[PPT] - New York State Teamsters Conference Pension and Retirement Fund 1 PowerPoint Presentation

SLIDE 1

New York State Teamsters Conference Pension and Retirement Fund

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SLIDE 2

Why Are We Here?

Pension Fund is running out of money
There are no other options
If we wait, the problem only gets worse
PBGC running out of money
Other funds have waited too long and now cannot be saved
If there is a pension bail-out, we’ll take advantage of it. But,

we can’t just wait and hope.

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SLIDE 3

25 Year Summary Increasing Reliance on Investment Returns

Year

Actives Retirees Terminated Vested Total Participants Contributing Employers Life Expectancy*

1990 23,883 10,150 3,920 37,953 490 72 1995 19,640 11,128 4,011 34,779 391 73 2000 16,827 14,198 3,866 34,891 308 74 2008 15,242 15,896 5,609 36,747 214 75 2016 11,575 15,976 6,908 34,459 184 76

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Year Contributions Benefits Paid Investment Return Needed to Cover Difference 1990 $60,011,653 $46,804,437 0.00% 1995 $58,872,901 $81,527,130 2.32% 2000 $68,970,712 $128,067,986 2.88% 2008 $101,062,928 $236,814,862 5.96% 2015 $118,741,696 $280,144,634 13.48%

SLIDE 4

Total Participants 37,953 34,779 34,891 36,747 34,595 Contributing Employers 490 391 308 214 184 Life Expectancy* 72 73 74 75 76

23,883 19,640 16,827 15,242 11,575 14,070 15,139 18,064 21,505 22,884 5,000 10,000 15,000 20,000 25,000

1990 1995 2000 2008 2016

Changing Demographics Actives vs. Retirees & Terminated Vested

Actives Retirees & Terminated Vested

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SLIDE 5

Investment Return Needed to Cover Difference 0.00% 2.32% 2.88% 5.96% 13.48% $60,011,653 $58,872,901 $65,970,712 $101,062,928 $118,741,696 $46,804,437 $81,527,130 $128,067,986 $236,814,862 $280,144,634 $0 $50,000,000 $100,000,000 $150,000,000 $200,000,000 $250,000,000 $300,000,000 1990 1995 2000 2008 2016

Increasing Reliance on Investment Returns

Contributions Benefits Paid

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SLIDE 6

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% (2,000) (1,750) (1,500) (1,250) (1,000) (750) (500) (250) 250 500 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 6.1%

0.7%

7.5% 6.8% 6.8% 6.8% 6.8% 6.8% 6.8% 6.8% 6.8% 6.8% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 11,896 11,678 11,576 10,399 10,245 10,098 9,957 9,821 9,690 9,561 9,441 9,324 9,212 9,102 9,000 8,897 8,799 8,703 8,610 8,522 8,437 8,355 8,274 8,198 8,122 8,050 7,980 7,911 7,845 7,782 7,717 7,655 7,595 7,537 7,480

New York State Teamsters Conference Pension & Retirement Fund Funding Standard Account ($Million) = Left Axis Funded Percentage / PPA Zone = Right Axis

FSA at 12/31 (1) Plan Year beginning 1/1 (2) Asset Return during Year (3) Active Population

PPA Funded Percentage FSA at 12/31 ($ Million)

2016 Projection

0.74% investment return in 2015 followed by 8.50% in all future years

Census data as of January 1, 2016 No changes to Plan provisions

Color of Bar = PPA Status Height of Bar = Funded Percentage Blue Line = Credit Balance Trust Fund Exhausted During 2026 6

SLIDE 7

The Pension Benefit Guaranty Corporation (“PBGC”)

The PBGC was established in 1974 so that workers are eligible for a PBGC

insured benefit if their pension plan failed. It is a stand-alone entity and currently receives no money from the federal government.

In 2015, the PBGC’s Multiemployer Program had a projected deficit of $52.3 billion

with projected insolvency within 10 years.

The calculation of the PBGC guarantee considers both the years of service that have

been worked and rate of benefit accrual that the Fund has credited. The maximum benefit the PBGC will guarantee is $35.75 for each year of service that has been earned. For a participant with 30 years, the maximum PBGC guarantee generally is $1,072.50 per month, annually $12,870.00

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No protection for any participants. i.e. 80 years old and older, disability, 75-
79. All are subject to same reduction.

SLIDE 8

The Pension Benefit Guaranty Corporation (“PBGC”)

(continues)

Congressional Budget Office report projects the Pension Benefit Guaranty

Corporation’s multiemployer program to become bankrupt by 2025 under current law.

CBO said the PBGC would be unable to pay $3 billion of the total $9 billion worth of

projected claims for financial aid filed with the Multiemployer Program from 2017 through 2026.

PBGC’s Multiemployer Program insures the benefits of approximately 10 million

people that are covered by pension plans provided by groups of employers.

CBO projects PBGC to face a cash shortfall of $34 billion from 2017 through 2036

between the claims filed with the program and available resources to meet such insurance obligations.

According to the report, the Multiemployer Program’s total financial assistance claims

would reach $101 billion on a fair value basis over the next 20 years.

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Edwards, Jane. August 3, 2016. CBO: Pension Benefit Guaranty Corp.’s Multiemployer Program Faces Insolvency in 2025. Civilian Agencies.

