for the opportunity to work on this audit. Thank you to the staff and karen for their assistance and cooperation with this audit. We feel like very smoothly. So thank you. Thank you. Well open up any questions or discussion, please. I have two questions. I understand the you said the word minor. I have to figure out how significant the minor is in terms of page ten, which is one of the relates to one of the suggested as you had this question asked, may be directed more. Jeanette this change on using the salary or amount weighted approach. How significant is that. Ill be happy to comment. Its you dont know until you look at it. And so you think a one way is and this is a process that weve identified. I think it depends on the system. So i you know, to quantify, it would be hard to say. But if you look at it this way, the current process, youre counting noses, theyre counting bodies of, you know, when they leave and stuff. But the other one, the suggestion of alternative approach is look at it on a Salary Weighted basis. You think a turnover, you know, turnover typically occurs more on lower paid positions than higher paid positions. And you think on a liability way to basis since your your benefit is a function of final average pay, you have higher paid higher liability on the associate. So is there a difference . So is that you know, are you trying so the goal is minimize liability gains and losses versus on headcount basis. Thats thats kind of the fundamental concept behind the suggestion. So to but to answer your direct question of how serious it is without looking at it, i dont couldnt quantify. You may have no effect on because the other table where you have all the spreads is on pages 2728. I see a lot of negative numbers. But when you add it all together, its almost insignificant. It could be right. But theres you know, the other thing weve i mean, Economic Times have changed so much over the years. But okay. But again, i come in, i come in the process on this point now well ask the question, is this a point worth discussing with chiron . Do you think theyll resist or or how much more works involved . Assessing we will be discussing this with chiron and they will be able to go back to their demographics study that they did five years ago. And the one that they did ten years ago and theyll be able to let to answer your question and we will be answering that question in november. Okay they desire to be as accurate as possible to minimize actual gains and losses. Yes. And i consider all of these suggestions worthy. The second question really is to do with page 29. Im trying to understand the significance of the last paragraph. I cant tell if i want to say discovered a mistake, but it sounds like what happened on page 42, the process was right, but the answer was correct in the process was wrong, but the answer was right. I just dont understand that paragraph. Yeah, so it goes with the there was a calculation. You have a schedule with amortization basis in in the report. And if you were to go through on that table, that table didnt foot or tie when you had the individual amounts when we went through and compared last years report to understand the difference, we went to last years report brought it forward and what we thought should have been looked at in that line when we put in, i believe its an honest missed reference where they show a total amounts of the annual amount outstanding for the year. And so when you correct that line item and then you sum for the total, the total ties to whats in the report and it also ties to what we expect or what what we believe should be in that report to. Okay thanks for that answer. Appreciate it. Got it. Okay. Yeah. Questions lets. Thank you very much and thank you. Thank you. Thank you. Thank you. We do a motion to accept the report. Please and make a motion to accept the report of the. April rotary and Smith Company as independent national review. Second second. Right its been this is a discussion item, right . This is an action item. Okay, then lets have. And we need to have Public Comment. Do we have any in person Public Comment seeing none. A reminder to callers to press star three to add to the queue. Moderator are there any callers on the line . Madam secretary, there are no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Okay. Its been moved and seconded by commissioner driscoll, seconded by commissioner thomas. We have a roll call vote. Oh, sorry. Yeah, sorry. Jim oconnor. You want a roll call . Vote yeah. Yes, i do. Commissioner oconnor. Mr. Thomas. President helfen. Hi, mr. Driscoll. Hi, commissioner gandy. Hi commissioner burgess. Hi thank you. We have six eyes, motion passes. Thank you. Thank you. So item number eight is not item not used. I dont see is not being used. Right. I item number nine discussion item. Chief executive officers report. If i may, ill go ahead and kick off this discussion. The comments today will be in two broad areas. One, board related topics and second and Administration Related topics. So first on the board related topics i had shared with all of you a board Education Survey to do a board education assessment. Many of you responded, but i dont have everybodys response, so i would appreciate those that havent responded to go ahead and do so, so that i have a consistent view of everybodys Educational Needs and we can work with the Governance Committee to put a plan in place next on board topics committee schedule. We talked a lot in the last Board Meeting about the process of setting up Committee Meetings for the year. Weve reached out to each of the committee chairs. Thank you for engaging in that discussion and have identified a set of proposed dates. We have to sort of schedule these meetings. Holistic so while we want to work with each individual chair in each committees schedule, we need to take into account all of the committees and the Board Meetings. Your busy schedules, our teams, busy schedules and get something that is regular and on the calendar and that is very much consistent with our policy. So to help in that effort, ive shared with all of you to confirm your availability for the dates that that have sort of come together and emerge in our discussions with the chair. And i seek your feedback on willingness to do more than one Committee Meeting on a day or do a Committee Meeting and a Board Meeting on a day. Because again, we can we can accommodate only so much, but in some cases we may want to pull these levers. And i want to know willingness to do so. Also we do have the proposed dates. So if you could confirm for us, if the ones that we have proposed work for you, for the committees that youre on, that would be extremely helpful. Again, we want to be respectful of your time and the tack that weve taken here is working with the committee chairs, anything thats going to be in a committee these are really important items that are either required or, for instance, in the meeting, part of the actuarial liability study that require deep dive. So we dont have a lot of extraneous things here. And this is important work, and i appreciate your support in that. So please do complete that. That survey. And as a heads up per policy next Board Meeting, the each of the chairs is responsible for making whats in the board policy of presentation on the goals and the schedule for the year. I will work on putting together those materials based on the discussions that ive had with the chairs. But get that to you for your review. It will be relatively straightforward. Next on administrative topics, our team is working very hard, led by karen to develop faqs, communicate and implement the changes with respect to the purchase of military service. This is a complex process. Military service is different than public service, and we have to address those complexities and we have to do that in compliance with admin code in our policies. So we are working diligently. There will be more to come and we will come before the board to amend our policy. But please know that that hard work is underway and we have received requests for the forms to apply for that service and we have responded to those requests. Finally, on the administrative side, weve included in the materials our Retirement Services dashboard, and i turn it over to karen to walk through commissioners. As you know, every quarter we provide a Retirement Services dashboard that gives you a high level information on what the team there has been doing. You have that before you. I did want to let you know that we are in the process of refining what were going to be reporting to you with respect to our disability cases, working with the City Attorneys office, theyve made some good recommendations on how we can let you know a lot better where the cases stand, not just what application are pending, but where they stand. Are they do we have the information . Is it waiting for hearing . I know over the years that many of you have expressed an interest in that kind of statistics. So i just wanted to let you know that the next report we will be providing you with that information. And im happy to answer any questions. Great great questions. The site visits out of separate from overlapping with what is done with the deferred comp. They do their own dashboard. And this is does not include good. Secondly its good to see the registration count is high versus the total number of members. And if we want to add the total number of members or just put in the percentage, how many of our members are actually registered on the website . And we can we can we can clarify that for you. All right. Three goes back to the first part about meetings for Committee Meetings. Does Remote Access rules still . And we still do it remotely for committees, but not the full the full Board Meeting. They have to be in person. There are a few more exceptions for committees than there are for the full board, but but the rules are that we are back in person. But the answer is no. Right. Okay. Thank you. But for everybodys edification, how long is the list of the exceptions . Not very long. I mean, i think there was, um. There might be a theres one for example, contains illness. You can be absent twice a year for committee for that purpose. But if not for the full board, youd have to just take the absence. So not very long and they are. Can we rare can we just a memo to the Board Members so that they know. Well theyve got a conflict or whatever whether it fits within an exception just we did circulate a memo but i will resend it. Yes i didnt read the memo. Yeah so well ill send it again. And now this is an important legal question because i get phone calls regarding the military service and i know its confusing for a bunch of reasons. People are going understandably crazy trying to get the answers for page two. My question is now that the benefit exists or the right to claim the benefit exist, it can still take many, many months to get this done. If someone were to retire today saying, hey, look it, i want it, but i cant get the paperwork in because beyond my control, would we recognize that they would get the benefit under the admin code in the charter, the purchase has to be complete before retirement. Yeah, well, the person is ready to retire and pay for it now. But its our process that combination, our process and the federal process that is impeding their theyre ready, willing to pay and everything. I i would have to consult with the City Attorney and its a legal call in the middle of a meeting, not knowing the full facts. Right. We need to wed have to look into that. Okay. Okay itll come up again. Thank you. Any other questions on. Any other questions . On this . On the report . I just want to point out one thing that i know from my discussions with our ceo and shes the important thing about on site visits and this would apply to your group is a definite point to consider in any real estate move or whatever that were looking at. And improvement to access is important. So thats a top list item. And for further comments. Its a discussion item. Well do Public Comment. We dont do public updates right to what shall we call the next item . We need Public Comment. We do. Do we have any inhouse Public Comment . Seeing none. A reminder to any callers to press star three to add to the queue. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Here are no calls. Public comment is now closed. Okay. So just to set the time then well break at 1230 or whenever we can close around that time. Im going to use this as a practice session because as you all, my fellow Board Members, were looking at the scheduling of all the committees and the boards and theres a possibility and the premises we might have these all meeting in the morning and a meeting in the afternoon. So lets get practice. Im going to give apology that we might be eating at the meeting. The commissioners, but not to hold up everybodys sitting there while were out having lunch at and sonia thats thats just but lets turn it over to diane item number ten discussion item San Francisco deferred Compensation Plan Quarterly Report q 223 thank you. Ms. Armando. Diane justin for the sbdc and thank you. Vice president helfand we will make sure that we conclude by 1230. Did i get demoted . I know hes president. Excuse me. Im so sorry i missed the line. Thats that. That was great. President helfand excuse me. Well, thank you so much for your time today. We are presenting our Quarterly Report, which covers the four main pillars of the plan in investments, Marketing Operations and the Record Keeper up first is our investments pillar. And if darlene can promote the quarterly activity report, the one before this one, the quarterly board report. Sorry and i will. Its the other one. Um so while shes working on that, i just want to provide a brief overview. So as mentioned in my report last month, we had a smooth transition to t rowe price as our target date fund manager. Most of the target date fund vintages are currently at their target allocation and well be meeting with the Deferred Compensation Committee to discuss tactical Asset Allocation required later this year. Also mentioned is the 22 bips jump for our stable value crediting rate, which is now at 2. 9, which is guaranteed for q three. Thank you, mr. Menino greg unger is also here from callan, who is our investment consultant. And ive asked him to share a few thoughts on last quarters performance, as shown on the attached activity report and being promoted right now by mr. Menino next month he will be reporting out on the performance for the first half of 2023. But as this is a Quarterly Report were going to talk about q two, so greg, please begin. Yeah. Good afternoon, everyone. Ill make my comments very brief on this one pager. I always start really with the target date funds on the bottom because they really express the beauty of the plan. All the Underlying Funds that you offer participants make up the target date funds and youll see both in the quarter and the year to date column. Theyre outperforming their various benchmark. So i know from a starting place, thats a very good sign both in relative terms. But youll note the absolute returns have been quite strong year to date. Youll see the most recent retire fund, thats the most conservative one, up almost 6 for the year to date with the longer dated funds up over 10. And i think id leave you with the one comment that weve last year we saw a big shift of value to outperforming growth. And now in 2023, growth is vastly outperformed value. So were seeing big shifts in style within particularly the us market really led by five companies. The big five company apple, microsoft and amazon and meta or facebook. So those phenomenons continue with volatility as as the Capital Markets digest inflation and the fed funds rate. Ill stop there and see if theres any questions. Ill send you my question regards to the large cap growth later. Its good. Thank you. Okay, commissioners, moving on to marketing, as noted in the memo before you, weve outlined all the features from our most recent target date Fund Campaign that includes the advanced notification, special messages for safety employees, our live presentation and webinars, microsites and other evergreen targeted fund messaging. I believe i mentioned our stellar open rates and click through rates last month and our participant engagement is very encouraging as we approach National Retirement security month in october. This year, we have a rather catchy theme. Do you have retirement fomo again . Do you have retirement fomo, fomo . So this is a rather a clever use of the fomo acronym, which is fear of missing out. It appears to be more mainstream these days and also sends a clear message that you dont want to be left behind. So positioning will be using peer comparisons to prompt action. So for instance, 60 of csrf employees are participating in the smtp and their maximizing the retirement benefits. Are you missing out or or 70 have registered their account online protecting them from cyber attacks. Are you missing out . Are you protected . So we look forward to developing this Years Campaign and hope we can win another psc award like we did last year for our last nzme campaign. And then finally, i want to share with the board our insert that was included in the recent spur annual statement mailing. It is the last attachment in the dc item. We always get a boost of activity as a result of this mailing and that really dovetails nicely into the october and shrm. If there are no questions on the marketing front, id like to move on to operations. I had a question. You said, did you say 60 of csrf employees participating in deferred comp . Correct. Have you looked at that data and based on income, is there any correlation between sort of like lower income folks are less likely to participate or higher income . Or is it is that not relevant . No, it is very thats a very, very good point. In fact, we definitely look at the demographics when were doing targeted messaging. So we can certainly divvy up the data and present, you know, the salary ranges for participation in the plan. So that is of interest to the board. We can certainly report out on that at an upcoming Committee Meeting, but we do have that data so that we can identify higher earners. And in fact, thats a very, very good point because were going right into secure 2. 0 where we will actually be identifying the higher earners. So okay. So that actually moves very nicely for operations. I wanted to provide an update to the board with regards to secure 2. 0. So we are closely monitoring and preparing for all the provisions related to secure 2. 0. Some of those details can be found on page seven in the memo before you. But in short, the most famous or rather most infamous provision is section 603. And this is also known as the 145 k roth, age 50 ketchup requirement. I dont want to bore the committee, but the board. But i do feel that maybe a brief overview on this provision is helpful. So section 603 basically means that any participant who makes more than 145,000 in wages from the city will be required to make roth contributions if they take advantage of the age 50 ketchup amount. So the irs sets annual limits for qualified plans. And i believe this year it is 22,500. So when you are over age 50, you are allowed to catch up contribution that amount this year is 7500, but this provision means as part of secure 2. 0 is that if you want it to maximize your contributions and contribute another 7500 to the plan, those contributions must be roth. Now, you have a choice. You can either do pretax or you can do roth. But but as part of secure 2. 0 being a rather Large Revenue generator, they have required now, now the ketchup contributions for the higher earners, which they have identified as 145 k plus to make only roth contributions. So how do we do this . There would be a look back at the prior year and we would be working with our Payroll Department to ascertain the amount of wages the city has paid an individual based on their w2. After identifying those whove earned more than 145 k, we would flag them with an rcr and rcr is the roth catch up required . Its an indicator that would default any age 50 ketchup amounts into roth parts will still have only one account, but the contributions will be earmarked and accounted as pretax versus roth. We currently do that now for pretax and roth and also rollover funds because rollover funds have to be accounted separately because theyre special required for 401. K money as opposed to 457 money, which is what the plan is. So i know thats a lot. I wanted to pause and see if theres any questions there before i go into sort of what were doing now as a result of this. So theres been a lot of industry pushback, both public and private, in administering, you know, these this mandatory provision. There is a lot of administrative effort and a relatively short period because were looking at completing this by year end. Our plan is positioned rather neutrally because we actually already have roth. So its just a matter of working with our payroll team and our Record Keeper to funnel the ketchup contributions into the roth category. But i want to share with the board that there have been at least five letters sent to congress. The Treasury Department and the irs to request an extension for at least two years. As mentioned earlier, this is a huge tax revenue generator. And so to my understanding and mr. Bishop stein can talk about it as well, he is closely connected on the Record Keeping side, and theyve been monitoring this very, very closely as well. That extension talks have been remote at best. So as such, staff is preparing under the assumption that this provision will hold and will go into effect next year. So as mentioned, were currently working with voya, our Record Keeper, as well as the Comptrollers Office, to analyze our options and compliance. Weve already had a kickoff meeting with the Key Stakeholders and the Payroll Division is currently working with spurs it to scope out the project and the business requirements because we would have to reprogram files that go back and forth between the city and voya to make sure we capture the rcr, which is the indicator and making sure that the Payroll Division has insight into the wages. So theres a lot of logistical things and i dont want to bore the board, but to give you an example on the logistics, that needs to be sort of fleshed out is the Payroll Office has said they dont get the w2s out until midjanuary. This provision goes into effect january 1st. So theres things like that that were trying to go through. Were also looking back to see, well, you know, when does that year start . Right . Is there a prior year . Do we work with the board . Do we do we delay, contribute, you know, for the age 50 ketchups to later on in the year after weve ascertained the wage amounts . There are a lot of logistics that have been really keeping us busy and up at night. Actually trying to figure this out. But our intention is to always allow participants to save the maximum they desire, right . And so were just trying to make sure that we can stay qualified under the laws we already have a draft letter in place to our participants as well as faqs of these changes. And our counselors also have talking points, as mentioned earlier this year, when secured, 2. 0 was first signed into law. We would implement the mandatory provisions first and then consider whether to recommend the optional provisions to the Deferred Compensation Committee and then to the board Plan Document changes are not required until january of 2028 for government plans. So the idea would be for us to implement all the things and then capture them in the Plan Document and that includes both the cares act and secure. 1. 0 as well. And one last thing, just to make sure that the board is fully aware with. Section 6. 603. Um, as as part of that legislation, there was also a technical error. Um they in including the 145 k wage limit or wage bottom, i guess they had inadvertently removed a clause about at age 50 ketchups entirely. So this actually means that if that is not fixed or put back in, it would theoretically be unlawful to even allow age 50 ketchups in 2024. Now ive talked to my colleagues, the extension is remote at best, but you can be sure that that they are working to make sure that that correction is made. So at that time, maybe i can stop since were talking about that. Greg, did you want to share any thoughts or. Bishop, did you want to share any thoughts on security 0. 0 . No, you accurately described it in the ketchup provision, as i understand is going through technical corrections. Now so that will be added back. Yeah, and thats thats my understanding is as well. But i guess my concern is because it is remote and because and i dont know the status of what committee is working on at this point, im wondering how theyre going to do the last part you talked about how are they going to make corrections prior to it going into effect because there are too many moving parts to most times that get that point that yeah, that that is a part that they are they say it was a complete error. Theyve all acknowledged it and that is not a subject of confrontation. 