The health and funding of public pensions are matters of great importance to so many people. That’s why it was disappointing when a recent guest editorial about Louisiana’s retirement system for teachers fell short of giving your readers an accurate and honest account of pension investments and funding.
I’d like to take this opportunity to share with Press-Tribune readers how the Teachers’ Retirement System of Louisiana (TRSL) is exceeding its target investment return; receiving employer and employee contributions to pay for benefits earned; and making an economic impact on the Louisiana economy.
I am pleased to report that TRSL achieved a 17.9% investment return for the calendar year ended December 31, 2013. This return placed the system among the best performing pension plans with assets greater than $1 billion, according to Wilshire Trust Universe Comparison Service.
TRSL’s investment returns are possible thanks to highly skilled and credential investment staff, consultants, and advisors. In addition, CEM Benchmarking, Inc., an independent third-party pension evaluation firm, has recognized TRSL for the system’s ability to negotiate lower external management fees compared to peer retirement systems.
With regard to funding, TRSL has been actuarially funded since 1988 when Louisiana voters passed a constitutional amendment making it a requirement. Furthermore, the state is on track to pay off the original unfunded accrued liability (UAL) on time, as required by the payment schedule defined in state law. The original UAL is retirement debt accrued before 1988, and owed to TRSL by the state.
Finally, a recent study by the Louisiana Budget Project likened the economic impact of Louisiana pensions to that of several major industries in the state, including chemical manufacturing, medical, and service. In fiscal year 2013, TRSL paid out more than $1.8 billion in benefits to more than 71,000 retirees and beneficiaries, the vast majority of whom live in Louisiana. These people buy goods and services—and pay taxes—in every city, town, and parish in the state. And, TRSL has invested hundreds of million of dollars in Louisiana companies, helping them grow their businesses and hire workers.
As TRSL director, I am proud of our accomplishments, and I am grateful for our long history of working with the Legislature and other stakeholders to create a sustainable, cost-efficient pension system. Louisiana IS on the right track when it comes to its teacher pensions.
Maureen H. Westgard
Teacher Retirement System of Louisiana Director