SLIDE 9

Pension Preservation Plan (“PPP”)

The Trustees approved the filing of an application for benefit reductions under the Multiemployer Pension Reform Act of 2014 (MPRA). The application will be filed with the U.S. Department of the Treasury in the coming week, and will contain the details of the PPP. The PPP calls for the following benefit reductions (subject to certain MPRA limitations described later in this presentation):

20% reduction in monthly benefits for all Active Participants.
31% reduction in monthly benefits for all retirees, beneficiaries,

and terminated vested participants, and all other Non-Active Participants. If the Fund’s application is approved, the PPP benefit reductions will become effective on July 1, 2017.

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SLIDE 10

Pension Preservation Plan (“PPP”)

Active Participants:
500 hours of contributions in 2015, or 2016, or 2017

Plan Year before July 1, 2017

Not retired as of July 1, 2017
Non-Active Participants:
Retired;
Beneficiary;
Terminated Vested; and
All other Non-Active Participants

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SLIDE 11

Equity

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The law requires that suspensions be equitable across all Participant

groups/statuses

The proposed suspension amounts are different for Active and Non-

Active participants

The proposed suspension amounts are the same for orphan Participants
The following slides describe how the different suspension amounts are

equitable across statuses

Benefit Comparison – Are the benefit amounts equitable across statuses after

suspensions?

Liability Comparison – Are the liability reductions equitable across statuses?
Orphans – Why don’t orphan Participants have larger suspensions?

SLIDE 12

The following chart is an illustration showing that benefit amounts after

suspension are equitable among Actives and Retirees

Amounts are estimated based on a 30+ year career with the Plan’s largest employer
Employer contribution rates have increased about 200% since the early

2000’s

So, a person retiring in the future will receive approximately the same benefit as a

current retiree but it will cost three times as much

Status Service at 2017 Benefit at 2017 Proposed Suspension Benefit at 2017 After Suspension Future Service Future Accruals Total Benefit After Suspension Retired 30+ Years $5,000 31% $3,450 0 Years $0 $3,450 Active 20 Years $3,050 20% $2,440 10 Years $1,050 $3,490 Active 10 Years $1,300 20% $1,040 20 Years $2,200 $3,240 Active 0 Years $0 20% $0 30 Years $3,350 $3,350

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Equity – Benefit Comparison

SLIDE 13

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The approximate reduction in liability by status associated with the

proposed suspensions is shown in the table below

The difference in liability as a result of the proposed suspension is about

$355 million more for retirees and beneficiaries when compared to Actives

This difference is equitable because of the reductions that were already

made to active Participants as part of the Rehabilitation Plan

This is described in more detail on the following slides

Status Suspension % Change in Liability Active 20% $135 million Retiree & Beneficiaries 31% $490 million

Equity – Liability Comparison

SLIDE 14

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The Trustees implemented the Rehabilitation Plan in 2011
At that time, future accruals and early retirement subsidies were reduced for

Active Participants only

By law, there were no reductions for retirees and beneficiaries
The reduction in liability associated with the Rehabilitation Plan is shown below
Note that because of the Rehabilitation Plan, Active Participants have or will have lost $20

million in benefits each year starting in 2011

With interest, this amounts to over $160 million
So, the combination of the Rehabilitation Plan and the proposed suspensions

reduce Active liability by approximately $485 million

This is approximately equal to the reduction in liability for retirees and beneficiaries as a

result of the proposed benefit suspension

Rehab Plan Change Reduction in Liability as of 2011 Early Retirement Subsidies $190 million Reduction in Future Accruals $20 million per year

Equity – Liability Comparison

SLIDE 15

Equity - Orphans

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After careful consideration from the Trustees, the proposed suspensions

do not include larger suspensions for orphan Participants

This decision was made for various reasons, including, but not limited to:
Larger suspensions for orphans may not be permissible under MPRA
For the Central States Plan, the law required larger orphan suspensions
It is not the participant’s fault if he or she worked for an employer that

couldn’t pay its withdrawal liability

Very difficult to Define, Isolate and Calculate Orphan Service
Participants generally worked for many companies – some orphan, some

not

Requires Company-by-Company and Credit-by-Credit Review

SLIDE 16

Pension Preservation Plan

Reduction Protections under MPRA

Maximum Allowable Benefit Reductions
A participant’s pension cannot be reduced below 110% of the amount that the PBGC would

guarantee if the Fund were to become insolvent.

A participant would not have his or her benefit reduced by 31% if that reduction in the monthly

benefit is below 110% of the PBGC guarantee.

Age Protections
Age 80 and older as of July 31, 2017 will receive no benefit reductions .
Age 75-79: Reductions will be limited depending on the participants age as of July 31, 2017.
Based on age at July 31, 2017, does not change as Participant gets older.
Disability Protections
Under MPRA, Participants who are currently receiving a disability benefit from the Fund are

protected and will not be reduced.

Does not protect other types of disability.

