Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Annual Report

Following is an update for all members who were not at Conference regarding the state of PORAC’s finances. Feel free to contact me with any questions.

PORAC investments: As of a recent conversation with Mark Sikorski, our investments were up around 16%, and that is with 25% of our monies in fixed income/bonds. The S&P for the same period is up 16.88%, which means our accounts are doing very well. Obviously, we would be doing much better if 25% of our monies were in stocks; however, there needs to be some security built into our investments. Since Mark and I began managing these accounts, our reserves have increased from $2.05 million to $9.7 million. About $3 million is segregated for any pension issue that may arise.

The audit: Finance and Administrative Manager Kim Busman was very busy this past year. We realized a savings at the closing of last year’s books, which was welcome news since there were several unexpected expenses along the way. We dealt with the same points of concern as we have in the past — the prominent one being having just one person controlling our finances — but there are security measures in place to prevent fraud. Those security measures are your executive officers, Executive Committee, Board of Directors, Budget and Fiscal Management committees, and the auditors.

Last year the auditors were also concerned about the amount of monies being held by PORAC chapters, with varied methods of oversight. However, they were pleased with the progress made by our chapters in providing better reporting methods to show where and how the money is being spent, along with oversight on their respective funds.

The budget: PORAC’s Budget Committee, composed of Executive Committee Directors Barry Donelan, Randy Beintema, Anthony Sanders, Laren Leichliter and me, has been very busy through this budget cycle. The committee decided to take a look at portions of the budget where it felt the organization could be more efficient. The Budget Committee has taken its fiduciary responsibility very seriously and is not afraid to ask tough questions and make tough budgetary decisions.

That brings us to next year’s budget. Over the past few years, I have presented the members with an unbalanced budget predominantly in the red, but we have always ended up in the black. This year we put together a budget that is in the black right from the outset.

Fiscal Management Committee: Your Fiscal Management Committee (FMC), which is composed of board members from each region, met in May this year to review PORAC’s vouchers from last year’s Conference up to April 2017. Upon review of the vouchers, the Committee did not find any discrepancies as to how PORAC is reimbursing its directors. Besides reviewing the vouchers and contracts, the FMC is in place to deal with any other issues that may arise that affect how PORAC manages your monies. It is the committee tasked with looking at the issues raised by our auditors and finding working solutions to ensure the organization remains fiscally strong.

PORAC assets: The PORAC building continues to show its age. We have had to invest in a few fixes here and there. Unfortunately, due to the current sentiment about law enforcement throughout the nation, we felt the building needed additional security both on the exterior and interior. The Board authorized an extensive capital improvement project. To that end, we purchased a state-of-the-art camera system that provides excellent video security to our building; in addition, we are able to remotely access the cameras.

Last year, we also had to conduct some significant foundation repairs on the PORAC house. The repairs were completed last September. This year we made the cosmetic repairs, since the Board gave Kim and me direction to sell the house and purchase two condos. Kim conducted the lion’s share of the work and within a month had sold the house and purchased two condos. With the money from the house sale, the condos cost around $113,000. They are near headquarters, close to the State Capitol, and should provide very well for the housing needs of our president, vice president and treasurer for years to come.

Headquarters also needed to update its over 20-year-old phone system. The 2017 budget included funds to replace it, which occurred in August. The system is now more user-friendly and has several added features that help serve our members better.

From your Treasurer: Future conferences will be held at the Atlantis Casino Resort Spa in Reno, Nevada, in 2018; the J.W. Marriott Desert Springs Resort & Spa in 2019; and Disneyland in 2020. We will begin looking at venues to host our 2021 conference in the early part of 2018.

