Pension Fund

The Baltimore City Council president plans to request hearings on the police and fire departments' pension fund's loss of $3.5 million in investments tied to disgraced money manager Bernard L. Madoff. At today's meeting, council President Stephanie C. Rawlings-Blake will propose a resolution seeking an inquiry into investment policy guidelines. The U.S. Securities and Exchange Commission is working to untangle the web of investors affected by Madoff's alleged $50 billion Ponzi scheme.

The recent sale of Cranberry Square shopping center in Westminster to the state's pension fund may not have an immediate economic impact on the area, but local officials say the deal bodes well for the community.The Maryland Retirement and Pension System, which has a portfolio of more than $28 billion, looks for commercial properties that have a positive cash flow, are leased and can be sold for a profit, said state Treasurer Richard N. Dixon, who chairs the system's board of trustees."We thought this was very attractive," said Dixon, who lives near Westminster.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.Q. My wife passed away in 1996. Can I file jointly this year? Also, I received a lump-sum payment -- the residue from her pension fund. Is that taxable?A. Normally, the determination of whether an individual is married is made as of the close of his taxable year, except when the spouse dies during the taxable year and the determination is made as of the time of death. Unless you have remarried in 1997, you cannot file a joint return because you were not married at the end of your taxable year.

More state employee pension funds should be invested in fledgling high-tech companies to spur economic growth, Democratic comptroller candidate William Donald Schaefer said yesterday.Acknowledging that his proposal would face opposition among those concerned about using pension money for relatively risky investments, the former governor said his plan would promote business development -- and not imperil the $28 billion pension fund's assets."There are ways the pension money could be used to help the state," Schaefer said.

The time when company managements at least pay lip service to the notion that the owners of the company have democratic rights to protest management behavior -- corporate annual meeting season -- looms.Workers whose retirement assets are held by pension funds -- especially public-employee and union-sponsored funds -- have seen increasing activism on the part of their fund managers toward curtailing corporate conduct that entrenches management at the expense of shareholders.But workers involved in the fastest-growing arena of retirement savings -- defined contribution plans, such as 401(k)

Hit by the loss of a major tenant and a shift of the city's central business district, the Crestar Bank Building has been scheduled for foreclosure auction next month.The inability of the owners, Calvert-Baltimore Associates, to pay their $51.4 million debt on the 25-story tower comes amid one of the hottest commercial real estate markets in Baltimore's history and underscores the fragility of downtown's office market, analysts said.Teachers Insurance and Annuity Association (TIAA), the New York pension fund that lent the developers money to construct the 120 E. Baltimore St. tower in the late 1980s, is to auction the building Aug. 19."

WASHINGTON -- The Supreme Court agreed yesterday to clarify the authority of companies to take surplus funds out of an employee pension plan and use the money to finance an early retirement program for other workers.The outcome of the case could affect the financial future of worker-contribution plans that cover millions of workers in health coverage, savings and thrift opportunities, retirement pensions and other benefits.A case involving Hughes Aircraft Co. -- now part of General Motors Corp.

SANTA MONICA, Calif. -- O. J. Simpson has been drawing $25,000 a month from his profit-sharing pension account and could continue doing so for the rest of his life without turning a penny of it over to satisfy the $33.5 million civil judgment against him, lawyers said yesterday.Attorneys involved in the continuing efforts to find and seize Simpson's assets spent yesterday, the third anniversary of the slayings of Ronald L. Goldman and Nicole Brown Simpson, cross-examining Simpson's longtime attorney and business manager Skip Taft, the first person to give an accounting of Simpson's financial picture.

From Wall Street to Pratt Street, commercial real estate is taking on the air of a Parker Brothers board game.Thanks to abundant capital, economic forecasts that project continued white-collar job growth and an investment system that rewards companies unafraid to make huge deals, downtown office buildings are in vogue for the first time in nearly a decade.And the interest -- especially among high-roller, publicly held real estate investment trusts and government pension funds -- shows few signs of waning, even as some perplexed observers raise eyebrows over escalating prices and make jokes about Monopoly money.

Gary Kominski, 40, pension fund managerGary Kominski, a native of the Baltimore area who had been a pension fund portfolio manager for various companies, died Wednesday of a heart attack in New York City. The Connecticut resident was 40.Raised in Rosedale, he was a 1975 graduate of Calvert Hall High School and earned a bachelor's degree in economics from the University of Pennsylvania.He worked for a pension fund management company at Salomon Brothers Inc. in New York, then with Rogers and Casey in Connecticut until the company created Symphony Asset Management a year ago. He was a member of the board of Symphony and was a portfolio manager there.