603 ms. Julie justin talked about is a big revenue raiser and that there is just its very hard to change a law thats already been signed by. Thats my thats my concern. Yeah. That that portion we dont believe is going to get deferred. Everybodys hoping. But those are two separate right and ive been following it closely. But my concern is, is once it goes into effect, how you do how you do the back field and as you said, you can prepare for it. But how do you actually get it right . Yeah. And maybe ill let my colleague from voya talk about that. Thank you. I think the question of getting it right is whats keeping all of us up late at night right . Theres a little bit of inertia out there, right . You have Plan Sponsors who dont want to look at this right now. You have payroll providers who are kind of kicking the can down the road a little bit as well. In some instances. And then you have consultants and brokers and others that are at the table. And i think theres a large mass of people that are banking on a delay. However the key for us and for our communication has always been to try to encourage people to comply and be ready to comply. In fact, i just had a conversation with a plan sponsor this morning, which has been kind of kicking the can down the road. And i said, okay, feel good to do that if youd like. But to be prepared and assuming it goes online, lets look at these various steps. And i think to applaud your plan, your plan is doing that. There have been active communications with the Comptrollers Office and others to make sure youre in compliance. So i feel good about where youre at. I hesitatingly say there are others im a little concerned about, but in your case i feel pretty good. I think were on a good track. Right. If you could just let us know because im just curious on how the whole legislative process will move forward at this point. We will certainly keep the board apprized at the next Board Meeting as well as the dcc. Okay any communications that we would roll out, we would definitely share with the dcc as well in advance. Are there any known lobbyists working against this or, you know, nothing . You mean against extension . None that im against extension or extension extension, not that im aware of. Okay thank you. My question i want to clarify something you said at the end there. You said only the age 50 ketchup. Is it both or just the age 50 . Ketchup age 50 ketchup. So the special ketchup doesnt change. Okay. Thats why its very confusing. Thats because the wrath requirement only applies to age 50 and special ketchup isnt even because thats only for government plans. Thats in a separate section. So the removal of 603 doesnt apply to special ketchup. So people who want to ketchup special ketchup today, yes, they can do it. They could 24. They can do it as well. The way the law is written now. Yes. Okay, good. Thats correct. Im glad to hear the inertia problem in washington defect. Everything actually, i might add to commissioner driscoll, thats one of the social issues that has, you know, some inertia. Theres been a letter by congress to treasury and to the irs indicating that that was an inadvertent change so that that has more attention, i think, at this point, then delay and the three year rule on the special ketchup doesnt get affected. So that wasnt worry about that how the special ketchup even if it gets delayed and retroactively fixed people still have time to catch up on any contributed amounts as well. So theres a lot of flexibility. Im just theres always that exception to things will work out. People who are going to retire next year who if the law thats not changed, theyre going to be negatively affected. Thats the exception i always worry about. But basically that will work through us over the next couple of years. Thank you. Okay. Excellent. So president helfand , i want to be mindful of time. It is 1229. We have just a few more minutes, if you would indulge us. No worries. Okay. Okay. Thank you. Um, so if there are no more questions on secure 2. 0 and operations, id like to move on to the Record Keeper. So this is our last pillar. As noted again in the memo before you, weve had some recent enhancements through voya, including a new look and feel of the dashboard post login. Theres an image of that for you in the memo as well as the new hire through retire podcast. So im an avid podcast podcast listener myself, so im rather curious. I look forward to hearing these different perspectives from dc experts through this higher, higher through retire podcast, and we will certainly keep the board briefed on that as well. I also wanted to provide a personnel update on the Record Keeper front. So we have recently onboarded a new sbdc counselor with a name you might recognize. His name is chris wisdom and he had previously worked in the spurs investments area. He is coming over to the participant facing side. We are delighted to have him. Chris has a passion for helping others. He has emergency teaching credentials and cannot wait to help ksf employees enroll and maximize their benefits. So so mr. Wisdom is currently getting licensed and he will be shadowing our counselor to get a lay of the land and to be introduced to the other city departments and their gatekeepers in addition, the plan will also benefit from additional counselor coverage. This is going to be provided by voya as floating counselors. Mr. Bishop, as dean can give a little bit more details as well. These are folks that do not have an assigned plan. So for us, we have five assigned counselors. Voya also maintains employees who dont have one, but they provide and travel to provide coverage as needed. So examples on when these folks would be there would be in person seminars or benefit fairs like the ones that are coming up in october to provide participant assistance. We look forward to reporting out on any increased activity as a result of these additional efforts. Mr. Bastian , did you want to share any other thoughts on the floating counselors . No. To build on dianes comment, i think having an additional resource that we can tap into a time to time, especially if someone is out on vacation, you know, that allows us to not skip a beat or at least adjust and shift meetings over to that counselor to assist. So were looking forward to having them come in and help out and help us maintain our Service Goals and objectives as well. Hey thank you. And that concludes the memo portion. We do have a board overview deck that has been attached to this presentation that goes over more of the metrics. So it goes over graphics, cash inflows, outflows, as well as other like counselor activity. Is this something that the president would like us to share with . We can provide a five minute overview if that is your pleasure. Or how would you like to proceed . Well make a short presentation. The work went into it and i think everybodys interested and lets take a few minutes. Thank you, mr. Bastian. Thank you. Thank you, commissioners. And since im truly standing between you and lunch, i will be quick. Just a couple quick things to point out. The board report does reflect an increase in overall number of accounts for the quarter. We did see just short of 250 accounts added during the corner. And this is the fifth straight quarter that weve seen accounting decreasing or account growth, i should say, within the quarter itself. Additionally, the plan experienced an increase in overall plan assets due to the positive market activity that mr. Unger mentioned earlier. Proud to say that although the increase wasnt as much as the prior quarter, we did see an increase of just over 5, bringing the total plan assets to 4. 7 billion overall. Ill skip down just to talk just a little briefly about the counselors since we talked about that a little bit. As well. The counselor activity was a little bit less. If you looked at it quarter to quarter for them, one on one Activity Group meeting or Virtual Meetings were down just slightly in Group Meetings, in person, Group Meetings were up. However so were happy to have chris come on board help us to fill that gap. Also using the extra resources that we have to increase the numbers as we go through the rest of the summer and into the fall. We do expect heightened activity in october. As diane said, the National Retirement security month activities will kick off and that is always a big month for us. And look forward to that activity as well. And with that, id take any questions you might have if you have any. Its not a question, but our next deferred comp Committee Meetings in october, the information correction income replacement ratio numbers on approximately page 32. Thanks for putting it there. Thats something i will definitely want to discuss thoroughly. The Committee Meeting. Thank you. Okay. Thank you. Thats noted. Great. Thank you. Thank you. Yeah. The committee is actually a great, um, role model for the other committees to get and how much work you guys do in that committee and really appreciate it and we appreciate all the help our advisors get. Any questions, comments . None. Discussion item, Public Comment. Thank you. Do we have any inhouse Public Comment . Seeing a reminder to any callers to press star three to be added to the queue . Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Okay so lets take a 20 minute break. Okay go to recess. Thanks did you know. Srf gov tv, San Francisco government television. Yes. Srf gov tv, San Francisco government television. We estimate that the Second Quarter of last year, we were at the maximum of our exposure at 30. And since then, as our public equities portfolio has rebounded, we have been improving. So youll see in your report this year, this month were currently at 29. So within the ranges, liquidity was in credibly challenging during 2022, ipo markets were completely shut. M a activity was not happening. Despite that, our 10 billion portfolio remained cash flow neutral, which is a great achievement. And then our team continue to work really hard deploying capital. Our target was billion two with deploy roughly a billion across various private equity strategies. So within private equity, nothing worked but diversification helped our buyout portfolio was only down roughly 2. Venture portfolio was down 20. Within the buyout portfolio, its interesting. Most of the markdowns were reflective of the valuation multiples because as reported by our general partners, actually underlying Performance Companies continue to perform grow revenue and ebitda on the venture side, its slightly different story. Our portfolio, our venture portfolio is a mature portfolio and a lot of companies are ready to go public, ready to produce liquidity. And that didnt happen. And those types of companies, more mature companies, theyre tend to be valued. You know, based on market comps. So that was that in another Interesting Data point, during 2021, our public exposure was in the venture portfolio ranged from 20 to 30 and you all know what happened to nasdaq in 2022, right down 30 plus percent. So that was impacting our portfolio as well. All geographies were down, but diversification helped our asia pacific portfolio. Asia portfolio was down the least at 6. And us portfolio was down the most, reflecting our then trend growth exposures during time of volatility, its increased terribly important to maintain long term strategic focus, particularly for an asset class like private equity, where Investment Decisions were making today will see the fruit of those decisions in five, seven years from now. Its incredibly challenging to type the markets. So our best defense is diversification and consistent capital deployment. The long term seems were pursuing in our portfolio our growth and innovation, and youll see it in our portfolio with our weights to venture and growth type of opportunities. Our exposure to asia, our exposure to technology and now growing exposure to healthcare type of opportunities. Were very comfortable as a team with our long term positioning of the portfolio. But i wanted to assure you that the team is monitoring debate in all of these tilts all the time and right now there are multiple Research Initiatives that are happening and just a few to highlight that. Were doing research on europe, were doing research on parts of asia and definitely looking to grow our healthcare exposure and definitely these top down views will shape our portfolio over time. But were committed to remaining opportunistic and pursuing the best opportunities, the best managers across geographies and strategies. Ill go through the next few slides very quickly just to remind you the role of private equity in our overall plan portfolio is the Growth Engine. We want to deliver returns. We target over the full cycle 12 to 14, with the goal to outperform in Public Markets and earn illiquidity premium. And thats reflected in our benchmark, which is a public index plus 300 basis points of illiquidity premium. And our portfolio has earned at the key strategies in the portfolio of Venture Capital buyouts and growth capital. All again, different type of dislocations. Its incredibly important to go back and revisit. What do you believe as a private Equity Investor and with no private equity is very cyclical. So what we experienced in 2022 when were down, we experienced it, you know, in 2021 when we were up 30. So we know to expect that. We also know that private markets are extremely efficient, and thats manifest itself in a huge dispersion of returns in private markets. Sometimes it could be thousands of basis points between Top Performing managers and median performing managers. And our job as a team is to go find those managers and create access for San Francisco. So were opportunistic, pursue managers, but were also managing a portfolio. And when were managing a portfolio program, its incredibly important to maintain the long term horizon consistent pacing and vintage sophistication. This is what makes breaks a private Equity Program. If we were deploying capital during the high valuation environment in 2021, we absolutely should continue deploying capital right now as valuations have come down. And im incredibly proud of our private equity team. It was incredibly challenging to stay disciplined in 2020, 2021, we had so many more opportunities than capital to deploy, but we maintained the course and were trying to do the exact same thing right now as valuations have come down. This is a quick overview. The only of our program. We have been investing in private equity for over 30 years now since inception. Returns a very strong 16 plus net irr, 1. 7 x multiple invested capital, almost 10 billion of generated value in the portfolio and over 4 billion of value above the benchmark. This is a graphical representation and you can see our performance versus the benchmark performance and how much value has been created in the portfolio. And you see that the last couple of years have been special. I dont think well see the repeat of that, but who knows . This is our annual deployment phase. We have been deploying consistently. So 2022, we came under our expected deployment pace. Were supposed to do 1. 2. We did roughly a billion, and thats reflective of the slowing market, the fundraising has slowed down. Gps are not fund raising as much, but in general were on a 1. 1, 1. 2 annual deployment base. Weve done analysis as was cambridge was on a team and the target deployment pays over the next few years for our portfolio is roughly 1. 2 billion. And then on this chart youll see that we have been the portfolio was then private equity is quite diversified and we have been deploying roughly 5050 to buyout and venture type of opportunity and growing our gross equity portfolio as well. This is a quick representation of cash flows in the portfolio. You all might be might recall that around 20 1415 we increased allocation to private equity, which means we went the deep into the jv curve, which means we had to put more capital into the program that was coming back to us. Were finally reaching the point where we should be generating a lot of cash back to the plan. Unfortunately given the current environment that has been delayed. But there is no doubt in my mind that the cash flows are coming and its really good that we have a Mature Program that does not consume a lot of capital, a lot of capital right now. Um, couple slides on our performance this chart just to show you that over the years over long term, the private equity portfolio has been a great contributor to the overall planned returns. And were indeed the Growth Engine of the plan assets. This is a quick snapshot. The only thing i would highlight here is that since inception we contributed roughly 13 billion into the program. We got back all the money. So dpi is one x and we have 10 billion left in value in the portfolio. So this is a fantastic program. This is performance by strategy. To give you a quick snapshot, youll see that one year was tough across the board. But if you look at the five, ten, 20 years performance has been really, really strong. So this time around, were also doing Something Different. Were showing you the analysis and which is Public Market equivalent and its essentially a way of measuring how well a private equity portfolio is doing compared if we invested all of this money, all of these cash flows into our policy benchmark and you see here that our portfolio has outperformed across all relevant time periods and let me remind you that the policy benchmark already includes the illiquidity premium that we put on the portfolio. Right now, its at 300 basis points. This is a value bridge just to show you how the portfolio did last year. So youll see what were down almost 1. 4 billion, but cash flows were roughly flat. We contributed roughly the same amount as we got back out of the portfolio. Obviously not a great outcome, but over the last three years, this portfolio. Generated 4 billion in appreciation. And thats one of the key reasons that were at the higher end of our range as percent of total plan assets. And we did. It was not without consuming cash because cash flows were neutral. We actually got a little bit back from the portfolio. This is a quick chart to show you. The preliminary. Well, were actually finalized the performance now and the portfolio is roughly flat up 1 for q1. And we only have roughly 15 reporting for q2 and all based on that, its going to be flat again, thats our expectations was that im going to turn over to add to walk you through our kids posters in the portfolio. Thanks tanya. Good afternoon, commissioners. Ill walk you through our next section, which was portfolio exposures, attributions and both short and long term performance drivers. Slide 22 focuses on performance contributors for the portfolio in 2022. As you recall , throughout innovation, our key themes for our portfolio and while those themes have been accretive over the long term, they faced headwinds in the past year as a Public Markets have shifted focus from growth oriented strategies to value. Slide 23 covers our sector exposures, which brings us to our first strategic, overweight technology. As part of our innovation theme. Long term attribution in the overweight to technology has been accretive. Its been a high performing sector with annualized performance over 20 over the last three years in 2022, the pullback in the public tech markets had a spillover effect on our private holdings with Software Exposure in the portfolio down around 8. 5 for the year. Really softness was felt across all sectors in 2022, with the exception of our industrial exposure, which was up about 18 despite the performance or the down performance for Software Software Company Fundamentals were remain strong. The average private tech company increased revenue by about 15 and ebitda by about 10 in 2022, which means the decline in performance was driven by falling multiples in the software sector. Looking ahead, we expect overweight to tech to continue as we continue to pursue excuse me, our innovation theme, health care as well has also been an area of focus. Slide 24 shows our second strategic overweight, which is asia pacific, at the expense of europe as part of our growth theme, the majority of the exposures through venture and Growth Strategies as we believe these strategies are best positioned to take advantage of the regions growth rate. As weve discussed before, we dont believe in Geographic Diversification for diversification sake. We need to have conviction, the manager, the strategy and the return profile in order to be comfortable to take on the currency risks. Investing outside of the us. The decrease in us exposure since 2017 is driven predominantly by the secondary sale that we had in 2018 2019. Time frame. We do expect us exposure to moderately increase Going Forward as the secondary sale impact wears off , but we do expect that shift to be very gradual. We continue to review a rationale for investing outside of the us and any changes to potential geographic exposures will likely also be gradual. We have been spending more time looking opportunities in europe, which so its feasible that the gap between asia and europe could shrink in the coming years. Slide 25 covers our geographic attribution. Weve achieved the highest absolute performance in the us over the last decade plus, although we felt the impact of short term volatility here in the region, weve outperformed cambridge in the us over longer time periods as well. A short term attribute in point of view, our asia pacific exposure was the best relative performer in 22, although all geographies were down for the year. We have generally performed well in apac across time periods compared to cambridge. And as a reminder, our focus on asia pacific investing really started about a decade ago. Over that time, our asia pacific exposure has outperformed european exposure with the caveat there being most of our european exposure. So thats a good reminder of how quickly the investment landscape can be changed. You think back only two years ago at our portfolio update, then our five and ten Year Investment returns for asia pacific were in line with what the returns for the us and thats no longer the case today. Slide 2626 shows our third strategic overweight, which is venturing growth as part of our innovation and growth themes, a decrease symbiotic structure really is driven mostly by the secondary sale in 2019 with large pieces of that also from the Strong Venture performance that tanya mentioned earlier Going Forward, we expect our exposure to increase as the impact of the secondary sale wears off, although we do expect the shift to be gradual and will likely remain decent amount below the numbers shown on cambridges benchmark here. Slide 27 shows our sub strategy attribution over a 20 year horizon. All of our sub Asset Classes are performed. Venture has been highest absolute performer over the past decade plus and since inception the venture has really been the performance driver for the point over the past year battle and Growth Strategies have outperformed cambridge with venture slightly lagging for venture in tonya mentioned this a little bit earlier and im going to dig into the details here a little bit. The volatility has impacted our Venture Holdings more than cambridge because our portfolio is more heavily weighted towards late stage Portfolio Companies. Now this is not due to investing more into late stage Venture Strategies than cambridge, both ross and cambridge have about 15 of their exposure to late stage vc strategies. But because our portfolio is more mature than cambridges, which means that we have older Portfolio Companies across our early stage and multi stage managers and pd. So these managers, these holdings, these older holdings will be more sensitive to Public Market movement. Their valued and also means theres likely more public stock that our managers are holding. They havent yet distributed either for lock up restrictions or other reasons, as a good example of this, at its peak in 2021, our Venture Capital portfolio had 35 of its value in public stocks, while cambridge only had 15. So long way of saying Public Market volatility volatility here. Our venture portfolio more than hit cambridge. And on slide 28, its a good visual representation of what we just discussed about our public exposure. You can clearly see the peak in 2021 and today the public exposure is back in line with historical averages of 1,011. And now id like to turn the presentation over to rishi for an update on our Coinvestment Program and our portfolio initiatives. Good afternoon, everyone. So im going to speak about Coinvestment Program today. As you can see, our coinvestment portfolio is still relatively early in its development. The first coinvestment was completed in 2014. We have one private equity team executing on Fund Investments and coinvestment. Since managing our Team Capacity is very important, you know, we think we have a solid Due Diligence process. Some of the things we do include evaluating general Partner Investment memos, reviewing third party Due Diligence reports, stress testing, financial models for financial, for operating different operating assumptions and return outcomes, and then having a large pipeline of coinvestment. Were hoping will allow us to be selective and focus on our highest conviction opportunities. So moving over, moving on now to the coinvestment portfolio and performance the teams invested a little over 350 million across 26 coinvestment since inception and the average check size per coinvestment is being about 15 million and the range per coinvestment is being 5 to 25 million. As i noted earlier, the portfolio is still relatively young with an average whole period of three years when five full exits since inception. So the portfolio is still developing. They need some time to mature and to continue to be built out. But overall, right now, the portfolio is currently performing and our goal is to build out the Coinvestment Program over time. But Fund Investing remains remains our top priority. So moving on to the last slide in this section now, i, id be interesting to share some of the recent observation weve seen from our coinvestment deal flow. And so you know lp demand for coinvestment remains robust and coinvestment have generally performed well for lps. We think the thesis around coinvestment remains intact, so low fees and lower carry, you know, leading to potentially potential outperformance versus primary fund commitments, you know, that said, coinvestment arent all upside there, theyre important considerations too, like the demands on Team Capacity