As 2017 comes to a close and we move into 2018, I am, as always, fully committed to being the fiscal watchdog of PORAC’s financial operations. I wish you and your family a safe and wonderful holiday season.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Protecting PORAC’s “Mint” Financial Footing and Addressing the Auditor’s Concerns

As mentioned in a past article, PORAC fared well during our audit of prior years’ financials. However, we did receive a management letter from the auditor noting a couple areas of concern. Finance and Administrative Manager Kim Busman refers to the management letter as a report card of her ability to properly manage PORAC’s finances. Therefore, she equates anything above the segregation of duties issue as needing to be remedied immediately. Based on the size of our organization, we are not going to be able to avoid the issue of segregation of duties. It would require a much larger accounting department, which would be cost prohibitive and a luxury for our organization. However, we don’t take this issue lightly; as such, we have numerous checks and balances put in place to ensure the organization is protected from being defrauded by one of our own. Those checks and balances include the regular review of our financials by the PORAC president, vice president, Fiscal Management Committee, Budget Committee, Board of Directors and treasurer.

Consequently, we arrive at the second noted area of concern, which is PORAC’s management and oversight of chapter funds. Last year, the auditors were concerned that PORAC was not monitoring how chapters spent their reimbursement monies. Furthermore, the auditors noted that some chapters kept large balances of cash, which in the long run can increase PORAC’s risk of fraud. As a result, the issue was referred to the Fiscal Management Committee to evaluate and come up with a possible solution. The Fiscal Management Committee met and discussed the issue, and Kim and I developed guidelines for how PORAC can better monitor our chapters’ general fund income and expenses, along with how those items are documented and reported to PORAC. During the Board meetings, the topic of chapter spending became a lively one; however, we were able to agree on making sure that chapters are using their reimbursement monies for the betterment of our members. For example, the Inland Chapter will usually select an active small association to send to Conference or Symposium to help develop the association’s leadership to better serve its members, or we will cover the expenses of the chapter executive board to attend Conference or Symposium. Other options consist of practices that many of you are currently using, such as supporting member association fundraising events, socials or, everyone’s favorite, golf tournaments.

I realize that I am taking you back to events from a couple of years ago; however, I’m doing so to inform you that our auditors were pleased with our efforts in this year’s audit. With that said, I want to thank all the chapters for taking the auditors’ and your financial team’s concerns seriously and helping us show that we are diligently doing what is best for the organization. Please keep up the good work so that we don’t revert to stockpiling money that would be better served to benefit our members.

For the most part, everyone is doing a great job when it comes to the reporting process. We appreciate everyone’s diligence in completing the reporting form, which helps to provide us with additional information and justification for how your monies are being spent. Kim and I understand that chapter treasurers volunteer their time. Therefore, we need to ensure that we address the concerns of the auditors while not overly tasking our chapter treasurers with complex financial requirements. On the other hand, the chapter’s financial practices are not just the responsibility of the chapter treasurer. The chapter executive board and members should be reviewing the chapter’s financials to ensure the chapter is properly spending its monies.

From the results of the audit this year, it appears we achieved our goal of creating a better system for PORAC HQ to monitor chapter expenses. As such, we were able to provide our auditors with the steps taken to satisfy their concerns about how PORAC oversees chapter funds. It’s important to bear in mind that PORAC is ultimately responsible for monitoring its funds at every level and needs to be able to show that people tasked with handling members’ monies are being held accountable and that those individuals are being responsible with your monies.

The last issue brought up was looking for an insurance mechanism for our PIC/PAC monies. As we are all aware, PORAC has substantial funds in our PIC/PAC accounts. As such, the auditors were concerned those monies were not properly insured to prevent loss. Kim and I, along with our PIC/PAC firm, are working on a viable solution for insuring those funds.

Once again, thank you for your efforts. I look forward to providing you with an update on the progress of this issue at Conference, along with additional insight on the positive work being accomplished by your PORAC financial team. Over the past several years, I have made a commitment to be your fiscal watchdog, and I continue to stand by that commitment. PORAC has made great financial strides over that past several years, and we need to ensure that it continues being financially strong through prudent fiscal management and oversight.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

PORAC’s Budget Committee and financial team, composed of Executive Committee Directors Barry Donelan, Randy Beintema, Anthony Sanders, Laren Leichliter, President Mike Durant, Vice President Brent Meyer, Finance and Administrative Manager Kim Busman and I, have been busy through this budget cycle. The committee continued to focus on areas of the budget where we felt the organization could be more efficient. We have taken our fiduciary responsibility very seriously and are not afraid to ask tough questions or make adjustments as needed to ensure the financial health of the organization. The Budget Committee understands that our decisions are focused on doing what is best with your money. Therefore, some areas were targeted for potential cuts on the basis of whether PORAC is utilizing its money wisely and efficiently. The committee delved into a concept that is very hard to overcome, which is changing what is known as business as usual. Therefore, we looked at areas where the budget could be streamlined, along with increasing efficiency and reducing potential unnecessary expenditures. This requires a paradigm shift away from the concept of “That is how we have always done it.”

