The San Diego County Employees Retirement Association board wants to attract top talent to become its top investment advisor. But despite three searches and many resumes, it simply wasn't satisfied with the candidates. The board was hampered in part by salary caps imposed by the county. So it decided to outsource.

Another benefit: The county could save as much as $25 million in the first year, mostly through reduced money manager fees. The county has already outsourced the job of chief investment officer to a private firm, which is being paid $900,000, not counting incentives based on performance.

The pay package is more than four times that of the association's former chief investment officer, notes the San Diego Union-Tribune. The new advisor will essentially implement the recommendations of the new CIO for hire. This is akin to the endowments model. We may see more pensions adopt it, but the local politics can get pretty onerous. 

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