and potential for a wider range of outcomes versus versus Fund Investments. Um whats what weve been seeing over time now as general partners in limited partners have continued to evolve their approach to coinvestment and theyve added dedicated resources and adding more dedicated resources in terms of the internal teams to manage coinvestment deal flow. And were also seeing expanding use cases from general partners in terms of how theyre using coinvestment capital. So evaluating potential conflicts of interest is a key part of our Due Diligence process. When we evaluate coinvestment and then some of the things weve been seeing here today, some themes from the deal flow. Weve seen, you know, general partners have been more focused on fundamentals. So profitability and growth versus growth at all costs. Weve seen some thoughtful financing and transaction structures. So in the current exit environment, rather than selling majority stakes of businesses, general partners have opted to sell minority stakes of their businesses. Youve seen general partners structure their transactions so they dont need to reprice their debt in the current higher Interest Rate environment, theyre able to maintain their the Capital Structures where they had favorably priced debts prior to the rate increases. And in the deals that are getting done, were seeing more equity in those deals due to the higher high cost of debt and low amounts of leverage available. Theyre putting more, more equity into those deals. Um, and i mentioned earlier lp demand for coinvestment is being robust. However, the supply of coinvestment has slowed and that slowed in line with the slowdown in private equity deal flow. And there are a couple of contributing factors to that. Uh, one of them is the persistence of the valuation gap between sellers and buyers on the seller side, especially sellers who have high quality assets. They might be able to hold on to those assets, continue to compound the growth in those assets and dont feel pressured to sell into the current exit environment. And then on the bias side, you know, with a higher cost of debt and lower leverage levels available, it makes it more difficult for buyers to stretch to the valuations that sellers are still demanding. So were still seeing that that valuation gap and thats thats causing a slow in deal flow. That said, is optimistic about their future pipelines. They feel like theres pent up supply of deals in the market and they feel like gps and lps will require liquidity at some point. And so theyre optimistic about about the future opportunity set there. So that wraps up the coinvestment section. Im going to im going to wrap up the staff portion of our presentation now by talking about our 2022 and 2023 initiatives, 2022 initiatives. I think the takeaway from this slide is that private equity being a long term asset class, as a lot of our initiatives are ongoing and multiyear initiatives. That said, weve made progress on on several of these initiatives in 2022. You know, tanya mentioned earlier a blue joining the team. Were pleased to welcome lou. So we were able to successfully recruit and add resources there. We continue to build out our buyout exposure and an important one for this year is the deployment of our new crm system. You know, this isnt just important for the private equity team. I think this is important for the broader first team and will help us to continue to institute, analyze our internal data and knowledge and investment process. So its something weve been focused on and are working on, including it in our in our workflows and then collaboration with other Asset Classes is an ongoing initiative and an example of how weve done that is, is how weve incorporated an esg review in all of our private equity reviews, private equity underwriting, um, moving on, moving on to the 2023 initiatives now, um, i think the 2023 initiatives are similar to the 2022 initiatives and that is focused on consistent deployment and investment pacing as well as thoughtful portfolio construction. Some of the specific initiatives were were focused on is continuing to build out a pipeline and buyout coinvestment and next generation managers, as well as continuing to monitor existing exposures and then of course continue to collaborate with with other assets plus teams remains an important goal for us. And so that concludes the off portion of the presentation. Um maybe we pause for questions after cambridge presents latest. Thats okay with everyone. Um, so let me let me pass it on to anita now to, to present for cambridge. Thanks rishi. Well, good afternoon commissioners its a pleasure to be back here in person today. And on behalf of the rest of my cambridge teammates, id like to thank you and staff for our partnership over the last nine years. I have some prepared remarks today in which ill provide a review of the private equity market for the last year and then talk about our outlook in the current environment and where we are focusing our efforts for the retirement system. Well reserve some time for q a at the end, but please feel free to interrupt me and ask questions as im talking through my presentation. The headline is after a few record breaking years, private equity started to slow down in 2022 in terms of performance, fundraising, investment activity, exit activity, especially as we entered into the second half of the year. And this this slowdown has extended through 2023 with the backdrop of higher Interest Rates. Recession fears lingering inflation concerns challenged ipo and exit markets, geopolitical risks and so on. Its no surprise that gpus are experience being a tougher environment. As tanya noted, hers is over target and private equity today, and this is largely due to the significant outperformance of the private Equity Program over Public Markets in recent years. The p e allocation is now at 30 and we are still above our target of 23, but down from the high we reached of 33 in a volatile. 2022 series p portfolio provided some volatility dampening benefits to the overall pool performance. This p program was down 12. 4 for the year, compared with down 15. 8 for the benchmark, which already incorporates a 300 basis point illiquidity premium. The retirement system was productive and flexible in the uncertain market last year. Target pace of 1. 2 1. 3 billion for the year. But maintain flexibility and ultimately closed on just shy of a billion with this lower commitment amount, the team still worked hard for it. We were able to add five new managers to the direct program, which emphasized some of the strategic areas we have been looking to add to for the program, like buyouts, health care and europe. Despite the more difficult environment, we continue to have High Conviction in private equity as a long term driver of portfolio returns and well discuss some of our current outlook. Its important to remember in times like these that private equity commitments in vintages, years during and coming out of a downturn generally have performed well. And the key is having a well constructed and diversified program with best in class managers that are able to navigate the uncertainty. And on this point, we believe spurs is well positioned with its current portfolio and initiatives in terms of commitment pacing, we reran our models and recommend a 1. 2 billion target annual pace for the next few years for the program. But we continue to emphasize maintaining flexibility and being guided more so by the attractiveness of opportunities in the market on the next several pages, we can see more clearly the slowdown in the industry. On this slide, you see that global fundraising in recent years has been really robust. The first half of 2022 remain strong, but it fell sharply in the second half, which continues through 2023. Similarly investment activity began at slowdown in the back half of 2022. Here we see the exit markets, the ipo market on the left side of the page shut down in 2022. You can see that that sharp drop off and m a on the right side of the page has come down significantly as well. We should be prepared for longer, hold periods and slower distribute options to lps as a result, we think m a will pick up more quickly as valuations reset and were already starting to see some ipo filings, but its still really challenged and the fall off in distributions to lps, those resulted in a liquidity crunch for many lps that rely on distributions to reinvest back into their private programs, thereby leading to the slower fundraising environment. Moving to this slide, we expected, as we expected, we saw private valuations correct somewhat in 2022 managers with large, unrealized public portfolios and late stage venture have been hit. The hardest. The s p 500, as denoted in the gray line here, had a peak to trough return of down 24. Here we see that us Venture Capital and us private equity have come down from its 2021 peaks to reflect some of that Public Market sell off us private equity here for us refers to us buyouts and the us in green which ran up the fastest in recent years, was down 21 in 2022. Us buyouts in blue was down a more mild 4. I should note that we have had three really strong quarters recently in the Public Markets. The s p is now down just 8 from its peak. Historically, private investments typically recover more slowly than publics in periods of rebound. And we saw this in during the tech wreck or after the tech wreck and the gfc. So in other words 2023 private numbers will likely lag Public Market returns. And we shouldnt be surprised if that happens. Its the valuation lag and a short term effect, but in the long term, private still outperform. On page eight here. Well i guess there are no page numbers on this page. We have another view of the start of the valuation reset. This valuation, this this slide breaks out venture and buyout returns by vintage. You and it shows returns as of december 2021 compared with returns as of december 2022. Venture in green on the right is down the most and then you see that the more recent vintages across private equity and Venture Capital are hit. The hardest, i. E. Those would have had more investments in the frothy year 2020 to 2021 timeframe. But looking to the long term, we continue to expect private investments to be a strong contributor of returns here you see the longer, longer term returns on the left side of the page and across buyouts, growth, equity and venture. The returns are in the midteens. Thats probably really but that is still very good and provides an attractive premium to the Public Markets. The next two slides show that private equity vintages during and coming out of downturns have performed well and generally generally better. The point is we want to emphasize the importance of staying the course with the privates program, if you can, and continuing to make investments during tougher times like today. This slide shows the buyout vintages and this this slide shows venture and weve boxed out the time period during the recovery after the gfc. On this slide, we see that in periods of significant market volatility, privates have historically been less volatile than Public Markets. In other words, providing volatility dampening benefits for the overall portfolio, which is what serves experienced last year. Looking at your specific performance, your private Equity Program has steadily outperformed your policy benchmark and our cambridge private benchmark and consistently ranks in the top ten of pension plan. Private equity returns in the latest American Investment council private equity report. The retirement system is once again on the top ten list of private equity performance for public pensions. Spurs boasts the rarefied accomplishment of being on the list nine nine out of 11 times that the aic has published a report. On this slide. We share data that breaks out the return multiple years of realized investments that weve tracked over the last 21 years. You can see that growth is a big driver of returns. The higher the Revenue Growth of an investment, the more likelihood of an outsized return. And you see that on the on the right hand side Going Forward, we think gps will need to continue to focus on driving growth in the Portfolio Companies. But theyll also need to focus on improving margins and operations as well. As rishi said, its no longer growth at any cost. We need to or gps need to find sustainable profitable growth paths for their their Portfolio Companies. And finally, ive said multiple times that we believe private equity continues to have the ability to outperform public and here are some additional metrics to show why you can see that in terms of entry valuations denoted by ebitda, pm or Purchase Price multiples all the way on the left here. That entry valuation lines are more attractive than Public Markets and weve compared that with the msci world index and also the growth rates for Revenue Growth and ebitda growth. Thats more attractive as well and leading to the outperformance all the way on the right in terms of actual returns that have been generated for the private Equity Investments as opposed to the public indices. I have in the in the appendix, some highlighted some observations of this first portfolio that i wont walk through, but just wanted to summarize that. In short, we think the portfolio is well positioned with a strong roster of manager relationships. We remain comfortable with the tilts to asia. Venture growth and technology, but recommend added focus in in complementing the program in other areas, which is an effort that we already began in recent years. And we also have been working on rebalancing underweight areas where appropriate such as buyouts, health care in europe, with that, let me turn it back to tanya and team and open it up for any questions for us as our staff. Thank you. Just open up for questions. Okay excellent report. Does anybody have any questions . I have a few, but lets open it up to the rest of the board and questions. Yeah. No particular order, but ill do it backwards. And images. Pages are not numbered the way i have them. But anyway, the return assumptions Going Forward, 12 irr for buyouts, 13 for Venture Capital. What is the assumption for the s p or the benchmark that were using, which is 75 to 25 well, this these assumptions i think youre referring from our pacing model. We included this in the appendix as well. This is for the Long Term Return assumptions thats used in the pacing model. Does not account for. Theres no input in terms of s p and for global equity, though, for the 25 year return, our estimate is, ana, correct me if im wrong, in terms of the Capital Markets assumptions, is. 7. 2. Yeah 7. 2. So our for global equity, our benchmark plus 300 falls within this or this is exceeds that, which is good. Okay. Thank you. And this 12 and 13 is does not assume any alpha right now it all. Thank you on. Page 28 of the staffs presentation on the 11 private exposure that 11. How much of it is under your discretion versus the discretion it was in portfolios. We still nothing with no exposure . No discretion from staff. Okay i see. This case goes back to cambridge statement. Fine that you were number eight in some sort of universe. Right. Okay. I prefer to ignore peer any kind of peer group comparison, but in this obviously good numbers. But my question is, is what is the spread between number eight and number one in the aic report . Um, you can make a wild guess because ill tell you what, the points really going to be because we look at those floating bar charts all the time , top quartile and theyre not spaced evenly basis points. Um because i think weve come to a conclusion we dont, we cant do this for the average. Okay. My question is if someones ahead of us, thats fine. Whoever they are, i think this is our why are they there . Are they better stock picking up stock . But are they doing something . Implies theyre doing Something Different or better. Its a ten year number, so it looks like theres some persistence. There wasnt just a one lucky kind of bet. So thats what im trying to drive at. Thats why i like to look at what are the endowments doing . Because when it comes to investing, we are the same as him. Therefore, what are they doing . Can we do it . Some things they can do we cant do. Thats fine, let alone the issue of then hiring better people. Meaning city hall. Please give us more salary and more people. Why because we can do better if you let us if youll support us. So thats why i asked that question, if i may. Commissioner driscoll, and i know you know this as well as anyone when we think about us relative to peers or if were delivering performance is absolutely important. But performance in the context of risk in other metrics are also important. And to use a very simple analogy, if a car is driving at 40 miles an hour, sure, its beating the 20 mile per hour car. But if it doesnt have brakes, thats a problem. And we want to make sure that we think about our performance relative to peers and where there are levers that we can successfully pull to enhance performance thats in private equity in any asset class. But make sure we do so in a way that meets what were trying to deliver in terms of return and risk over the long term. Our risk tolerance may be different than other good institutional investors. Our liquidity needs may be different. Therefore, theres things we can and cannot do while were still trying to be wise, but not to fool around with your analogy. But the woman who got arrested yesterday for driving at 100 miles an hour into a wall, shes the one who survived, not the two passengers. And thats a kind of a silly analogy, but when i see someone else is doing better, she doesnt quite know how or why did they do that . Can we do it or not again . And it may come back to our Asset Allocation mix because we have a higher weight to buy out, which is fine, but thats the safer group. We want a higher probability of that return as opposed to the Venture Capital group, which we do a lot of. So thanks for the numbers. Thanks for reports. Thanks for the good carrying on. The reason i asked about the liquidity premium is the alpha is above the liquidity premium. Thats the number i look at that really you guys get credit for achieving that. Thank you. But listen, thank you. First, i want to say thank you for the presentation and also just similar to our last meeting when we discussed private credit, one of the things that hes done has just been spectacular performance. Looking back over the last few years to the point where now were relying on you all to be really good because youre carrying a big load of the of the performance of the entire fund in that growth. And then additionally, when we see the denominator effect and how it impacts your strategy, one of the things we discussed last time was balancing that need against liquidity needs of the fund as well. So you mentioned that and i appreciate in your presentation how youve been able to produce while also not having an impact negative on liquidity and that you actually are optimistic Going Forward when it comes to liquidity, were where i wanted to just kind of get an idea on is where would that that opportunity come from, where were not impacting our liquidity, it would seem like youd need to be able to reinvest more funds in that. And when i looked at sort of the change over time, it looked like there was several different areas that you were trying to reallocate. And one of them in particular was geographic. So to get to kind of the meat of the question that im looking at is, are there risk concerns you have about this sort of pivot . Does it increase the risk that we have where youre able to invest with less capital or in a way that doesnt sorry, im fumbling the words, but where youre not impacting our liquidity, but youre able to still produce the sort of returns that the fund needs, the last impact on liquidity is because the private Equity Program is Mature Program because what happens with a young program, youre investing contributing capital over the like five, seven years and there are no distribution lines, right . And that you become cash flow negative at the beginning. But then when the program hits like seven, ten years and above , then distributions start coming in and a successful program, well measured, well managed program can be selffunding over time if were not making any big changes to the program. Thats what i meant. Its not because we did anything special. Its just the time function that the portfolio has matured and essentially selffunding itself. If for example, the board was to increase allocation significantly, then we would go again into the jv curve and the program will consume capital. But its normal Younger Program consumes capital more Mature Programs start spitting out cash. And then the focus on europe that you talked about, i assume that youre referring to the geographic focus thats not in addition to what were already doing. That is going to be a part of the current allocated. The current planned expenditure allocations Going Forward. So this is within the boundaries we built for ourselves. This is not in addition to what weve had planned on doing. Thank you. And im wondering if we could kind of talk a little bit more about that. I noticed that youd had under contributors and tractors, geography is one of the components and asia was there. Could you kind of unpack what you mean by asia pacific . Its big, broad region where are we really targeting with some of this investments and opportunities and are they any risk concerns that you have about investing in this area as compared to, say, europe or north america . Im sorry. So i think most of their exposure we have in asia pacific is through venture growth. A lot of that exposure is within china itself. Any time you look us, theres a higher risk profile, i guess you would call it that. If nothing else, Everything Else being even theres currency that needs to be taken into account. And then i think given whats happened over the last few years, i would say looking investing in china, risk profile is also changed a little bit and not in a positive way. So these considerations on the risk side are continual considerations. Were already looked at and reviewed them for every investment or every commitment we make outside of the us. So you know, you could say i would say that theres not necessarily more or less risk. I dont know if thats the way we necessarily think about it, but the risk youre taking on investing in asia pacific is going to be different than the risk youre taking on investing in europe and europe. Youre over generalization here, but likely to have currencies that are that could potentially be more stable , and especially if youre in developing asia, youre probably gonna have a little bit less stable currencies. Yeah, the trade major trade partners could be different for each of their relationship with the us, could be different for each. And importantly, the growth rate of each region is materially different, right . So these are all the availability of debt, etcetera, etcetera, etcetera. Right . So we try to build a profile of risk profile when we think about the risk construct of a potential commitment, we kind of built on the ground up based on, you know, the managers strategy, what theyre trying to accomplish, how they go about accomplishing that and the geography in which they play. And how that also layers on as well. So i hope that touches on some. Yeah, im on that same note when youre when were allocating funds in different regions is the distribution of sectors more or less the same. So like our europe exposure is in the same sort of sector distribution as in asia or china specifically, or probably not exactly the same. But i will say that the focus on technology and the focus on health care are themes we have globally. So thats not just within the us. Those are things areas were interested in, in asia or asia areas were interested in in europe as well. So i would expect that those two to probably be the foot forward from from an exposure point of view. If you will, you know, different regions as you will have to build conviction in exposures differently. What consumption looks like in the us will be different than what a consumption looks like in asia, which is going to look vastly different than what the consumption looks like in europe per se. So based on the differences between the geographies, the other subsectors that were interested in, well also change. And regarding. Oh, sorry, go ahead. I was going to add, you know, its the sort of top down thinking about it from a geographical standpoint, thats absolutely something we do. But we also acknowledge that weve got to do the bottom up evaluation of a fund of the sectors that theyre playing in. And i think being really targeted with that is becoming increasingly important now. And so it isnt sort of a view of, oh, were going to allocate to this region, its a view of, hey , heres a portfolio construction that could make sense for us. Are they investment opportunities, bottom up that are attractive enough for us to build, build up that exposure . So its sort of a combination of the top down and bottom up. And would you say, well, how how does Due Diligence differ . So, you know, obviously with covid and the challenge and travel and all, and then going into these markets that maybe we didnt have as much exposure to before, can you describe sort of what that Due Diligence process is when youre proving up these investments . So one of the things were fortunate with having a fairly Consistent Team thats been around for a long time, its unlikely that were committing to a manager that weve never met before, even during covid times, you know, there would be, you know, tonyas been in this role for a long period of time, so she knows the market in asia and europe adventure and b very, very well. So having those long standing connections in ties helps go a