“How we have always done it” could eventually become a costly venture for our organization. While PORAC is fiscally strong and can continue to sustain practices along current lines, the real question should be “Why should we continue doing it that way, and is that based on best practices?” Moreover, I believe the Budget Committee is willing to bring forth this concept to the rest of the Board of Directors to make sure the Board members are asking themselves the same question. Ultimately, we want to ensure that the cost of the existing practice does not outweigh the benefit to the organization. This discussion brings to light the concept of cost-benefit analysis or return on investment (ROI). The areas that the committee looked at were evaluated for whether PORAC is getting the best ROI from them.

Unfortunately, budget decisions are not evaluated in a vacuum, and those who are affected by them may feel that the changes are personal attacks. However, budgetary decisions are not made with ill will or thoughts of retribution; they are made to ensure that those proposing the changes are fiduciary with the members’ monies. If it means that the organization can save a few hundreds or thousands of dollars by curtailing certain practices, then the organization needs to consider those changes. While those minor adjustments may seem insignificant in the greater scheme, over time they add up to significant amounts that can be used to strengthen the organization’s financial footing or toward other projects. Nonetheless, it is important to keep in mind while making budgetary adjustments to consider the overall impact, and not just to make changes because it saves money.

On another note, remember that if you are on your POA’s or DSA’s board, you have a fiduciary responsibility to your members. Your members have elected you to keep their best interests in mind, especially when it comes to financial matters. If you fail in your responsibility, you are subject to legal ramifications. Please take your responsibility seriously, and make sure to review your POA’s or DSA’s financial statements, ask questions, and ensure that there are checks and balances in place to avoid fraud and deception.

I am proud of the work being done by the Budget Committee and the rest of the PORAC financial team. Everyone is working diligently to ensure that PORAC is a force to be reckoned with, as well as protecting your money. I look forward to having the final draft of the 2018 budget for your review at Conference, along with the opportunity to provide you with additional insight on the positive work being accomplished by your PORAC financial team. I have made a commitment to be your fiscal watchdog, and I continue to stand by that commitment. PORAC has made great financial strides over the past several years, and we need to ensure that it continues to be financially strong through prudent fiscal management and oversight.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Gearing Up for Conference

Last year’s audit is now completed, and PORAC fared well. We had the usual challenges discussed by the auditors, which were delineated to the Board of Directors. The concerns were discussed, and the Board understands the reason for these challenges. I was provided with direction to resolve those issues that are within our sphere of influence.

The Budget Committee met and finalized the 2018 proposed budget. The budget was presented to the Board of Directors at the August meeting. The next phase is to have you and the rest of our members review the budget at the Conference of Members.

Last year at this time, we were discussing making some capital improvements to the office building pertaining to the area of additional security. As always, Kim did some great work in obtaining bids to ensure the Board was getting a range of choices when deciding how to approach providing enhanced security to our building. Those improvements were made, and the new security camera and building access are working perfectly.

This year, we conducted a comprehensive salary and benefits study to ensure we were doing the right thing by our employees (a study we usually perform every six to 10 years). As a bit of a historical context, we normally look at a two-year window when considering adjustments for staff. Kim and I are also working on a plan to make sure that our employees feel they are being taken care of during the years we don’t conduct a salary survey. We are exploring performance-based bonuses for the interim years. Now back to the comprehensive study. The assessment reaffirmed what PORAC has been doing all along, and that is taking care of those who serve you. We had to make some minor modifications on certain employees’ salaries, while others were Y-rated for the time being. PORAC has taken a firm stance of ensuring our employees are well compensated and that their salaries are not negatively impacted when there is an overall market decline in a certain classification.

