When Robert F. Carlson was first elected to the governing board of the Public Employees Retirement System, the world was a different place: Richard Nixon was in the White House, the Vietnam War had four years left to go, Dick Cheney had hair, and the Sacramento Bee was an afternoon paper.
Thirty-six years later, Carlson is still on the board.
But not for long: He’s retiring, and his seat will be filled in an election. It’s an unusual race with a limited electorate, specialized issues and vast amounts of money at stake to run the nation’s largest public pension fund, which provides benefits to 1.5 million people and controls some $255 billion in investments.
Typically, these campaigns evolve in obscurity. From first to last, it takes two months to conduct the mail-only voting, tabulate the results and swear in the victor. The voting, which began Nov. 9, ended Friday; the results will be announced next week, and the swearing-in will be in January. The price tags of CalPERS campaigns, in comparison with seven-digit legislative, initiative or statewide races, typically are miniscule.
But this year there are twists.
First, the money is significant: A campaign backing one of the candidates, retired L.A. school district fiscal officer Henry Jones, has made some $340,000 in independent expenditures, almost all of it for mailers. The group, CalPERS Retirees for Henry Jones, includes retirees and active public employees. The group’s principals include Dean Tipps, executive director of the SEIU state council, and Dave Low, an assistant director of the California School Employees Association.
“This is unheard of. One guy called me and he said he had never spent more than $1,000 on any of his races,” rival Perry Kenny noted. Kenny, former president of the California State Employees Association, or CSEA, said he has raised and spent about $20,000.
Second, the contest raises the public labor tensions that have become familiar in the Capitol between the 140,000-member CSEA and the Service Employees International Union. SEIU’s Local 1000, with 85,000 members, is the single largest bargaining unit of state employees, and the SEIU and CSEA have been in a number of disputes, stemming in part from a split years ago between the two groups.
Carlson, also a former ranking CSEA official, has endorsed Kenny. SEIU and a variety of government employee groups, including the California Faculty Association and the Association of Federal, State, County and Municipal Employees, have backed Jones.
“As you know, our RPEA Board endorsed Henry as the best-qualified candidate at our board meeting in April after listening to and questioning all three candidates,” said Bill Duclus, legislative director of the Retired Public Employees Association of California.
Kenny, who served three terms as the elected head of the CSEA, is backed by the CSEA and the CSEA Retirees, Inc.
“The reason for keeping a former CSEA president on the CalPERS Board of Administration is clear — they are steadfastly in our corner on issues of pension protection and holding down health care costs,” the CSEA retirees group said in a statement. Kenny agrees. “I’m a voice for the retirees, and I’ve represented retirees my entire elected life.”
Jones, who began his career as a union janitor organizing for wage and benefit increases, rose to become the chief financial officer of the Los Angeles Unified School District, managing a $7 billion budget and large investment portfolio. He believes that preventing the erosion of retirees’ benefits is a key concern.
“The fear that comes from aging without health care benefits, coupled with assaults on a pension system that we’ve built over a lifetime and difficulties finding affordable housing on a fixed income become reasons for grave personal concern,” Jones says on his Web site.
The fight for the seat also is important because, unlike many other elected positions, term limits don’t apply here. And that means that the seats don’t often come open. The seat, by law, must be filled by a retiree from an agency served by CalPERS. There are about 400,000 such retirees, and only they are eligible to vote in the election.
The Jones-Kenny contest is a runoff. Originally, there were three candidates: Jones, Kenny and Susan Bergeron-Vance, a retired finance director from the City of Santa Fe School District. In the October election, Jones received 44.6 percent of the vote, Kenny received 33.5 percent and Bergeron-Vance got 21.9 percent. Since no candidate got at least 50 percent of the vote, a runoff was required to be held between the two top vote-getters, Jones and Kenny. Bergeron-Vance endorsed Jones.
The retirees’ seat is one of 13 board slots — six of them are elected and seven of them are appointed by the governor or filled by virtue of the members’ public offices. Of the non-elected members, two are named by the governor, one each by the Assembly speaker and the Senate Rules Committee, and the final three are the state treasurer, controller, and a representative of the State Personnel Board.
Of the six elected members, two are drawn from throughout CalPERS’ membership, another must be from only active CalPERS members, the fourth must be an active CalPERS school member, the fifth is from public agencies, and the sixth, as in the Carlson seat, must be a retiree.
When the ballot counting began this week, nearly 123,000 ballots had been received from the 400,000 who were eligible to vote, a participation level of about 30 percent. By comparison, in the last statewide election for governor, about 40 percent of those eligible voted.
Despite the light turnout, the seat is important, the candidates say.
“There are only six elected seats — the other seven are appointed — and there is only one seat for retirees. It hasn’t been open for years,” Kenny said.