long way. But then the complexities during covid were probably not all that much different. And within the if we couldnt meet someone even in San Francisco in person, you know, so that, you know, you have to do a lot over video the zoom etcetera. Yeah the amount of desktop work, the preparation and work we do into it, the cutting, the reviewing data, cutting data, you know, understanding that understanding portfolio fit, understanding sector fit, thats the same. Yeah so that parts fairly consistent, but trying to figure out how do you build the same level of conviction when youre video call is what youre able to do in person was a key part of it. And then i would say that the increasing the number of reference calls ended up being important there to try to kind of build out the qualitative aspect of a Due Diligence and also relying more on our partners who have presence in the ground in the region, whether its cambridge or some of our managers, you know, who we used as a resource. Absolutely. To beef up our diligence during that time. And that function is usually delegated to the managers. Our staff is not going, oh, we are absolutely going. Absolutely going. Yeah this is this is very much a this team here, including justin judd et cetera. ■need to have full conviction Going Forward. We need to do our work. We need to be comfortable. We are not going to give anyone else that authority or on behalf. And the team has been traveling extensive and the travel has picked up significantly this year and starting was the second half of last year. So the team has been on the road nonstop. Thank you. Notice the nods about the travel . I guess the expense has gone up. Mr. Yes, thank you. President helfand and just to piggyback on commissioner thomas questioning, we got regarding your ongoing evaluation of asia opportunities, how do you benchmark that against the current geopolitical landscape thats going on . Its a very tough question. I know, because the dynamic have changed quite a bit. What helped us right now, the fundraising has slowed down significantly in asia. So we have time to reevaluate as managers are coming back for ops, every manager is going to be evaluated, not based on what you manager did and your performance, but also does this strategy make sense in the current geopolitical environment . So yeah, its going to be tough. Re underwriting and thats why our team is going to be in asia several times this year to meet with everybody to see whats actually happening in the ground before making any conclusions. Right, because we dont want to make any any rash decisions and we want to do sort of re underwriting of the portfolio. Its one of the biggest projects we have this year, i would think so, given where we are absolutely. And if i could also add that there are really two levers to pull. We can make a decision whether to invest, for instance, in a asia manager and that asia manager most often is investing across countries. And they have on the ground knowledge and Decision Making capability to move within those opportunities. And they also are assessing geopolitical risk on behalf of us as a us investor. So theres a lot of ways to get at this question and mitigate and manage that risk. And thats a thats important. Its worth mitigating risk. Thats why i wanted to understand the ongoing evaluation of it. Great. And then i guess my second question is going into the esg platform, one of the things that ive witnessed and noticed over time with pe and a lot of the managers, youre focused. I mean, theres been an increase focus on esg, but theyre not quite there when it comes to building the internal platforms to really support their esg investing. So i wanted to get understand where you feel they are. Their focus is and is it something thats a priority when it comes to working with spurs and other Pension Plans . Or whats the update on that . Um, we definitely have seen a lot of progress across our larger private Equity Managers who have added dedicated resources would do was in our portfolio was a focus on smaller managers and venture perhaps those folks that need a little bit of a help, a little bit of a push and thats where our internal resources was. Andrew have been instrumental where he has been engaging with those folks directly and those folks have been reaching out for , you know, resources and programs. So its ongoing dialog and its the approach would take is a very pragmatic approach to that. And they understand the importance of it as they absolutely understand. Before we close any investor, once they see our esg policy, andrew meets with all of our managers to kind of not only to understand what theyre doing, but also so they understand what were doing in offer us as a resource to get help them get better. Thank you and thanks for a great report and update and congratulations on expanding your team. But maybe, maybe one quick thing on on on esg, just a data point that were seeing with some of our larger managers. You know, some of our larger managers, i think they started on esg in more of a defensive posture. Yeah, exactly. And some of them are pivoting now to looking at it more offensively, which is being, you know, a pleasing development because hopefully thatll thatll help to drive returns also. So and that was my concern with the whole sector. Thats exactly how they started. Exactly. Thank you. I have a simple question. You received 62 inbound opportunities and made one coinvestment in 19. In 2022. Right if you take a needle on one side, its your team has in their diligence has decided not to do it or the other side of the scale is that you werent didnt get the allotment and somewhere in between it just wasnt a good investment. Where would it fall . Um, i put maybe a third category in there of, of Team Capacity and timing to, to be able to, to, to, to execute and get the coinvestment across the line. So a lot of the coinvestment processes can be very quick, they can be sort of a four week turnaround to get from start to finish in a particular process. And you know, our team, were focusing on Fund Investing and investing. And so if a coinvestment comes up, you know, in the middle of us underwriting a fund , for example, its not its not as easy to underwrite and get that coinvestment from start to finish in four weeks. And particularly with, you know, sort of the schedules that we had to in order to take to the board, we really need to get a lot of our work done in the first couple of weeks and build conviction. And so id add that third, that third leg to it, which i think is an important piece. I think theres a portion of those Core Investments that just werent fit for us in terms of, you know, they might not have been in in companies that were profitable, which is a focus for us. And so the Company Might have been burning cash. So just not a fit for what were trying to achieve on the coinvestment side, some of those investments came from managers that we might not have been familiar with. And so we would not only need to underwrite the coinvestment in four weeks, we would have to underwrite that manager in four weeks and that can also be be challenging to do. So you know, there are various various reasons for it, but i think tight timelines and capacity is the other leg. Id add to your to use commissioner driscolls analogy about the woman who is driving so fast and the wall. You guys have a good breaks on the car. Yeah. Yeah yeah. Second second question. Ive always when i first came on the board and our previous cio, so went into the coinvestment space and the like and i was always sort of drawn back to the fact we wrote to small a check as the, as the world comes back to normal, hopefully what normal is , itll be redefined, but it will be a little more robust and whatever are you do you think its aspirational to say we should be playing with bigger dollars in these coinvestment spaces on the Lessons Learned weve learned today . Yeah, ill take a shot and then i should definitely jump in. So i think there are a couple of things. I think the size of the check can can, can be driven by the, the type of investment in the size of the manager and so some from some managers will hear that, hey, you know, this 15 to 25 million strike zone that you have, this is perfect for us because this is this is the size check we need. And then from other managers that might be sort of megacap, they might be looking for several hundred Million Dollars of coinvestment , which is which, you know, would be difficult for us to do and feel like we were adequately diversified. So the middle sorry, where do you think the middle is . If you were going to define what you just said . Yeah i have to. Whatever. Or 100. What . Yeah yeah, i know. So i think i think the several hundreds for us, i think its tricky. I think it comes back to , you know, if we, if we push into coinvestment what percentage of the private equity portfolio do we want that to be . And then you sort of backtrack that into pacing and we backtrack that into the number of deals that we want to do each year and we backtrack that into our Team Capacity to be able to execute. So i think, you know, the question around check size, i think it it would need to start first around, like how much of an allocation do we do . We want . How are we going to resource it . You know, and then back back into check size. So maybe not a satisfying answer. Well, perhaps to just take a step back and think big picture here. Weve got a great team who have all the capability to do the diligence that we need to make individual investments. What we are going to do over the course of the year is really sort of refine how were going to approach coinvest setting. The objective relative to the team that we have and the skills that that we have. So its not im not here to say were doing a 180 or making a big change, but as youve seen, as weve done in other Asset Classes, weve been very thoughtful about what are our objectives, where, where is our time best spent, wheres the return and risk for those types of investments and how do we want to approach it . So i say that because i dont want any of our team to be put on the spot and putting a stake in the ground on a size of a coinvest. We want to think about our approach holistically and that will then drive how big of a check size we maybe to tie that into what weve done historically, i could say weve been opportunistic historically with with regards to how weve approached investments. And were fortunate that seems to be working well so far and hopefully that continues. It would be great to be able to pivot where its more of a strategic piece of the overall portfolio. But as alison mentioned, theres a few a couple of boxes that need to be checked, a staffing problem that probably needs to get. Yeah buffed a little bit before it was on advocating, it was asking a question. Thats okay. And if i could just add the specific bite size. So looking at a coinvestment from our perspective, youd probably look at it in the context of a fund size bite. So if youre typically investing or committing, say, 100 million to a fund that invests in ten underlying companies, you know, bear in mind, a coinvestment is one company. So youve got concentration on risk and you want to build a basket of that. So would you be comfortable with 10 of a bite size or 20 . I think that theres some wiggle room in terms of flexibility and judgment there. But looking at the conviction in that specific coinvest, but managers, managers, managers, yeah. Yeah. I want to understand something that you said. You said normally youre given four weeks. Okay yes. Obviously 18 suggests why dont we do more of it. But i understand if the average coinvestment was 15 million, it takes just as much time, if not more so, to do a coinvestment Due Diligence recommendation as it does to do a 50 to 100 million fund recommendation. And you can argue which is more valuable, etcetera. But there is a time issue when theres i count five and a half people right now on the private equity. My point being was four weeks, not enough. Yeah. So yeah, it depends. Four weeks can can be can be tricky because four weeks, you know, it takes us time to do the initial Due Diligence. Well ill give you a sense of the process. Right. So first, we typically need to sign ndas and non reliance letters just to get access to information for the coinvestment. That process of lawyers going back and forth can take can eat a few days and then then well get access to the information. Well do a desktop review, the manager might schedule. Due diligence meetings , those Due Diligence meetings sometimes happen after when we need to submit board material to for a Board Meeting. And so, you know, in situations like that, were in a were in a difficult position because wed have to say is this worthwhile for us to call a special Board Meeting to try to try to execute on this coinvestment and then with Everything Else we have going on is this the right use of resources . So these are these are some of the challenges weve we faced trying to do this opportunistically. I think if there was if we were doing it programmatically, we you know, it it could be different. There are other plans that do it more programmatically. But based on how were set up to do it today. Yeah. And having one team execute Fund Investments and Co Investments for weeks is typically not been enough for us. Okay well then ill make the comment that in one sense you asked the question is it worth it . Because when you focus on an opportunity like that, its going to be disruptive when all the other work you guys plan your work, what, 1 or 2 years in advance, right . Non stop. So for all of a sudden an opportunity to come in, theres going to be an effect because theres a lot of other deadlines. Even for Fund Investing. I would say simply with the numbers on page 18 suggests its worth doing if you want to be an opportunity to invest your you have to think and act that way. Granted, bringing on the resources which means people and tools you edit a crm and maybe that was only on funds as opposed to the other tools that will help you even do that kind of Due Diligence on a deal. But it indicates to me it is worth doing. And ill say it this way it is worth calling the special meeting. And then we decided, cancel. We dont want to do it. You have to think parallel all the time. Much like the funds youve selected for us. Im sure they have to play broker deal fields. Excuse me . Broken deal fees. Not all the time, but they have to be there because they know its wise to pay the broken deal fee as opposed to just not doing it. So its the same kind of thinking we parallel those people. So im just supporting thats how we should do it Going Forward. As you develop your team and the tools to do more co investing with all the other Fund Investing. Thank you. Great. Okay just listening to the exchange, one of the things that came up a couple of times was capacity and i know that weve kind of been looking at the process and how much needs to be done before the board versus otherwise. But id like to hear from tony or allison more just with my Personnel Committee head on. If there is really a lot of room for additional staffing capacity on this team, if that would make a sizable impact on these sorts of investments. If we think that thats maybe a thing we should explore Going Forward. Thank you for that question. So we do have a new addition, as you know, to the team. Theres another position. Well, let me take a step back. So two years ago, there were seven investment positions in total approved. And i came in and i looked at and assess the needs across all the Asset Classes based on where we need to invest the money based on liquidity, based on all these things where to start allocating those resources. So weve been expanding the team and the newest additions in ps, one of those we are looking to make another addition. The process of hiring is long, long, but it is a priority and we will make that happen. We have in the budget two investment positions for this coming fiscal year and thats whats been approved. So we can take a look longer term. But for now i think its been a tremendous add with the board support to have those seven positions and we will continue to evaluate that is why, though, how we design the coinvest Program Based on time experience. Yes, trade offs is important. So we want to put parameter on that so we can be efficient and effective. Thank you. Okay so any further questions, comments. Its interesting that this started and like i said, its interesting. You started in 1987. I was going to ask joe, was that before or after the crash . Do you remember the inception of private equity . It was in 87. And ill tell you, there were Co Investments in the first fund of funds called crossroads. Oh, okay. See, i think you know that thats i was curious when i was preparing for the Board Meeting, i wanted a historical perspective. So i thought i would ask for context history. 19. Yeah. All right. Number in your head. Thank you. Okay thank you. Time on team. That was. That was excellent. Thank you. So great. And good example of bringing this report in because of the cancellation of the investment committee, we brought it on to the board. Thats the flexibility that will get us to the next step in this committee process. And so thank you. Um do you have a i believe we need to open it up to Public Comment. Yeah we will. Well open up to comments to discussion item pulling in Public Comment. We. Reminder to callers to press star three to be added to the queue. Moderator do we have any callers on the line . Madam secretary . We have no callers on the line. Thank you. Hearing no close Public Comment is now closed. Three call the next item. Item number 12 discussion item. Real assets annual update. All righty. Real assets before we go into the presentation, i wanted to highlight our team to my left, we have chris chow and chris rosenow, chris chow joined us almost eight years ago now as senior Portfolio Manager working on our real assets portfolio and was promoted to director. And in this capacity, chris oversees our real assets portfolio. Hes joined by chris tarzana. Chris joined us four and a half years ago as Investment Analyst and he was promoted to associate Portfolio Manager. So very happy to have him. Were going to go through very similar agenda. Our team will cover. Well give you highlights of what happened in 2021. Our performance tilts in the portfolio, our initiatives, and mark with cambridge will walk you through the markets and give you an overview of what happened in the real assets market in 2022. So unlike many other assets in the portfolio, real assets portfolio actually did well in 2022. Our portfolio returned 10 in 2022, we have three major sub strategies in the portfolio and Natural Resources led the way with 21 return followed by infrastructure. The newest addition to our portfolio and real estate, but also key sub strategies was in the portfolio, were positive, similar to private equity. Were over allocated to real assets versus our 10 target. Its partially driven by the fact that in 2022 the allocation to assets was decreased from 17 to 10. And at that time we told the board that its going to be a long process. We dont want to make any big cuts in the portfolio and were on a glide path to our 10 allocation and that it should take us maybe seven, maybe ten years. So thats in line with what were expecting. Plus you add the fantastic 2022 when the portfolio was up, when Everything Else was down, the team continued to commit capital. Our pacing is was almost. 600 million and we committed to 12 new investments. The majority of those were Real Estate Investments followed by infrastructure and while the majority of capital went into the existing portfolio, we also supported three new manager relationships. And this portfolio was cash flow positive and delivering 170 million in net distribution to the portfolio. Just to remind me, remind you the role of real assets is to provide diversification in total return in yield and also inflation protection. So our program is driven by the total return. Were targeting 10 to 12 over the long time cycle. And you know, the majority of that return will come through asset appreciation. There are three key strategies in the portfolio real estate, Natural Resources and infrastructure. You might recall that last year we updated our benchmark and added infrastructure as a new strategy to the portfolio, and the team has been doing a lot of work on that. And similar to private equity, its a global, very opportunistic program focused on private market funds and coinvestment and again, were emphasizing partnerships with high quality sponsors. The program started in 1978. At that time, were were largely for the majority of the program. It was a core Real Estate Program. And then more recently, maybe within the last ten years, we started to diversify into other assets and it became not just a Real Estate Program, but a real assets program. I already mentioned that our benchmark was revised in 2022 and we added the infra structure piece to the portfolio and thats just a graphical representation of the evolution of our program. So youll see that the majority for the majority of its history, it was a core Real Estate Program targeted in returning roughly 8. But come to 1000. I think 1314. This is when we added additional strategies such as value add, opportunistic real estate, Natural Resources, and more recently, over the last couple of years, infra structure. As far as highlights for 2022, again, we made 12 new investment across 11 managers. The majority of capital went to the existing portfolio, three new relationships, and we made, you know, 60,000,000in Core Investments. The portfolio pipeline for the year end looks really, really busy. And again, with a majority of capital going to the re ops. And then as far as new commitments that were made in 2022, the majority of them went into the real estate, followed by infrastructure, and then our approach to you know, managers were going after specialized managers, managers who have have expertise, who operate in special geographies or or, you know, can add value and you see it in our investments in dedicated strategies such as outdoor storage, self storage and data center assets, returns were a positive across all strategies, but again, very strongly driven by our exposure to Natural Resources that return over 20 to the portfolio. Um, i think thats it. On this slide i already mentioned some of the metrics that were slightly over allocated and we were cash flow positive last year as of the end of 2022, we have roughly 5 billion in nav, an additional 2 billion in unfunded commitments. With that, im going to turn over to chris to walk you through performance highlights of the portfolio. Thank thank you, tanya. Um, so yeah, starting off on, on page 12, this shows overall market returns for the year. You can see it was a mixed year for public real assets. In light blue is Natural Resources, which had a very strong year and opposite of that is in dark blue is real estate which struggled as Interest Rates increased over the over the year on the very right as infrastructure which you cant really see because it was flat for 2022. And on page 13 this dials in on the real estate return since thats the bulk of our exposure and its showing 2022 reit performance in blue and then 2023 performance in green, which is through june. So clearly 2022 is a difficult year for every asset class or every asset type. Nothing was exempt really from the impacts of rising rates, but weve seen a bit of a rebound thus far in 2023. Theres a lot more variation in that depending on the asset type, you can see, particularly for office, its continued to struggle so far this year. While those have rebounded a little bit. And in the bottom row, you can see where source has dedicated exposure. Thats through closed end funds, not through reits. But just to provide some insight , you can see where we have exposure and how some of those sectors have started to rebound. Page 14 so this is showing performance of the real assets portfolio overall. You can see in the one year time period the portfolio underperformed the policy benchmark, but its in line for the three year time period and shows considerable outperformance for the longer term time periods. So regarding the one year time frame, its likely a function of two things. First, currency effects were not favorable in 2022. So our investments were negatively negatively impacted by the Currency Movement. And another driver was a higher exposure to core real estate. And our benchmark than in our actual portfolio and core real estate performed very well in the first half of 2022, which pushed our benchmark higher. I will come back to that point in a little bit. So ill touch on that a little bit later on page 15, you can see how the real assets portfolio has performed relative to overall plan returns. Clearly a challenging year in 2022, but real assets helped offset that and in addition has also been a contributor over a longer time periods. And on page 16, we also looked at real assets Portfolio Performance relative to us, cpi over the same time periods, you can see that performance has outpaced inflation over every time period, even as it began ramping up over the last year. So here were breaking down performance by each of the major sub strategies. So the bottom half of the page shows Natural Resources on the left and infrastructure on the right. Both of those sub strategies outperform the respective benchmarks over every time period and had a fairly Strong Performance in 2022. On the top right is real estate, which also shows outperformance over the long longer time periods but slight underperformance in the one and through your time periods. We do have greater exposure to europe and apac markets relative to the benchmark there. And so again, Currency Movement impact returns over the shorter