After reviewing the results of the comprehensive salary and benefits study, the Compensation Committee met to discuss making positive adjustments to a few employees’ salaries. The Compensation Committee will recommend to the Board that the salary adjustments be approved in order to put them into effect at the beginning of the 2018.

Our investment tsar, Mark Sikorski, made a presentation to the Board of Directors about the outlook of the market. Interestingly, based on how the market has been performing throughout the year, his assessment of what is going to happen was clear as mud. But keep in mind, the market has done some interesting things this year. Ultimately, the feeling in the financial world is that we are looking at an adjustment and/or correction in the market. However, the geniuses believe the market could potentially reach record highs at the year’s end.

Please don’t forget to attend your local chapter meetings and keep yourself informed as to what is occurring within your city, county and state, especially in the anti-police environment we find ourselves today. It seems there are many out there who profess to know how to do our job without ever having donned a uniform. Yet it is those who condemn us who are also the first to expect our help when things go sideways. Please be sure to attend your chapter meetings and take an active role in helping to further the goals of your association and PORAC throughout the state.

I look forward to seeing everyone at the Conference of Members in San Diego and providing you with the opportunity to review your 2018 PORAC budget as well as addressing any other financial questions, suggestions or comments you may have about PORAC’s financial health.

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

It’s Budget Time

Last year’s audit is in the wrap-up stages. It appears your PORAC financial team was able to gauge our income and expenses fairly well. At the end of the day, when you deduct our unrealized gains and losses on our investments, we ended up with a surplus.

By the time you read this article, the Budget Committee will have already met and be well on the way toward presenting the 2018 proposed budget to the Board of Directors. As has been our past practice, our accountant has done an extensive review of the past three to five years’ income and expenses to create a better prediction for the 2018 budget. We continue to see some certainties in areas where increases will be needed.

When preparing your association’s budget for the coming year, you may want to consider using the three- to five-year average method. Association budget preparation calls for a bit of a paradigm shift in your thought process. You need to shift your thought process from government budgeting to business budgeting. There are a few considerations in this paradigm shift to prepare your association’s budget. In the first phase, you need to determine what items you are looking at maintaining at status quo and which will require an increase or decrease. It is in this phase that the three- to five-year average comes in handy in providing justification for the amounts you have decided to place under each category. Second, it’s important to remember that in business budgeting, a surplus in your previous year’s budget shows that you have done a great job in the budgeting process as well as in keeping your fiduciary responsibility to your members. Conversely, the surplus does not mean you need to go and spend the money before the end of the budget cycle for fear that item will not be fully funded for the following year. Remember that, as association leaders, you make the decisions on what will or will not be funded for the following year.

Finally, do not set your budget in stone. You are not required to have your members formally adopt the budget. That does not preclude your members from reviewing it and making recommendations. If it’s your association’s practice to formally adopt your yearly budget, you may want to reconsider that practice, especially when it comes time to modifying your budget by making significant increases to a specific line item. If your members formally adopted the budget, you will be looking at having to get your entire membership to meet and adopt the change. Now, if you are a part of a small association, this may not be a problem; however, for large associations this could be a costly process. Notwithstanding either approach, keep your members involved and informed during the budget process by giving them the opportunity to review it along the way and providing them with guidance through the fiscal roadmap your board has decided to take for the following year.

As an association member, by not setting your budget in stone, you are not automatically giving your board carte blanche to do as they please with your money. This is why it is imperative that the bylaws and standing rules that govern your board, president and vice president’s actions when spending your money are up to date. Your bylaws and standing rules should clearly delineate how much authority you are willing to give the aforementioned executive officers when it comes to making financial decisions, and when they need to seek input from the members.

