FROM: Debby Cherney, Chief Executive Officer
SUBJECT: Annual Review of SBCERA Retiree Medical Trust
RECOMMENDATION:
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Annual Plan Compliance Report for SBCERA Retiree Medical Trust.
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BACKGROUND:
In April 2019, the SBCERA Board approved a new Investment Policy Statement (“IPS”) for the Section 115 Retiree Medical Trust (“Plan”). The IPS incorporated the concept of an oversight committee (“Oversight Committee”) to ensure fiduciary compliance, including oversight of the available investment fund line-up and fees. The Oversight Committee consists of me, Chief Financial Officer Amy McInerny, and Trustee Marc Bracco. The fund line-up for the Plan was substantially overhauled at the time the IPS was adopted by the Board, and has been modified over the years.
In April 2026, staff engaged the Morgan Stanley Fiduciary Consulting Group (formerly the Hyas Group) to review the fund line-up and fees and provide an overall report on the Trust. That report is attached as Exhibit A. The Oversight Committee met with Hyas Group via video conference on June 10, 2026 and reviewed the report.
Overall, the Plan’s investment line-up is meeting the quantitative and qualitative factors established under the IPS. No changes were made to the fund line-up, although the Voya Fixed Account and the Vanguard Target 2020 fund remain on watch for quantitative performance factors.
Conforming to best practices, the Oversight Committee also reviewed the IPS, and adopted changes reflected in redline format, primarily associated with target date funds indexes and definition. The redlined IPS attached as Exhibit B.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Prudent Fiscal Management
COMMITTEE REVIEW:
This item was reviewed by the RMT Oversight Committee. No Board action is required, other than to receive and file this annual report.
STAFF CONTACT:
Debby Cherney
Amy McInerny
ATTACHMENTS:
Exhibit A: Fiduciary Consulting Group Report (Confidential)
Exhibit B: Investment Policy Statement, updated June 10, 2026