term time periods. Page 18 is illustrating the return attribution based on each of the major sub strategies. So the chart on the left shows quarterly breakdown in terms of gains and losses and then the chart on the right just showing the total for 2022. So in the quarterly chart you can see the year started off fairly strong. However, real estate begins to pivot in the Second Quarter. By the third quarter, you know, were seeing more losses than gains from the real estate portfolio offsetting that, though, is the Natural Resources portfolio, which produced a gain in every single quarter of 2022. So the result is that over 70 of the gains within real assets last year returned by the Natural Resources portfolio. Even though its only about a third of the portfolio. From a nab perspective. And here on page 19, this is going back to the point earlier that that i mentioned about the underperformance over the one year time period. So we just wanted to point out that that the lag is mostly driven by our high exposure to core real estate and our benchmark, but that benchmark was changed in the middle of last year and that took effect on july one, 2022. So prior to the change, the policy benchmark for real real estate was the odyssey index. That is 100 core real estate. But the actual composition within our real estate portfolio was only about one third core, which you can see in the middle bar graph and the middle bar chart there. So when core real estate had a very strong start to 2022, the benchmark fully captured that performance. But our portfolio didnt give in. Its mostly non core real estate. Then the benchmark shifted and that took effect on july first. So from that point on, the weights in our benchmark are floating so that the core non core weights will match our actual portfolio exposure. But of course after that point last year, market shifted in real real estate performance was negative in the second half of the year. So not much of an opportunity to for our portfolio to bounce back relative to the benchmark. But the point being essentially the underperformance in the one year time frame is driven by the core real estate exposure, said being substantially higher in our benchmark compared to our actual portfolio in the first half of 2022. On page 20 here, this is an overview of our coinvestment portfolio. You can see performance is flat at this point to highlight the major points here. So we had two new Co Investments that were made in 2022, both within real estate and a vast majority of that Capital Focus on maintaining exposure in the industrial space. There have been a few realizations at this point within our coinvestment portfolio, but offsetting some of that, those positive investments was material negative impact from one specific sponsor in in the conventional energy sector. And at this point, though, the active portfolio is relatively young and all of the more recent investments have been in real estate or infrastructure or Infrastructure Communications and Digital Infrastructure. So we think were better positioned Going Forward in terms of coinvestment performance. And then finally, page 21, so this chart is just depicting quarterly gains and losses and it goes through the First Quarter of 2023. So you can see obviously 2021 was a very strong year, but that started to reverse in the Second Quarter of 2022. And while the net gain loss was positive throughout all last year, we have dipped into negative territory in the First Quarter of 2023. So that concludes performance. Ill hand it off to chris to review the exposures and construction. Thanks, chris. So now on this slide, ill talk about our portfolio construction. This has a lot of text and well talk about some of these bullet points and succeeding slide. So ill just hit a few points. One, real estate is our largest exposure and will still be our large exposure. Real estate is fairly mature. It has a global opportunity set relative to, say, Natural Resources or infrastructure for our real estate portfolio. We do intend and continue to have a diversified portfolio as relates to property types, we do have a global portfolio, although ill note that over the past couple of years and over the near term it will be more domestic and focus on Natural Resources, which is our second largest exposure given the current nav and changing our Asset Allocation target back in 2020. And the change to our long term benchmarks, which reduces Natural Resources, we do expect this to decrease over time. And on infrastructure, its our latest addition from a sub composite perspective. Were building from a low base, but we are growing that quite meaningfully on the next page is a illustration of our portfolio evolution by strategy. As you mentioned, historically, we were really a core us Real Estate Program, but about a decade ago that shifted to become a global real assets portfolio. So as you see in the illustration, Natural Resources in blue has been increasing over time as it relates to infrastructure. We formally adopted it last year, hence the 10 allocation or the 10. Thats right, allocation in blue. Ill just note that we have been investing in infrastructure for a period of time. And so in the details, it does break out the infrastructure which was historically classified as either a real estate or Natural Resources. Just given our long term benchmarks and where we are today, we do expect to continue to focus on real estate and infrastructure on the next page is an evolution of our portfolio by geography. We do maintain a Global Program and it has increased in a nationally over this time period. Most of the exposure internationally is focused in our Real Estate Program. As i mentioned, given our focus more domestically, we do expect this trend of us exposure to moderate this. We will now take a deeper dive into the three different set portfolios with this one being focused on real estate. This is a busy slide, so ill walk through by quadrant. So starting at the top right, this is a depiction of our exposure by risk profile. Weve talked about and noted that our exposure to core will decline or has been declining over time. Hence and have weve increased our exposure or investments to noncore meaning value add and our Opportunistic Fund strategies. We do expect core to continue to decline as we were active on the value add side of things. Just directly below is a depiction of our property type exposure. We do maintain a diversified portfolio, as is evidenced by this illustration. We do intend to increase our exposure to the industrial and Residential Markets Going Forward and then just directly to the left is our exposure by geographies. We are overweight to us, both europe and asia pacific compared to, say, the Cambridge Associates benchmark. And we do expect this trend to moderate. This slide is talking about our Real Estate Office exposure. Purely Real Estate Office is topical these days. There has been value destruction to varying degrees depending on Building Quality and location. There have also been structural headwinds for office precovid and additionally postcovid with the work from home phenomenon. Ill make a couple of notes in our Office Exposure. One half of our exposure is outside the us through either our work from home trends most prominently, say in the uk and australia, but we think internationally is probably less severely impacted as, say, the us and the second over two thirds of our exposure is in core properties, meaning they are currently well leased and generating cash flow. So office as a whole does remain on watch. Were not necessarily looking to add Office Exposure or be contrarian, although im sure there will be opportunities that our funds will target for our portfolio. This slide breaks down our Natural Resources and infrastructure exposures just on the left for Natural Resources. We do have a overweight towards metals and mining and have had so for a period of time with the rest of the exposure being diversified generally across conventional energy, on the right is our infrastructure portfolio. Unfortunately, there isnt a great breakdown of benchmark from Cambridge Associates by sectors or sub strategies. Ill note that we are looking to diversify our infrastructure program, which is so relatively nascent right now. We do have a heavy allocation towards communications, Digital Infrastructure, hence the exposure you see for towers and fiber. And then we are looking to be active on the Energy Transition side and broader sustainability sectors. So you see at the bottom the 21. We do expect that to grow over time. Moving to the next slide on annual deployment pace, one of our goals and beliefs is to have consistent vintage year deployment so as not to time the markets. With the exception of 2020, which was due to covid and the change in our Asset Allocation mix from 17 to 10, weve generally been in the 500 to 600 million range over the past couple of years. Year to date, weve closed 125 million and we expect to end up end the year at around 500 to 600 as well. So the teams committing roughly 10 to 12 commitments per year. This next slide, i think its new than what weve relayed or had before, although we have relayed some of these same messages and themes previously. The team is always evaluating different strategies and markets from a top down perspective to balance our bottoms up and investment analysis. The trends dont train, trends dont change too much from year to year to much of our focus remains from the prior years. Ill note that there is a greater action ability in special situations or structured solutions since covid, a lot of it is dealing with the rapid rise in the Interest Rate environment. We will be focused mostly on real estate and infrastructure for our portfolio, given our current underweight. Tanya did talk about our Portfolio Cash flow a bit as as our portfolio is maturing and with the reduced Asset Allocation targets, there is a greater chance for positive net cash flow for the past four years, starting in 2019, at 2020, we have seen positive net cash flow for the portfolio. I will note that for 2023 year date, our current exposure is negative to the tune of around 100 million. The drop in real estate and just broader real assets transaction activity is having an impact. Hence why we are negative cash flow for the moment. The next couple of slides well talk about our initiatives. First, with 2022 recap and then on 2023 for this slide, i wont go through all of the different initiatives in general. We have been looking to diversify our portfolio with new complementary exposures as well as maintain an integer commitment. So well continue to collaborate across asset class teams at spurs, which then leads me to my next slide on esg collaboration. Esg is integral to our investment Due Diligence process, as well as monitoring. So for the 12 commitments we made in 2022, we did have an esg review and andrew and tim have been super helpful in that regard. On 2023 initiative on the following slide, this first slide is focused on our portfolio construction portfolio construction goals, and the second will be focused on investment process and internal strategy and planning for some of our portfolio goals. The 2023 initiatives are large. We continuation of 2022 as a portfolio is maturing. Given a team, a dedicated team of two, we do want to be intentional. So as far as who and what we commit to and part of that deals will relate to, were expecting 100 of our 2023 calendar to be focused on existing managers. The next slide for is some internal processes. As the private equity team mentioned, we have been implementing a crm system to help manage our relationships and Due Diligence process. On the second one, currently where its dedicated team of two with the current budget, we do expect to recruit and hire a third dedicated professional at the io level. So we do expect a posting out later this fall through recurring internal discussion and collaboration, were continuously learning from past mistakes taking postmortems and staying on top of manager and market trends. This now concludes the asset teams prepared remarks. With us is Mark Cardillo of Cambridge Associates, who will now talk, who will now talk about the market environment before broader q a. Thank you, chris, and good afternoon, commissioners. Ill provide a high level overview and outlook of the real asset Asset Classes , beginning with real estate. I think in an effort to keep my comments more efficient, im not necessarily planning to go slide by slide, but everything that i discussed will be in the slide deck. So beginning with real estate, commercial real estate has been a strong asset class really since the Global Financial crisis up until 2022. And this was largely, you know, that solid progress had largely been negatively impacted by by rising Interest Rates, real estate delivered asset class, higher financing costs will will naturally lead to a decline in valuation patterns. But a key point i want to mention is that that and this may be obvious, but but we shouldnt think of real estate commercial real estate as one homogenous asset class. But its more nuanced than that. And i think the context for that is that i think when you read a lot of headlines about commercial real estate and distressed real estate, those articles inevitably immediately talk about the Office Sector for good reasons. Theres distress in the Office Sector and therell be a lot more distress in the Office Sector. But those articles dont always mention other sectors that are that are from a fundamental perspective, doing a lot better. Not to say that they wont have, you know, be impacted negatively on the valuation side, given the rise in Interest Rates. But again, i just think sometimes just looking at those headlines can be a little bit misleading. And so these are sectors like industrial and residential where where service has been growing exposure. Industrial has obviously been affected from the continued growth in ecommerce. More recently benefiting from ensuring and reshoring trends as more manufacturing grows moves back to the us. And so you see occupancy excuse me, vacancy rates that are still midsingle digits in the us and europe. Similarly, the apartment sector itself storage, these are areas where in 2022 you are seeing increases in supply and that is having an impact on occupancy rates. To a lesser degree, youre seeing the impact more on on rental rates declining from pretty robust levels over the past 4 or 5 years. And youre starting to see concessions in certain markets where theyre giving a free month or two of rent. But but to the extent theres a positive aspect of rising rates and the pullback in financing the new construction starts across most sectors has has really ground to a halt in this environment. And so we think that that this period of oversupply will be temporary and therell be a period of time where where owners will will experience an uptick in occupancy, lower rental rates than maybe they were projecting. But but given what we already see with construction starts, we think thatll be fairly short lived, particularly when you think about the apartment sector. Theres still a shortage of housing in the us. The demographics still support new household formation and again, rising rates make homeownership more challenging for a lot of folks and may will push a lot of people towards towards apartment. And so again, longer term industrial residential, these are sectors that that we still think, you know make a lot of sense to be active with. And you know, therell be some short term pain no doubt. But but but nothing like youre seeing in the Office Sector. Similarly hotels, as anybody thats traveled, has probably been horrified at how much theyre paying for a hotel room, given the hotel that they may have stayed in five years ago. And so leisure Oriented Hotels are doing you know, when you look at what theyre doing relative to precovid 2019, theyre theyre way ahead of, you know, where they where they had been. Business Oriented Hotels struggling a little bit more, but starting to recover. And then similarly, even the Retail Sector where where the plan doesnt have that much exposure , you have seen certain sectors really thrive. The open air retail is doing really well. Community, retail is, in a weird way, benefiting from the work, from home dynamics that are impacting the Office Sector as people are just in those communities. More and taking advantage of the retail and the restaurants. Clearly the class b and the class c malls are dead and not coming back. And thats thats probably a good analogy for whats whats happening and what will happen in the Office Sector, which is also bifurcated. We have a an exhibit in the materials that show just the vast the disproportion amount of leasing thats going towards the Newest Office buildings which have the, you know, the best amenities in the layouts. The tenants are looking for. And so those, you know, therell be work from home is still, you know, impacting all Office Sectors although maybe thats starting to change. Youre certainly seeing more and more tenants. I should say more, more companies. You know, more ceos encouraging or demanding their employees come back to the office a little more frequently as chris noted, work from home is more of a us phenomenon than you see in asia or europe. And so the office occupancies excuse me, Office Vacancy in europe and asia are midsingle digits in a lot of places. And so again, i think the portfolio, as chris noted, that Office Component of the portfolio is largely in the better quality assets. Its the bnc assets that will struggle and therell be a portion of b Office Assets that will get perhaps become converted to residential. But i think thats going to happen in a in a small amount of cases just because it is challenging to make those conversions work just given the layouts of the Office Sector and i think in a lot of cases the economics require a subsidy from the municipality to justify the transition to residential. So for a lot of back Office Assets, they will struggle and there will be certainly distress there. But so i would say in 2022, you probably seen values as measured by cap rates, which are the initial yields on these assets of backed up by, you know, 75 to 100 basis points, perhaps more for certain sectors like industrial where which had had really seen a compression incorporates and then thats impact on valuations was further exacerbated by the banking crisis earlier this year and the pullback. And in debt availability from a lot of lenders. And so as a result, transaction volumes are down significantly in 2023. Sellers dont want to sell unless they absolutely have to. And so one impact of that is theres been a were not necessarily seeing that those those lower valuations. Its taking a while for those to be reflected in in private, private the private valuations in our in our benchmarks and in in the manager of portfolios. So well see the impact of those valuation declines. You know, continue to be impacted over the next few quarters. Id say that conversely, its a tough market for to be an asset owner that will create what we think will be a pretty good vintage year for real estate in 2024. And 2025. And again, i think while there will be certainly will be distress in certain sectors, areas like industrial and residential areas that the plan has been active and will likely continue to be active. Youll certainly see some distress there. But were not expecting widespread distress. I would describe it as maybe, you know, more likely opportunities to get exposure to Asset Classes, properties at a at a more attractive valuation, a better yields and an underwriting that doesnt require especially heroic assumptions to get to the target returns perhaps you know transitioning to the Infrastructure Sector where id say the story is a little bit more positive as chris mentioned, Renewable Energy, Digital Infrastructure. So think of things like cell towers and data centers still have huge tailwinds, huge Capital Requirements over the next few decades. And as a result, valuations in the Infrastructure Sector have remained pretty strong. Renewable Energy Assets in particular have benefited in a lot of cases from specific contractual linkages to inflation that that that flow right to the revenues. Theres a green premium now for, for renewable assets. So you know, think of a generating asset that has a given amount of megawatts. A buyer would pay more for a renewed generating asset than they would for the same megawatts thats powered by natural gas and then lastly, the Inflation Reduction Act in the us will be a pretty meaningful opportunity and have a meaningful impact on the Infrastructure Sector as as more renewable projects will be funded, thatll create opportunities for developers but also Service Providers and suppliers to the renewable sector. Similarly, within the Digital Infrastructure space, huge tailwinds driven by the growth in technology in all aspects of our lives and most recently ai is, is having a Material Impact or well have a Material Impact on the on the need for data centers. Thats which was a sector that you were starting to see some concerns around new supply. But but those dynamics have completely changed not a sector were expecting to see much distress, if anything, maybe were concerned about valuations in some of these sectors that are that are that are receiving a lot of capital. And id say those concerns are largely on the core lower risk return. And so think of a fully built out wind farm or solar farm where those properties are probably trading at levels that imply a midsingle digits rate of return for the buyer. We think the better opportunity is more on the value added segment of the market, which requires development, which which, you know, has its own risks. Obviously but can be mitigated through, through picking, picking the right gps. And then we also like Energy Transition plays. You may recall we, we made a commitment to a few months ago, but you know, a way to benefit from these trends and the development thats taking place. But but, but you know, sort of supplying the picks and shovels, so to speak, to use that analogy. And benefiting from those megatrends without and hopefully a better a better return. And as we look forward to the next even six months in terms of whats on the commitment calendar, were weve got new commitments lined up for most likely funds focused on, again, data center cell towers abroad, Renewable Energy place. So continuing to grow that part of the portfolio. Just quickly on Natural Resources, since thats a declining part of the portfolio, but its still meaningful today. And the reason its declining is because its largely fossil fuel related energy investments. As much as wed like to find timber and agriculture investments, its hard to find those opportunities that meet the plans, return profile. And so the good news here is given that its still a meaningful segment of the rail assets portfolio, is that fundamentals are decent. Oil prices have largely traded between 60 and 80 a barrel over the past year, and thats a level that allows producers to make a good return. It leads to activity in the field that benefits the Service Providers. And those prices will fluctuate based on expectations around recession, economic growth. And so weve been pushing more towards the 80 level. Is the timing of a recession or the severity of it gets pushed out. Similarly, the Industrial Metals will be impacted by those economic expectations, but you know, the socalled green metals, the lithium and cobalt and metals that are used for batteries and electric vehicles is a huge demand to continue to find those those metals, pull them out of the ground, find them in jurisdictions that are that are easier to work with. And so we would still expect to see some growth there. Um, so not to be redundant, but this Energy Transition that were going through, it is a transition meaning you will still need oil and gas for a long period of time and so in that context its the portfolio should benefit from having that exposure here. And but nevertheless, that portfolio of Traditional Energy investments that will wind down and the exposure to the Renewable Energy sector will grow in line with the hopefully quicker than the broader economy. So that transition will continue to occur and we certainly look forward to providing future updates on the pace of that transition and how that how that how that progresses in the portfolio. But with that, let me hand it off back to tanya. That concludes our prepared remarks and well open up for questions as well as. Two questions. Chris, is energy 2. 