Employees' Retirement System of Georgia
Comprehensive Annual Financial Report
20 14
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
Fiscal Year Ended June 30, 2014
A component unit of the State of Georgia
Our Mission
Our mission is to be guardian of the retirement plans on behalf of the State of Georgia for the ultimate benefit of the members, retirees and beneficiaries.
Our vision is to use our passion for excellence to become the "Best Managed" retirement system in the country, utilizing state-of-the-art technology, and knowledgeable, customer-focused staff to best serve customers and to protect the retirement system for all of our current and future members.
Our Values
Our Core Values are:
Quality execution Accurate results Continuous improvement Knowledgeable and customer focused staff Sound and secure investment of funds
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
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Introductory
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
James A. Potvin Executive Director
A component unit of the State of Georgia
1
Table of Contents
Introductory Section
Boards of Trustees
4
Letter of Transmittal
5
Certificate of Achievement in Financial Reporting
8
PPCC Recognition Award
9
Administrative Staff and Organization
10
Organizational Chart
11
Financial Section
Independent Auditors' Report
13
Management's Discussion and Analysis (Unaudited)
15
Basic Financial Statements:
Combining Statement of Fiduciary Net Position as of June 30, 2014
21
Defined Benefit Plans-Combining Statement of Fiduciary Net Position as of June 30, 2014
22
Combining Statement of Changes in Fiduciary Net Position for the Year Ended June 30, 2014
23
Defined Benefit Plans-Combining Statement of Changes in Fiduciary Net Position for theYear Ended June 30, 2014
24
Notes to Financial Statements
25
Required Supplementary Information (Unaudited)
Defined Benefit Pension Plans:
Schedules of Employers' and Nonemployers' Contributions
49
Schedules of Employers' and Nonemployers' Net Pension Liability
51
Schedules of Changes in Employers' and Nonemployers' Net Pension Liability
52
Schedule of Investment Returns
55
Defined Benefit OPEB Plans
Schedules of Funding Progress
56
Schedules of Employer Contributions
57
Notes to Required Supplementary Information (Unaudited)
58
Additional Information
Schedule of Administrative Expenses
61
Schedule of Investment Expenses
62
Investment Section
Investment Overview
64
Pooled Investment Fund/Rates of Return
65
Asset Allocation/Investment Summary
66
Schedule of Fees and Commissions/Twenty Largest Equity Holdings
67
Fixed Income Holdings
68
Actuarial Section
Actuary's Certification Letters
70
Summary of Plan Provisions
77
Summary of Actuarial Assumptions
78
Active Members
89
Member and Employer Contribution Rates
91
Defined Benefit Pension Plans
Schedules of Funding Progress
93
Schedule of Retirees Added to and Removed from Rolls
95
Analysis of Change in Unfunded Accrued Liability
97
Solvency Test Results
100
Statistical Section
Introduction
104
Additions by Source - Contribution/Investment Income
105
Deductions by Type
107
Changes in Fiduciary Net Position
110
Number of Retirees
111
Average Monthly Payments to Retirees
112
Annual Benefit
113
Withdrawal Statistics
114
Average Monthly Benefit Payment for New Retirees
115
Retired Members by Retirement Type
120
Retired Members by Optional Form of Benefit
122
Top Participatory Employers
125
Statistical Data at June 30, 2014
127
2
Introductory Section
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
Introductory
Boards of Trustees
Employees' Retirement System, Legislative Retirement System, Georgia Defined Contribution Plan, and Georgia Military Pension Fund
Steven N. McCoy Chair
Sid Johnson Vice-Chair
Harold Reheis
Frank F. Thach, Jr.
Lonice Barrett
Greg S. Griffin
Public School Employees Retirement System*
Eli P. Niepoky State Employees' Assurance Department**
J. Sammons Pearson
Open Position
Georgia Judicial Retirement System*
Mark Butler
H. Phillip Bell
Daniel J. Craig
Dennis Sanders
Larry B. Mims
*The PSERS and GJRS boards are comprised of the members of the ERS board and additional members shown under each plan.
**SEAD -- ERS Board Members Greg S. Griffin, Harold Reheis, Steven N. McCoy, and Sid Johnson serve in addition to the two members shown above.
4
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
Introductory
Two Northside 75 Atlanta, GA 30318
Letter of Transmittal
December 23, 2014
I am pleased to present the Comprehensive Annual Financial Report for the fiscal year ended June 30, 2014 of the retirement systems and programs administered by the Employees' Retirement System of Georgia (the System). The management of the System is responsible for the accuracy, completeness and fairness of the presentation, including all disclosures. It is to the best of our knowledge and belief that the enclosed data is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the System.
Profile of the System
The Employees' Retirement System of Georgia was established to provide benefits for all State employees in 1949. Plans administered by the System include the Employees' Retirement System (ERS), the Legislative Retirement System (LRS) established in 1979, the Public School Employees Retirement System (PSERS) established in 1969, the Georgia Defined Contribution Plan (GDCP) established in 1992, the Georgia Judicial Retirement System (GJRS) established in 1998, and the Georgia Military Pension Fund (GMPF) established in 2002. In addition, the Board of Trustees is responsible for a Group Term Life Insurance Plan (SEAD), the 457 Plan established in 1974 and the 401(k) Plan which began in 1994. A summary of each plan can be found on pages 25 through 33 of this report. The investments of all plans are pooled together into one fund except for the three defined contribution plans, which are maintained individually.
The ERS, LRS, GDCP, GMPF, 401(k) and 457 plans are administered by a 7-member Board made up of 3 ex-officio members, 1 governor-appointed member, and 3 Boardappointed members. PSERS has the same Board as ERS with 2 additional governor-appointed members. GJRS has the same Board as ERS with 3 additional governor-appointed members.
As of June 30, 2014, the System's defined benefit plans served a total of 126,060 active members and 63,613 retirees/beneficiaries from 901 employers around the state. There were 43,236 participants in the 401(k) plan with a total account balance of $607 million. The 457 plan had 13,344 participants with a balance of $590 million. There are 487 participating employers from around the state in the 457 and 401(k) plans.
Legislation
In the 2014 Session, a total of four Acts impacting ERS and its Systems were passed by the General Assembly and signed by the Governor: Act 497, Act 508, Act 521, and Act 663.
Act 497 allowed a member of ERS who was previously an active member of GJRS to transfer service from GJRS to ERS. No service credited to members creates an accrued liability on the system.
Act 508 updated the Public Retirement Systems Standards law by providing a reference date of June 15, 2013 for Governmental Accounting Standards Board (GASB) Statements 25 and 27.
Act 521 aligned Georgia law with the federal Internal Revenue Code in order to maintain compliance with IRS regulations relating to qualified plan status for ERS. Minor changes were made to the General Provisions (replacing detailed IRC 415 language with a statement that the retirement systems will comply with IRC 415 requirements), LRS (add IRC 414 employer "pick-up" language), and GJRS (add IRC 414 employer "pick-up" language).
Act 663 increased the automatic 401(k) contribution rate from 1% of salary to 5% of salary for newly eligible Georgia State Employees' Pension and Savings Plan (GSEPS) members, the current tier for new hires under ERS, and became effective on July 1, 2014. This change allows employees to take full advantage of the maximum employer matching contributions offered by the State of Georgia. Employees may continue to opt out of the 401(k) plan or otherwise elect to change their contribution rate.
Summary of Financial Information
The Management of the System is charged with the responsibility of maintaining a sound system of internal accounting controls. The objectives of such a system are to provide management with reasonable assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorizations, and that they are recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. The concept of reasonable assurance recognizes that first, the cost of a control should not exceed the benefits likely to be derived, and second, the evaluation of the cost and benefits requires estimates and judgments by management.
5
Introductory
Even though there are inherent limitations in any system of internal control, the management of the System makes every effort to ensure that through systematic reporting and internal reviews, errors or fraud would be quickly detected and corrected.
Please refer to the Management's Discussion and Analysis starting on page 15 of this report for an overview of the financial status of the System, including a summary of the System's Fiduciary Net Position, Changes in Fiduciary Net Position, and Asset Allocations.
In FY2014, the pooled fund generated a return of 17.3%. The fund continues to invest in a mix of high quality bonds and stocks which allows the System to participate in rising markets while controlling the downside risks. This has proven to be a successful strategy for other markets and for our System. For further information on investments of the pooled fund, please refer to pages 64 through 68 of this report.
The objective of ERS pension trust funds is to meet longterm benefit promises through contributions that remain approximately level as a percent of member payroll over time while maintaining an actuarially sound system. Historical information relating to the progress in meeting this objective is presented on pages 56, 93, and 94. The latest actuarial valuations as of June 30, 2013 showed the funded ratio of ERS and GJRS decreasing while the funded ratios of PSERS, LRS, and GMPF increased. The decreases of ERS and GJRS are due primarily to the unfavorable investment experience of 2008-2009, the losses of which are now fully recognized. The following table shows the change in funding percentage for each of the pension systems:
FY2012
FY2013
ERS
73.1%
71.4%
PSERS
79.4%
79.9%
LRS
116.1%
118.4%
GJRS
108.5%
104.8%
GMPF
35.7%
40.4%
Further information regarding the funding condition of the pension plans can be found in the Actuarial Section of this report.
Excellence in Financial Reporting
For the fourth consecutive year, the Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Employees' Retirement System of Georgia for its comprehensive annual financial report for the fiscal year ended June 30, 2013. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial
report. This report must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current comprehensive annual financial report continues to meet the Certificate of Achievement Program's requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate.
Initiatives
In FY2014, ERS completed a number of projects focusing on continued enhancements to our member communications, as well as on technology and quality process improvement.
Communication Continuing an initiative begun several years ago, ERS sent out a second round of benefit statements to active members of ERS, LRS, and GJRS. In so doing, ERS also enhanced our delivery capability by making the statements available to the members via the secure member portal of the ERS web site. Upon logging into their accounts, members can go to their "mailbox" to view and print their individual member statements.
ERS launched an effort to better reach our inactive GDCP membership. Many former members of our systems have small account balances that are available to be refunded to them upon their request, and the GDCP plan has the largest number of such accounts. We have therefore begun a campaign to locate and send letters to these former members to remind them of their benefit and let them know how to reach us if they want to take action. For our active membership in all of our systems, we continue to expand our outreach, particularly in the number of benefit fairs, webinars, and videos that we have created or in which we participate. We also began to explore options with a vendor to provide financial education seminars, especially targeting new hires and those who are approaching retirement.
In the area of financial reporting, we have been participating for over a year in a coordinated statewide effort to understand and implement the requirements of the new GASB Statements 67 and 68. GASB 67 is being implemented for our plan-level year-end 2014 reporting, and GASB 68 must be implemented at the participating employer level next year.
Technology and Quality Our online refund application process for the GDCP plan, implemented last year, was very successful as more than half of our GDCP refund applications are now submitted online. This year we expanded the process to include refund applications for terminated ERS and PSERS members. We have also begun design work on a process for members to submit their regular retirement applications via a similar online process.
