A little bit of everything
The state pension board on Tuesday lowered its target for investment return on the $41 billion retirement fund from 7.75% to 7.55%, a move it’s been considering for over a year
The 14-member Board of Trustees of the State Retirement and Pension System also lowered its projection of inflation from 3% a year to 2.8%, and phased in both steps over the next four years.
Read moreThe outside advisor for the Maryland pension system told its Board of Trustees Tuesday that he was “very disappointed” that the legislature reduced the state’s payment into the retirement fund by $100 million in budget action this month. The money comes from $300 million in added contributions of state employees and teachers passed in 2011. It is being set aside for the possible federal budget cuts from sequestration.
Read moreA $36.9 billion state budget for fiscal 2014 easily passed the House of Delegates and state Senate Friday, with less Republican opposition than last year. The budget raises overall spending 3% and is $500 million less than Gov. Martin O’Malley originally proposed, largely by setting aside funds in case federal budget cuts impact state revenues.
Read moreThe Senate Budget and Taxation Committee voted Thursday to cut $100 million in contributions to the State Retirement and Pension System for fiscal 2014. The committee tied the unexpected move to passage of legislation that will eventually ensure the state puts aside enough money for employee and teachers pensions. But the cut also adds a year to achieving long-term funding goals for those pensions.
Read moreA legislator who has spent his career as a financial advisor and investor is seeking to force the state pension system to limit what he sees as risky investments in private equity, hedge funds and other alternative assets.
The investment managers at the State Retirement Agency told the House Appropriations Committee Tuesday that Del. Steve Schuh’s legislation, HB819, will mean lower returns on investment and less diversification for the $38 billion fund that pays for pensions for teachers and state employees.
Read moreRepublican lawmakers are pushing a bill to cut the expected rate of return on Maryland $38 billion pension investment portfolio — a move that would effectively add billions of dollars to the state’s pension liabilities. The move to reduce what the GOP considers an unrealistic 7.75% rate to something like the corporate rate several points below that drew strong opposition from the State Retirement Agency at a hearing Tuesday.
Read moreFor most of the last decade, Maryland has been putting less money into the pension system for state employees and public school teachers than actuaries said it should, as much as $2.4 billion less.
For years, the trustees of the pension system have been urging the legislature to phase out the “corridor” method of funding. This year the General Assembly’s Joint Pension Committee has agreed to go along, and approved a plan to phase it out over the next 10 years.
Read moreTwo of Maryland’s free-market think tanks are again attacking the Maryland pension system for spending too much money on investment advisors who are not producing enough returns. But the State Retirement Agency says the advisors have helped it reach its benchmark investment goals.
Read moreThe Abell Foundation of Baltimore has awarded a $35,000 grant to MarylandReporter.com to produce a year-long series of stories on Maryland’s pension system for teachers and public employees.
Read moreThe General Assembly’s Joint Pensions Committee unanimously recommended Wednesday abandoning a pension funding method that has allowed the state to pay hundreds of millions less each year into the state retirement system than actuaries said was needed.
Read more