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SLIDE 17

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Pension Preservation Plan

71.84% Subject to some level of suspension
32.56% have partial MPRA protection
39.28% are subject to full suspension
28.16% Fully Exempt from suspensions

Reduction Count Percent Cumulative % No Reduction 9,750 28.16% 28.16% 0 - 10.00% 6,348 18.33% 46.49% 10.01 – 20.00% 8,364 24.15% 70.64% 20.01 – 30.00% 1,547 4.47% 75.11% 30.01 – 40.00% 8,608 24.86% 99.97% 40.01 – 50.00% 10 .02% 99.99% 50.01 – 60.00% 2 .01% 100.00% Total 34,629 100.00% 100.00%

SLIDE 18

Retiree & Beneficiary Distribution January 1, 2016

Monthly Benefit Count Percent of Total Retirees & Ben’s Cumulative Percent of Total Count $1.00 - $499 5,364 33.72% 33.72% $500 - $999 2,992 18.81% 52.53% $1,000 - $1,499 1,753 11.02% 63.55% $1,500 - $1,999 1,460 9.18% 72.73% $2,000 - $2,499 1,034 6.50% 79.23% $2,500 - $2,999 893 5.61% 84.84% $3,000 - $3,499 591 3.72% 88.56% $3,500 - $3,999 389 2.45% 91.01% $4,000 - $4,499 368 2.31% 93.32% $4,500 - $4,999 556 3.50% 96.82% $5000 - $5,499 421 2.65% 99.47% $5,500 - $5,999 75 0.47% 99.94% $6,000 + 12 0.06% 100.00%

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SLIDE 19

Retiree & Beneficiary Distribution January 1, 2016

Monthly Benefit Count Monthly Distribution Percent of Monthly Distribution Cumulative Percent of Monthly Distribution $1.00 - $499 5,364 $1,360,592 5.85% 5.85% $500 - $999 2,992 $2,175,959 9.35% 15.19% $1,000 - $1,499 1,753 $2,157,882 9.27% 24.47% $1,500 - $1,999 1,460 $2,542,587 10.92% 35.39% $2,000 - $2,499 1,034 $2,319,940 9.97% 45.36% $2,500 - $2,999 893 $2,438,463 10.48% 55.83% $3,000 - $3,499 591 $1,912,373 8.22% 64.05% $3,500 - $3,999 389 $1,452,029 6.24% 70.29% $4,000 - $4,499 368 $1,571,035 6.75% 77.04% $4,500 - $4,999 556 $2,644,452 11.36% 88.40% $5000 - $5,499 421 $2,194,395 9.43% 97.83% $5,500 - $5,999 75 $427,003 1.83% 99.66% $6,000 + 12 $78,880 .03% 100.00% Total 15,908 $23,275,590

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SLIDE 20

Pension Preservation Plan Impact

Annual Benefit Payments:

$280M

Contributions :

$118M

Current Annual Shortfall:

$162M If Approved: Monthly Pension Reductions $5.2/month x 12 months: $62.4M Revised Annual Shortfall: $99.6M Assets Under Management 6/30/2016: $1.178B Asset Return Needed: 8.46%

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SLIDE 21

Pension Preservation Plan

Retired Participant with No MPRA Protections

Retirement Benefit as of July 1, 2017:

$ 5,000.00

31% PPP Proposed Reduction:

($1,550.00)

Reduced Benefit as of July 1, 2017:

$ 3,450.00

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SLIDE 22

Pension Preservation Plan

Guarantee-Based Limitation Protection – PBGC 110% rate

Retirement Benefit as of July 1, 2017:

$ 1,300.00

31% PPP Proposed Reduction:

( $ 403.00)

Net Benefit with Reduction:

$ 897.00

Guarantee Based Limitation – PBGC 110% rate:

$ 1,163.25 ($35.25 x 30 years of service X 110%)

Actual Reduction:

($ 136.75)

Reduced Benefit as of July 1, 2017:

$ 1,163.25

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SLIDE 23

Pension Preservation Plan

Age-Based Protection (Age 75 – Age 79)

Retirement Benefit as of July 1, 2017:

$ 3,686.58

31% PPP Proposed Reduction:

($ 1,142.84)

Age as of July 31, 2017:

78 years 5 months

Age-Based Pro-rating Factor (19/60):

0.3167

Actual Reduction:

($ 361.94)

Reduced Benefit as of July 1, 2017:

$ 3,324.64

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SLIDE 24

Pension Preservation Plan

Active Participant with 20 years of service

(A) Benefit Subject to PPP

Accrued Benefit as of July 1, 2017:

$3,050.00

20% PPP Proposed Reduction:

($ 610.00)

Reduced Benefit as of July 1, 2017:

$2,440.00 (B) Benefit After PPP

Accrual July – December 2017:

$ 50.00

2018 Accrual:

$ 100.00

2019 Accrual:

$ 100.00

2020 Accrual:

$ 100.00

2021 Accrual:

$ 100.00

2022 Accrual:

$ 100.00

2023 Accrual:

$ 100.00

2024 Accrual:

$ 100.00

2025 Accrual:

$ 100.00

2026 Accrual:

$ 100.00

2027 Accrual:

$ 100.00 (C) Total Benefit (A+B) $3,490.00 24

SLIDE 25

Joint & Survivor

As your benefit is reduced under the PPP, the cost of providing a lesser Survivor Benefit is also reduced proportionately. For example:

Prior to PPP After PPP $2,175.38 Accrued benefit $1,501.01 (Less 31%) Accrued Benefit ($175.38) 50% J&S Reduction ($121.01) 50% J&S Reduction $2,000.00 Monthly Benefit $1,380.00 Month Benefit $1,000.00 Survivor Benefit $690.00 Survivor Benefit

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SLIDE 26

Re-Employment Rules – Under Age 65

Current Plan restrictions:
Less than 40 hours per month: Employment after retirement in any trade,

craft or industry covered under the Fund and in the Fund’s geographical area.

