Retirement Monitor, October 27, 2004

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North Carolina’s largest public pension plan is among an elite few of state plans that remain more than 100 percent funded. The annual financial evaluation of the Teachers’ and State Employees’ Retirement System, (TSERS) places North Carolina’s funding ratio, or its assets divided by its liabilities, at 108 percent.  TSERS provides retirement benefits for North Carolina’s 500,000 working and retired teachers, state law enforcement and other state employees. 

“This is good news for retirees, teachers and state employees,” said State Treasurer Richard Moore.  “We have one of the healthiest public plans in the country because of prudent financial management, strong investment returns and historically regular contributions from the General Assembly.”
 
 According to the Public Fund Survey released in September 2004 by the National Association of State Retirement Administrators, the aggregate funding ratio for the 125 retirement plans participating in the survey was 91.1 percent. 

Funding for TSERS is collected from employee and employer contributions and investment earnings.  More specifically, all state employees contribute 6 percent of their paycheck to the System each month and the General Assembly appropriates an actuarially determined amount each year.  Treasurer Moore invests these funds and investment earnings are returned to the pension plan.

A financial evaluation for the System is produced by an independent third-party during the fall of each year.  The evaluation is based on numbers collected up to the end of the previous calendar year.  The most recent evaluation is based on numbers collected through Dec. 31, 2003.   

In July 2004, Moore announced FY 2004 investment returns for the Retirement System portfolio of 12 percent.