Please don’t forget to attend your local chapter meetings and keep yourself informed as to what is occurring within your city, county and state, especially in the anti-police environment that we find ourselves today. It is extremely unfortunate that certain groups can espouse hatred and ill will toward law enforcement, but we have to be the ones to stand up and support each other. It is unfortunate how those who condemn us are also the first to expect our help when things go sideways. In addition, we have some politicians who can’t help but jump in front of a camera to make uneducated, unnecessary remarks about events that are not textbook in nature or that are considered inappropriate or wrong by those who have never done this job or faced making a critical decision in their lives. Hopefully, you understand your chapter meetings are imperative — see you there!

Ultimately, I or Kim Busman, your PORAC Finance and Administrative Manager, are available to assist you should you need help with your association’s budgeting needs. I look forward to seeing you at Conference in San Diego and providing you with the opportunity to review your 2018 PORAC budget. By the way, don’t forget to register early for this year’s Conference. You may do so at www.porac.org.

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

PERS Investing in Unicorns and Rainbows, Part II

PORAC has taken an active role in ensuring that CalPERS is focusing its fiduciary responsibility on the health of its funds, not whether the investment mechanism is politically correct or not. During the legislative portion of the June Executive Committee meeting, we had the opportunity to discuss PERS and its investments. Your PORAC Board took active steps to ensure that we actively oppose any bill that deals with CalPERS divesting. Last month, I discussed the Legislature’s concern with where CalPERS chooses to invest its money. The Legislature is not concerned because CalPERS is making poor choices and failing in its fiduciary responsibility, but because it is choosing to invest in politically incorrect funds, such as tobacco, oil, coal, the Dakota Access Pipeline and other similar investments. While these investments may be politically incorrect, they are making solid positive returns. Nonetheless, the Legislature has chosen to run three bills to get PERS to divest its investments in tobacco, oil, coal and other politically incorrect ventures: AB 20 (Kalra), AB 946 (Ting) and AB 1597 (Nazarian).

It is very interesting how the health of the fund is not the prevailing issue for our state legislators, but the type of fund the money is being invested in. Unfortunately for our legislators, the “Unicorns and Rainbows Fund” is not making the needed returns to make PERS sustainable. However, since our state is beyond blue, the legislators worry about what funds the money is in versus the return on those funds — which is quite a dichotomy, since they should be focused on helping their local counties and municipalities reduce their respective CalPERS unfunded liabilities. What better way to help than ensuring that CalPERS is making the best returns possible? It’s obvious that legislators are being myopic and foolish, or following the misguided requests of their constituents. However, I find the latter a bit hard to accept, since most of their constituents who would follow CalPERS and its investments are probably concerned about its recent dismal returns. While tobacco, oil and coal are politically incorrect, they are generating healthy positive returns, which is what PERS needs to achieve sustainability.

Fortunately for everyone, PORAC has taken an active role in ensuring that CalPERS does the right thing and puts its money in areas known to be profitable, if not necessarily politically correct. However, we need your assistance in this area. I will digress for a moment based on a meeting we had with an Assembly member at the Capitol. Assembly Member Cooper is a retired Sacramento Sheriff’s captain. He scheduled a meeting with us on Sunday evening to discuss some of the things occurring at the Capitol dealing with law enforcement in California. During this meeting, we were able to pick up some gold nuggets on what we can do collectively to help ourselves.

PORAC represents more than 69,000 active and retired members throughout California. We have an outstanding platform and collective voice to help enact change, despite some of the things going on regarding law and order. It is in this area where each individual member of PORAC can help. As you monitor the bill chart included in the PORAC magazine and on the website, you can take an active role by calling your local legislators and expressing your thoughts on how they should vote on the legislation. Your local lawmakers are actually concerned with what you think as a constituent. Please make every effort to take a few minutes and share your opinion; don’t just rely on PORAC to carry the weight. We will continue to do so, but we can be an even more overwhelming force with your support. I have listed the divestment bills in this article, so as you call your local legislator, share with them how you feel about this legislation.

Please remember to keep yourself, family and friends informed. PORAC continues to work diligently to maintain the strength and vitality of your pension investments. It is imperative that you do your part by attending your local chapter meetings, taking the time to make a phone call to your local legislators to express your views and keeping yourself abreast of the ever-changing situation in our state. Information is constantly flowing from PORAC and other sources that affects us all. Your chapter meetings are the dissemination points for this information and your opportunity to get clarification on those issues. See you at your next chapter meeting.

