State retirement system investments earn 4.1%

CARSON CITY — The Nevada Public Employees Retirement System has reported a preliminary 4.1 percent rate of return on its investments in the 2015 fiscal year that ended June 30, bringing the plan’s total assets to $34.4 billion.

The return comes off a 17.6 percent return in fiscal year 2014, the plan’s fourth best in its 30-year history. PERS investments saw a 12.4 percent gain in 2013, 2.9 percent in 2012 and a record 21 percent in 2011.

PERS Investment Officer Steve Edmundson said agency staff was not surprised at the moderation in the pace of investment gains last year.

“The fund is up 11.4 percent annualized for the five-year period ended June and PERS’ annualized return since inception remains above 9 percent,” he said. “We continue to be pleased with the way the investment portfolio has performed in different market environments.”

Edmundson said preliminary data suggests that PERS’ 2015 fiscal year net return after fees will be in the top 10 percent of large public pension funds.

The fund that covers nearly all state and local government employees is invested primarily in stocks and bonds but has other investments including real estate.

There are about 100,000 active public employees who are members of PERS.

The 2015 Legislature made some changes to the defined benefit pension plan for new hires, but a major proposal to shift it to a hybrid plan that would have included a defined contribution portion for new hires was not adopted by lawmakers.

The change was proposed by Reno GOP Assemblyman Randy Kirner because of the long-term unfunded liability of the plan, which by one estimate totals $12.5 billion. As of June 30, 2014, the system was 71.5 percent funded, a slight increase from the 69.3 percent reported as of June 30, 2013.

The 2015 valuation will be completed this fall.

Contact Sean Whaley at swhaley@reviewjournal.com or 775-687-3900. Find him on Twitter: @seanw801.