November 19, 2015 - 3:19 pm
CARSON CITY — Nevada’s public pension fund covering about 103,000 active state and local government employees saw its financial health improve in 2015 over the previous year, and now stands at 73.2 percent fully funded.
The funded rate for the combined plans for regular workers, police and firefighters was 71.5 percent in fiscal year 2014, so there was a 1.7 percentage point improvement this past fiscal year, according to the report by Segal Consulting, the system’s independent actuary.
A 70 percent funding ratio is considered the threshold for fiscally sound public pension plans by the investment and research firm Morningstar Inc. The goal of the plan, as with other public pension plans, is to get to 100 percent fully funded over time.
An unfunded liability means that the benefits owed to current and future retirees exceed the amount of money the plan has currently on hand to meet the obligations.
The report on the status of the $34 billion Public Employees’ Retirement System pension fund was reviewed and accepted Thursday by its seven-member board.
The actuarial funded ratio has seen ongoing improvement over the past few years. The pension plan, when regular employees and police and fire employees are blended together, was 69.3 percent fully funded in 2013.
The fund has a long way to go to reach its high point of 85 percent fully funded in 2000, however.
The report explains that the improvement was due in part to gains on investments. The return in the 2015 fiscal year was 4.2 percent, below the target rate of an 8 percent return over time. But the 2014 year saw a return on the plan of 17.6 percent.
The report also found that for regular retired employees as of June 30, there were 45,508 retired members and 5,369 beneficiaries and survivors receiving total monthly benefits of nearly $135 million. Of these, 628 retired members and 11 beneficiaries and survivors were receiving annual benefits of at least $100,000, which represents 1.3 percent of all retirees, beneficiaries and survivors.
For police and fire, there were 6,345 retired members and 937 beneficiaries and survivors receiving total monthly benefits of $33.5 million. Of these, 762 retired members and five beneficiaries and survivors were receiving annual benefits of at least $100,000, which represents 10.5 percent of all retirees, beneficiaries and survivors.
The retirement plan’s assets are invested primarily in stocks and bonds but PERS has other investments including real estate. The plan saw a 12.4 percent gain in 2013. It grew by 2.9 percent in 2012 and a record 21 percent in 2011.
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