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

PERS Investing in Unicorns and Rainbows

The California Law Enforcement Officers’ Memorial Ceremony was fresh on my mind as I wrote this article. As always, it is a somber occasion filled with the grief and sorrow of family members, friends and colleagues over the passing of peace officers throughout the state. Consequently, the ceremonies are a source of reflection on the inherent dangers of our profession. Regardless of how long we have been officers and how invincible we believe we are, the ceremonies make us stop and think about our own mortality.

As the dignitaries were speaking, I began reflecting on those officers’ last thoughts and interactions with their family and friends. Did they have the time to share how they felt about their loved ones? Did they have the opportunity to share with their spouse, children and friends what each of them meant in developing them into the person they were? Do we take the time to do that today? Ultimately, it is important that we express how we feel to our loved ones as often as possible, because we don’t really know if that will be the last time we get to share how we feel about them. As we focus on the families of our fallen officers in this issue, please take the time to reflect and focus on strengthening your family ties.

The day following the ceremonies, it was back to work. We were in the Capitol on our Legislative Day visits. During the legislative portion of the Board meeting, we had the opportunity to discuss PERS and its investments. It seems that the Legislature is concerned with where PERS chooses to invest its money. However, the Legislature is not concerned because PERS is making poor choices and failing in its fiduciary responsibility — it’s concerned because PERS is choosing to invest in politically incorrect funds such as tobacco, oil, coal and similar investments despite solid, positive returns. The Legislature has chosen to run three bills to get PERS to divest from these ventures.

It is very interesting how the health of the fund is not the prevailing issue here; rather, it is the type of fund the money is being invested in. Unfortunately for our legislators, the “Unicorns and Rainbows Fund” is not making the needed returns to make PERS sustainable. However, our state is beyond blue, in that we worry about what funds the money is in versus the return on those funds. Tobacco, oil and coal are generating positive returns, which is what PERS needs in order to achieve sustainability. This is just another way that legislators are being myopic and foolish, and these are probably the same legislators who will later blame us for bankrupting cities and counties. Fortunately for everyone, PORAC is taking an active role in ensuring that PERS does the right thing and puts its money in those areas known to be profitable. PORAC has taken an active oppose on the various divestment bills, and our lobbyists are going to ensure any future legislation is immediately brought to PORAC’s attention. I want to thank our colleagues from the Corona Police Department, who are making it a point to attend the PERS Investment Committee meetings to express their dismay about making any divestments in profitable ventures and rebutting the arguments from the proponents of the Unicorns and Rainbows Fund.

There is a silver lining to this picture. PERS is not required to comply with the political pressure to divest — even if it comes in the form of legislation — if it can determine such actions would be detrimental to returns. However, everyone knows boards are susceptible to political pressure, which could ultimately affect the sustainability of the investment returns, and diminishing returns would mean an increased cost to the various agencies within PERS and potentially the taxpayers.

Please remember to keep yourself, your family and your friends informed. PORAC continues to work diligently in maintaining your political voice as well as the security of your privacy, while balancing the public’s need for transparency. It is imperative that you do your part by attending your local chapter meetings and keeping yourself abreast of the ever-changing situation in our state. Information that affects us all is constantly flowing from PORAC and other sources. Your chapter meetings are the dissemination points for that information and your opportunity to get clarification on those issues. See you at your next chapter meeting.

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Time to Look Within?

We are changing gears this month by focusing on ourselves. Last year I discussed the topic of post-traumatic stress disorder (PTSD) by evaluating the choices you make that may have an effect on your body and ability to successfully enjoy your retirement. All of us realize that we are in a high-stress career. Along the way, we find various methods to manage our stress — some are healthy, while others may be the cause of additional stress. Similar to our military and their tours of duty, we have a tour of duty that lasts about 30 years, all the while taking a toll on our emotional and physical well-being. Hence, “time to look within.” However, this time it pertains to your emotional portfolio rather than your financial portfolio.