0 is that renewables. You know, generally still Renewable Energy is what im focusing on. Still generally relating to conventional energy, but just a different model where you have the us conventional shale boom, where Fund Managers , companies were focused on acquiring acreage and doing development drilling. Now groups are focused more on cash flow and producing assets. Given us Energy Markets are maturing, its still a conventional energy, oil and gas. Okay, i know youve got us into some Renewable Energy funds. Im just wondering how focused you are on that at all . We are and we have been active in that space for a number of years. We have also been making a number of commitments, have a handful or least a couple of core managers in that space. So we have been emphasizing and growing that portion of the portfolio. Great the word fusion is coming back up on the radio all the time. Second question in terms of this 5 billion plus portfolio for real, how much of it would you estimate percentage wise is in rates currently . We dont have any dedicated exposure towards reits and our managers dont generally invest in reits. So its negligible. Dont generally is it worth considering maybe youre trying to specialize, but in terms of theres a liquidity issue, i know in the absolute return we change things a little bit to have more liquidity, which means less longer term stuff. Im just wondering, in real estate there is that element of liquidity with reits, assuming you found a good manager and that. Yeah, definitely. We did have a read allocation for a period of time. I think it was discontinued back in 2017. Its on our radar screen, its on our weekly discussions and we do have plans to review that closer or in greater detail this calendar year given kind of the valuation kind of mismatch between public and private. So its on our radar to deal with. Nothings imminent, but we do consider public securities reits. Okay thank you. Just. Thank you. Just a couple of questions. So one of the things is i was listening to the presentation that i just needed to keep wrapping my head around was reconciling some of the trends that youre explaining to us with some of the anecdotal stuff that we see here locally, because it was hard to reconcile. So im hoping that you can help us a little here about the westfield mall situation. The large haze and van ness construct, apartment Construction Projects stopping, and then of course, the struggles with Downtown Office space. But there are some examples that i heard you as you were as you all were presenting around areas where apartments and Single Family rentals being an optimal source for optimism and some forms of office space possible being an area for optimism. And then even in some forms of malls. And so i was wondering if you can kind of unpack so that, you know, as we try to message what locally is a very different narrative from your analysis of the portfolio, thatd be helpful to us. Sure yeah. I think it does depend on markets. Clearly, San Francisco bay area is one of the most negatively impacted as far as some of these trends and perhaps more so say in San Francisco proper or oakland. As it relates to the apartments or office space or some of the retail space. Just given the dynamics, whereas perhaps some suburban suburban markets like san jose or parts of the east bay might be doing quite well. I think there are some pockets of growth and say weve seen activity with the i kind of or resurgence or trends there. We do hear of groups taking up office space in San Francisco and the broader bay area as the capital of i for now. But the trends are definitely unfortunately negative within San Francisco proper and parts of the bay area, but parts of the sunbelt, texas, other areas nationally, there are different trends than say, here and San Francisco in particular has been hit really hard with the remote work phenomena and that were probably one of the largest big cities where lagging behind everybody else. And thats one of the key reasons why. And that impacts what is trickles down to everything like retail, hotels, Everything Else. Unfortunately that and that kind of tied in. One of my other questions about the difference between domestic versus abroad and the work from home, it seems like the part of the presentation was that San Francisco may be an outlier within the us, but the us is also an outlier around the globe in terms of work from home phenomenon. Thats right. I mentioned there are some of those work from home trends that probably more accelerated and say the uk or australia, but say in asia, japan, other parts of asia from a cultural perspective or just not having enough space at your own home residence. People are generally showing up to the office from logistics perspective. I think theres groups that track that information. I think generally some of the bigger cities north in the northeast are maybe office properties, for example, are at 50 of capacity. Compare that to the texas markets that are 70 or 80, maybe higher. And largely never really left the office except for a few months in the early days of covid. And again, San Francisco and other some other west coast markets are probably even lower than 50. So unfortunately, this is just a tougher market for a lot of these sectors. Thank you. Additionally you mentioned perhaps a need for some municipal subsidies and some areas for conversion of property. Can you unpack that a little for us . Yeah, i think i just think maybe as office values continue to decline, perhaps office properties, the values will get to a level where it makes economic sense for a for a developer to buy that and to either demolish it or convert it. I think the problem is, again, a lot of the layouts dont lend themselves to converting it to two residential. So they probably need to be demolished and rebuilt. So with those costs and i think just with the with the added level of risk of taking on a project like that, i think for a lot of developers they can be doing other things that are that are easier and you know, not getting to that level of return, but get an acceptable return. And so, you know, theres been articles about, you know, in chicago, for example, where where i think developers have or the mayor has has talked about ideas of perhaps trying to you know, engage in activity to spur development. But i think yeah, whether its sort of tax abatements, which sometimes you see related to affordable housing, perhaps perhaps those kind of public to private partnerships are whats needed to spur some of the development because it makes sense. I mean, theres too much office, theres not enough residential, theres certainly not enough affordable residential. So ideally that those groups can come together. But its obviously complicated. And thats really in these markets as youre talking about that that were sluggish in the return office. They wouldnt be doing this and like texas or something. No but yeah some you know the new york chicago certainly some of the cities that have had declining population, it would make a lot of sense to consider. And my last question is on some of the other when i was looking at the portfolio self storage and cell towers was the other one. But the specifically self storage storage were seeing im seeing it elsewhere where im reading articles and theyre talking about this. Can you explain a little bit of where this trend is going . Is this a short term thing . Is there some long term projection . Why is self storage such a booming area . Yeah i think its done well from an asset class perspective as its driven by kind of life events, whether its divorce, people moving, just general changes that arent necessarily tied to the economy. So its generally been a stable, defensible asset class for a number of investors is also quite fragmented or still own a lot by kind of mom and pop investors. Although there are the large publicly traded reits. But there is still an opportunity to acquire these relatively Small Properties or develop properties in the right locations. So the Main Attraction is not necessarily tied to gdp and press cyclicals and say office retail. So i imagine people have been getting divorced and moving for many, many years. But is the idea that its mom and pops and it has really been consolidated as kind of the opportunity or the theres a number of trends and also because its based on life events and relatively small percentage of someones expense, oftentimes are not inclines or motivated to move their furniture or property out of these facilities. So owners historically have been able to push rent increases to the consumers without much impact of people leaving. Okay. Sector did boom. And during covid, as as people started to work from home and so needed to create that home office. So there was a probably a pull forward of demand that that now youre seeing the postcovid dynamics. Its flattening out a little bit. But but yeah, to chriss point, theres its very defensive in terms of you know, in difficult economies maybe people downsize or need to move. And so its been a pretty stable, stable asset class that people dont always think about. Thank you. So. I. Assume an actual definition of the cities and worldwide and. Redefinition of the city and work life and in tangency to having to stuff things in Storage Facility not to mention building out new properties that are in new areas that have a different metric in what work and people are. So this is its an interesting area. Thank you. Thank you very much for the presentation and for the questions. Yeah thank you guys. Probably comment. Do we have any Public Comments . Seeing none. A reminder to any callers to press star three to be out to the queue. Moderator do we have any callers . Madam secretary . We have no callers on the line. Thank you. Hearing no false Public Comment is now closed. Okay lets call the last call is the last item, not the last item. The next item number 13 discussion item. Chief investment officers report. Thank you. Just wanted to start off by saying thank you to the Board Members. Its been a lot of topics to get through this afternoon and detailed topics and i really appreciate your engagement and the good questions that that you asked. What i had asked the team as they did these asset class reviews that we not only reported on performance and the numbers, but really highlighted the judgment of the team and their ability to think about where we want to go moving forward. So hopefully that came through in the presentation today. With respect to the cio report here, ill make a few points on performance. And then as always, provide an update on the board approved investments. So on the performance side, i want to reiterate, we put the performance numbers in here. We meet monthly. So we provide them to you monthly. But you know that we have a lot of private market exposure. So provide performance numbers on a monthly basis has to come with a big asterisk that these are estimated numbers with lags built in our aum today stands at 34. 5 billion. Looking a little longer term three year performance again, estimate is at 10. 3. Notably exceeding the long term actuarial rate of return assumption of the 7. 2. And think about that for the last three years, 10. 3 return given all the turmoil in the market, weve had covid, weve had rate resetting inflation, bank struggles, but we continue to be in a strong position given the diversified creation and allocation of our portfolio. One point related to our Asset Allocation that i do want to continue to highlight for the board as i had done in the prior month, is that we are outside of our Asset Allocation guideline for treasuries, specifically treasury allocation is at 2. 1 versus the guidelines which have a range of 3 to 12. However we do have cash today. Our cash stands at 2. 2 and the range there is 0 to 5. So as i discussed last time, we are thinking about sort of treasuries in combination with cash as our source of liquidity. And even today, you can you can earn some return on that that cash. So were in an okay liquidity position. But again, just wanted to be consistent in reporting that clearly to the board. And finally, with respect to this report, each month, my approach here is to give the highlights. We have more detailed performance reports on a quarterly basis, and im going to let those conversations drive the performance discussion. But if at any point Board Members want to talk more about what are in these slides in the performance, im certainly happy to do that unless there are any questions there. Ill go ahead and turn it over to the approved assessments and ill read through the script. Yeah. At the Board Meeting on april 20th, 2023, the retirement board approved in closed session an investment of up to k750 million to mc p private capital fund. Five r investment to that fund. Close on july 27th, 2023. This investment is classified as a Capital Appreciation investment within the private credit portfolio and this is the third investment with metric net. Next blackstone Energy Transition partners for at our meeting, the Board Meeting on june 15th, 2023, the board approved in closed session an investment of up to 70 million in blackstone Energy Transition partners for the commitment of 70 million to the fund closed on july 31st, 2023. Its classified as an Infrastructure Investment within the real assets portfolio and its the 12th investment with the group finally, altus Health Partners. Six at the july 20th Board Meeting, the retirement board approved in closed session a commitment of up to 75 million and altus Health Partners for and priority coinvest vehicles. Our commitment of 75 million to all terrorist Health Partners closed on july 28th, 2023, and this is classified as a buyout investment within our private equity portfolio. And our third commitment to altus concludes my remarks for the cio report, but certainly having to go in any more detail or answer any questions, any questions. Okay i just want to spend more money of your operating funds and encourage my from my opinion as the world changes, lots of theories and better ideas and whatever are going to come out of a lot of smart people. And i know joe is an avid and joe and leona are avid attendees of conferences and the like, and this is something that the retirement system does support. And i would only encourage Board Members to Pay Attention to the plan funds that were given and expand their mind. It benefits the plan. I think so, said any further business, anything for the good of the order. So go ahead. Public comment. Yeah. Before when you Public Comment, aj did you have something . Yeah, were on the order. Well, no. Yeah, were on the public. No, were on public service. Any questions on the cio report . All right. Yeah. No i didnt come for Public Comment. Sure. Pauline, Public Comment in the Public Comment, seeing none. Moderator do we have any callers on the line . Madam secretary . We have no callers on the line. Thank you. Hearing no calls, Public Comment going to call the final item. Item number 14, discussion item retirement board member good of the order. So no. Oh so to my fellow members, i just wanted to express some appreciation to the members of unite here that came up from los angeles at great expense to speak to us, but also the letter that weve all received, or at least most of us received, detailing some of their concerns. I definitely found the allegations to be concerning, but i know that our staff does a great deal of Due Diligence when looking at any investments. My primary concern when i heard these though, is just the lack of labor, peace and the threat it can pose to possible returns on our existing investment. So im definitely when i hear about potential liability or potential labor issues that might have impact on returns on existing investments, i do have some concerns that id like to get more information on some. Any other comments . No i would just like to echo the same concerns after reading the letter that was sent to all of us, as well as listening to the comments. And i would like some further Due Diligence into whats going on and the impact it may have on our our performance as well as just the optics. Wrong. I dont any further comments, items, nothing. All right. Were adjourned. Public comment. Public comment. Excuse me. We have no inhouse Public Comment. Moderator do we have any callers on the line . Madam secretary, we have no callers on the line. Thank you. Hearing no calls, Public Comment is now closed. Or adjourned. indiscernible i just know it. Excuse me boys, but does anybody have sun block to block this skin from the sun . Yes. Thats right, i need to get my indiscernible many of us last summer indiscernible reapplying sun screen is like getting the second dose of mpox vaccine. Wait, two doses indiscernible isnt it too late to get my second dose . Girl, it is like sun screen, never too late to put more sun screen on. Thats right, i need to get my second dose of mpox vaccine before the summer starts. Lets indiscernible 21201 to find the closest location to get the vaccine or go to sf. Gov mpox. Thank you for the information indiscernible excuse me boys, do you mind checking please . Sure. That doesnt look like a sun burn, you might want to getd it checked out. What do you mean clecked out . Checked out. I was told if i got my second m pox vaccine i would have less severe symptoms. indiscernible maybe i schedule the second dose just to be safe from mpox. Most vackeens offer you a level of protections, just like sun block. Sometimes you need to reapply for more protection. The m pox vaccine is based on two shots several weeks apart to provide the strongest level of protection. Visit sf. Gov mpox to get yours. Thank you boys for that reminder make sure your are fully vaccinated for m pox this summer. Text summer vibes to 21201, to get [music] so, can you tell us what it was like for you during your First Encounter with the San Francisco Fire Department . Yep. It was super cool i got to learn about the dry standing pipe correction. It is actually called, dry sand piper just stand pipe. Tomato. You know. Yea. So, what is coming up next for what is that for . Oh , firefighter backsterinvited mow to a fire station to see the cool stuff firefighters use to put out fires. You have seen the had doors open like a space ship from out of nowhere. I close my eye its is like im there right now wow whoa. Watch out, man. What is that for . What is this . These are fire engines they might look alike they are both red. White top and red lights on top. This is a new 2021 fire engine and this is an older 2014 fire engine. If you cant tell, this one is shorter and narrower than our older fire engines. They have cool things like recessed lights. Roll up doors. 360 degree cam ares and more that is important as the city is moving toward slower and safer streets adding parklets and bulb outs and bike lanes we need to decrease our footprint to keep us and the Community Safer on emergency scenes. Whats back there . When is not guilty fire engine. Great question. I want to see, sure. Lets go back and look at the equipment and the fire pump on the fire engine. This is a fire pump. It is cool all the colors and all that. This fire pump and this engine holds 500 gallons of water that is a lot. A lot of water. It is push out 1500 gallons a minute of water. We can lose our 500 gammons quickly. Why we use hoses like this to connect to a fire hydrant and that gives us unlimited amount of water to help put a fire out temperature is important we have enough fire engine in San Francisco to put fires out. So we can reduce the injuries and minimize loss of life and minimize property damage. [music] mr. Will. Mr. Will. Will oh. Daydreaming. Thanks, everybody for watching bye [music] item 50 is resolution calling on department of Public Health to provide medically necessary transition related care for transgender related people and remove restrictions. In 2012 gender health sf was born out of advocacy from Community Stakeholders and local leaders. Really as response to providing quality, accessible jnder aaffirming care for the most underserved. indiscernible the way i see it, there is two ways of folks we serve at our program. The first wave of folks who never imagined surgery access was accessible to them. Many folks who had to save money or par ticipate in underground economy to access the surgery outside the country. indiscernible really to make Something Real in terms of being able to connect with the gender identity and external indiscernible and so transform so many lives of many of trans folks who never imagined it was accessible to them. Now we are in the different era and time where transrights is in the social political and general indiscernible and now we are serving young folks to support them and making sure their gender identity is connected to who they are, so providing a space to support transfolks to live authentically and that is the goal to provide the level of care trans folks deserve. When it comes to access to healthcare, while we all believe in cost control and make sure we deliver healthcare in a Cost Effective manner, i dont think that cost is a reason or legitinate rational to exclude people from healthcare indiscernible colleagues i ask for your support. Thank you supervisor wiener. Colleagues on this item can we do this without role call . Same house same call, without objection the resolution is adopted. [applause] [music] San Francisco is known as yerba buena, good herb after a mint that used to grow here. At this time there were 3 settlements one was mission delores. One the presidio and one was yerba buena which was urban center. There were 800 people in 1848 it was small. A lot of Historic Buildings were here including pony express headquarters. Wells fargo. Hudson Bay Trading Company and famous early settlers one of whom william leaderdorph who lived blocks from here a successful business person. Africanamerican decent and the first million airin california. Wilwoman was the founders of San Francisco. Here during the gold rush came in the early 1840s. He spent time stake himself as a merchant seaman and a business person. His father and brother in new orleans. We know him for San Franciscos history. Establishing himself here arnold 18 twoochl he did one of many things the first to do in yerba buena. Was not california yet and was not fully San Francisco yet. Because he was an american citizen but spoke spanish he was able to during the time when america was taking over california from mexico, there was annexations that happened and conflict emerging and war, of course. He was part of the peek deliberations and am bas doorship to create the state of california a vice council to mexico. Mexico granted him citizenship. He loaned the government of San Francisco money. To funds some of the war efforts to establish the city itself and the state, of course. He established the first hotel here the person people turned to often to receive dignitaries or hold large gatherings established the First Public School here and helped start the Public School system. He piloted the first steam ship on the bay. A big event for San Francisco and depict instead state seal the ship was the sitk a. There is a small 4 block long length of street, owned much of that runs essentially where the transamerica building is to it ends at california. I walk today before am a cute side street. At this point t is the center what was all his property. He was the person entrusted to be the citys first treasurer. That is i big deal of itself to have that legacy part of an africanamerican the citys first banker. He was not only a forefather of the establishment of San Francisco and california as a state but a leader in industry. He had a direct hahn in so many things that we look at in San Francisco. Part of our dna. You know you dont hear his anymore in the context of those. Representation matters. You need to uplift this so people know him but people like him like me. Like you. Like anyone who looks like him to be, i can do this, too. To have the citys first banker and a street in the middle of financial district. That alone is powerful. [music] [music] first start with the amazing ryan nicole. Grammy nominator, utilize every gift available to her for liberation of all people. Titled the 4a, seeks opportunities to empower and inspire by way of pursuits as Award Winning artists actrshx ath least and activist. Please give it up for ryan nicole. There we go. Check, check, check. Whats up yall . How you doing . I was going on the stage but want to be closer to you. We heard the bio. I decided to wear my warriors shirt. Especially because we are here, but look, on the back yall, look on the back. Yeah, i had a opportunity to come here a couple months ago. I won the impact warriors award and really i had everything to do with being on the trajectory you are on right now. Starting as a young person working for a mayors program, identifying my passion as a activist and continuing that work now into adult hood, i do that as a artist, i do it as a activist and musician and will hear that in the music now. Sound man, run that first track called queen of everything, because i do everything, yall. We going to do, we are going to have a good time and wake you up. I havent had my coffee, but we are going to have fun. Is that cool . Alright. It is a head nod track. Im not the average bay area rap girl. I like the old school boom box. You all feeling that . Are you feeling it in your chairs . Feeling it in your chest . Cool. Feel it in your ears real quick for me, okay . [rapping] labor for the people no indiscernible while the nation indiscernible i make the sacrifice, but i wont die a martyr. indiscernible [rapping and music] everybody out here who understands the hustle, understands being and doing so many things at once, while im asking you to master every bit of your craft, queen of everything. [rapping and music] im telling you, if you master your craft, they will all bow down to you. Im living proof, yall. Im living proof, yall. As a black woman, i put the whole world on my back, and thats why i can say with full authority that im the queen of everything. Every woman, every black woman, every person that comes out of poverty, knows all about that. We make this go around, right . You make the dollars come down. But thats why we deserve the crown, queen. [applause] thank you. Thank you. This last one i will do and get out of your way because you got a beautiful long program ahead of you, you also just deserve every flower, every acknowledgment, every accolade and all the people who partnered to make opportunities for all possible. They dissever every flower and accolade. Glad to see you all working throughout the summer, developing your skills developing your talents and figuring what you want to do for the rest of your life. Way to go. The next song is called, for colored girls but ill repurpose it and call for all of us. It is for everybody in this building but i will always speak to my colored girls first, but you can see yourself as that. I give you permission. Lets do it. All most forgot the beat it was on, but now i remember. Can i get some of the hands in the sky like this here . Just like that, right there. You got