Teachers retirement fund earns $1 billion from investments

Hefty investment earnings increased the Teachers Retirement System of Louisiana’s assets more than $1 billion during the past fiscal year ending June 30.

“Our investment return was 13.8 percent,” said TRSL Executive Director Maureen Westgard. “That added $1.09 billion in assets to the system … Overall it was a good investment year.”

System assets jumped from $13.5 billion to $14.66 billion, according to the latest valuation report by TRSL’s actuary Shelley Johnson of Foster & Foster Actuaries.

On those earnings, TRSL paid $1.6 billion in annual benefits to some 70,000 retirees.

“Ninety percent of that stays in Louisiana ... That’s good economic news for Louisiana,” said Westgard.

From retirees’ perspective, Westgard said there is a potential for a small cost-of-living adjustment because of the $219.7 million deposited in what is called an “experience account.”

She said it would likely be similar to the 1.5 percent of Social Security based on the Consumer Price Index.

“Clearly, there’s enough in there to pay that COLA if the Legislature authorizes it,” she said.

There are 71,031 teachers system retirees but not all of them would benefit because individuals must be retired for a year, be 60 or older and get less than a certain amount in benefits today.

Westgard said the system’s unfunded accrued liability — the amount required to pay off all commitments today — went up slightly from $10.95 billion to $11.3 billion.

But even in that area there was good news, Westgard said.

“For the first time this year the payment for the state made a small amount of payment on the principal of the UAL,” she said.

The system is 56.4 percent funded, up from 55.4 percent last fiscal year. TRSL’s membership includes public school teachers, administrators and some school workers as well as people who work in higher education. Retirements have been steadily risings. Retirements have increased from 65,512 to 71,031 between June 30, 2011, and June 30, 2013.

Active members have decreased during the same period from 86,742 to 82,910.

On investment earnings, TRSL is in the top 6 percent of public retirement funds over $1 billion across the nation and in the last three to five years it has been in the top 9 percent of public retirement funds.