Baltimore City Council President Stephanie C. Rawlings-Blake wants to tap a prominent business-group leader to head a commission examining the city's troubled fire and police pension system. Donald C. Fry, president and CEO of the Greater Baltimore Committee, has accepted an invitation from Rawlings-Blake and City Councilman William H. Cole IV to lead an effort to review a retirement program whose ballooning costs have created what both call a "fiscal crisis." "You want to make sure that these funds are sustainable and you do have enough money to support them," said Fry, a former Harford County state senator who is also heading a panel to award slot-machine licenses in Maryland.

Officials of the Baltimore fire and police pension fund painted a grim financial picture yesterday, laying the groundwork for requesting tens of millions of dollars from city coffers. The value of the fund has dropped by $554 million in the past 2 1/2 years, officials said. More than half of the decline came from scheduled benefit payouts, and the rest resulted from the plummeting stock market. "Revenue has dropped dramatically," said Thomas P. Taneyhill, the executive director of the fund, speaking at the city Board of Estimates meeting.

The Baltimore City Council president plans to request hearings on the police and fire departments' pension fund's loss of $3.5 million in investments tied to disgraced money manager Bernard L. Madoff. At today's meeting, council President Stephanie C. Rawlings-Blake will propose a resolution seeking an inquiry into investment policy guidelines. The U.S. Securities and Exchange Commission is working to untangle the web of investors affected by Madoff's alleged $50 billion Ponzi scheme.

Pension proposal unfair to retirees In introducing legislation to the City Council that could reduce the hard-earned pension benefits of retired Baltimore police officers and firefighters, the city administration has shown its willingness to promote an idea that is rooted in greed and deception ("A costly pension benefit," editorial, Oct. 23). For almost 30 years under four different mayors, the variable benefit program has provided pension increases to retired police and fire employees.

Baltimore officials say they need to eliminate a long-standing benefit to thousands of Fire and Police Department retirees because the volatile stock market is forcing a huge increase in the city's contribution to their pension fund when its budget is already strained. The police and fire pension fund is causing an extra drag on Baltimore's budget because of an unusual benefit. In addition to the regular fixed annuity that guarantees retired officers a percentage of their final salary for life, it provides increases in years when the stock market exceeds expectations.

Imagine the woods and pastures you used to drive through, or play in, as a child. Are they overgrown now with housing divisions, shopping centers and office parks? Are they connected to the services residents need by highways, electric lines, water systems and sewer systems? You have had a glimpse at the tremendous change in infrastructure that comes as more areas of the country become developed. And in areas outside the United States, where prosperity is creating demand for modern sewage systems and turning bicycle riders into car users, the demand for infrastructure is intense.

Three days after Gov. Martin O'Malley announced a $1.1 billion initiative for the biotechnology industry, Comptroller Peter Franchot announced yesterday that he would advocate that the state pension fund to invest about $1 billion in life sciences and "green" technology such as renewable energy and environmentally sensitive building materials. Franchot, who is vice chairman of the Maryland State Retirement and Pension System, said he would recommend that about $500 million be invested in the biotechnology industry, particularly in Maryland.

A ruling by the state's highest court requiring the city of Annapolis to increase retiree pensions to coincide with pay scale increases for its active employees could impact future pay raises for city workers and force higher individual contributions to the pension fund, city officials said. The ruling handed down recently by the Maryland Court of Appeals was the result of a long-running lawsuit filed by a group of more than 60 retired firefighters and police officers seeking increases in their pensions in tandem with increases in the city's current pay scale.

Hedge-fund operator Citadel Investment Group LLC and JPMorgan Chase & Co. agreed to take over energy-trading positions from Amaranth Advisors LLC, the hedge fund whose wrong-way bets lost about $4.6 billion this month, two people with knowledge of the decision said. Separately, Citigroup Inc. is in talks to buy a stake in Amaranth, two people involved in those discussions said. Amaranth, which had $9.5 billion in assets in August, was forced to unload the trades after swings in natural-gas prices last week turned it into the biggest hedge fund meltdown since the near collapse of Long-Term Capital Management LP's 1998.

A Baltimore think tank railed yesterday against the city's pension systems for police, fire and municipal employees, contending that their governing boards are staffed by people who lack financial expertise and whose stewardship contributed to a combined $168 million shortfall. The Calvert Institute for Policy Research said in a report that the pension boards hired a large number of investment advisers to compensate for a lack of investment know-how. One consultant, Callan Associates Inc. of San Francisco, however, has come under fire for potential conflicts of interest and investment losses, and has been questioned by the Securities and Exchange Commission as part of a broad inquiry into pension consultants.