6
With system and data security having been so prominently in the news recently, ERS took action to ensure the security of our online presence as well. We contracted with an outside vendor to conduct a comprehensive systems penetration test. The test revealed that we have done very well in keeping our technology up to date, while also providing some recommendations for continued training and awareness for our employees. This process will become part of our regular schedule, with updated testing as often as twice per year going forward.
Acknowledgements
This report reflects the combined effort of our staff under the Board's leadership. Copies of this report, along with other valuable plan information, can be downloaded from the System's website.
I would like to express my sincere thanks to the Boards of Trustees for their leadership and support. Many thanks are also extended to the offices of the Governor, Lieutenant Governor, members of the House and Senate Retirement Committees and their staff, members of the House and Senate, and the department officials whose support and assistance have helped ERS accomplish its mission over the years.
Respectfully submitted,
James A. Potvin, Executive Director Employees' Retirement System of Georgia
Introductory
7
Introductory
Government Finance Officers Association
Certificate of
Achievement for Excellence
in Financial Reporting
Presented to
Employees' Retirement System
Text38:
of Georgia
For its Comprehensive Annual Financial Report
for the Fiscal Year Ended
June 30, 2013
Executive Director/CEO
8
Introductory
P P CC
Public Pension Coordinating Council Recognition Award for Funding
2014
Presented to
Employees' Retirement System of Georgia
In recognition of meeting professional standards for plan funding as
set forth in the Public Pension Standards. Presented by the Public Pension Coordinating Council, a confederation of
National Association of State Retirement Administrators (NASRA) National Conference on Public Employee Retirement Systems (NCPERS)
National Council on Teacher Retirement (NCTR)
Alan H. Winkle Program Administrator
9
Introductory Administrative Staff and Organization
James A. Potvin Executive Director
Charles W. Cary, Jr. CIO - Investment Services
Gregory J. Rooks Controller
Chris Hackett Director
Information Technology
Nicole Paisant Director
Human Resources
Susan Anderson Chief Operating
Officer
Carlton Lenoir Chief Financial
Officer
Angie Surface Director
Peach State Reserves Quality Assurance
Consulting Services
Cavanaugh Macdonald Consulting, LLC - Actuary KPMG LLP - Auditor JPMorgan Chase Bank, N. A. - Defined Contribution
Custodian Aon Hewitt - Defined Contribution Consultant
Investment Advisors*
Albritton Capital Management Baillie Gifford Overseas Limited Barrow, Hanley, Mewhinney & Strauss Cooke & Bieler Denver Investment Advisors
Medical Advisors
Harold E. Sours, M.D., Atlanta, GA G. Lee Cross, M.D., Atlanta, GA Douglas Smith, M.D., Smyrna, GA William H. Biggers, M.D., Atlanta, GA Jeffrey T. Nugent, M.D., Atlanta, GA Pedro F. Garcia, M.D., Atlanta, GA H. Rudolph Warren, M.D., Dunwoody, GA Quinton Pirkle, M.D., Atlanta, GA Marvin Bittinger, M.D., Gainesville, GA
Fisher Investments Mondrian Investment Partners Limited PENN Capital Management Sands Capital Management
*See page 67 in the Investment Section for a summary of fees paid to Investment Advisors.
10
Introductory
Organizational Chart
Board of Trustees
Executive Director
Chief Operating
Officer
Executive Support
Chief Financial Officer
Investment Services Division
Accounting Division
Information Technology
Division
Member Services Division
Office Administration
Financial Management
Division
Peach State Reserves
Quality Assurance
11
Financial Section
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
12
Financial
Independent Auditors' Report
KPMG LLP Suite 2000 303 Peachtree Street, NE Atlanta, GA 30308-3210
The Board of Trustees Employees' Retirement System of Georgia:
Report on the Financial Statements We have audited the accompanying financial statements of the Employees' Retirement System of Georgia (the System), a component unit of the State of Georgia, as of and for the year ended June 30, 2014, and the related notes to the financial statements, which collectively comprise the System's basic financial statements, as listed in the table of contents.
Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with U.S. generally accepted accounting principles; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the fiduciary net position of the System as of June 30, 2014, and the changes in fiduciary net position for the year then ended in accordance with U.S. generally accepted accounting principles.
Report on Summarized Comparative Information We have previously audited the System's 2013 financial statements, and we expressed an unmodified audit opinion on those audited financial statements in our report dated September 30, 2013. In our opinion, the summarized comparative information presented herein as of and for the year ended June 30, 2013 is consistent, in all material respects, with the audited financial statements from which it has been derived.
Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Emphasis of Matter As discussed in note 3(a) to the basic financial statements, in 2014, the System adopted Governmental Accounting Standards Board Statement No. 67, Financial Reporting for Pension Plans, an amendment of GASB Statement No. 25. Our opinion is not modified with respect to this matter.
Other Matters Required Supplementary Information U.S. generally accepted accounting principles require that the management's discussion and analysis, schedules of employers' and nonemployers' contributions, schedules of employers' and nonemployers' net pension liability, schedules of changes in employers' and nonemployers' net pension liability, schedule of investment returns, schedules of funding progress, and schedules of employer contributions on pages 15-20 and 49-57 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any
13
Financial
assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary and Other Information Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the System's basic financial statements. The schedules of administrative expenses and investment expenses, introductory, investment, actuarial, and statistical sections are presented for purposes of additional analysis and are not a required part of the basic financial statements.
The schedules of administrative expenses and investment expenses are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedules of administrative expenses and investment expenses are fairly stated in all material respects in relation to the basic financial statements as a whole.
The introductory, investment, actuarial, and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 31, 2014 on our consideration of the System's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the System's internal control over financial reporting and compliance.
December 23, 2014
14
Financial
Management's Discussion and Analysis (Unaudited)
June 30, 2014
This section provides a discussion and analysis of the financial performance of the Employees' Retirement System of Georgia (the System) for the year ended June 30, 2014.The discussion and analysis of the System's financial performance is within the context of the accompanying basic financial statements, notes to the financial statements, required supplementary schedules, and additional information following this section.
The System is responsible for administering a cost-sharing, multiple-employer defined benefit pension plan for various employer agencies of Georgia, along with six other defined benefit pension plans, three defined benefit OPEB plans and funds, and three defined contribution plans.
The defined benefit pension plans include: Employees' Retirement System (ERS) Public School Employees Retirement System (PSERS) Legislative Retirement System (LRS) Georgia Judicial Retirement System (GJRS) Georgia Military Pension Fund (GMPF) Superior Court Judges Retirement Fund (SCJRF) District Attorneys Retirement Fund (DARF)
The defined benefit OPEB plans and funds include:
State Employees' Assurance Department Active Members Trust Fund (SEAD-Active) State Employees' Assurance Department Retired and Vested Inactive Members Trust Fund (SEAD-OPEB) Survivor's Benefit Fund
The defined contribution retirement plans include:
Georgia Defined Contribution Plan (GDCP) 401(k) Deferred Compensation Plan (401(k)) 457 Deferred Compensation Plan (457)
Financial Highlights
The following highlights are discussed in more detail later in this analysis:
The net position of the System increased by $1.6 billion, or 10.5%, from $15.6 billion at June 30, 2013 to $17.3 billion at June 30, 2014. The increase in net position from 2013 to 2014 was primarily due to the increase in the equity markets in 2014.
For the year ended June 30, 2014, the total additions to net position were an increase of $3.2 billion compared to an increase of $2.4 billion for the year ended June 30, 2013. For the year ended June 30, 2014, the additions consisted of employer, nonemployer contributing entities (nonemployer), and member contributions totaling $611 million, insurance premiums of $5.1 million, net investment income of $2.6 billion, and participant fees of $1.1 million.
For the year ended June 30, 2013, the total additions to net position were an increase of $2.4 billion compared to an increase of $712 million for the year ended June 30, 2012. For the year ended June 30, 2013, the additions consisted of employer, nonemployer and member contributions totaling $533 million, insurance premiums of $5.8 million, net investment income of $1.9 billion, and participant fees of $0.9 million.
Net investment income of $2.6 billion in 2014 (comprised of interest and dividend income, the change in fair value of investments, and other, reduced by investment expenses) represents a $707 million increase, compared to the net investment income of $1.9 billion for the year ended June 30, 2013. The increase in net investment income from 2013 to 2014 is due primarily to the increase in equity markets in 2014.
The total deductions were $1.55 billion and $1.53 billion for the years ended June 30, 2014 and 2013, respectively. For the year ended June 30, 2014, the deductions consisted of benefit payments of $1.5 billion, refunds of $27 million, death benefits of $34 million, and administrative expenses of $14.5 million. For the year ended June 30, 2013, the deductions consisted of benefit payments of $1.5 billion, refunds of $22.5 million, death benefits of $32 million, and administrative expenses of 15
Financial
Management's Discussion and Analysis (Unaudited)
$14.4 million. Administrative expenses and related total deductions reflect the implementation of Governmental Accounting Standards Board (GASB) Statement No. 67 which requires investment-related costs to be reported as investment expense, a component of net investment income rather than administrative expense. For fiscal year 2013, these costs have been reclassified, from administrative expense to investment expense, for comparative purposes.
Benefit payments paid to retirees and beneficiaries had a slight increase of $7.3 million, or 0.5%, from $1.466 billion in 2013 to $1.473 billion in 2014, resulting primarily from a slight increase in the number of new retirees and beneficiaries applying for benefits across all plans.
Overview of the Financial Statements
The basic financial statements include (1) the combining statement of fiduciary net position and changes in fiduciary net position, (2) the defined benefit plans combining statements of fiduciary net position and changes in fiduciary net position, and (3) notes to the financial statements. The System also includes in this report additional information to supplement the financial statements.
In addition, the System presents six types of required supplementary schedules, which provide historical trend information about the plan. The six types of schedules include (1) Schedule of Employers' and Nonemployers' Contributions (2) Schedule of Employers' and Nonemployers' Net Pension Liability (3) Schedule of Changes in Employers' and Nonemployers' Net Pension Liability (4) Schedule of Investment Returns (5) Schedule of Funding Progress and (6) Schedule of Employer Contributions.
The System prepares its financial statements on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles as promulgated by the GASB. These statements provide information about the System's overall financial status.
Description of the Financial Statements
The Combining Statement of Fiduciary Net Position is the statement of financial position presenting information that includes all of the System's assets and liabilities, with the balance representing the Net Position Restricted for Pensions and OPEB. The investments of the System in this statement are presented at fair value. This statement is presented on page 21.
The Combining Statement of Changes in Fiduciary Net Position reports how the System's net position changed during the fiscal year. The additions include contributions to the retirement plans from employers, nonemployers, and members, group life insurance premiums, participant fees, and net investment income, which includes interest and dividends and the net increase in the fair value of investments, net of investment expenses. The deductions include benefit payments, life insurance death benefit payments, refunds of member contributions and interest, and administrative expenses. This statement is presented on page 23.
The Defined Benefit Plans Combining Statement of Fiduciary Net Position and the Combining Statement of Changes in Fiduciary Net Position present the financial position and changes in financial position for each of the funds administered by the System. These statements are on pages 22 and 24, respectively.
Notes to the Financial Statements are presented to provide the information necessary for a full understanding of the financial statements. The notes to the financial statements begin on page 25.