Competing Clause: No Employment for employer that competes with a

Contributing Employer of the Fund.

Relaxed Plan restrictions – effective September 1, 2016:
Up to 1,000 Hours Per Year: Employment after retirement in any trade,

craft or industry covered under the Fund and in the Fund’s geographical area.

Competing Clause: No employment for employer that competes with a

Contributing Employer of the Fund.

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SLIDE 27

Re-Employment Rules – Over Age 65

Current Plan restrictions:
Less than 40 hours per month: Employment after retirement in:
any trade, craft or industry covered by the Fund,
in a trade or craft where he or she worked as an Active, or
in the Fund’s geographic location
Relaxed Plan restrictions – effective September 1, 2016:
Up to 1,000 Hours Per Year: Employment after retirement in:
any trade, craft or industry covered by the Fund,
in a trade or craft where he or she worked as an Active, or
in the Fund’s geographic location

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SLIDE 28

Historical Legislative Actions Impacting the Pension Fund

Action Impact Trucking Industry Deregulation Loss of hundreds of trucking companies and jobs Excise tax on overfunding Unable to save for rainy day Shorter Vesting Requirements (i.e. 5 year) Additional Cost Cap on Employer Withdrawal Liability Unable to collect full amounts due Pension Protection Act of 2006 (“PPA”) Trustees required to reach mandated (improved) funding levels by increasing contributions and reduced benefits Multiemployer Pension Reform Act of 2014 (“MPRA”) Allows Trustees of Plans in Critical and Declining status to consider benefit suspensions for all participants. First time in history, includes those already in pay status (i.e. retired). Pension Benefit Guaranty Corporation (“PBGC”) Premiums Premium rate increased from $13 to $26 per participant for 2015. The 2016 rate is $27.

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SLIDE 29

Investments

Introduction
What is a pension investment consultant?
Who is Meketa Investment Group?
Investment Strategy / Asset Diversification
Your Fund’s Investments
Investment Performance
What Happened in 2008?
2016 Returns

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SLIDE 30

Pension Fund Investment Consultant

Advise the Trustees on their investment decisions
Recommend investment policy and asset allocation
Recommend investment managers to the Trustees
Monitor performance of investment managers for Trustees
Serve as fiduciary

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SLIDE 31

Who is Meketa Investment Group?

Provide independent investment fiduciary services since 1978
Specialize in multiemployer plans and work for 135 clients

total assets of over $860 billion

Staff of 127, including 78 investment professionals, in six
ffices
Highly experienced staff
Investment consultant for NYS Teamsters Pension Fund since

2006

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SLIDE 32

Pension Investment Strategy

Long-term approach to investing
Not chasing short-term returns/market timing
Use best-in-class active managers, complemented by low-cost index

funds

Minimize fees and expenses
Written investment policy
Defines the Plan’s objectives
Sets asset allocation (how much in each asset class)
Defines rules for investing
Requires rebalancing to keep correct asset allocation

IMPORTANT:

Trustees and Meketa DO NOT select specific investments (e.g.,

stocks, bonds) in traditional investment portfolio

Trustees select and monitor, with Meketa’s assistance, specialized

investment managers for each asset class

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SLIDE 33

Asset Diversification

Investments not concentrated in any one asset class
Generally no more than 20% in any one asset class
Limit risk from overexposure to any single asset class
May limit short-term investment returns, but improves risk and

return long-term

Required by ERISA for pension funds
Many different investment classes
US Equity

Real Assets

International Equity

(Real Estate, Infrastructure, Natural Resources)

US Fixed Income

High Yield Fixed Income

Emerging Markets

Private Equity

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SLIDE 34

Periodic Table of Returns

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Emerging Markets Debt 9.7% Commodities 25.9% Emerging Equity 55.8% Emerging Equity 25.6% Emerging Equity 34.0% Emerging Equity 32.2% Emerging Equity 39.4% Bonds 5.2% Emerging Equity 78.5% Emerging Equity 18.9% Real Estate 14.3% Emerging Equity 18.2% US Equity 32.4% Private Equity 17.6% Real Estate 10.1% Bonds 8.4% TIPS 17.0% EAFE Equity 39.1% Emerging Markets Debt 23.0% Private Equity 30.4% EAFE Equity 26.3% Private Equity 26.6% Cash 1.7% High Yield 58.2% Commodities 16.7% TIPS 14.1% EAFE Equity 17.3% EAFE Equity 22.8% US Equity 13.7% US Equity 1.4 % TIPS 8.0% Emerging Markets Debt 13.7% High Yield 29.0% EAFE Equity 20.6% Commodities 21.4% Private Equity 18.6% Emerging Markets Debt 18.1% TIPS

