Raleigh, N.C. -- During today’s quarterly meeting of the Board of Trustees for the Teachers’ and State Employees’ Retirement System (TSERS) and Local Governmental Employees’ Retirement System (LGERS) data was presented showing the actuarial valuations for the pension funds through December 31, 2016 were 90.4 percent funded for TSERS and 95.2 percent funded for LGERS. These funded ratios are measured on an actuarial value of assets basis.
“We are very pleased with the valuations relative to our peers,” said North Carolina State Treasurer Dale R. Folwell, CPA. “However, given the fact that life expectancy is increasing and interest rates are at historic lows, we must focus on not just preserving and strengthening these plans, but sustaining them for the future as well.”
Annual valuations report on the overall percentage of funding for each plan. These valuations also directly impact the amount of money employers must contribute to a retirement plan for each of their employees. Each October, the Boards of Trustees receive valuations for each of the seven state-sponsored retirement, disability or death plans managed by the Department of State Treasurer (DST).
“Even with our assumptions that in aggregate are more conservative, the North Carolina Retirement Systems continue to be well funded relative to our peers,” said Steve Toole, Executive Director of the Retirement Systems, a division of DST. “We are happy to share with our boards that the North Carolina Retirement Systems are strong and healthy.”
Historically, North Carolina has ranked near the top of many rankings in pension funding status. Just this month, The Pew Charitable Trusts
ranked North Carolina as having the 3rd lowest pension unfunded liability among the states.
The TSERS and LGERS funding status is a direct result of:
• Stakeholders working together to keep our retirement systems well-funded since inception
• A history of the N.C. General Assembly appropriating and fully funding the recommended contribution requirements
• Assumptions that in aggregate are more conservative than other similar public systems
• A funding policy that aggressively pays down unfunded liability over a 12-year period
“We’re thankful that the General Assembly, through North Carolina taxpayers, has fully funded the pension plus millions more,” said Folwell. “But all stakeholders must work together to decide how we are going to make sure that we can keep the promises that we’ve made to the state’s hard working public servants.”
The Department of State Treasurer’s Retirement Systems Division manages the processing and administration of all retirement benefits for North Carolina state government, local government, law enforcement, judicial, and legislative employees, as well as fire and rescue workers, and all of their applicable beneficiaries. More information can be found at www.myncretirement.com
The Board of Trustees for the Teachers’ and State Employees’ Retirement System (TSERS) is comprised of 13 members, including eight actively working state employees or retirees, and five public and appointed members who also serve on the Local Governmental Employees’ Retirement System (LGERS).
The LGERS Board of Trustees is also comprised of 13 members, including five members who also serve on the TSERS board and eight members representing local governments across North Carolina.