Required Supplementary Information begins on page 49. The required schedules are discussed as follows:
The Schedule of Employers' and Nonemployers' Contributions presents the required contributions and the percent of required contributions actually contributed.
The Schedule of Employers' and Nonemployers' Net Pension Liability presents the components of the net pension liability as of the fiscal year end and the fiduciary net position as a percentage of the total pension liability as of that date. This trend information will be accumulated to display a ten-year presentation.
16
Financial Management's Discussion and Analysis (Unaudited)
The Schedule of Changes in Employers' and Nonemployers' Net Pension Liability presents total pension liability and is measured as total pension liability less the amount of the fiduciary net position. This trend information will be accumulated to display a ten year presentation.
The Schedule of Investment Returns presents historical trend information about the annual money-weighted rate of return on plan investments, net of plan investment expense. This trend information will be accumulated to display a ten year presentation.
Three of the required schedules above, the Schedule of Employers' and Nonemployers' Contributions, the Schedule of Employers' and Nonemployers' Net Pension Liability, and Schedule of Changes in Employers' and Nonemployers' Net Pension Liability are applicable to five of the defined benefit pension plans: ERS, PSERS, LRS, GJRS, and GMPF. Two additional required schedules, the Schedule of Funding Progress and the Schedule of Employer Contributions relate to defined benefitOPEB plans, which are postemployment benefit plans.The Schedule of Funding Progress presents historical trend information about the actuarially determined funded status of the plans from a long term, ongoing plan perspective, and the progress made in accumulating sufficient assets to fund benefit payments as they become due. The Schedule of Employer Contributions presents historical trend information about the annual required contributions of employers and percentage of such contributions in relation to actuarially determined requirements for the years presented. Notes to Required Supplementary Information are presented to provide the information necessary for a full understanding of the supplementary schedules. The notes to required supplementary schedules begin on page 58. Additional information is presented, beginning on page 61, which includes the Schedule of Administrative Expenses Contributions and Expenses. The Schedule of Administrative Expenses Contributions and Expenses presents the expenses incurred in the administration of these plans and funds, and the contributions from each plan and fund to provide for these expenses. This schedule reflects the implementation of GASB 67 which requires investment related costs to be reported as investment expense, a component of net investment income. For fiscal year 2013, these costs have been reclassified from administrative expense to investment expense, for comparative purposes.
17
Management's Discussion and Analysis (Unaudited)
Financial
Financial Analysis of the System
A summary of the System's net position at June 30, 2014 and 2013 is as follows:
Assets: Cash, cash equivalents, and receivables Investments Capital assets, net Total assets
Liabilities: Due to brokers and accounts payable Net position
Net Position (in thousands)
2014
2013
Amount Change
Percentage Change
$
384,416
16,917,235
6,797
17,308,448
419,213 15,242,010
3,778 15,665,001
(34,797) 1,675,225)
3,019) 1,643,447)
(8.3) % 11.0) 79.9) 10.5)
41,756 $ 17,266,692
40,720 15,624,281
1,036) 1,642,411)
2.5) 10.5) %
18
Financial
Management's Discussion and Analysis (Unaudited)
The following table presents the investment allocation at June 30, 2014 and 2013:
Asset allocation at June 30 (in percentages): Equities: Domestic International Private equity Domestic obligations: U.S. Treasuries U.S. Agencies Corporate and other bonds International obligations: Governments Corporates Mutual and common collective trust funds and separate accounts
2014
49.5 % 17.7
0.1
9.3 0.1 14.0
0.5 1.7 7.1
2013
51.8 % 16.3
13.2 0.1
10.5
0.6 0.6 6.9
Asset allocation at June 30 (in thousands): Equities: Domestic International Private equity Domestic obligations: U.S. Treasuries U.S. Agencies Corporate and other bonds International obligations: Governments Corporates Mutual and common collective trust funds and separate accounts
$ 8,372,234
2,999,387 21,914
$ 7,887,778
2,485,682
1,573,719 10,028
2,374,957
2,019,495 18,074
1,605,803
78,652 276,764 1,209,580
$ 16,917,235
85,050 82,707 1,057,421
$ 15,242,010
The total investment portfolio increased by $1.7 billion from 2013, which is primarily due to the increase in the equity markets in 2014.
The implementation of GASB Statement No. 67 requires the System to report an annual money-weighted rate of return on plan investments, net of plan investment expense. A money-weighted return is weighted by the amount of dollars in the fund at the beginning and end of the performance period. A money-weighted return is highly influenced by the timing of cash flows into and out of the fund and is a better measure of an entity or person who controls the cash flows into and out of the fund. The nondiscretionary cash flows of the plan, primarily contributions and benefit payments, have a considerable impact on the moneyweighted returns of the portfolio. The money-weighted rate of return for the fiscal year ended June 30, 2014 was 5.95%.
The investment rate of return in fiscal year ended June 30, 2014 was 17.3% with a 23.7% return on equities, a 6.8% return on private equity (inception date of October 3, 2013) and a 3.1% return on fixed income investments.The five-year annualized rate of return on investments at June 30, 2014 was 12.8%, with a 17.3% return on equities and a 4.4% return on fixed income investments.
19
Financial
Management's Discussion and Analysis (Unaudited)
A summary of the changes in the System's net position for the year ended June 30, 2014 is as follows:
Additions: Employer contributions Nonemployer contributions Member contributions Participant fees Insurance premiums Net investment income Other Total additions
Deductions: Benefit payments Refunds Death benefits Administrative expenses Total deductions Net increase in net position
Changes in Net Position (in thousands)
2014
2013
Amount Change
Percentage Change
$
445,214
39,107
126,732
1,122
5,109
2,573,389
7
3,190,680
369,224 38,695
125,131 948
5,774 1,866,275
7 2,406,054
75,990 412
1,601 174 (665)
707,114 --
784,626
20.6 % 1.1 1.3
18.4 (11.5) 37.9
-- 32.6
1,472,803 27,044 33,946 14,476
1,548,269 $ 1,642,411
1,465,545 22,490 32,044 14,395
1,534,474 871,580
7,258 4,554 1,902
81 13,795 770,831
0.5 20.2
5.9 0.6 0.9 88.4 %
Note: This schedule reflects the implementation of GASB 67 which requires investment-related costs to be reported as investment expense, a component of net investment income. For fiscal year 2013, these costs have been reclassified for comparative purposes, from administrative expenses to investment expense, which is included in net investment income. Additionally, nonemployer contributions have been reclassified from employer contributions.
Additions The System accumulates resources needed to fund benefit payments through contributions and returns on invested funds. In fiscal year 2014, total contributions increased 15%, primarily because of an increase in the employer contribution rates coupled with modest overall salary increases. Net investment income increased by $707 million, primarily due to the increase in the equity markets in 2014.
Deductions For fiscal year 2014, total deductions increased 0.9%, primarily because of a 0.5% increase in benefit payments. This was due to an increase of approximately 0.3% in the number of retirees receiving benefit payments across all defined benefit pension plans. Refunds increased by 20.2%, which was primarily due to an increase in the number of refunds processed during 2014. Death benefits increased by 5.9%, which was primarily due to an increase in the number of death claims processed during 2014. Administrative expenses increased by 0.6% over the prior year, primarily due to an increase in required employer retirement contributions, contractual services, and computer services.
Requests for Information
This financial report is designed to provide a general overview of the System's finances for all those with interest in the System's finances. Questions concerning any of the information provided in this report or requests for additional information should be addressed to Employees' Retirement System of Georgia, Two Northside 75, Suite 300, Atlanta, GA 30318.
20
21
Assets Cash and cash equivalents
Receivables: Contributions Interest and dividends Due from brokers for securities sold Other Unremitted insurance premiums
Total receivables
Investments - at fair value: Domestic obligations: U.S. Treasuries U.S. Agencies Corporate and other bonds International obligations: Governments Corporates Equities: Domestic International Private equity Mutual funds, common collective trust funds, and separate accounts Equity in pooled investment fund
Total investments
Capital assets, net
Total assets
Liabilities
Accounts payable and other Due to brokers for securities purchased Insurance premiums payable Due to participating systems
Total liabilities
Net position restricted for pensions and OPEB
Defined Benefit Plans
$
26,923
24,885 -- --
1,378 759
27,022
Pooled Investment
Fund
230,181
Defined Contribution Plans
Georgia Defined Contribution
Plan
47,191
401(k) Plan
24
457 Plan
25
-- 42,984
7,160 -- --
796
1,758
345
208
--
--
--
--
--
--
427
131
--
--
--
50,144
1,004
2,185
476
Eliminations
(759)
(759)
15,913,400
15,913,400 6,797
15,974,142
22,970 --
759 --
23,729
$
15,950,413
1,573,719 --
2,324,117
78,652 276,764
8,372,234 2,999,387
21,914
-- 15,646,787 15,927,112
2,001 11,711
-- 15,913,400 15,927,112
-- 10,028 50,840
-- --
-- --
-- --
60,868
109,063
--
616,687
616,687
618,896
592,893
592,893
593,394
563
563
108,500
3,700
3,700
615,196
811
811
592,583
(15,913,400) (15,913,400)
(15,914,159)
(759) (15,913,400) (15,914,159)
See accompanying notes to financial statements.
Total
2014 304,344
2013 335,347
27,784 43,192
7,160 1,936
--
80,072
30,440 43,102
8,543 1,781
83,866
1,573,719 10,028
2,374,957
78,652 276,764
8,372,234 2,999,387
21,914
1,209,580 --
16,917,235 6,797
17,308,448
2,019,495 18,074
1,605,803
85,050 82,707
7,887,778 2,485,682
1,057,421
15,242,010 3,778
15,665,001
30,045 11,711
-- --
41,756
17,266,692
31,751 8,969
40,720
15,624,281
Combining Statement of Fiduciary Net Position
June 30, 2014 (with comparative totals as of June 30, 2013) (In thousands)
Financial
Financial Defined Benefit Plans Combining Statement of Fiduciary Net Position
June 30, 2014 (In thousands)
22
Assets
Cash and cash equivalents
Receivables: Contributions Interest and dividends Due from brokers for securities sold Other Unremitted insurance premiums
Total receivables
Employees' Retirement
System
$
25,731
Public School Employees Retirement System
87
Defined Benefit Pension Plans
Legislative Retirement
System
25
Georgia Judicial Retirement System
409
Georgia Military Pension
Fund
6
Superior Court Judges
Retirement Fund
25
District Attorneys Retirement
Fund
2
Defined Benefit OPEB Plans
State Employees' Assurance Department
Active
State Employees' Assurance Department
OPEB
Survivors Benefit Fund
107
433
98
24,600
2
28
255
--
--
1,378
--
25,978
2
28
255
--
--
--
--
85
674
--
85
674
--
Investments - at fair value:
Domestic obligations:
U.S. Treasuries
--
U.S. Agencies
--
Corporate and other bonds
--
International obligations:
Governments
--
Corporates
--
Equities:
Domestic
--
International
--
Mutual funds, common collective
trust funds, and separate accounts
--
Equity in pooled investment fund
13,254,496
822,744
32,808
400,723
15,278
235,210
1,037,189
114,952
Total investments Capital assets, net
13,254,496
822,744
32,808
400,723
15,278
235,210
1,037,189
114,952
6,797
--
Total assets
13,313,002
822,833
32,861
401,387
15,284
25
2
235,402
1,038,296
115,050
Liabilities
Accounts payable and other Due to brokers for securities purchased Insurance premiums payable Due to participating systems
20,726
1,100
65
585
33
22
--
--
--
745
2
12
--
--
--
44
395
--
--
--
--
Total liabilities
21,471
1,100
67
597
33
22
44
395
--
Net position restricted for pensions
and OPEB
$ 13,291,531
821,733
32,794
400,790
15,251
3
2
235,358
1,037,901
115,050
Defined Benefit Plans Total
26,923
24,885 -- --
1,378 759
27,022
15,913,400 15,913,400
6,797 15,974,142
22,970 --
759 --
23,729
15,950,413
See accompanying notes to financial statements.
