Wednesday, October 13, 2010 – 01:00 p.m.
Last Updated: October 14, 2010 – 06:30 a.m.

The blame game has already started related to the various allegations swirling around San Bernardino County’s government pension fund.

Employees and trustees of the San Bernardino County Employees Retirement Association (SBCERA) are now pointing fingers and casting blame for the now-public missteps at the pension fund.

The fund, which has been slowly recovering from more than a billion dollars in loses at the height of the stock and real estate market crashes, has fallen under scrutiny from county supervisors. The focus? The funds performance, compensation practices and the awarding of sweetheart consulting contracts to people and firms who are either politically-connected or have ties to current and former insiders at the fund.

One outside investment manager has told the pension system is being operated somewhat like a “hedge fund”.

Now to the pay front.

Some time ago, pension fund trustees approved a variable compensation structure for certain employees of the pension fund, which made the individuals eligible for bonus compensation.

As an example, the retirement fund executive director at an annual salary of $325,000 was made eligible for an annual bonus of up to an additional $325,000. The actual bonus amount to be paid is based on the pension fund meeting certain investment objectives.

Frankly, if people want to make this kind of money, while building a defined benefit pension, they need to work in the private sector, not government.

Something Barrett has apparently decided to do.

Also, there is now a few instances of the “pot calling the kettle black” taking place, which seem worthy of note.

First, insiders tell that certain trustees along with outgoing executive director Tim Barrett and outgoing legal counsel Lance Kjelgaard attacked the proposed trustee appointment of Steve PonTell, management consultant with the LaJolla Institute and close friend of Board of Supervisors chairman Gary Ovitt. Even though the two men had no problem stomaching the appointment of San Bernardino-based certified public accountant Marvin Reiter.

Reiter is the campaign treasurer to District Attorney Mike Ramos and Sheriff Rod Hoops.

Secondly, Barrett and Kjelgaard also went along with proposing the pension fund board approve no-bid contracts to Orange County-based consultant David Ellis and Sacramento lobbyist Brett Granlund.

Ellis owns the firms Delta Partners LLC and The David Ellis Group. Grandlund is employed by the Sacramento and Washington D.C.-based lobbying firm Platinum Advisors.

The two men and their companies were awarded hundreds of thousands of dollars in contracts for marketing and governmental affairs work.

In a recent interview with Press-Enterprise columnist Cassie MacDuff “Ellis said they helped get special laws enacted enabling SBCERA to become independent and to handle other public investments.”

What is interesting here is that a check of a state database doesn’t list Ellis or his companies as a registered lobbyist as required by California law.

Ellis is also the political consultant to Ramos, and he was the long-time political consultant to former San Bernardino County Treasurer-Tax Collector Dick Larsen. Larsen, who sat on the pension fund board for more than a decade, abruptly resigned his elected office last summer.

Larsen is believed to have been instrumental in the pension funds adoption of the controversial compensation structures and approval of the aforementioned consulting arrangements.

Another interesting turn came this week as pension fund trustee Robert McDonald penned an article which was distributed to the funds retiree membership.

Besides blaming Ovitt for crashing the party, McDonald placed the pension funds woes on the safety retirement system, not investment performance. McDonald is spinning to as many people that will listen, the half-baked theory, that all the pension funds woes are being caused by the 3% at age 50 safety retirement formula.

Is this man for real?

Safety members in SBCERA pay the highest percentage towards their pension benefits than any other group of employees in the stand-a-lone county  system.

As a matter of fact, when the 3% at age 50 benefit was negotiated, the San Bernardino County Safety Employee’s Benefit Association (SEBA) agreed that safety members would contribute an additional 5% of their earnable compensation into the pension system.

An important fact McDonald and others conveniently overlook.

Also, at last report, the safety unit wasn’t managing the pension fund.

So, McDonald is either smoking crack, or doesn’t know what he’s talking about.

Last week Auditor-Controller-Treasurer-Tax Collector Larry Walker was appointed as interim trustee administrator for SBCERA, until Barrett’s replacement can be recruited.

Expect more fallout related to the pension fund.