Copyright 2004, Reuters

Calpers will provide info to settle with California First Amendment Coalition.

(Reuters 12/8/04) -- Calpers, the nation's biggest pension fund, said it would disclose management fees and other costs paid to individual private equity funds to settle a lawsuit.

Calpers, the California Public Employees' Retirement System, said Tuesday it settled a suit with the California First Amendment Coalition and agreed to provide the dollar amount of gains and profits from private equity funds since 1999.

The California First Amendment Coalition filed its lawsuit in early September, aiming to discover Calpers' cost for investing in private equity funds and their performance.

Calpers had earlier rejected requests from the group, fearing that it would be excluded from top-tier private equity and hedge funds for disclosing terms as a so-called "limited partner" investor in them.

"The disclosure of this information strikes the appropriate balance between the public's right to access information and the continuing ability of Calpers to invest in these asset classes, which generate long-term returns to pay benefits," said Peter Mixon, Calpers' general counsel.

Calpers said it has investments of $19 billion in private equity funds and $850 million in hedge funds, and has generated profits of more than $6 billion since 1990 in its private equity program.

Calpers said it is too early to tell how the investments will do because the average private equity fund in which it invests is 3.9 years old and most have a 10-year life span.

The fund said that in 2003 it paid management fees and costs of $192 million to private equity fund managers.

"They had been resisting consistently to show which funds get how much money so California taxpayers were unable to see if the funds were getting the money on merit," said Peter Scheer, executive director of the California First Amendment Coalition.

The public interest group brought its lawsuit against Calpers to find out if private equity funds managing the retirement system's money had also provided Calpers board members, which include elected officials, with campaign contributions, Scheer said.

"An average taxpayer would like to know if we're getting a decent return for all this money compared with other opportunities out there and if we're making these decisions on their merits or because of politics," Scheer said.