23
Additions: Contributions: Employer Nonemployer Member Participant fees Insurance premiums Administrative expense allotment
Investment income: Net increase in fair value of investments Interest and dividends Other Less investment expenses Allocation of investment income Net investment income
Total additions
Deductions: Benefit payments Refunds of member contributions and interest Death benefits Administrative expenses Total deductions
Net increase in net position
Net position restricted for pensions and OPEB:
Beginning of year
End of year
See accompanying notes to financial statements.
Defined Benefit Plans
Pooled Investment
Fund
Defined Contribution Plans
Georgia
Defined
Contribution
401(k)
457
Plan
Plan
Plan
Total
2014
2013
$
423,701
39,107
39,095
--
5,109
7
(7,846) 2,427,538
2,419,692
2,926,711
2,103,091 333,072 -- (8,625)
(2,427,538)
1,383,854
9,323
33,946
10,373
1,437,496
1,489,215
14,461,198
$ 15,950,413
16,290
21,513 --
53,724 1,122 -- --
17,623
445,214 39,107
126,732 1,122 5,109 7
369,224 38,695
125,131 948
5,774 7
445 980
(57)
1,368
17,658
80,064
523 (2,004)
78,583
154,942
73,837
748 (839)
73,746
91,369
2,257,437 334,052 1,271 (19,371) --
2,573,389
3,190,680
1,537,278 344,298 1,204 (16,505)
1,866,275
2,406,054
9 17,721
991
18,721
(1,063)
43,133
2,300
45,433
109,509
45,807
812
46,619
44,750
109,563 108,500
505,687 615,196
547,833 592,583
1,472,803 27,044 33,946 14,476
1,548,269 1,642,411
15,624,281 17,266,692
1,465,545 22,490 32,044 14,395
1,534,474 871,580
14,752,701 15,624,281
Combining Statement of Changes in Fiduciary Net Position
Year ended June 30, 2014 (with comparative totals for the year ended June 30, 2013) (In thousands)
Financial
Financial Defined Benefit Plans Combining Statement of Changes in Fiduciary Net Position
Year ended June 30, 2014 (In thousands)
24
Additions: Contributions: Employer Nonemployer Member Participant fees Insurance premiums Administrative expense allotment
Investment income : Net increase in fair value of investments Interest and dividends Other Less investment expenses Allocation of investment income
Net investment income
Total additions
Deductions: Benefit payments Refunds of member contributions and interest Death benefits Administrative expenses
Total deductions
Transfers to (from) other plans
Net increase in net position
Employees' Retirement
System
Public School Employees Retirement System
Defined Benefit Pension Plans
Legislative Retirement
System
Georgia Judicial Retirement System
Georgia Military Pension
Fund
Superior Court Judges
Retirement Fund
District Attorneys Retirement
Fund
Defined Benefit OPEB Plans
State Employees' Assurance Department
Active
State Employees' Assurance Department
OPEB
Survivors Benefit Fund
Defined Benefit Plans Total
$
418,807
45
1,373
1,892
1,504
80
10,945
27,160
1,002
--
32,423
1,659
282
4,731
--
--
--
6
1
607
4,502
--
423,701
--
39,107
--
39,095
--
--
5,109
--
7
(6,859) 2,028,607
2,021,748
2,483,923
(309) 124,108
123,799
152,618
1,305,998
8,757
7,440 1,322,195
1,161,728
56,189
514
1,450 58,153
94,465
(12) 4,981
4,969
5,296
(149) 60,161
60,012
67,118
1,801
30 152 1,983
3,313
17,441
22 754 18,217
48,901
(5) 2,184 2,179 4,071
841
110 951
3,120
-- -- -- -- -- 1,510
1,504
-- -- 6 1,510
--
--
--
(51)
(461)
--
(7,846)
35,124
155,329
17,044
2,427,538
35,073
154,868
17,044
2,419,692
81
35,680
159,370
17,044
2,926,711
80
--
1,383,854
5,055
28,891
1
46
414
81
5,101
29,305
--
9,323
--
33,946
--
10,373
--
1,437,496
5
(5)
30,579
130,070
17,039
1,489,215
Net position restricted for pensions and OPEB:
Beginning of year, as adjusted (Note 3g)
12,129,803
727,268
29,481
351,889
12,131
3
2
204,779
907,831
98,011
14,461,198
End of year
$ 13,291,531
821,733
32,794
400,790
15,251
3
2
235,358
1,037,901
115,050
15,950,413
See accompanying notes to financial statements.
Financial
Notes to Financial Statements
June 30, 2014 (1) General
The accompanying basic financial statements of the Employees' Retirement System of Georgia, including all plans and funds administered by the Employees' Retirement System of Georgia (collectively, the System), is comprised of the Employees' Retirement System of Georgia (ERS), Public School Employees Retirement System (PSERS), Legislative Retirement System (LRS), Georgia Judicial Retirement System (GJRS), Georgia Military Pension Fund (GMPF), State Employees' Assurance Department Active Members Trust Fund (SEAD-Active), State Employees' Assurance Department Retired and Vested Inactive Members Trust Fund (SEAD-OPEB), Survivors Benefit Fund, Superior Court Judges Retirement Fund (SCJRF), District Attorneys Retirement Fund (DARF), Georgia Defined Contribution Plan (GDCP), 401(k) Deferred Compensation Plan (401(k) Plan), and the 457 Deferred Compensation Plan (457 Plan). All significant accounts and transactions among the various systems, departments, and funds have been eliminated. The Board of Trustees, comprised of active and retired members, ex-officio state employees, and appointees by the Governor, are ultimately responsible for the administration of the System.
(2) Authorizing Legislation and Plan Descriptions
Each plan and fund, including benefit and contribution provisions, was established and can be amended by state law. The following summarizes authorizing legislation and the plan description of each retirement fund:
(a) ERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement allowances for employees of the State of Georgia and its political subdivisions. ERS is directed by a Board of Trustees and has the powers and privileges of a corporation. There were 425 employers and 1 nonemployer contributing entity participating in the plan during 2014.
Membership As of June 30, 2014, participation in ERS is as follows:
Inactive members and beneficiaries currently receiving benefits Inactive members entitled to benefits but not yet receiving benefits Active plan members
Total
45,819 81,621 60,490
187,930
Benefits The ERS Plan supports three benefit tiers: Old Plan, New Plan, and Georgia State Employees' Pension and Savings Plan (GSEPS). Employees under the old plan started membership prior to July 1, 1982 and are subject to plan provisions in effect prior to July 1, 1982. Members hired on or after July 1, 1982 but prior to January 1, 2009 are new plan members subject to modified plan provisions. Effective January 1, 2009, new state employees and rehired state employees who did not retain membership rights under the Old or New Plans are members of GSEPS. ERS members hired prior to January 1, 2009 also have the option to irrevocably change their membership to GSEPS.
Under the old plan, the new plan, and GSEPS, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attainment of age 60 or 30 years of creditable service regardless of age. Additionally, there are some provisions allowing for early retirement after 25 years of creditable service for members under age 60.
Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months, multiplied by the number of years of creditable service, multiplied by the applicable benefit factor. Annually, postretirement cost-of-living adjustments may also be made to members' benefits, provided the members were hired prior to July 1, 2009. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension, at reduced rates, to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
25
Financial
Notes to Financial Statements
Contributions and Vesting Member contributions under the old plan are 4% of annual compensation, up to $4,200, plus 6% of annual compensation in excess of $4,200. Under the old plan, the state pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these state contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan and GSEPS are 1.25% of annual compensation. The state is required to contribute at a specified percentage of active member payrolls, determined annually by actuarial valuation. The state contributions are not at any time refundable to the member or his/her beneficiary.
Pursuant to The Official Code of Georgia Annotated (O.C.G.A.) 47-2-292 the employer contributions for local tax commissioners are funded by the State of Georgia on behalf of the local county employer and pursuant to O.C.G.A. 47-2-290 the employer contribution for certain State Court employees is funded by the State on behalf of the local county employer.
Employer and nonemployer contributions as a percentage of covered payroll required for fiscal year 2014 were based on the June 30, 2011 actuarial valuation for the old plan, new plan, and GSEPS as follows:
Employer and nonemployer: Normal Employer paid for member Accrued liability
Total
Old Plan
1.51 % 4.75 12.20 18.46 %
New Plan
6.26 %
12.20 18.46 %
GSEPS
2.98 % --
12.20 15.18 %
Members become vested after ten years of membership service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.
(b) PSERS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement allowances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. The ERS Board of Trustees, plus two additional trustees, administers PSERS. There were 184 employers and 1 nonemployer contributing entity participating in the plan during 2014.
Membership As of June 30, 2014, participation in PSERS is as follows:
Inactive members and beneficiaries currently receiving benefits Inactive members entitled to benefits but not yet receiving benefits Active plan members
Total
16,434 77,322 36,109
129,865
Benefits A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of ten years of service.
Upon retirement, the member will receive a monthly benefit of $14.75, multiplied by the number of years of creditable service. Death and disability benefits are also available through PSERS. Additionally, PSERS may make periodic cost-of-living adjustments to the monthly benefits.
26
Financial
Notes to Financial Statements
Contributions and Vesting Individuals who became members prior to July 1, 2012 contribute $4 per month for nine months each fiscal year. Individuals who became members on or after July 1, 2012 contribute $10 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees.
Employer contributions required for the year ended June 30, 2014 were $692 per active member and were based on the June 30, 2011 actuarial valuation.
Members become vested after ten years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contribution, the member forfeits all rights to retirement benefits.
(c) LRS is a single-employer defined benefit pension plan established by the Georgia General Assembly from 1967-1971, and later reestablished in 1979, for the purpose of providing retirement allowances for all members of the Georgia General Assembly. LRS is administered by the ERS Board of Trustees. There was one employer in the plan for 2014.
Membership As of June 30, 2014, participation in LRS is as follows:
Inactive members and beneficiaries currently receiving benefits
259
Inactive members entitled to benefits but not yet receiving benefits
148
Active plan members
222
Total
629
Benefits A member's normal retirement is after eight years of creditable service and attainment of age 65, or eight years of membership service (four legislative terms) and attainment of age 62. A member may retire early and elect to receive a monthly retirement benefit after completion of eight years of membership service and attainment of age 60; however, the retirement benefit is reduced by 5% for each year the member is under age 62.