During the early to middle portions of your tour is the perfect time to reflect on how you are managing your emotional portfolio. Nonetheless, if you have gone past the midpoint in your career, don’t think it’s time to throw in the towel. You still have plenty of reflection time. Be mindful that most of us would look at ourselves and quickly think, “I’m doing fine.” This is why in the financial world there are checks and balances. At the end of the fiscal year we look at the numbers and say it was a great year (or maybe not). However, the buck does not stop there; we turn our books over to the auditors and have an independent review to determine where there were possible mistakes or to identify areas where improvements could be made.

Now, you have the opportunity to turn the books over and conduct your own audit. Begin with your family and then move on to your close friends. This should provide you with a clear picture as to the status of your emotional portfolio. Remind your family and friends to be bold and honest in their evaluations of you. You may learn that you have made both wise and poor decisions in your personal investment choices. Fortunately for you, your family and friends are a whole lot more forgiving and supportive than the investment world and are willing to help you along in the process toward reconciling your books and achieving your goals.

The audit process is a perfect start toward making positive changes in your emotional account — especially if your family and friends feel that you are not taking positive strides toward managing your stress, which, in turn, will increase theirs. Lately there have been numerous reports on “second hand” stress and the negative effects it has on our family and friends. Depending on how your personal portfolio is doing, there are remedies out there to improve your situation. Even if you are operating in the positive zone, it does not hurt to have an advisor provide you with some detailed guidelines to keep you on the right track.

Take some time to review your agency’s employee assistance program (EAP) or medical insurance coverage to get professional advice on diversifying your emotional portfolio. If not for yourself, then you have a resource to offer your partners should you realize they are in need. It is incumbent on all of us to not only back our fellow officers in times of danger, but also in times of emotional need.

Here is a short list of some reading material to help you gather more insight on this very important topic.

I close with retired Lieutenant Marty Van Lierop’s words: “Remember two things. First, you can’t control the direction of the wind. But you can adjust your sails! And remember your goal. Live long enough and healthy enough to draw retirement benefits for at least the same number of years of service you put into the system!”

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Here We Go Again: Cut, Cut, Cut!

Your Executive Committee recently returned from its biannual pilgrimage to our nation’s capital. Last year around this time we were dealing with an upcoming election, so there was a whole lot of posturing going on. Unfortunately, the posturing did not work for the Democrats, since they lost the presidency and the Republicans kept control of both the House and Senate. Last year’s efforts were focused on the Electronic Communications and Privacy Act (ECPA), Next-Generation 9-1-1 and continued federal funding for DOJ programs. While we were lobbying to continue funding and ensure that the initiatives were laws we could work with, both candidates were trying to make themselves look good. At the end of the process, Donald Trump was successful in persuading the American people that Hillary Clinton was not the right option. While a Republican in office is good for law-and-order issues, it may not be so good for the bread-and-butter issues — i.e., benefits.

With that being said, it appears that the President’s initial budget shows a 3.8% reduction in DOJ spending. DOJ is responsible for Byrne JAG, COPS, HIDTA and body-worn camera pilot program funding. Unfortunately, his budget proposal is very ambiguous, otherwise known as a “skinny budget,” on the proposed funding levels for the offices and programs within DOJ. There are no specific amounts recommended for funding COPS, Byrne JAG and other programs instrumental to our efforts. As usual, our plight does not change, and during our meetings we encourage our respective members of Congress to maintain or increase spending in DOJ programs, and definitely not to cut the funding. What was concerning to us during this visit was that the “skinny budget” proposed to eliminate about $700 million in spending on programs that are considered outdated or thought to have reached their desired goal. The problem with such a proposal is: Who gets to make the decision about the program’s usefulness or whether its objectives have been met?