it. If you got a car, and you got beat in your trunk, this is how it feels, right . [rapping and music] that is for my colored folk, never thought indiscernible shout out to you. Opportunities for all. Thank you so much. [applause] we can do better then that, give it up again for ryan nicole. A real lyricist. [applause] them words are anointed for real. Next up i have the privilege to bring up direct cheryl davis the executive director of the San Francisco Human Rights Commission. Previously served as a commissioner. Prior to joining the hrc executive director of collective impact overseeing mo indiscernible passionate about serving the community. Please welcome director cheryl davis. [applause] alright. What time is it . I will say good morning still. Good morningism good morning i heard the folks on this side. They are way too many people in this stadium that is used to a lot of noise, so ill try it again. Good morning good morning even the folks in the back side, right . Ill keep saying itthere is a little more energy. Act like this is pay day and you just got your check and double what it usually is. Good morning somebody really wants to double check. Good morning, im as tanner said, give it up for tanner for agreeing to [applause] i want to give it up for ryan nicole for getting us starting, kicking us off. I really want to give them a shout out, because it is pretty hard to get up and talk in front of a crowd in general, but to get up and talk in front of a crowd that could care maybe a little less about whether you are talking to them or not and still do with the energy and furfb they are do are doing i want to appreciate them, because i would not beas you could see, i would be too honest with you. I also want to give a shout out to some of our partners that are here with us today. Michael lambert, chief librarian, give it up for michael lambert. Ivan, from the airport. Representatives from bank of america, our Police Department, and i want to givei always forget to do this, so bear with me hopefully a bit this morning on the way to afternoon. I want to give a special special shout out. I are was looking at his name and hoping he was going to come, give a special shout out for alvin woo from jcyc. You should be excited because that is who is cutting the checks. Alvin, you got to stand up and take more applause then that. When this program started a few years back, mayor breed was like, i want to get to develop a program that gets to all, and shes like, where can we go, who can i partner with in community that has the capacity, infrastructure, the willingness and the experience to do that work and jcyc came to mind. Alvin along with john osake said we dont want to do another program that celebrates the summer or repeats what is done before. They want it to be very intentional about the programming and as many will be able to attest to, we had bumps and some hiccups along the way and even though it is not their fault, they stayed with us in that process, and so the ability to pivot during the pandemic when we didnt have inperson opportunities and we had to go to stipends or the ability to figure how to give wages, all those things and more in the sense that i dont know how many people alvin this year have you processed through opportunities for all . So, for them to figure how to make sure that over 3,000 young people can get paid through this program, give it up for them one more time. [applause] i also want to ask the folks from collective impact, mo magic, magic zone if they can stand up to give them a round of applause. [applause] i want to give special shout and thanks to those folks who have also agreed to be partners and help to fill in the gap and have helped to create the additional programs when we dont have enough placements so the csi model. I wanted to start with that because i usually forget it. I also want to ask the folks from the Human Rights Commission the opportunity for all team to get around of applause as well, baize because they have been making it happen. I dont know where they are, i think they are up front processing people. I see nicole. Dont want tothere is kamisha who is managing and stepped into that work. Nicole in the back. I did all that because i always always forget and the truth of the matter this program would not happen without each and every one of those folks. I ask you indulge me one more time because i want to ask the senior fellows to come up front to give a round of applause for making all the work happens. All the fellows, senior fellows, all the folks please i want folks and then we have some in the wings if you want to wave. We have over 40 or 50 i dont know, folks who have been 90, over 90 interns and fellows who are help making this program happen. Who are leading the work and helping to supervise and organize and coordinate and make it happen, so if you see your fellow up here, you should give them a round of applause and some screens and some shouts. They are the ones helping make sure your checks get paid, that your time sheets get run, that all that happens. [applause] right . So, i want to thank them and the evolution of this program and the work that continued to happen leads me to i would say probably one of the most important people that has been helping to lead this work and im going to ask everybody to do like a round of standing applause for sarah williams. [applause] sarah has beenif yall dont know it you should be grateful because sarah has been helping process the applications, the one process the placements, the one who is making sure you get paid, helping find the money when we run out so you all should give a huge amount of gratitude for sarah, because none of us would be here today without sarah doing the job she does so thank you sarah, you are appreciated. So, thank you to our fellows. We are going keep the program moving. I are want to say they talk all the time about people being fashioninable late. I want to thank Paul Henderson being fashionable late. He was making a statement what not to do when you show up to work. Be on time. Again, the whole point of opportunities for all was to create opportunities for everyone, but to build pipelines, and so you your charge today is to help us make sure that it doesnt end with the summer. That we are working to make sure that folks get to go to jobs in the library or the airport, or with bank of america and jycy has done their part and i know the Police Department would love to have all you sign up to come and work. But, it is not just about a summer job, and so usually when i come to these spaces and places, i will not do it today but i am going to make mention of this, this is a job interview. You dont know who will be in this room. You dont know what impression you are going to make, but this is a social net work you are building. These are relationships forming. This is a opportunity to do whatever the next thing is that you may want to do, so when you show up, you show up as your best self. You show up to dress to impress, right . You think about who is it that is in the room, whether it is the person who is had head of the department of Police Accountability or the chief of police, whether it is the mayor. Where do you you next internship to be . If you want your next internship to be in a law firm you want to dress to impress the law firm. If you want to be a entertainer, make sure when somebody is who is up here, they see you and when you connect with them after the performance that they take you serious. Everything is a opportunity and so many times i have seen people lose or waist the opportunity. When you show up at an event like this, what are you doing to make sure somebody remembers you for the next time around, the next go round . You dont me to do like im about to do with carl and say, are you paying attention . You want me to be like, hey, that is is a great job that you are doing over there, and are maybe next year you can be fellow or you could lead a program, or ill say the program with bank of america is pretty prestigious and it is a whole other application process. I think we only have how many spots . Only 5. I have seen peoplethe mayor actually started her career as a teller in a bank. So, every opportunity is the opportunity for greatness and i would say, when you come into this place, you want to make sure when i see you, why were you sleeped or scrunched in your seat . Why did you come like you were going to bed in your pajamas . Everything is a opportunity. Every moment you show up somewhere you never know who someone is or what they have access to or where they can help you open the door. So, when you think about opportunities for all, dont think this is about the 6 weeks of getting a check, think about what it is you want do with your future. That was mayor breeds purpose. That was her intention when she created opportunities for all because she came from a place where she felt she had more opportunities then other folk jz it made a difference in her life. The question is, what will you do with this opportunity . How will you come back . How will you support, engage and make not just your life better but the community, city, neighborhood, bay area, the region better . I am grateful for all of you in these seats today. Im grateful what is coming next and i just want to say thank you, because the program wouldnt exist without you. But you are the key to the program continuing. The ability to make it happen is based how you show up and how you engage. I just want to say, so, i just wanted to say that there are opportunities to expand and do this work and im going to put on the spot, because we have been happy this year to have a partnership with the department of Police Accountability that expanded to work with student from college. We were able to use the university of San Francisco to house them. They are working and say Paul Henderson is one of thbest partners to hire people as fellows and work in his department so i want to provide space a little bit for director henderson to share a little about what he is doing this summer so give up for paul. Always fashioninably late, henderson. [applause] put your timers on. After three minutes we need to make sure he knows his time is up. You know i wasnt prepared for this. Check out these shoes though. Since we are here, since we are herealright. I dont like crowds and im shy. Im just kidding. I got a packed audience. This isi was not expecting to talk today, but this Program Means so much to me. Seeing the young people here means so much to me. My career startedi grew up in bayview, a 4th generation san franciscans, but coming into the city, i started as an intern. I started in city hall working and volunteering and trying to learn. I always felt like things happen to my community, rather then for my community, and for me, education and experience was my way of giving back to the city and trying to become a better person to learn how the city operated. How decisions were made and coming into the pipeline, i began as a intern. I worked hard to get good grades. Not always so successful but my work experiences were fantasticism people reached out to me and the best allies i had didnt necessarily come from the bayview. Didnt necessarily look like me, but being able to reach out and follow those opportunities and stay connected to the people that i was exposed to from the programs as a intern made all the difference in the world for me and the trajectory for my career. Being able to once i got out of school to come back to the city where i grew up where my mother and father grew up and the rest of my family was here. Cant tell how meaningful that is to find a job that want a job that was a career, because i was committed to doing the work that i cared about deeply has meant eeverything to me and i hope all of you take the opportunity and the experiences that you have both to build out a network that define and shape the trajectory for your academic careers and professional careers when you are out of schools, that is the value of a program like this. You are not just sitting at a desk not doing anything, you create opportunities for meet people and learn how systems work and how the systems fit in the operation and everything that makes San Francisco the great place we are all so lucky to be in for this summer. I are want d to make sure from my agency at the department of Police Accountability that i leaned into the responsibility to try to make sure everyone has as great a opportunity as possible. I hope i have done that and set an x example for other departments to see how much they can do if they lean into the opportunity to have young folks like you be a part of the city family. Look forward working with all of you in the future, cant wait for all of you to come and look forward seeing all of you as City Employees in the future and ally employees in the future for folk s outside the city working with the program to create opportunity for the young people. This is absolutely the future. You are absolutely the future. It has been a pleasure and honor to be working with all of you over the summer. I cant wait to see what you all do during the year and what next Years Program looks like. Thank you all so much for being here today. Really a honor. [applause] alright. Thank you paul. So, at this point i are want to bring up the person who is responsible for the creation of this program, who really wanted to make sure that every young person in the city and county of San Francisco had an opportunity not just for a internship, but for a paid internship. I want to just thank her for her vision, her commitment and her dedication. When things were getting rough and folks were asking for things to be cut and to beto make budget make tough budget decisions, she never ever compromised on making sure that there were opportunities for young people, understanding you are critical for the success of this city. Without further ado, welcome and give a warm welcome to mayor london nicole breed. [applause] alright we at chase center. There needs to be more energy in the room [applause] i heard steph curry might be here tonight for a movie premier. You had ryan nicole getting your pumped. You have stunt a man coming aboard and going to rock this place, so lets show some energy. Let me tell you something, when i was growing up your age withwasnt that long ago, there were really some serious challenges in the city. You think the challenges that exist now are problem, way back then before social media, before the ability to access cell phones and other things that you all enjoy, we had a lot of challenges in the city and are there was once a time where we could not offer a paid internship to young people in San Francisco. But i was one of the lucky ones and some of you probably know a little bit about how i grew up in San Francisco. I grew up in Public Housing where my grandmother raised me and during a time whereinteresting, we didnt have a Good Relationship with the Police Department. We had a lot of contversery, poverty, hopelessness and dispair. The reason im here today where now im in charge of the city, the Police Department, the policies, in charge of a 14 billion annual budget, the reason why that happened had everything to do with my start. With my start at age 14 as a intern, where i worked at a place called the Family School, which is no longer open. One of my first jobs was to answer the phone. Now i know you all are doing some really fun and exciting projects. I heard some are working at places like google and for the giants and doing some really funeverybody is looking at each other. Who is doing that . I know jessica is here who worked in my office. People worked in the public and private sector and hopefully you had some rewarding experiences, but let me tell you something, i wasnt always this polished mayor i you see before you today and didnt necessarily show up in the appropriate attire when i showed up to my first job. The cut off genes were the style then and some of the revealing tshirts and things and my boss said, you have to change your attire and ill show you what you need to wear in a Office Setting and not only am i going to do that ill help purchase the clothes so you show up dressed appropriately to be in a office. I had to answer the phones so the first phone call that came in, this is what i didhello. Who you looking for . Whats her name . Hold on just a minute. I didnt put her on hold and i was like, men on is calvin available. You laugh now, but i was pretty serious, because i thought that is what you did. That is what i did at home. I never learned and i had to be taught. I had to be taught how to answer a phone in a professional setting. Then i was forced to write out the script and forced to repeat it and answer the phone like this regularly. Hi, this is london breed, thank you for calling the Family School, how may i help you . I had to practice over and over before i was able to answer the phone and you see over 30 years later i still remember that First Experience and i still remember the impact it had on my life. I had a summer internship but after the summer was over i did such a good job that they kept me onboard. I worked for the Family School even during the school year and that was a god sent because i had no money what so ever. My grandmother, we got welfare, we had food stamps. We didnt have the ability to pay for a lot things and this helped me with my money for School Clothes and lunch and all these other things that my grandmother couldabout always give me money for. I worked at the Family School and worked there throughout my High School Time at galileo high school. The reason i tell the story is because people are watching you. They are watching for potential. They are watching for excitement. They are watching to see whether or not you could be the person that they could hire, and through this program, which existed for 5 years, we have had about i think indiscernible who runs the airport, about 5 interns that used to be sitting in your seats right now. They are working full time at San Francisco airport as a result of this program and their internship. [applause] my goal in this program is not just so you have something to talk about when you start to apply for colleges, my goal is not just to make sure you are getting paid in the summer. My goal is to make sure that money is not a barrier to your ability to participate in a internship where it can change your life. Where you can explore Different Industries and Different Things that you may want to do. Now, i wanted to actually make commercials. I know that is kind of funny too, because it is like i really did. There were these commercials that existed when i was a kid. I wont recite any now, but i always felt i could do it better and used to make my brothers and sister dress up with my grandmothers wigs and reenact the commercial. I wanted to make commercials and i did nt know the first thing about how to make commercials and then i got a chemistry scholarship and thought i was going to be a chemist and make my own cosmetics and are Makeup Products and chemistry was tedious and very challenging and plus when i worked at Lawrence Livermore national lab i spilled methylene chloride all over the place and a clumpsy chemist so decided to go into politics. The point is, i had a chance to experience all those things through internships, through opportunities and i want to make sure you take advantage of not only this internship as a place where you get paid, it is really about learning. It is really about exploring. As you start to grow older, right now you are young, you are kids, everybody is helping you out and want to support you, but let me tell you something, once you hit 18 or in your 20s or what have you and you start buying your own toilet paper and pay your own bills it becomes a lot harder, so we want to make sure that while you are looking at and thinking about your future, what are the things i want to do . How do i get access to a internship . How do i learn about a industry if i want to design clothes, if i want to be a computer programmer, if i want to run my own company . Artificial intelgence is being developed here in San Francisco. It is going to change the future like nothing we have ever experienced. How do i become a part of that industry . What will it take . This is the platform for you to ask those questions. For you to learn about those industries and for you to be fearless in your pursuit for what you want to do in your life as you think about your future. We have a lot of people here from a number of companies. I know that the giants and google and bank of america, the Police Department, the library and other city agencies as well as non profits have opened their doors, including opportunities for all where i know james hired a few students who were part of the program. We have a lot of programs that provide you with a opportunity to learn, so today is about taking advantage of those. indiscernible man is here to perform, but stuna man was born and raised in this city and he is now a world wide artist. He is traveling all over the world with a team of people, including his dj, his manager, his folks and he is employing people to work for him, but hes the star, and he is taking the world by storm and are he came from this city. The point im make is, dont let your circumstances, dont let anything that you might be experiencing at home or in your neighborhood, never ever ever ever let that determine whether or not you become a success and pursue your wildest dreams. Do you think that i would have ever thought i would be mayor or could be mayor when i was your age . I never thought that was possible. My family was broke. My grandmother was doing everything she could to take care of us including working as a made and when she couldnt she got welfare and food stamps to take care of her grandkids. I never knew by biological father. I have a brother still incarcerated. I lost a sister to a drug overdose. I lived in pover ty and dispair and hopelessness and never thought i would go to college. I didnt think that was even my future in high school, and i became mayor of San Francisco. The point that i want to make [applause] the point i want to make and ill say it again, never ever ever let somebody tell you what you cant do. Never ever let somebody tell you that you cant pursue your hearts desire. Never ever let your circumstances, even your family members or other negative friends, never let them get in the way of what you want to do in life, because it is out there. What it takes is your willingness to sacrifice, to work hard, to be resilient, to be persistent in your pursuit to fulfill your wildest dreams. Thats why i started opportunities for all, because i wanted to make sure that the next generation that is growing up in San Francisco that they dont let anything get in their way of achieving their wildest dreams, of being a real success, being able to take care of yourself, to take care of your family and your community. You can do it, and today is really only just the beginning. Thank you all so much for being here. [applause] i need you to stand on your feet and give a round of applause for mayor london breed and director cheryl davis. Thank you. [applause] this next person i honor to bring up so happens to be one of my interns and marcus is full of life. Marcus is intern indiscernible lives in the Western Addition and student at lincoln high school. Marcus likes to sing, act, write, spoken word pieces, please give a round of applause for marcus. [applause] hi. My name is marcus. Im a rising 10th grader at lincoln high school. I joined indiscernible because i believe it bring me good experiences. Last year i worked with criminal justice cohort and this year working indiscernible prepare me for my future. Thank you mayor breed and dr. Davis for making this possible. Now, i will read my poem. Im from the windy weather, the church every sunday, the home cooked meals. From singing and can goofing around with my friends and spending time with my dog. Smell of freshly baked sweets, to the streets, indiscernible of the wind outside. indiscernible from the loud music. From the birds everywhere, from the cars and buses honking. From the Juneteenth Celebration and from taking the bus throughout fillmore. Im from the fillmore. [applause] thank you. Good job marcus. Next we want to bring up chief scott. San Francisco Police chief scott grew up in birmingham. Chief scott was sworn in by mayor ed lee in 2017 after serving 12 years in the los angeles Police Department. Chief scott focus is on community policing, with the emphasize on implementing major reforms especially as it relates to providing service with dignity and respect. Welcome chief william scott. [applause] good morning. Alright. I will tray try it again. Good morning good morning alright. So, first of all, i where want to thank mayor breed for providing this opportunity to everybody. Most of us who are sitting in these seats when we were sitting in your seats, ill tell me story. I had no idea what i was going to turn out to be. None. I know many of you, some probably know what you want to do in life, some dont. Some of you are just going to figure it out later. But i want to echo a few things that have been said already, particularly what dr. Davis and mayor breed said. Life is about opportunities and life is about putting yourself in a position to take advantage of those opportunities. When you look at the people in the front row, all of us or most of are Public Servant and we have people that have done very well in their careers. None of us, none of us and ibet my pay check on this, started out with anything handed to us. Life is about creating your own opportunities. You will need help along the way. A lot of people say, im selfmade and there is probably a little truth to that but none of us got to where we are alone. For me, when i was sitting in your