Upon retirement, the member will receive a monthly service retirement allowance of $36, multiplied by the number of years of creditable service, reduced by age reduction factors, if applicable. Death benefits are also available through the plan.
Contributions and Vesting Member contributions are 8.5% of annual salary. The state pays member contributions in excess of 4.75% of annual compensation. Employer contributions are actuarially determined and approved and certified by the ERS Board of Trustees.
There were no employer contributions required for the year ended June 30, 2014 based on the June 30, 2011 actuarial valuation.
Members become vested after eight years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member.
However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.
27
Financial
Notes to Financial Statements
(d) GJRS is a cost-sharing multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1998 for the purpose of providing retirement allowances for judges and solicitors generals of the state courts and juvenile court judges in Georgia, and their survivors and other beneficiaries, superior court judges of the State of Georgia, and district attorneys of the State of Georgia.
The GJRS was also created to serve the members and beneficiaries of the Trial Judges and Solicitors Retirement Fund, the Superior Court Judges Retirement System, and the District Attorneys Retirement System (collectively, the Predecessor Retirement Systems). As of June 30, 1998, any person who was an active, inactive, or retired member or beneficiary of the Predecessor Retirement Systems was transferred to GJRS in the same status effective July 1, 1998. All assets of the Predecessor Retirement Systems were transferred to GJRS as of July 1, 1998. The ERS Board of Trustees and three additional trustees administer GJRS. There were 92 employers and 1 nonemployer contributing entity participating in the plan during 2014.
Membership As of June 30, 2014, participation in GJRS is as follows:
Inactive members and beneficiaries currently receiving benefits
278
Inactive members entitled to benefits but not yet receiving benefits
66
Active plan members
514
Total
858
Benefits The normal retirement for GJRS is age 60, with 16 years of creditable service; however, a member may retire at age 60 with a minimum of 10 years of creditable service.
Annual retirement benefits paid to members are computed as 66% of state paid salary at retirement for district attorneys and superior court judges and 66% of the average over 24 consecutive months for trial judges and solicitors, plus 1% for each year of credited service over 16 years, not to exceed 24 years. Early retirement benefits paid to members are computed as the pro rata portion of the normal retirement benefit, based on service not to exceed 16 years. Death, disability, and spousal benefits are also available.
Contributions and Vesting Members are required to contribute 7.5% of their annual salary. Those who became members prior to July 1, 2012 must also contribute an additional 2.5% of their annual salary if spousal benefit is elected. Employer contributions are actuarially determined and approved and certified by the GJRS Board of Trustees.
Pursuant to O.C.G.A. 47-23-81 the employer contributions for state court judges and solicitors are funded by the State of Georgia on behalf of the local county employers and pursuant to O.C.G.A. 47-23-82 the employer contributions for juvenile court judges are funded by the State on behalf of local county employers.
Employer and nonemployer contributions required for fiscal year 2014 were based on the June 30, 2011 actuarial valuation as follows:
Employer: Normal Accrued liability
Total
12.78 % (8.55)
4.23 %
Members become vested after ten years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.
28
Financial
Notes to Financial Statements
(e) The GMPF is a single-employer defined benefit pension plan established on July 1, 2002 by the Georgia General Assembly for the purpose of providing retirement allowances and other benefits for members of the Georgia National Guard (National Guard). The ERS Board of Trustees administers the GMPF.
Membership As of June 30, 2014, GMPF had 795 retirees and beneficiaries currently receiving benefits. Active and inactive plan member information is maintained by one employer, the Georgia Department of Defense.
Benefits A member becomes eligible for benefits upon attainment of age 60, with 20 or more years of creditable service (including at least 15 years of service as a member of the National Guard), having served at least 10 consecutive years as a member of the National Guard immediately prior to discharge, and having received an honorable discharge from the National Guard.
The retirement allowance is payable for life in the amount of $50 per month, plus $5 per month for each year of creditable service in excess of 20 years. The maximum benefit is $100 per month.
Contributions and Vesting Employer contributions are actuarially determined and approved and certified by the ERS Board of Trustees. There are no member contributions required.
Employer contributions required for the year ended June 30, 2014 were $137.32 per active member and were based on the June 30, 2011 actuarial valuation.
A member becomes vested after 20 years of creditable service (including at least 15 years of service as a member of the National Guard), having served at least 10 consecutive years as a member of the National Guard immediately prior to discharge, and having received an honorable discharge from the National Guard.
(f) SEAD-Active is a cost-sharing multiple-employer defined other post employment benefit plan created in 2007 by the Georgia General Assembly to amend Title 47 of the Official Code of Georgia Annotated, relating to retirement, so as to establish a fund for the provision of term life insurance to active members of ERS, LRS, and GJRS. Effective July 1, 2009, no newly hired members of any Georgia public retirement system are eligible for term life insurance under SEAD. The SEAD-Active trust fund accumulates in the fund the premiums received from the aforementioned retirement systems, including interest earned on deposits and investments of such payments from active members. There were 482 employers participating in the plan during 2014.
As of June 30, 2014, participation in SEAD-Active is as follows:
Retirees and beneficiaries Terminated employees Active plan members
Total
n/a
38,711
38,711
Employee contribution rates of 0.05% or 0.02% of member's salaries were appropriated for the fiscal year ending June 30, 2014 as follows: ERS Old Plan 0.05% and ERS New Plan, LRS and GJRS 0.02%. ERS Old Plan members were hired prior to July 1, 1982 and new plan members were hired on or after July 1, 1982, but prior to January 1, 2009.
Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable compensation. There were no employer contributions required for the fiscal year ended June 30, 2014.
According to the policy terms covering the lives of members, insurance coverage is provided on a monthly, renewable term basis, and no return premiums or cash value are earned. The net position represents the excess accumulation of investment income and premiums over benefit payments and expenses and are held as a reserve for payment of death benefits under existing policies.
29
Financial
Notes to Financial Statements
The amount of insurance coverage is equal to 18 times monthly earnable compensation frozen at age 60. For members with no creditable service prior to April 1, 1964, the amount decreases from age 60 by a half of 1% per month until age 65 at which point the member will be covered for 70% of the age 60 coverage. Life insurance proceeds are paid in lump sum to the beneficiary upon death of the member.
Administrative costs for the plan are determined based on the plan's share of overhead costs to accumulate and invest funds, actuarial services, and to process benefit payments to beneficiaries. Administrative fees are financed from the assets of the plan.
(g) SEAD-OPEB is a cost-sharing multiple-employer defined other post employment benefit plan created in 2007 by the Georgia General Assembly to amend Title 47 of the Official Code of Georgia Annotated, relating to retirement, so as to establish a fund for the provision of term life insurance to retired and vested inactive members of ERS, LRS, and GJRS. Effective July 1, 2009, no newly hired members of any Georgia public retirement system are eligible for term life insurance under SEAD. The SEAD-OPEB trust fund accumulates in the fund the premiums received from the aforementioned retirement systems, including interest earned on deposits and investments of such payments from retired and vested inactive members. There were 482 employers participating in the plan during 2014.
As of June 30, 2014, participation in SEAD-OPEB is as follows:
Retirees and beneficiaries Terminated employees Active plan members
Total
40,789 1,038 38,711
80,538
Employee contribution rates of 0.45% or 0.23% of member's salaries were appropriated for the fiscal year ending June 30, 2014 as follows: ERS old plan 0.45% and ERS new plan, LRS and GJRS 0.23%. ERS old plan members were hired prior to July 1, 1982 and new plan members were hired on or after July 1, 1982, but prior to January 1, 2009.
Georgia law provides that employee contributions to the plan shall be in an amount established by the Board of Trustees not to exceed one-half of 1% of the member's earnable compensation. There were no employer contributions required for the fiscal year ended June 30, 2014.
According to the policy terms covering the lives of members, insurance coverage is provided on a monthly, renewable term basis, and no return premiums or cash value are earned. The net position represents the excess accumulation of investment income and premiums over benefit payments and expenses and are held as a reserve for payment of death benefits under existing policies.
The amount of insurance for a retiree with creditable service prior to April 1, 1964 is the full amount of insurance under SEAD-Active in effect on the date of retirement.The amount of insurance for a service retiree with no creditable service prior to April 1, 1964 is 70% of the amount of insurance under SEAD-Active at age 60 or at termination, if earlier. Life insurance proceeds are paid in lump sum to the beneficiary upon death of the retiree.
Administrative costs for the plan are determined based on the plan's share of overhead costs to accumulate and invest funds, actuarial services, and to process benefit payments to beneficiaries. Administrative fees are financed from the assets of the plan.
(h) Survivors Benefit Fund (SBF) was established under O.C.G.A. 47-2-128(c)(3) within the ERS trust solely for maintaining group term life insurance coverage for members of the plan. All assets of SBF are therefore limited to the payment of benefits and expenses for such coverage and cannot be used to pay pension benefits of ERS. SBF is shown on the financial statements separately with the OPEB plans to closely align with their ultimate purpose. While shown with the OPEB plans for reporting purposes, SBF may only be used to pay benefits or expenses of SEAD-OPEB or SEAD-Active with authorization by the ERS Board of Trustees. There are no liabilities associated with this fund and an actuarial valuation is not prepared, as there are no funding requirements.
30
Financial
Notes to Financial Statements
(i) SCJRF is a single-employer defined benefit pension plan established by the Georgia General Assembly in 1945 for the purpose of providing retirement benefits to the superior court judges of the State of Georgia. SCJRF is directed by its own Board of Trustees. The Boards of Trustees for ERS and SCJRF entered into a contract for ERS to administer the plan effective July 1, 1995.
Membership As of June 30, 2014, SCJRF had 20 retirees and beneficiaries currently receiving benefits and no active members. No new members are allowed into SCJRF.
Benefits The normal retirement for SCJRF is age 68, with 19 years of creditable service, with a benefit of two-thirds the salary paid to superior court judges. A member may also retire at age 65, with a minimum of 10 years of creditable service, with a benefit of one-half the salary paid to superior court judges. Death, disability, and spousal benefits are also available.
Contributions and Vesting Employer contributions are not actuarially determined, but are provided on an as-needed basis to fund current benefits.
(j) DARF is a multiple-employer defined benefit pension plan established by the Georgia General Assembly in 1949 for the purpose of providing retirement benefits to the district attorneys of the State of Georgia. DARF is directed by its own Board of Trustees. The Boards of Trustees for ERS and DARF entered into a contract for ERS to administer the plan effective July 1, 1995.
Membership As of June 30, 2014, DARF had 7 retirees and beneficiaries currently receiving benefits and no active members. No new members are allowed into DARF.
Benefits Persons appointed as district attorney emeritus shall receive an annual benefit of $15,000, or one-half of the state salary received by such person as a district attorney for the calendar year immediately prior to the person's retirement, whichever is greater.
Contributions and Vesting Employer contributions are not actuarially determined, but are provided on an as-needed basis to fund current benefits.
(k) GDCP is a defined contribution plan established by the Georgia General Assembly in July 1992 for the purpose of providing retirement allowances for state employees who are not members of a public retirement or pension system and do not participate in Social Security. GDCP is administered by the ERS Board of Trustees. There were 67 employers participating in the plan during 2014. There were 131,869 members as of June 30, 2014.
