Florida Pension Fund Back Up to 100 Percent
Florida’s pension fund is back to full-funded status with the state’s investment portfolio having rebounded, state money managers told advisory panelists Thursday during a quarterly performance review.
With $111 billion in estimated assets, the Florida Retirement System has increased nearly 17 percent since the first of the year and is up from a low of $83 billion in March.
The State Board of Administration’s deputy executive director Kevin SigRist told panelists the relatively robust market of late has buoyed the state’s pension fund, already considered one of the most solid in the country.
“That gets us pretty close to full-funded status,” SigRist told advisory panel members during his update on the fund.
Florida’s pension fund balance increased despite monthly withdrawals of up to $400 million to pay retirement benefits.
Florida’s retirement fund has been the envy of other states for several years. Even at its most vulnerable, it funded 93 percent of its obligations. That compares with some states, including California, that see its assets equal less than 70 percent of its obligations.
Despite the relatively good news, State Board of Administration Executive Director Ash Williams wants the agency to accelerate the review of its overall investment strategy.
After the upheaval in world financial markets in the past year, Williams wants to determine if the state is putting the money it manages - more than $133 billion in all - in the right spots.
Normally conducted every five years, the agency would begin an asset/liability review over the next six to nine months instead of waiting until 2012 when the review was originally scheduled.
“We need to be looking at the world as we know it and re-evaluate our assumptions,” Williams told members. “…At the end of the day with a fund this size, those are the most fundamental decisions.”
In other SBA action, staff members are forging ahead on efforts to create a new department within SBA that would track risk management and federal compliance standards.
Led by a chief compliance officer who would report directly to the executive director, the department would be structured to provide a big picture look at the SBA and whether its separate units are adhering to agency goals and objectives.
The agency in recent years has been criticized for a handful of problems, including a run on the local government investment pool. Local governments, which use the account to park money that can be quickly withdrawn to pay bills, had complained that SBA managers were unresponsive.