1.1%

EAFE Equity 31.8% Private Equity 15.7% Private Equity 12.0% Emerging Markets Debt 16.8% Private Equity 18.1% Real Estate 11.8% Bonds 0.6% Real Estate 7.2% Bonds 10.2% US Equity 28.7% Private Equity 15.9% Real Estate 20.1% Real Estate 16.6% Commodities 16.2% Emerging Markets Debt

5.2%

US Equity 26.5% Emerging Markets Debt 15.7% Bonds 7.8% US Equity 16.0% Real Estate 11.0% Bonds 6.0% Private Equity N/A High Yield 5.3% Real Estate 6.7% Commodities 24.0% Real Estate 14.5% EAFE Equity 13.5% US Equity 15.8% Real Estate 15.8% Real Estate

6.5%

Emerging Markets Debt 22.0% High Yield 15.1% High Yield 5.0% High Yield 15.8% Hedge Funds 8.7% TIPS 3.6% Cash 0.0% Hedge Funds 4.6% Cash 1.6% Hedge Funds 19.5% High Yield 11.1% Hedge Funds 9.3% Emerging Markets Debt 15.2% TIPS 11.6% Private Equity

7.1%

Hedge Funds 20.0% US Equity 15.1% US Equity 2.1% Private Equity 14.5% High Yield 7.4% Hedge Funds 3.3% EAFE Equity

0.8%

Cash 3.8% High Yield

1.4%

Emerging Markets Debt 16.9% US Equity 10.8% Emerging Markets Debt 6.3% Hedge Funds 12.9% EAFE Equity 11.2% Hedge Funds

19.0%

Commodities 18.9% Real Estate 13.1% Cash 0.1% Real Estate 10.5% Cash 0.0% High Yield 2.5% Hedge Funds

1.1%

Emerging Equity

2.6%

Hedge Funds

1.4%

Real Estate 8.9% Commodities 9.2% US Equity 4.9% High Yield 11.9% Hedge Funds 10.0% High Yield

26.2%

TIPS 10.0% Hedge Funds 10.2% Emerging Markets Debt

1.8%

TIPS 7.3% Bonds

2.0%

Emerging Markets Debt 0.9% TIPS

1.4%

US Equity

11.8%

Emerging Equity

6.2%

TIPS 8.3% Hedge Funds 9.0% Cash 3.0% Cash 4.6% Bonds 7.0% Commodities

35.6%

Bonds 5.9% EAFE Equity 7.8% Hedge Funds

5.2%

Hedge Funds 6.4% Emerging Equity

2.6%

Cash 0.0% High Yield

4.5%

Commodities - 19.5% Private Equity

14.1%

Private Equity 7.3% TIPS 8.5% TIPS 2.8% Bonds 4.3% US Equity 5.5% US Equity

37.0%

Cash 0.1% Bonds 6.5% EAFE Equity

12.1%

Bonds 4.2% Emerging Markets Debt

9.0%

Emerging Equity

2.2%

Emerging Markets Debt

6.7%

EAFE Equity

21.2%

EAFE Equity

15.6%

Bonds 4.1% Bonds 4.3% High Yield 2.7% Commodities 2.1% Cash 4.7% EAFE Equity

43.4%

Private Equity

6.6%

TIPS 6.3% Commodities

13.4%

Cash 0.1% TIPS

9.4%

EAFE Equity

4.9%

Emerging Equity

14.9%

Private Equity

25.6%

US Equity

22.1%

Cash 1.0% Cash 1.2% Bonds 2.4% TIPS 0.5% High Yield 1.9% Emerging Equity

53.3%

Real Estate

16.9%

Cash 0.1% Emerging Equity

18.4%

Commodities

1.1%

Commodities

9.5%

Commodities

17.0%

Commodities

24.7%

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SLIDE 35

Fund’s Investments – Asset Allocation as of 12/31/15

$1,441.6 $1,452.0 $1,412.2 $1,361.6 $1,197.0 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 m Int'l Emerging Equity 15.6% Investment Grade Bonds 5.3% Domestic Equity 14.0% Bank Loans 3.2% Hedge Funds <0.1% Private Equity 19.6% Int'l Developed Equity 8.0% Real Estate 5.5% Emerging Market Debt 7.4% Infrastructure 8.1% High Yield Bonds 2.2% TIPS 3.6% Cash 0.4% Natural Resources & Commodities 7.3%

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SLIDE 36

Asset Class Overviews

What Is Private Equity?

Investments in privately held companies.
Generally structured as partnerships that consist of ten to twenty equity

investments in individual companies.

Investments come in many forms, including: venture capital, buyouts, mezzanine

debt, and special situations. Why Invest In Private Equity?

Potential for returns in excess of those from public equities.
Greater potential for (more persistent) higher returns.

Private Equity has been instrumental in expansion and creation of new industries:

Emergence of personal computing (Compaq, Apple)
Business networking (Cisco, 3Com)
Search engines (Yahoo, Google)
Online social networking (YouTube, Facebook)

36

SLIDE 37

What Is Infrastructure?

The underlying foundation of basic services, facilities, and institutions upon which a

community depends.