Benefits A member may retire and elect to receive periodic payments after attainment of age 65. The payments will be based upon mortality tables and interest assumptions adopted by the ERS Board of Trustees. If a terminated member has less than $5,000 credited to his/her account, the ERS Board of Trustees has the option of requiring a lump-sum distribution to the member. Upon the death of a member, a lump-sum distribution equaling the amount credited to his/her account will be paid to the member's designated beneficiary.
Contributions Members are required to contribute 7.5% of their annual salary. There are no employer contributions. Earnings will be credited to each member's account as adopted by the ERS Board of Trustees. Upon termination of employment, the amount of the member's account is refundable upon request by the member.
31
Financial
Notes to Financial Statements
(l) The 401(k) Plan was established by the State of Georgia Employee Benefit Plan Council (the Council) in accordance with Georgia Law 1985, as amended, Official Code of Georgia, Sections 45-18-50 through 45-18-58, and Section 401(k) of the Internal Revenue Code (IRC). On October 1, 1994, activity commenced when the 401(k) Plan became available to employees of the State of Georgia Community Service Boards (CSBs). On December 1, 1998, the 401(k) Plan became available to employees of the Georgia Lottery Corporation (GLC). On July 1, 2005, the Plan became available to employees of Fayette County Board of Education; on July 1, 2006, the Plan became available to employees of Walton County Board of Education; and on January 1, 2010, the Plan became available to employees of Henry County Board of Education.
Effective July 1, 1998, the State of Georgia Employee's Deferred Compensation Group Trust (Master Trust) was formed for the State of Georgia Deferred Compensation Program to serve as the funding medium for the 401(k) Plan. At that time, the 401(k) Plan began operating on an employee elective deferral basis for all state employees working at least 1,000 hours in a 12-month period. All assets of the 401(k) Plan are held in trust for the exclusive benefit of the participants and their beneficiaries. The assets of the 401(k) Plan and the State of Georgia Employees' Deferred Compensation 457 Plan are commingled in the Master Trust with the respective trusts owning units of the Master Trust. Participant contributions are invested according to the participant's investment election. If the participant does not make an election, investments are automatically defaulted to a Lifecycle fund based on the participant's date of birth.
Effective July 1, 2005 (HB275), ERS became the trustee of the 401(k) Plan. Aon Hewitt and JPMorgan Chase hold, administer, and invest the assets of the Master Trust.
Contributions and Vesting Participating CSBs, the GLC, and Walton and Henry County Boards of Education offer employer contributions, some matching, some automatic, and some a combination of both, to eligible employees at various rates (limited to a maximum of $255,000 base salary for calendar year 2013 and $260,000 base salary for calendar year 2014). As of January 1, 2009 individual participants may defer up to 80% of eligible compensation, or up to limits prescribed by the IRC (whichever is less).
Effective January 1, 2009, in accordance with O.C.G.A. 47-2-350 through 47-2-360, newly hired state employees, as well as rehired state employees who did not maintain eligibility for the ERS "old" or "new" plan, are members of the Georgia State Employees' Pension and Savings Plan (GSEPS). The GSEPS plan includes automatic enrollment in the 401(k) plan at a contribution rate of 1% of salary, along with a matching contribution from the state. The state will match 100% of the employee's initial 1% contribution and 50% of contribution percents 2 through 5. Therefore, the state will match 3% of salary when an employee contributes at least 5% to the 401(k) plan. Employee contributions greater than 5% of salary do not receive any matching funds. Plan participants who are not employees of the GLC, a CSB, Walton and Henry County Boards of Education, or who are not GSEPS eligible do not receive any employer contributions in their 401(k) plan.
All employer contributions are subject to a vesting schedule, which determines eligibility to receive all or a portion of the employer contribution balance at the time of any distribution from the account after separation from all state service. Vesting is determined based on the following schedule:
Less than 1 year 1 2 3 4 5 or more years
--% 20 40 60 80 100
32
Financial
Notes to Financial Statements
For CSB/GLC participants whose services terminated prior to January 1, 2010 but after December 31, 2001, the following vesting schedule applies:
Less than 2 years 2 3 4 5 6 or more years
--% 20 40 60 80 100
For CSB/GLC participants whose services terminated prior to January 1, 2002, the following vesting schedule applies:
Less than 3 years 3 4 5 6 7 or more years
--% 20 40 60 80 100
Employee contributions and earnings thereon are 100% vested at all times. The 401(k) Plan also allows participants to roll over amounts from other qualified plans to their respective account in the 401(k) Plan on approval by the 401(k) Plan Administrator. Such rollovers are 100% vested at the time of transfer.
Distributions The participant may receive the value of his or her vested accounts upon attaining age 59.5, qualifying financial hardship, or 30 days after retirement or other termination of service (employer contribution balances are only eligible for distribution upon separation from service). Upon the death of a participant, his or her beneficiary shall be entitled to the vested value of his or her accounts. Employees who die while actively employed and eligible for 401(k) employer matching contributions become fully vested in employer contributions upon death. Distributions are made in installments or in a lump sum.
(m) The 457 Plan was established by the State Personnel Board in accordance with Georgia laws 1974, page 198 as amended, Official Code of Georgia, Sections 45-18-30 through 45-18-36, and Section 457 of the Internal Revenue Code (IRC). The 457 Plan is available to employees of the State of Georgia and county health departments and permits such employees to defer a portion of their annual salary until future years. Employee contributions and earnings thereon are 100% vested at all times.
Effective July 1, 1998, the State of Georgia Employee's Deferred Compensation Group Trust (Master Trust) was formed for the State of Georgia Deferred Compensation Program to serve as the funding medium for the 457 Plan. All assets of the 457 Plan are held in trust for the exclusive benefit of the participants and their beneficiaries. The assets of the 457 Plan and the State of Georgia Employees' Deferred Compensation 401(k) Plan are commingled in the Master Trust with the respective trusts owning units of the Master Trust. Participant contributions are invested according to the participant's investment election. If the participant does not make an election, investments are automatically defaulted to a Lifecycle fund based on the participant's date of birth.
Effective July 1, 2005 (HB275), ERS became the trustee of the 457 Plan. Aon Hewitt and JPMorgan Chase hold, administer, and invest the assets of the Master Trust.
Distributions The balance in the employee's account in the 457 Plan is not available to the employee until age 70.5, termination, retirement, death, or unforeseeable emergency as defined in the 457 Plan. Upon the death of a participant, his or her beneficiary shall be entitled to the vested value of his or her accounts. Distributions are made in installments or in a lump sum.
33
Financial
Notes to Financial Statements
(3) Significant Accounting Policies and System Asset Matters
(a) Basis of Accounting The System's basic financial statements are prepared on the accrual basis of accounting. Contributions from the employers, nonemployers, and members are recognized when due, based on statutory requirements. Retirement benefits and refund payments are recognized as deductions when due and payable.
During fiscal year 2014, the System adopted the provisions of GASB Statement No. 67, Financial Reporting for Pension Plans, an amendment of GASB Statement No. 25. This Statement establishes new financial reporting standards for state and local governmental pension plans that are administered through a trust or similar arrangement. This statement resulted in changes to the actuarial calculation of total and net pension liability and comprehensive related footnote disclosure and supplementary schedule.
(b) Reporting Entity The System is a component unit of the State of Georgia, however, it is accountable for its own fiscal matters and presentation of its separate financial statements. The System has considered potential component units under GASB Statements No. 61, The Financial Reporting Entity's Omnibus An Amendment of GASB Statement No. 14 and No. 34, and GASB Statement No. 39, Determining Whether Certain Organizations are Component Units, and determined there were no component units of the System.
(c) Cash and Cash Equivalents Cash and cash equivalents, reported at cost, include cash on deposit at banks, cash on deposit with the investment custodian earning a credit to offset fees and short-term highly liquid financial securities with original maturities of three months or less from the date of acquisition.
(d) Investments Investments are reported at fair value. Equity securities traded on a national or international exchange are valued at the last reported sales price. Private equity fair value is measured using the valuation of the underlying companies as reported by the general partner. These investments, in the form of limited partnerships, reflect values and related performance on a quarter lag basis due to the nature of the investments and the time it takes to value them. The estimated fair value of investments without readily ascertainable market values could differ significantly if a ready market for these assets existed. For fixed income securities, values are based primarily on quoted market prices provided by independent pricing sources. Global foreign exchange holdings are translated using a third party vendor. Investment income is recognized as earned by the System. There are no investments in, loans to, or leases with parties related to the System.
The System utilizes various investment instruments. Investment securities, in general, are exposed to various risks, such as interest rate, credit, foreign currency, and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the financial statements.
The System's policy in regard to the allocation of invested assets is established on a cost basis in compliance with Georgia statute. Plan assets are managed on a total return basis with a long-term objective of achieving and maintaining a fully funded status for the benefits provided through the pension plan. The following was the System's adopted asset allocation policy as of June 30, 2014:
Asset Class
Fixed income Equities Alternative investments Cash and cash equivalents
Total
Target Allocation
25%-45% 55%-75%
0%-5%
100%
34
Financial
Notes to Financial Statements
Approximately 9.4% of the investments held in trust for pension benefits are invested in debt securities of the U.S. government and its instrumentalities, of which 9.3% are U.S. government debt securities and 0.1% are debt securities of the U.S. government instrumentalities. The System has no investments in any one organization, other than those issued by the U.S. government and its instrumentalities, that represent 5% or more of the System's net position restricted for pensions and OPEB.
For the year ended June 30, 2014, the annual money-weighted rate of return on pension plan investments, net of pension plan investment expense, was 5.95%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.
(e) Capital Assets Capital assets, including software development costs, are stated at cost less accumulated depreciation. The capitalization thresholds are $100,000 for buildings and building improvements and $5,000 for equipment and vehicles. Depreciation on capital assets is computed using the straight-line method over estimated useful lives of five to forty years. Depreciation expense is included in administrative expenses. Maintenance and repairs are charged to administrative expenses when incurred. When assets are retired or otherwise disposed of, the costs and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in the combined statement of changes in fiduciary net position in the period of disposal.
(f) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of net position and changes therein. Actual results could differ from those estimates.
