In an effort to help fix the state of Illinois’ burdensome pension problem, the Civic Committee of Chicago has made a bold proposal: Raise income taxes for 10 years; pour the $28.5 billion of proceeds into the state’s pension funds, and turn the corner on eliminating $140 billion in pension debt. Read more

National News

U.S. State Pensions and OPEBS: Fundings Progress is Likely to Pick Up in 2023 After Slipping in 2022

Although S&P Global Ratings' annual survey shows state pension funded ratios slipped in 2022, improving asset performance for the fiscal year ended June 30, 2023, and a continuing focus on funding discipline will likely support near term positive funding progress. Read more

Inequality Worse for Social Security Than Low Birthrates, Chief Actuary Says

The Social Security Expansion Act, sponsored by Senators Bernie Sanders, I-Vermont, and Elizabeth Warren, D-Massachusetts, in February, would create a 12.4% investment income tax on individuals making more than $200,000 to help fund Social Security. It would gradually lift the cap on wages subject to payroll tax until the cap would be fully removed in 2035. Read more

New Report Finds Public Pensions Play a Critical Role in Delivering Retirement Security for Older Americans While Reducing Wealth Inequality by Race and Gender

The report, from the National Institute on Retirement Security (NIRS) and the UC Berkeley Labor Center, also finds that the wealth value of lifetime pension income, particularly from public pensions, is distributed more equitably by race and gender than other private financial assets, thereby narrowing the wealth gap among older families. Read more

U.S. Public Pension Funds Stage Comeback in Latest Fiscal Year

U.S. public pension funds staged an impressive comeback for the fiscal year ended June 30, thanks primarily to strong equity markets, experts say. The median return among the 65 pension funds with more than $1 billion in assets whose results had been tracked by Pensions & Investments as of Sept. 12 was 7.6%. The median return among plans tracked by P&I the previous fiscal year was -5.2%. Read more

How to Not Overwhelm Participants During Open Enrollment

Open enrollment is a time for plan sponsors to promote their benefits offerings, but they should also be wary of confusing employees with too many options and complex language. Read more

Canadian News

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A Pension Fund Is Investing in Wealth Management Firms. It Won’t Be the Last.

The Ontario Teachers’ Pension Plan announced Sept. 5 that it acquired a majority stake in Seven Investment Management (7IM), a private wealth management firm in the U.K. with $26.2 billion in assets. The transaction stands out from similar deals. Hundreds of wealth management firms are sold every year, mostly to other wealth managers. Large ones have occasionally raised capital from, or been acquired by, traditional private equity firms, insurance companies and family offices. A direct investment from a pension fund is rare but now it’s happened at least twice this year. Read more

State News

New York, Oregon Pension Funds Sue Fox Corp. for Opening Itself Up to Lawsuits

Pensions funds from New York City and Oregon allege that Fox Corp. exposed itself to defamation lawsuits and breached its fiduciary duty following the network’s controversial coverage of the 2020 U.S. presidential election. Read more

Los Angeles County Pension Fund Returns 6.4% in Fiscal Year 2023

The Los Angeles County Employees Retirement Association reported a net return of 6.4% for the fiscal year that ended June 30, beating its benchmark’s 5.0% return and raising its total market value to approximately $73.57 billion from $70.41 billion one year earlier. Read more

Chicago to Contribute $2.7 Billion to City's Underfunded Pension Plans

The city of Chicago plans to contribute a total of $2.7 billion in 2024 to its four woefully underfunded pension funds, which includes $307 million in advance payments, according to a 2024 budget forecast released by Mayor Brandon Johnson's office on Sept. 13. Read more

CalPERS CIO Nicole Musicco Will Step Down at the End of September

Musicco said the decision to leave CalPERS will allow her to attend to the immediate needs of family in her native home of Toronto, Canada. CalPERS Deputy Chief Investment Officer Dan Bienvenue will serve as interim chief investment officer. Read more

Connecticut Poised to Take $1.9B Chunk Out of State's Pension Debt

When state officials use the bulk of last fiscal year’s $1.9 billion surplus to reduce pension debt this fall and winter, it will raise total supplemental payments into those cash-starved funds to nearly $7.7 billion in just four years. Read more

New York State Pension Cashes Out of $2.1B Public Equity Fund

The $254.1 billion pension giant also committed nearly $1 billion in July to a pair of investments within its credit portfolio. Read more

CalSTRS Simplifies Its Reference Benchmark to 70/30

CalSTRS' investment committee on Sept. 13 adopted a new reference benchmark of 70% stocks and 30% fixed income that it considered simpler and more easily understood by the average beneficiary. Read more

Connecticut Pension Fund Returns 8.5% for Fiscal Year

Connecticut Retirement Plans & Trust Funds, Hartford, returned a net 8.5% for the fiscal year ended June 30, above the benchmark of 5.9%, according to materials included in the agenda for the Sept 13 board meeting. Read more

LACERS Produces 6.8% Fiscal-Year Return

Los Angeles City Employees' Retirement System reported earning a net 6.8% return for the fiscal year ended June 30, outperforming its 5.8% benchmark, a report for the board states. Read more

San Diego Pension Debt Rises to $3 Billion

San Diego’s pension debt will rise above $3 billion again thanks to a new analysis showing sharper-than-expected increases in future years to the salaries of city workers and to payouts for retirees. Read more

CalSTRS Promotes Julie Donegan to Real Estate Investment Director

Donegan, the first woman to hold the role, according to CalSTRS, will provide insights on the real estate market to the teachers’’ retirement board, execute the real estate investment policy of CalSTRS and serve as a member of the fund’’s senior leadership team. Read more

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