Investable infrastructure includes the development and/or ownership of:

– Transportation ─ roads, bridges, airports – Environmental ─ water, waste, sanitation – Energy ─ pipelines, power generation and distribution – Communication ─ cable, internet, phone networks – Social ─ hospitals, schools, parks

This is a relatively new asset class to U.S. investors, but it has a longer history in Europe,

Canada, and Australia.

Investors can access infrastructure through public and private markets.

Why Invest In Infrastructure?

Equity like returns
Provides a hedge against inflation
Low correlation to other asset classes

Asset Class Overviews

37

SLIDE 38

Asset Class Overviews

What is Real Estate?

Core real estate represents high quality, income producing properties with

stable cash flows.

The most common property types are: office, industrial (warehouse),

retail (malls, shopping centers), and residential (apartments, condominiums).

Institutional investors can invest via public markets (REITs) or private

markets. Why Invest In Real Estate?

Core properties produce stable income.
Low correlation to traditional equity and bond markets.

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SLIDE 39

Private equity, infrastructure, and real estate significantly outperformed other major asset

classes over the past five years.

Investment Performance

Five Year Return as of June 30, 2016

13.5% 13.1% 10.4% 5.8% 5.4% 3.8% 3.2% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Infrastructure Private Equity Real Estate High Yield Bonds Global Equity Investment Grade Bonds Natural Resources

39

SLIDE 40

What Happened in 2008?

45.9%
42.2%
29.6%
26.2%

3.8%

50%
40%
30%
20%
10%

0% 10% Real Estate (REITs) Global Equities Pension Fund High Yield Bonds Global Fixed Income

∙ During the global financial crisis, many asset classes produced sharply negative returns in 2008.

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SLIDE 41

The Pension Fund has produced strong returns since the March 2009 rebound.

13.8% 10.8% 4.3% 0% 2% 4% 6% 8% 10% 12% 14% 16% Global Equities Pension Fund Global Fixed Income

Market Rebound (March 2009 – June 2016)

41

SLIDE 42

Pension Fund returns strong in 2016:
Equities and investment grade bonds with returns between 0.3% and 6.6%.
Diversified Pension Fund up 8.6%.

1 Pension Fund returns based on actual returns provided by custodian through August 31, 2016 and estimated for September and October based on index returns.

2016 Returns1

(through October 11, 2016)

42

8.6% 6.6% 5.2% 0.3% 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% Pens ion Fund Domes tic E quity Inves tment Grade Bonds International Developed E quity

SLIDE 43

Summary of MPRA Applications Filed to Date

Plan Filing Date Proposed Suspension Overview Status Central States Pension Plan 9/25/15 Recalculation of benefits to approximately 1.00%

f contributions

Denied Road Carriers Local 707 3/15/16 Reduce benefits to 110% of the PBGC guarantee Denied Ironworkers Local 16 3/26/16 Recalculation of benefits with a max of 50% reduction In Review Teamsters Local 469 3/31/16 Reduce benefits by 45% for all participants In Review Bricklayers Local 7 6/28/16 Recalculation of benefits to approximately 1.30%

f contributions

In Review Iron Workers Local 17 7/29/16 Recalculation of benefits and applying early retirement reductions in the case of subsidized benefits In Review Bricklayers Local 5 8/4/16 Reduce to 110% of the PBGC guarantee after restoring (previously reduced) adjustable benefits In Review

43

SLIDE 44

Next Steps

The Treasury Department accepted the application for review on September 2, 2016:
Treasury will have up to 225 days to review it.
The decision date is estimated to be no later than April 12, 2017.
All Participant notices were sent out on September 6, 2016 explaining the PPP reductions

and an individualized benefit statement.

Comments can be made to the Treasury by November 14, 2016 on the following website:
http://www.regulations.gov (electronic submissions are encouraged)
If Treasury approves the application:
Then participants and beneficiaries will be given the opportunity to vote on the proposed

reductions within 30 days after approval. Treasury administers the vote.

Generally, unless a majority of all participants and beneficiaries vote to reject the PPP, it

will go into effect on July 1, 2017.

However, if Treasury determines that the Fund is a “systemically important” plan (a plan

with a present value of projected PBGC financial assistance payments that exceeds $1 billion), Treasury can approve the Fund’s proposed reductions, or a modified version of the proposed reductions, regardless of whether the participants vote to reject the PPP.

44

SLIDE 45

Next Steps

Additional Information

Frequently Asked Questions available on our website at

www.nytfund.org

For further information and assistance you can also write to the Treasury

Department at the following address: Department of the Treasury Attn: MPRA Office Room 1001 1500 Pennsylvania Avenue NW Washington, DC 20220

45

SLIDE 46

Appendix A - Meketa Investment Group Additional Investment Information

1

SLIDE 47

Investment Policy Development

Investment policy represents one of the most important governance tools for an

asset pool.

Investment objectives and constraints are key elements to Investment Policy.
Well-developed investment policy represents the intersection of client-specific

goals and concerns with the realities of the capital markets.

Our role:
Assist clients in setting their objectives.
Assist clients in achieving those objectives through the development of

investment policies that reflect real-world experience.

Investment policy development includes:
Defining the objectives of the Fund (i.e., the purpose of the Fund’s assets).
Defining the return and risk parameters.
Identifying Fund-specific constraints.
Defining governance structure.