(g) Adoption of New Accounting Standard During fiscal year 2014, the System adopted the provisions of GASB Statement No. 67, Financial Reporting for Pension Plans, an amendment of GASB Statement No. 25. The implementation of GASB Statement No. 67 resulted in a change in reporting from the previous year. GASB Statement No. 67 requires the net pension liability to be measured as the total pension liability, less the amount of the plan's fiduciary net position. Under O.C.G.A. 47-2-128(c)(3), the Survivors Benefit Fund (SBF) was established within the ERS trust solely for maintaining group term life insurance coverage for members of the plan. All assets of SBF are therefore limited to the payment of benefits and expenses for such coverage and cannot be used to pay pension benefits of ERS. System management determined based on consultation with legal counsel that SBF assets while previously included as a part of the ERS trust, under GASB 67 such amounts could not be reported as assets available to meet pension obligations. Amounts were reclassified to report SBF as a fund under OPEB plans to properly characterize that these assets are available to provide life insurance benefits for plan member if approved by the ERS Board of Trustees. The following reflects the impact of reporting the SBF in connection with the provisions of GASB 67 (dollars in thousands):
ERS
SBF
Net postition - beginning of year as previously reported Adjustment
Net position - beginning of year as adjusted
$ 12,227,814 (98,011)
$ 12,129,803
98,011
98,011
35
Financial
Notes to Financial Statements
(4) Investment Program
The System maintains sufficient cash to meet its immediate liquidity needs. Cash not immediately needed is invested as directed by the Board of Trustees. All investments are held by agent custodial banks in the name of the System. State statutes and the System's investment policy authorize the System to invest in a variety of short-term and long-term securities as follows:
(a) Cash and Cash Equivalents The carrying amount of the System's deposits totaled $289,344,798 at June 30, 2014 with actual bank balances of $295,256,178. The System's bank balances of $278,550,770 are fully insured through the Federal Deposit Insurance Corporation, an independent agency of the U.S. government. The remaining bank deposits $16,705,408 are uninsured and uncollateralized.
Short-term highly liquid financial securities are authorized in the following instruments: Repurchase and reverse repurchase agreements, whereby the System and a broker exchange cash for direct
obligations of the U.S. government or obligations unconditionally guaranteed by agencies of the U.S. government or U.S. corporations. The System or broker promises to repay the cash received, plus interest, at a specific date in the future in exchange for the same securities. The System held repurchase agreements of $15,000,000 at June 30, 2014.
Other short-term securities authorized, but not currently used, are as follows:
U.S. Treasury obligations.
Commercial paper, with a maturity of 180 days or less. Commercial paper is an unsecured promissory note issued primarily by corporations for a specific amount and maturing on a specific day.The System considers for investment only commercial paper of the highest quality, rated P-1 and/or A-1 by national credit rating agencies.
Master notes, an overnight security administered by a custodian bank and an obligation of a corporation whose commercial paper is rated P-1 and/or A-1 by national credit rating agencies.
Investments in commercial paper or master notes are limited to no more than $500 million in any one name.
(b) Investments Fixed income investments are authorized in the following instruments:
U.S. and foreign government obligations. At June 30, 2014, the System held U.S. Treasury bonds of $1,573,718,920 and international government bonds of $78,651,610.
Obligations unconditionally guaranteed by agencies of the U.S. government. At June 30, 2014, the System held agency bonds of $10,027,950.
Corporate bonds with at least an "A" rating by a national rating agency. At June 30, 2014, the System held U.S. corporate bonds of $2,374,957,270 and international corporate bonds of $276,764,370.
Private placements are authorized under the same general restrictions applicable to corporate bonds. At June 30, 2014, the System did not hold private placements.
Mortgage investments are authorized to the extent that they are secured by first mortgages on improved real property located in the State of Georgia.
Equity securities are also authorized (in statutes) for investment as a complement to the System's fixed-income portfolio and as a long-term inflation hedge. By statute, no more than 75% of the total invested assets on a historical cost basis may be placed in equities. Equity holdings in any one corporation may not exceed 5% of the outstanding equity of the issuing corporation. The equity portfolio is managed by the Division of Investment Services (the Division), in conjunction with independent advisors. Buy/sell decisions are based on securities meeting rating criteria established by the Board of Trustees, in-house research considering such matters as yield, growth, and sales statistics, and analysis of independent market research. Equity trades are approved and executed by the Division's staff. Common stocks
36
Financial
Notes to Financial Statements
eligible for investment are approved by the Investment Committee of the Board of Trustees before being placed on an approved list.
Equity investments are authorized in the following instruments:
Domestic equities are those securities considered by O.C.G.A. to be domiciled in the United States. At June 30, 2014, the System held domestic equities of $8,372,233,711.
International equities, including American Depository Receipts (ADR), are not considered by the O.C.G.A. to be domiciled in the United States. At June 30, 2014, the System held international equities of $333,964,318 and ADRs of $2,665,423,257.
Alternative investments are authorized (in statutes) to provide portfolio diversification and to enhance the riskadjusted rate of return for the retirement fund that benefits the members of the System. By statute, the allocation to alternative investments shall not, in the aggregate, exceed 5% of the System's plan assets at any time. Further, in any calendar year, new commitments to alternative investments shall not, in the aggregate exceed 1% of the System's plan assets until the first occurrence that 4 % of the assets have been invested, at which time there shall be no limit on the percentage of commitments that may be made in any calendar year, subject to compliance with other provisions of the statue. At June 30, 2014, the System held private equity investments of $21,913,875.
The State of Georgia Employee's Deferred Compensation Group Trust (Master Trust) invests in various mutual funds, common collective trust funds, and separate accounts, as selected by participants. Each participant is allowed to select and invest contributions into investment options that own one or more of 2 mutual funds, 11 common collective trust funds, and 2 separate accounts, as authorized by the Board of Trustees. Mutual funds, common collective trust funds, and separate accounts are reported at the fair value of participant balances.
Substantially all of the investments of ERS, PSERS, LRS, GJRS, GMPF, and SEAD are pooled into one common investment fund. Units in the pooled common investment fund are allocated to the respective plans, based upon the cost of assets contributed, and additional units are allocated to the participating plans, based on the market value of the pooled common investment fund at the date of contribution. Net income of the pooled common investment fund is allocated monthly to the participating plans, based upon the number of units outstanding during the month.
The units and fair value of each plan's equity in the pooled common investment fund at June 30, 2014 were as follows (dollars in thousands):
Employees' Retirement System Public School Employees Retirement System Legislative Retirement System Georgia Judicial Retirement System State Employees' Assurance Department - Active State Employees' Assurance Department - OPEB Georgia Military Pension Fund
Fair Value $ 13,254,496
822,744 32,808
400,723 235,210 1,152,141
15,278
$ 15,913,400
Units
3,459,990 214,771 8,564 104,606 61,400 300,758 3,988
4,154,077
Credit Risk. Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations to the Employees' Retirement System. State law limits investments to investment grade securities.
It is the System's investment policy to require that the bond portfolio be of high quality and chosen with respect to maturity ranges, coupon levels, refunding characteristics and marketability. The System's policy is to require that new purchases of bonds be restricted to high grade bonds rated no lower than "A" by any nationally recognized statistical rating organization. Obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. The quality ratings of investments in fixed income securities as described by Standard & Poor's and by Moody's Investors Service, which are nationally recognized statistical rating organizations, at June 30, 2014 are shown in the following chart:
37
Financial
Notes to Financial Statements
Quality Ratings of Fixed Income Investments Held at June 30, 2014
Investment Type
Domestic obligations: U.S. Treasuries U.S. Agencies
Corporates
Standard & Poor's/ Moody's
Quality Rating
June 30,2014 Fair Value
AA/Aaa
AAA/Aaa AA/Aa AA/A A/Aa A/A
$ 1,573,718,920
10,027,950
213,366,160 535,009,830 586,359,960
81,323,580 958,897,740
Total Corporates
2,374,957,270
International obligations: Governments
AA/Aa
78,651,610
Corporates Total Fixed Income Investments
AA/Aa
276,764,370
$ 4,314,120,120
The investment policy requires that repurchase agreements be limited to the purchase of U.S. Treasury or Agency obligations or corporate bonds rated no lower than "A" by any nationally recognized statistical rating organization with a market value in excess of funds advanced. As of June 30, 2014, the System held repurchase agreements included in cash and cash equivalents of $15,000,000.
Mutual funds, common collective trust funds, and separate accounts investments of the deferred compensation plans are not considered to have credit risk and do not require disclosure of credit risk rating.
Concentration of Credit Risk. Concentration of credit risk is the risk of loss that may be attributed to the magnitude of a government's investment in a single issue. On June 30, 2014, the System did not have debt or equity investments in any one organization, other than those issued or guaranteed by the U. S. Government or its agencies, which represented greater than 5% of plan net position.
Interest Rate Risk. Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. While the System has no formal interest rate risk policy, active management of the bond portfolio incorporates interest rate risk to generate improved returns. This risk is managed within the portfolio using the effective duration method. This method is widely used in the management of fixed income portfolios and quantifies to a much greater degree the sensitivity to interest rate changes when analyzing a bond portfolio with call options, prepayment provisions, and any other cash flows. Effective duration makes assumptions regarding the most likely timing and amounts of variable cash flows and is best utilized to gauge the effect of a change in interest rates on the fair value of a portfolio. It is believed that the reporting of effective duration found in the following table quantifies to the fullest extent possible the interest rate risk of the System's fixed income assets.
38
Financial
Notes to Financial Statements
Effective Duration of Fixed Income Assets and Repurchase Agreements by Security Type
Fixed Income and Repurchase Agreements Security Type
Domestic obligations: U.S. Treasuries U.S. Agencies Corporates
International obligations: Governments Corporates
Repurchase agreements
Total
Fair Value June 30, 2014
$ 1,573,718,920 10,027,950
2,374,957,270
78,651,610 276,764,370
15,000,000
$ 4,329,120,120
Percent of All Fixed Income Assets and Repurchase Agreements
36.4 % 0.2
54.9
1.8 6.4 0.3
100.0 %
Effective Duration (Years)
4.9 1.3 4.1
3.3 3.7 --
4.4*
*Total Effective Duration (Years) does not include Repurchase Agreements.
Mutual funds, common collective trust funds, and separate investments of the deferred compensation plans are not considered to have interest rate risk and do not require disclosure of interest rate risk.
Foreign Currency Risk. Foreign currency risk is the risk that changes in exchange rates will adversely impact the fair value of an investment. The System's currency risk exposures, or exchange rate risks, primarily reside within the System's international equity investment holdings. The System's foreign exchange risk management policy is to minimize risk and protect the investments from negative impact by hedging foreign currency exposures with foreign exchange instruments when market conditions and circumstances are deemed appropriate. As of June 30, 2014, the System's exposure to foreign currency risk in U.S. Dollars is highlighted in the following table:
39
Financial
Notes to Financial Statements
International Investment Securities at Fair Value as of June 30, 2014
Currency
Australian Dollar Brazilian Real British Pound Canadian Dollar Danish Krone Euro Hong Kong Dollar Indonesian Rupiah Japanese Yen Malaysian Ringgit Mexican Peso New Taiwan Dollar New Zealand Dollar Norwegian Krone Philippine Peso Polish Zloty Singapore Dollar South African Rand South Korean Won Swedish Krona Swiss Franc Thailand Baht
Equities
$ 32,533,321 3,411,073
77,785,672 9,047,130 6,049,169
42,507,522 51,614,155
160,979 34,209,250
4,440,277 6,268,212 2,076,806 1,059,524 4,921,378
603,656 2,437,174 8,560,399 18,382,292 4,686,622 10,616,447 6,189,798 6,403,462
Fixed Income
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
Total Holdings Subject to Foreign Currency Risk Investment Securities Payable in U.S. Dollars
333,964,318 2,665,423,257
-- 355,415,980
Total International Investment Securities - at Fair Value $ 2,999,387,575
355,415,980
Total
32,533,321 3,411,073
77,785,672 9,047,130 6,049,169
42,507,522 51,614,155
160,979 34,209,250
4,440,277 6,268,212 2,076,806 1,059,524 4,921,378
603,656 2,437,174 8,560,399 18,382,292 4,686,622 10,616,447 6,189,798 6,403,462
333,964,318 3,020,839,237
3,354,803,555
(5) Securities Lending Program
State statutes and Board of Trustees policies permit the System to lend its securities to broker-dealers with a simultaneous agreement to return the collateral for the same securities in the future. The System is presently involved in a securities lending program with major brokerage firms. The System lends equity and fixed income securities for varying terms and receives a fee based on the loaned securities' value. During a loan, the System continues to receive dividends and interest as the owner of the loaned securities. The brokerage firms pledge collateral securities consisting of U.S. government and agency securities, mortgage-backed securities issued by a U.S. government agency, corporate bonds, and equities. The collateral value must be equal to at least 102% to 109% of the loaned securities' value, depending on the type of collateral security.
