La. pension systems post big gains

Louisiana’s teacher and state employee pension systems registered investment gains approaching 20 percent in the fiscal year that ended June 30, nearing record growth levels.

The Teachers Retirement System of Louisiana led the way with a market return — net of fees — hitting 19.49 percent.

“We are very pleased with our investment performance. TRSL assets are up $2.33 billion over last year,” said TRSL system Executive Director Maureen Westgard. Assets stand at $17 billion.

Last year’s return was 13.4 percent, and assets stood at $14.7 billion.

The Louisiana State Employees Retirement System was not far behind with an 18.5 percent market return, which boosted assets to $11 billion — an increase of $1.3 billion from the prior year.

Last year’s investment return was 12.6 percent.

“This is good news for Louisiana,” said LASERS Executive Director Cindy Rougeou.

Rougeou said the healthy gains should reduce the amount taxpayers contribute to the pension plans.

“It will go down compared to what it otherwise would have been,” Rougeou said. “It should be less total dollars.”

What impact the investment earnings and other new legislatively approved pension changes will have on both systems’ long-term debt obligation is not yet known. TRSL and LASERS have combined unfunded accrued liabilities of about $19 billion, with about $11 billion at TRSL.

A clearer picture will come after the systems’ actuary completes a financial analysis in late September.

“Until we get our analysis you won’t see the full impact on the UAL,” Rougeou said.

The substantial investment earnings are far cry from the days of the market downturn, which increased the UAL — the dollars needed to pay off promised benefits to those in the pension systems today.

“We had had some good fortune like everybody else in the country,” said LASERS investment officer Bobby Beale. He said a “strong performance” in the domestic and international equity markets had a definite impact on the returns.

“Obviously, it helps to have a really good market,” Beale said. “You always have to be positioned well to take advantage of that market.”

The investment returns caused TRSL to be ranked second among 92 other public retirement funds of greater than $1 billion, according to the Wilshires’ Trust Universe Comparison Service. LASERS ranked in the top 10.

Follow Marsha Shuler on Twitter @MarshaShulerCNB. For more coverage of the state capitol, follow Louisiana Politics at http://blogs.theadvocate.com/politicsblog/.