2

SLIDE 48

Control Risk Using The Three D’s: Discipline, Diligence, and Diversification

Discipline:

Necessary to avoid hasty judgments and expensive tactical (short-term) reversals.
Investment decisions made within the framework of a carefully considered investment

policy.

A disciplined approach reduces the tendency to “time the markets,” adopt investment fads,
r terminate managers after a short interval of poor performance.

Diligence:

Necessary to prevent small problems from growing into big problems.
Trustees meet regularly to review every aspect of their Fund.

Diversification:

The only mechanism for reducing event risk (i.e., the risk that any given investment will

fail and lead to a loss).

Trustees utilize diversification in every dimension across: individual holdings, asset types

and classes, investment strategies and managers, and time.

3

SLIDE 49

What Is Asset Allocation?

Refers to the distribution of assets across a number of asset classes that

exhibit modest or low correlations with each other.

Goal: reduce risk, while maximizing return.
Each asset class exhibits a unique combination of risk (volatility) and

reward (return).

Some asset classes, like equities, exhibit high degrees of volatility, but

also offer high potential returns over time. Other asset classes, like cash, experience very little volatility, but offer limited return potential.

A primary determinant of the long-term return and risk for an investment

pool is its overall asset allocation; each asset class (e.g., equity, fixed income, real estate) exhibits unique risk and return behavior, with varying correlation to other asset classes.

By combining asset classes, an investor can control risk without sacrificing

expected return, and can create a multi-asset portfolio tailored to a unique set of objectives.

49

4

SLIDE 50

Asset Allocation

Why Is Asset Allocation important?

The distribution of assets across various asset classes exerts a major influence
n the return behavior of the aggregate pool over short and long time periods.
Empirical evidence suggests that more than 90% of the variability of a fund’s return over time is

explained by asset allocation; further, that asset allocation explains more than 100% of the level

f returns within a fund.
Essential element of sustained and consistent long-term investment results.

How does Asset Allocation affect aggregate performance?

In addition to exhibiting unique characteristics, each asset class interacts

differently with other asset classes .

Because of low correlations, the likelihood that any two asset classes will

move together in the same direction is limited, with the movement of one asset class often offsetting another’s.

Combining asset classes allows investors to control more fully the aggregate

risk and return of their portfolio, and to benefit from the reduction in volatility that stems from diversification.

50

5

SLIDE 51

Asset Allocation

The asset allocation policy:

Reflects the return (actuarial rate) and risk objectives of a pension fund, in

addition to the expectations for capital market behavior.

Is expressed as target allocations to each defined asset class, and should

include ranges around which the allocation may vary without necessitating deliberate rebalancing.

Includes a rebalancing policy to facilitate rebalancing when necessary.
Ensures that the primary determinants of return and risk are developed and

monitored at an aggregate level.

Is reviewed and adjusted as necessary (i.e., changes in objectives and/or

constraints, changes in capital market environment, etc.).

Represents a coordinated approach between a pension fund and its

investment managers.

51

6

SLIDE 52

Top Performing Asset Classes Rotate Regularly

Asset Class Top Performing Years (since 2000)1 US E quities 2013, 2014 International Developed E quities 2003, 2006, 2012, 2013 E merging Market E quities 2003-2007, 2009, 2010, 2012 High Yield Bonds 2009 Investment Grade Bonds 2001, 2008 Private E quity 2000, 2011, 2014, 2015 Real E state 2011, 2015

∙ Diversified portfolio ensures exposure to some of strongest asset classes each year. ∙ Also ensures assets never concentrated in weakest asset classes.

1 Defined as one of top two performing asset classes for respective year compared to 14 total asset classes/proxies.

7

SLIDE 53

Broad Manager Research Coverage

Investment Committee Structure ∙ We maintain dedicated resources across all public & private markets asset classes. ∙ Our due diligence teams report to the firm’s Marketable Securities and Private Markets Investment Committees. ∙ Investment Committee structure draws on the expertise of the firm’s senior professionals.

Public Equities

Global U.S. Developed Markets Emerging Markets Frontier Markets Long/Short

Fixed Income

Investment Grade TIPS High Yield Bank Loans Global Emerging Markets

Marketable Alternatives

Hedge Funds GTAA Natural Resources Commodities REITs Infrastructure

Private Equity

Buyouts Venture Capital Special Situations Secondaries

Private Debt

Mezzanine Distressed Opportunistic

Real Assets

Natural Resources Infrastructure Real Estate

Private Markets Investment Committee Marketable Securities Investment Committee

8

SLIDE 54

Public Markets Manager Research

The Five Key Areas of the Meketa Investment Manager Evaluation Process

Organization

∙ Stability ∙ Focus ∙ Employee ownership ∙ Investment driven culture ∙ Operationally sound

Investment Team

∙ Experience ∙ Depth of resources ∙ Team-oriented, performance driven ∙ Stock selection ability ∙ Investment intuition

Performance & Fees

∙ Validates process ∙ Long-term record ∙ Risk-adjusted returns ∙ Reasonable fees

Investment Process & Risk Management

∙ Straightforward ∙ Level of due diligence ∙ Thought process assessment ∙ Communication ∙ Decision-making and portfolio construction ∙ Self-evaluation / lessons learned ∙ Risk controls