While the House passed its ECPA legislation during the last session, the bill contained some flaws. Our goal this time around was to get the Senate to take up its version of the ECPA bill, but with some changes to ensure that electronic communication does not have more protection than physical evidence. As it currently stands, there are no exigency, consent or plain view exceptions to the updated federal ECPA laws — which means we must obtain warrants to get electronic communication posted on public social media sites and, if a person gives us consent to access their emails or other electronic communication, the service provider does not have to comply and give us the information. It is obvious that the House legislation needs some work, and it’s our hope to get the Senate to realize these corrections need to be made.

The final piece was to continue pushing for Next-Generation 9-1-1. The Federal Communications Commission (FCC) has been working on this project for a while, and it needs Congress to push it along and make it happen. Next-Gen 9-1-1 is geared toward fixing the issues with locating wireless callers along a horizontal and vertical plane — in other words, locating a person in a multistory building. In addition, it would fix the issue with multi-line phone systems, such as those found in most of our places of employment, hotels, etc. This would solve the problem of calling 9-1-1 from a hotel, enabling the person dialing to just dial the number and not have to enter the prefix for an outside line before 9-1-1. Finally, there are the complications with Voice over Internet Protocol (VoIP). These systems are reliant on internet connection and power; therefore, if any component fails, the party needing assistance will not get it.

The aforementioned pieces of legislation were the meat and potatoes of our dialogues. However, by attending your next chapter meeting, you can receive more of the details from your local executive director.

Be safe and have fun.

Treasurer’s Message

Marcelo Blanco
PORAC Treasurer

Let Us Remember, When Filing Our Tax Returns

Wow, it seems like yesterday that we were exchanging gifts and making new year’s resolutions. Yet here we find ourselves, in the process of gathering receipts and preparing tax returns. However, some of you may be ahead of the game, have filed your returns early, and are putting your money to some constructive use or are preparing a payment plan.

As we find ourselves longing for football games and anticipating March Madness or the beginning of the baseball season, the space–time continuum keeps us edging closer toward April’s tax deadline. Just try to contain your jubilee for Tax Day, which happens to fall on Tuesday, April 18, this year, thus giving you an entire weekend and a couple extra days to gather as many receipts as possible. Based on how you structured your withholdings, this may be a momentous occasion, since you can expect to make a withdrawal on your established savings account with the state and federal government. On the other hand, you may be wondering if your calculations were accurate and whether you will break even or, worst-case scenario, have to make minor contributions for improper tithing to our government.

No matter what side of the fence you happen to fall on this year, let us remember our brothers and sisters who made the ultimate sacrifice. We can honor their legacy by checking the box on our state tax form to donate toward the California Peace Officers’ Memorial Fund. It is imperative we make every effort to contribute to this worthy fund, which helps the families of our fallen colleagues. Whatever amount you contribute is better than no contribution. Please don’t forget to check the California Peace Officers’ Memorial Fund donation box, whether you prepare your own taxes or have someone prepare them for you. If you are one of the early birds and have already completed your tax return, you can go online and donate at www.camemorial.org by clicking on the “Donate Now” tab.

Speaking of contributions and returns, I spoke with PORAC’s investment czar, Mark Sikorski from UBS, and discussed the health of PORAC’s investments. The overall health of our monies remains solid, based on the direction of your Board of Directors, PORAC’s investment policy and Mark’s guidance. According to Mark’s expertise and experience, PORAC’s investments are poised to continue making positive returns. Mark mentioned the market has been in a tight trading range for the past few months. In addition, per Mark, the market has been in uncharted waters. Even though the Fed just met and decided not to increase the rate for this quarter, the prediction is two 1/4-point interest-rate increases for this year. As always, Mark is available to assist you and your association with your investment needs. Feel free to contact me to obtain Mark’s information.

Finally, make every effort possible to attend your local chapter meetings. I realize for some folks, local could mean a few hours of travel. However, pension reform is still in the crosshairs of many of our opponents. Chapter meetings are your best source of information on how to deal with the aforementioned and any other issues respective to your area. PORAC represents over 69,000 members. The chapter structure was set up to be a source of information to our members, and the meetings provide the opportunity to visit with and gather information from the various trustees of the Legal Defense Fund, Long Term Disability Plan and Retiree Medical Trust.

Be safe and have fun.