seats, 15, 16, 17 years old i had no idea what i wanted to do, none. Second generation, first generation actually out of Public Housing. Mom widowed twice. Worked all the time just to put food on the table. But there were a few people in my life that believed in me. Probably more then i believed in myself. And you all have a golden opportunity because you are here. You are here because somebody believes in you. Somebody believes you have the ability to do something great with your life. Do something great in this world. Take advantage of it. Dr. Davis said shes paying attention. Shes looking who is sleeping, looking who came dressed appropriately and it looks like all of you have your eyes wide open. It looks like all of you are dressed appropriately, so somebody has been working with you. But heres the thing, the interview doesnt start at the interview. As you go through life, whether your college interview, whether your first job, second job, every day you are in your interview. Live your life that way. Every day somebody is watching you, particularly with social media. All the stuff you do right now that you put on social media, when you go to that job interview, somebody is probably going to be looking to see how you live your life. Think about that. We have i think 25 interns from San Francisco Police Department that are here. Thank you all for being here. I want to thank the ced team responsible this year for kind of coordinating the cohorts. But i never thought i would be in this profession. I didnt have anything against police. I grew up in birmingham alabama, west end. It was the hood. Plain and simple. Never knew a police officer, never saw a police officer, didnt want to be around police officers, didnt have nothing against them, but that wasnt what what we did in those days. Never had any idea i would be standing San Franciscoi watched San Francisco from the Football Games and saw the Golden Gate Bridge and see the fog and said i wanted to live there. Didnt know i would be doing this. If you work your dreams will come true. You got to put in the work and you have to live your life in a way that you dont take away your own opportunities. Now, some of us have probably talked to some of you about you should think about being a cop when you get out of school and grow up. Keep that option open. I got degree in accounting. I was pretty good with math. Pretty good with numbers. Never really wanted to do that though. Kind of like the mayor with chemistry. I knew pretty early on that i never wanted to be an accountant, i just wanted to get a degree because i promised my mom i would and i knew if i didnt i would have hell to pay with my mother. That degree did give me a opportunity. It gave me a opportunity to fall into a career that became my lifes work. I love what i do. I love what i do and i consider myself a very fortunate person because work for me is not work, it is hard. I put in a lot of time, but it aint work to me. Try to find your passion. Try to find something that you really have your heart, your soul and your mind in, and if you do that, it will never be work. But you got to keep those options open. Like mayor breed, something saw something in me. I dont know what. There is a part of my life i was a little bit of a knuckle head, but somebody saw something in me that kept me on the right path. I was always a hard worker and i ended up falling into a career i love, but i took advantage of that. For those of you who think that you might want to go into public service, this is the city to do that in and i will say that. I worked in a couple cities, this is the city that takes care of its people. We have a mayor that takes care of her people. And we have a lot of challenges and a lot of work to do. It is a beautiful place, but those of us in public service, we are here to serve people. If you have a heart for that, whether with Police Department, Fire Department, airport, public works, it is out there. At the end of the day you go to work to make money. At the end of the day, i see some very expensive shoes out there. As the mayor said, if you are not paying for them already, it wont be a long time before you have to pay for those 500 nikes i see out there. Director henderson was showing off his shoes, but that came out of his pay check, i guarantee you that. If you want those finer things in life, put in the work, find your passion, and do the things you love and you will sore in this world. By the way, if you want to make money, check out what the San Francisco Police Department is paying, because it aint nothing to sneeze at. I are want to thank the mayor and thank everybody for being here and please, please, please stay safe, take care of each other, keep your options open. Alright . Thank you. [applause] thank you. Next i want to bring up nattily nicole. Natalie became her osa journey as a fellow in 2020 and now a senior fellow. Currently a rising senior at is San Francisco state majoring in cell nuclear biology. A bay area native, please give it up for natalie. Thank you. Good afternoon. My name is natalie. I have been with osa three summers now. Each summer i learn the importance of empathy, diligence and communication in the workplace. I incorporate the skills i learned during the summer into fall and spring semesters interacting with classmates professors mentors and colleagues. Each time im presented with a new opportunity i remember the compassion showed my and try to implement for my colleagues because i know it can create a healthier and more inviting work environment. You are not just a number in a pool of millions, your unique experience is necessary for a better future. Ofa taught me that. Thank you all. [applause] before we bring stuna man up, i want to do awho said ohoh before we bring stuna man up, i want to do a vibe check. I want to see how everybody feeling. Im in mylet me hear from this side. How are you all feeling . Carl, who are you here with, sir . Who you representing . indiscernible lets give it up for ellen hill hutch. [applause] lets see whats going on over here. Lets see, if you looking at me crazy im come right to you. Who we here representing . Representing young defenders. Young defenders. Give it up for young defenders lets go. Lets seewe have a hand. We have a hand. Who we representing young man . You forgot culinary and hospitality. Give it up for culinary and hospitality. [applause] so look, im born and raised louisiana. Look, we got this interactive thing we do. Whether it was a church event, summer event, it was a competition for both sides. All together i want to repeat after me, i want you to say, my side indiscernible on beat, i will say it again, my side crunker crunker then your side. Let me hear it. Go. Louder. Let me hear alright. We got it. We going to split off. Right side versus left side. I need my left side to stand up and face the right side, come on, stand up. Stretch it out. Lets stand up. Right side stand up. Right side stand up. Right side stand up. Stand up, stand up. Check, check. Lets go. Left side, my side crunker crunker then your side right side, right side. My side crunker then crunker then your side both sound weak to me. Lets try it again. My side crunker then crunker then your side right. Right side. My sidedr. Davis eating you all up over here. All together, gomy side crunker then crunker then your side give it up. Everybody stand up. Dont sit down. Dont sit down. If yall ready to turn up here let me get a yea if you all made good money this summer let me get a yea if yall love everybody and everything they put together today let me get a yea yea my name is dj west coast with stuna man. When i say west, you say coast. Westcoast. Westcoast. When i say still, winning. When i say stuna you all say man. Stuna, me. Everybody in the building make some noise you all got to get louder then that. West coast, i think they still sleeping. If you still asleep, let me get a yea yea. That was reverse psychology. If you feel good, let me get a yea, yea. Look, right now, yall sounding like the gentrifyed San Francisco. Thats cool in certain circles, but we come from the authentic original San Francisco. When i ask yall something, i need yall to say from the bottom of your diaphragm. Everybody got that . Everybody got that . So, if you all feeling good, you ready to turn up, say stuna man o2, let me get a yea yea that was much better. Before we get to the set, it is a message what we got to do. There is always a message. That is what hip hot is for. You heard the mayor, we have beautiful speakers, law enforcement, the people that help put this event together, but before we go into this, i like to do a exercise so that anything coming into this performance you can let go. Before we do this, we going to have a moment of silence. This moment of silence, if you lost anybody, you going through Mental Health issues, anything that might not allow you to really express yourself. Real quick, i need everybody to bow their head, close their eye jz have a moment of silence real quick. [moment of silence] indiscernible because it is tricky positions. You going to be a soldier toting buns and busing missions or have conviction to be somebody different . Once upon a time, i was thinking Something Different. Maybe even dreaming, young king with a vision. Want to stick together but nobody want to listen, they keep their mind closed and get caught up in the system. Now the same two change but you yelling how you different, hands up, dont shoot still made him a victim. Rappers talking about drugs and next person they killing. These dudes will say anything just to get a mention. Maybe its me, but something got me feeling different. Im on my own wave, the main stream i cant feel it. All lives matter trying to tell us we aint different. Whole time benefiting from the white privilege. If we aint different tell me who getting killed. Kap took a knee, indiscernible how is your mission, pulling guns on children . See, royalty and goldie used to be our daily living. [rapping] i pray for better days it is ironic im christian. If you awake now, let me get a yea yea west coast, you got that first one . before we get into this we got to teach your Something Real quick. We have been taking a dance all around the world. It is indiscernible when they won a championship. 49ers when they won. indiscernible if you played indiscernible ill ask west coast, we going to teach you all a dance and for the next three minutes and 10 seconds you all in the frontyou got to dance too. Camera man. I dont know why you are sitting down. Have to wake him up. Yall need to get lit. You better not leave me out. Ill rap the lyrics. [rapping] who feel they want to come down here . [multiple speakers] dont be scared. I see you in the front. Why are you acting squared . I know you didnt come for nothing. We about to turn up we about to turn up in here the right way. We dont do the scary stuff. We about to turn up the right way. See if they have the energy. Drop it one time. I need everybody up. [rapping and music] we have people over here not moving. We got all these people over here chilling. For the next three minutes and 10 seconds, i need everybody over here in the crowd moving. I dont care if you know the song, i need you turned up. I need everybody in the crowd over here moving. If you got that let me get a yea yea drop it one more time west coast. [rapping and music] make noise for everybody that was up here. Real quickly, let mehold on. I want to do something special. If this is ofa, let me get a yea yea if ofa means giving opportunity out, let me get a yea yea my man tony was cutting it up, right . Yes, sir. I got this new song i just dropped so i want to do something special. Is there anymore dancers in the crowd . Im talking about that young lady up there, come down here, you a real dancer. [multiple speakers] you love to dance like how i love music. Tony, why you i want to do something special. They said this ofa, right . We got a new song out called going around the world. Man, i want to do something special. I want to bring a dancer out here, right and the best dancer that danced to this song, i want to give them a hundred dollars, but only giving it to two spots. Right now that was just addition. Tony won his spot. Going to take all the money. Come on i want real dancers though. I want real dancers. Well keep everybody up here. Well keep everybody up here. This is how we going to do it, yall got to judge, alright . This is enough people. This is enough people. This is what we going to doim going to play the song so you can hear the song, alright. Then ill play the song one time through and then you hit your best dance moves to it, then we have the crowd judge who did the best dance. Crowd, you got to be attention and be involved and be dancing. If you comp rehend that, let me get a yea yea play it for them so they know what it sounds like. We are going around the world with this. This a whole different vibe. This is not what everybody used to. Come on. Turn it up west coast. Turn it up west coast. [music] [singing and music] i will see if indiscernible i know dancing might not be everybodys forte. I dont point pictures. It is going to be a part of the song i i go likewhen i say the woo, i point this way and i need everybody to take two steps this way just like that and then when the ahh come on, i point that way and then take two steps and ill tell yall, do it with me, step this way, 1, 2. Dont be shy. Step that way, 1, 2. Step this way, 1, 2. Step that way, 1, 2. Step this way, 1, 2. Step that way, 1, 2. Now, step this way, 1, 2. Now step that way, 1, 2. You all getting the hang of it. Step this way. Now step that way. They look a lot more ready. Lets keepdancers get in close. Hundred dollars is oen the line. When i tell you to go to the front go to the front and do your thing and let the song run one time through. We starting with you. You ready . West coast [singing and music]n the line. When i tell you to go to the front go to the front and do your thing and let the song run one time through. We starting with you. You ready . West coast [singing and music] when i say i love indiscernible when i say i love, yall say ofa. I love, ofa. I love, ofa. When i say still, you all say winning. Still, winning. We got to deliberate and see who really won this. By the way, that last song i just did around the world is out now all platforms. Yall look very technologically savvy. Make surewhat you got to say . We got a special announcement. Is you ready to be excited. Give a hundred dollars. My winner is tony right now. Everybody make noise for tony right now tony, claim your money. We have a special announcement. The director let me know for your efforts everybody is getting a hundred dollars today. Sometimes most the battle is just showing up. Remember that, when you in your internships and qu have to go to class, a lot of you will be going to college. Many dont know this about me,eme polk a product of San Francisco, i with grew up on haight and indiscernible i grew up thin fillmore, moved to hunters point, went to sacred heart prep. I got multiple academic scholarships and went to college, got my degree in neurological psychology. A rapper has a science degree. I have a degree in science. When you are doing what you do just like the mayor, just like the police chief, just like the director, you see all these people of different colors and creeds, walks preferences, how bunch of denominations. Sometimes you just got to do it and it gets what you want and need. Before i leave, before we leavethank you chief. Before we leave and we on this high, i feel it is always appropriate to talk to the most high. God, thank you for allowing all these Beautiful People to get here safely and just as they got here safely, allow them to make it to their next destination and home safely. Bless everybody mentally, physically emotionally, psychological morally and financially. We always say mentally first because the mind rules all, and we say financially last because if you get the money you dont care about all the other stuff. Most importantly, eliminate worries, strife and stress, because worry is only paying for thing tuesday to go wrong, we want things to go right. If anybody in is here doubting life and dont want to be here another day, having thoughts about not being here, anything like that to not preserve your life and keep going, god please allow them to be wrapped around and find a support system, please allow them to understand life is important and whatever they go through is temporary but you have to live today. If thats not enough, please thank you for the ancestors the people who cannot be here, those who moved on to another life, thank you for their presence and allow that energy to give the burst to still want to be here. With that said, i am going to say awoman, amen, athem and we still winning i love yall. Make sure you all get your hundred dollars, alright . Wait, wait, real quick, lets all take a picture real quick, alright . I need everybody on this side to come close and you all come over here with me. If you over here, get close, get close. Bring it in yall, bring it to the center court. Get close. Get close. Get close. Turn it down real quick west coast. On three, i need everybody to say still winning. 1, 2, 3, still winning thank you all. One more time, going to take one more. On three, i need everybody to say ofa. 1, 2, 3, ofa i love yall, man. Alright. Back in your seats folks. Give it up for stunna man again. Give it up for stunna man again i do want to put respect on stunna man. I want to read his bio because it is really inspirational stunna man is high Energy Artist aSan Francisco native artist entrepreneur incorporating message of social justice into artistry. Also has degree in neuro psychology from Saint Mary College and clothing line. indiscernible hes the man behind the hit song big stepjug been big stepping with mayor london breed. Give it up i want to welcome indiscernible stephanie lopez. First generation daca recipient and proud daughter of immigrant immigrants raised in the mission and consider the bay area forever home. Believes first generation woman of color has the responsibility to be a strong ally and give back to the Community Organizations and non profits that raised her. Stephanie is pathway manager with bacr overseeing the Latino Task Force internship program. Welcome. Thank you. [applause] hello hello. Happy friday. Good afternoon everyone. My name is stephanie lopez. I work with the Bay Area Community resources and support the efforts of the San Francisco Latino Task Force. Today fill would a sense of pride and excitement. As we gather to celebrate our youth and power collaboration and partnership, as a ofa partner i have witnessed first hand the incredible impact that working together can have in championing the potential dreams of our younger generationism in the Latino Task Force, we firmly believe that investing in our young people is not just a option, but an necessity. The future of our communities, our city and our world rest in the hands of those bright minds and it is our responsibility to nurture and guide towards a better tomorrow. Our efforts are rooting in the belief that every young person regardless of legal status, zip code, background and adversities deserve access to quality work experiences, mentorship and opportunity to grow and thrive. We see how each individual poses unique talent and it is our duty to create a inclusive supportive environment that allows them to flourish. I witnessed remarkable stories of resilience and determineition, i have seen young minds overcome adversity, break barriers and transform their lives. Inspired by tenacity and reminded of the potential that exist in each of them. Our work is far from over. We must continue to push boundaries and challenge the status quo, advocate for policies that prioritize Youth Development and engagement. Together we can build a space where opportunities are not limited by circumstances where every young person can access the tools to succeed. Our efforts are a commitment to being a catalyst for change. It is about recognizing our collective efforts can create a Lasting Impact and achieve a future brighter, more inclusive and filled with hope. Lets continue empower the youth. Equip the skills they need and celebrate successes as our own. Thank you ofa having the Latino Task Force be a part of the work. The future belongs to youth and these partnerships are the key to unlocking this extraordinary potential. Congratulations, everyone. [applause] alright. As we close our program i want to thank you. Thank you for participating. Our drump circle interns for the last indiscernible before i call dr. Davis back up, our drum circle interns you want to come down and ill introduce mr. Arturo, the drum circle. You all come on down. Arturo is a Program Director with San Francisco street violence intervention program. Working to build meaning fm positive relationship with community, helping indiscernible incorporates drum circles to treatment bringing healing of drum to the clients. Today he brings the healing to us. Please welcome mr. Arturo. Bringing back dr. Cheryl davis. Alright. We are about to wrap up it. We are going to get ready for lunch and cannot remember if i did this before and if i did well do it again. Give a round of applause for miguel, allison and the folks at chase center for opening up for us. The warriors play in here with the champions because you all are champions. Wave to miguel. You got to act like we are in the warriors stadium. People complain how loud it is in here. Lets hear the noise and thank you for the warriors. Who wants to be invited back for a Warrior Games and be in these seats . If you want to come back to the game and want miguel to believe it, give a round of applause for the chase center. [applause] you hear that miguel, we want to come back for a game. Alright. So, thank you all again for being here. Thank you for trusting your summer with us. We are going to end it on something that is focused on how we come together. How we get in sync. How we align ourselves. Brother arturo is going to kick us off. Here is what im going to ask, and he will direct. This is what im saying and what i watch the most for. These things you might think are hokey and why are we listening to the speeches, anybody who had a job these adults on the side over here know that at some point in time there are two things that are going to happen. One, you have to go to a professional Development Workshop you may not enjoy and listen to a lot of people talk and wonder why you are there. And two, you will have go to is a social engagement where you watch people dance that you never want to see people dance again. That is what this is about. You got to understand that going to work isnt just about your 9 to 5. It is about how you build relationships, it is about how you sit and engage, it is about how you attend workshops and convenes you may not want to be a part of, because with you show up and look like you dont want to be there your boss knows it. We are giving practice how to show up and be in space and do conversations and drumming. Arturo, let me know when you are ready and well get ready to go. Give it up for arturo while hes getting set up. [applause] getting ready to do this. You ready arturo . You need this mic . The chief wants to get in on that. I would invite paul, but not sure about his rhythm. No, paul, you can take a seat. Hello, hello, hello. Dont play yet. Dont play yet. Dont play yet. We are all ready to eat, so arturo, lets not take too long. Alright. Good afternoon everybody good afternoon the drum circle we are going to do is a medicinal drum circle. We take rhythms from africathe intention is have intention on each rhythm. The first rhythm is called indiscernible it comes from west africa, jamaica and the intent is ask ancestors to come into the circle and Bring Positive Energy to the circle. Im going to start it, and then i want you all to follow. It goes like this, first rhythm goes [drum] then you gotogether. Second part, [drum] im going to do the full rhythm and then you follow. [drumming] keep going. Not too fast. Not too fast. Come on chief [drumming] at the count of 5 hit the drum. 1, 2, 3, 4okay. Alright. Give them a round. [applause] this next rhythm is a rhythm called indiscernible this rhythm, the intent is to honor the female energy. All you mothers, you sisters. Thank you for helping us knuckle head men, right, be nurtured, calm, smarter then us. Thank you for your energy and we love you. It goes like this, ill start and you follow. [drumming] 1, 2, 3, 4. Last rhythm, heres one from trinidad. The saying goes, say calypso play calypso. You all did it for the rapper, how come you cant do it for me . Say calypso, play calypso. [drumming] bring it up, bring it up. 1, 2, 3, 4thank you. Give them a round. You all make sure to give sarah your name or shanell who will make sure the folks that participated in the circle, we appreciate folks participating, shanell will make sure you get a hundred dollar gift card so thank you for your participation give them a round of applause for taking the risk [drums] yeah, the chiefthat does not include you. [laughter] you already get overtime. So, give yourselves a round of applause for sitting through all of this. [applause] we want to thank again the chase center, and bone apteat. We have lunch upstair, make sure you leave with a bag and im going to be watching, looking. Sarah and i will look for who can get bonuses for attitude, behavior and engagement on the way out the door. Give yourselves a round of applause. Congratulations rchlt thank you for being a part of opportunity for all this summer. See you all in the room for lunch. Dont eat it all and please dont let people breathe over the food, because i dont want germs. Thank you sfgovtv and our partners at the chase center. We appreciate you. [singing and music]