Investment Philosophy

∙ Set of beliefs ∙ Stock price determinants ∙ Reasons for mispricings ∙ How to add value ∙ Competitive edge

9

SLIDE 55

Manager Evaluation, Selection & Monitoring

Continuous Monitoring and Evaluation of Investment Managers

Reconciliation

f each

manager’s reported inves tment performance Detailed analysis of trends, s trategies, and tactics Frequent, in-person,

n-site inspection

visits Quarterly ques tionnaire Reconciliation

f each

manager’s reported inves tment performance Detailed analysis of trends, s trategies, and tactics Frequent, in-person,

n-site inspection

visits Quarterly ques tionnaire

10

SLIDE 56

Optimal Investment Structure

Index funds in efficient markets

Broad diversification
Exposure to several markets
Low cost

World class active managers

Complement index funds
Specialists in inefficient markets

11

SLIDE 57

Representative Public Markets Managers

Benchmark Plus

Seattle-based large cap U.S. equity manager
Beat S&P 500 by 2.6% per year over the past five years
Top 1% of all large cap managers

Loomis, Sayles & Company

Detroit-based U.S. small cap value equity manager
Beat index by 1.9% per year over past 10 years

Artisan Partners

San Francisco-based global equity manager
9.6% per year since inception in October 2012

Aberdeen Asset Management

London-based emerging markets equity manager
4.5% per year above the benchmark since 2007
Top 5% of emerging markets equity universe

12

SLIDE 58

Private Markets Pipeline

Private Markets Investment Review

We have a strong flow of private equity investment opportunities of which only a select few

will be appropriate for the strategy: Screen: 500+ per year Phase I: 350+ per year Phase II: 35+ per year Phase III: 25+ per year Discretionary Commitments: 20 per year

We compare new managers with information in our proprietary Private Markets Manager

Database with over 1,000 managers which is supplemented by outside databases including Thomson Reuters and Preqin.

Phase III Phase II Phase I Commitments

13

SLIDE 59

Private Markets Due Diligence: Rigorous Process

Initial Review of investment

pportunity

PM sub- committe e Review Broad outreach to GPs, including those not actively fundraising Office meetings with General Partners PM sub- committe e Review PMIC Review Construct analysis for review GP completes our comprehensive “Due Diligence Questionnaire” Reference checks On-site inspections Extensive evaluation of firm’s investment track record PMIC Review Extensive “Investment Memorandum” developed Legal review and additional due diligence Not Approved Not Approved Not Approved Not Approved Negotiation of legal documentation Establish communication, banking & accounting relationships b/w GP and Client Negotiation of side letter providing specific investor rights

Investment Sourcing PPM Review Phase I Phase III Phase II Execute Documents

Approval Anonymous Scoring

Unanimous vote by members of the Private Markets Investment Committee is required

before any investment is approved for our clients. Private Markets Investment Analysis ∙ We apply a rigorous review process to identify and evaluate the highest quality managers.

14

SLIDE 60

In 2008, markets declined modestly (-11%) until September 2008.
The majority of the year’s 37% decline occurred in September and October (-24%).
Investors that went to cash after October outperformed in 2008 as declines continued through

year-end.

Investors that stayed the course outperformed by over 100% since the beginning of 2008.

1 Defined as one of top two performing asset classes for respective year compared to 14 total asset classes/proxies.

Risks of Market Timing

15

SLIDE 61

Risks of Market Timing

The biggest risk in market timing is being out of the market during positive return environments.
U.S. equity long term returns are driven by big returns in a handful of specific days rather than a smooth accumulation of small

returns.

Missing some of the top days of equities returns can heavily detract from overall performance.
For example, missing just the top 10 days of market returns each year can reduce portfolio return from 10.4% to 7.8% per year.

S&P 500 Total Return Index Returns January 1, 1988 – August 17, 2015 Growth of $100 January 1, 1988 – August 17, 2015

A portfolio with $100 as of January 1988 growing at 10.4% per year would be worth $1468 in August 2015.
In comparison, a portfolio growing at 7.8% would be worth just $770.

Period/Missing Days Annualized Return (%) All s ample (6,966 days ) 10.4 Mis s ing top day 9.9 Mis s ing top 5 days 9.0 Mis s ing top 10 days 7.8 Mis s ing top 21 days 5.8 Mis s ing top 63 days 0.0

Annualized Return Mkt Value as of August 2015 10.4% $1,468 7.8% $770

1 Return is calculated assuming a return of 0% for the missing days.

2 21 trading days equals one month and 63 trading days equals one quarter.

16

SLIDE 62

Market Reversals After Large Declines

Global equity markets have historically risen 30% over the next 12 months following a

decline of 17%.

Additionally, market reversals don’t happen “on a dime”.

– Markets often experience smaller but continued declines after a sharp move down, before reversing sharply in a relatively short period of time.

Source: Bloomberg.com; January 26, 2016

Risks of Market Timing

17

SLIDE 63

Performance Chasing Detracts Value

Investors performance lag actual fund performance due to performance chasing, a practice

that effectively translates into buying high and selling low.

Risks of Market Timing

18