Securities loaned totaled $3,950,689,359 at fair value at June 30, 2014. The collateral value was equal to 103.5% of the loaned securities' value at June 30, 2014. The System's lending collateral was held in the System's name by the tri-party custodian.
Loaned securities are included in the accompanying combined statement of fiduciary net position since the System maintains ownership. The related collateral securities are not recorded as assets on the System's combined statement of fiduciary net position, and a corresponding liability is not recorded, since the System is deemed not to have the ability to pledge or trade the collateral securities. The System is deemed not to have the ability to pledge or sell the collateral securities, since the System's lending contracts do not address whether the lender can pledge or sell the collateral securities without a borrower default, the System has not previously demonstrated that ability, and there are no indications of the System's ability to pledge or sell the collateral securities.
40
Financial
Notes to Financial Statements
(6) Capital Assets
The following is a summary of capital assets and depreciation information as of and for the year ended June 30, 2014:
Capital assets: Land Building Equipment Vehicles Computer software
Balance at June 30, 2013
Balance at Additions Disposals June 30, 2014
$
944,225
2,800,000
2,321,010
13,381
14,344,610
20,423,226
3,127,941
161,152
3,289,093
4,072,166
2,800,000
2,482,162
13,381
14,344,610
23,712,319
Accumulated depreciation for: Building Equipment Vehicles Computer software
(630,000) (1,658,479)
(12,282) (14,344,609)
(16,645,370)
(70,000) (198,727)
(1,100)
(269,827)
(700,000)
(1,857,206)
(13,382)
(14,344,609)
(16,915,197)
Capital assets, net
$ 3,777,856 3,019,266
6,797,122
During fiscal year 2014, the System did not experience any capital asset impairment loss with respect to the provisions of GASB Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries.
(7) Commitments
As of June 30, 2014, the System had committed to fund certain private equity partnerships for a total capital commitment of $70,750,000. Of this amount, $44,600,000 remained unfunded and is not recorded on the System's Combining Statement of Fiduciary Net Position.
(8) Net Pension Liability of Employers and Nonemployers - ERS
The components of the net pension liability of the participating employers and nonemployers at June 30, 2014 were as follows (dollars in thousands):
Total pension liability Plan fiduciary net position
$
17,042,149
13,291,531
Employers' and nonemployers' net pension liability
$
3,750,618
Plan fiduciary net position as a percentage of the total pension liability
77.99%
Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation Salary increase Investment rate of return
3.0% 5.45-9.25%, including inflation 7.50%, net of pension plan investment expense, including inflation
Mortality rates were based on the RP-2000 Combined Mortality Table for the periods after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement.
41
Financial
Notes to Financial Statements
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.
The long-term expected rate of return on pension plan investments was determined using a log-normal distribution analysis in which best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Asset Class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Target Allocation
30.00 % 39.70
3.70 1.60 18.90 6.10
Total * Rates shown are net of the 3.00% assumed rate of inflation
100.00 %
Long-term Expected Real Rate of Return*
3.00 % 6.50 10.00 13.00 6.50 11.00
Discount rate: The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate: The following presents the net pension liability, calculated using the discount rate of 7.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.50%) or 1-percentage point higher (8.50%) than the current rate (dollars in thousands):
Employers' and nonemployers' net pension liability
1% Decrease (6.50%)
$ 5,469,145
Current Discount
Rate (7.50%)
3,750,618
1% Increase (8.50%)
2,287,751
Actuarial valuation date: June 30, 2013 is the actuarial valuation date upon which the total pension liability is based. An expected total pension liability is determined as of June 30, 2014 using standard roll forward techniques. The roll forward calculation adds the annual normal cost (also called service cost), subtracts the actual benefit payments and refunds for the plan year, and then applies the expected investment rate of return for the year.
(9) Net Pension Liability of Employers and Nonemployers PSERS
The components of the net pension liability of the participating employers and nonemployers at June 30, 2014 were as follows (dollars in thousands):
Total pension liability Plan fiduciary net position
Employers' and nonemployers' net pension liability
Plan fiduciary net position as a percentage of the total pension liability
$
930,745
821,733
$
109,012
88.29%
42
Financial
Notes to Financial Statements
Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation Salary increase Investment rate of return
3.0%
n/a 7.50%, net of pension plan investment expense, including inflation
Mortality rates were based on the RP-2000 Combined Mortality Table set forward one year for males for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females for the period after disability retirement.
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.
The long-term expected rate of return on pension plan investments was determined using a log-normal distribution analysis in which best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Asset Class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Target Allocation
30.00 % 39.70
3.70 1.60 18.90 6.10
Total * Rates shown are net of the 3.00% assumed rate of inflation
100.00 %
Long-term Expected Real Rate of Return*
3.00 % 6.50 10.00 13.00 6.50 11.00
Discount rate: The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate: The following presents the net pension liability, calculated using the discount rate of 7.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.50%) or 1-percentage point higher (8.50%) than the current rate (dollars in thousands):
Employers' and nonemployers' net pension liability
1% Decrease (6.50%)
$
211,620
Current Discount
Rate (7.50%)
109,012
1% Increase (8.50%)
22,657
Actuarial valuation date: June 30, 2013 is the actuarial valuation date upon which the total pension liability is based. An expected total pension liability is determined as of June 30, 2014 using standard roll forward techniques. The roll forward calculation adds the annual normal cost (also called service cost), subtracts the actual benefit payments and refunds for the plan year, and then applies the expected investment rate of return for the year.
43
Financial
Notes to Financial Statements
(10) Net Pension Liability of Employer LRS
The components of the net pension liability of the participating employer at June 30, 2014 were as follows (dollars in thousands):
Total pension liability Plan fiduciary net position
Employer's pension liability (asset)
Plan fiduciary net position as a percentage of the total pension liability
$
25,216
32,794
$
(7,578)
130.05%
Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation Salary increase Investment rate of return
3.0%
None 7.50%, net of pension plan investment expense, including inflation
Mortality rates were based on the RP-2000 Combined Mortality Table for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement.
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.
The long-term expected rate of return on pension plan investments was determined using a log-normal distribution analysis in which best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Asset Class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Target Allocation
30.00 % 39.70
3.70 1.60 18.90 6.10
Total * Rates shown are net of the 3.00% assumed rate of inflation
100.00 %
Long-term Expected Real Rate of Return*
3.00 % 6.50 10.00 13.00 6.50 11.00
Discount rate: The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate: The following presents the net pension liability, calculated using the discount rate of 7.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.50%) or 1-percentage point higher (8.50%) than the current rate (dollars in thousands):
44
Financial
Notes to Financial Statements
Employer's net pension liability (asset)
1% Decrease (6.50%)
$
(5,259)
Current Discount
Rate (7.50%)
(7,578)
1% Increase (8.50%)
(9,545)
Actuarial valuation date: June 30, 2013 is the actuarial valuation date upon which the total pension liability is based. An expected total pension liability is determined as of June 30, 2014 using standard roll forward techniques. The roll forward calculation adds the annual normal cost (also called service cost), subtracts the actual benefit payments and refunds for the plan year, and then applies the expected investment rate of return for the year.
(11) Net Pension Liability of Employers and Nonemployers GJRS
The components of the net pension liability of the participating employer at June 30, 2014 were as follows (dollars in thousands):
Total pension liability Plan fiduciary net position
Employers' and nonemployers' pension liability (asset)
Plan fiduciary net position as a percentage of the total pension liability
$
350,443
400,790
$
(50,347)
114.37%
Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation Salary increase Investment rate of return
3.0% 6.00%, including inflation 7.50%, net of pension plan investment expense, including inflation
Mortality rates were based on the RP-2000 Combined Mortality Table for the period after service retirement, for dependent beneficiaries, and for deaths in active service, and the RP-2000 Disabled Mortality Table set back eleven years for males for the period after disability retirement.
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.
The long-term expected rate of return on pension plan investments was determined using a log-normal distribution analysis in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
Asset Class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Target Allocation
30.00 % 39.70
3.70 1.60 18.90 6.10
Total * Rates shown are net of the 3.00% assumed rate of inflation
100.00 %
Long-term Expected Real Rate of Return*
3.00 % 6.50 10.00 13.00 6.50 11.00
45
Financial
Notes to Financial Statements
Discount rate: The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate: The following presents the net pension liability, calculated using the discount rate of 7.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.50%) or 1-percentage point higher (8.50%) than the current rate (dollars in thousands):
Employers' and nonemployers' net pension liability (asset)
1% Decrease (6.50%)
$
(16,060)
Current Discount
Rate (7.50%)
(50,347)
1% Increase (8.50%)
(80,106)
Actuarial valuation date: June 30, 2013 is the actuarial valuation date upon which the total pension liability is based. An expected total pension liability is determined as of June 30, 2014 using standard roll forward techniques. The roll forward calculation adds the annual normal cost (also called service cost), subtracts the actual benefit payments and refunds for the plan year, and then applies the expected investment rate of return for the year.
(12) Net Pension Liability of Employer GMPF
The components of the net pension liability of the participating employer at June 30, 2014 were as follows (dollars in thousands):
Total pension liability Plan fiduciary net position
Employer's pension liability (asset)
Plan fiduciary net position as a percentage of the total pension liability
$
31,511
15,251
$
16,260
48.40%
Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of June 30, 2013, using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation Salary increase Investment rate of return
3.0%
n/a 7.50%, net of pension plan investment expense, including inflation
Mortality rates were based on the RP-2000 Combined Mortality Table for the period after service retirement, for dependent beneficiaries, and for deaths in active service.
The actuarial assumptions used in the June 30, 2013 valuation were based on the results of an actuarial experience study for the period July 1, 2004 June 30, 2009.
The long-term expected rate of return on pension plan investments was determined using a log-normal distribution analysis in which best estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target asset allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table:
46
Financial
Notes to Financial Statements
Asset Class
Fixed income Domestic large stocks Domestic mid stocks Domestic small stocks International developed market stocks International emerging market stocks
Target Allocation
30.00 % 39.70
3.70 1.60 18.90 6.10
Total * Rates shown are net of the 3.00% assumed rate of inflation
100.00 %
Long-term Expected Real Rate of Return*
3.00 % 6.50 10.00 13.00 6.50 11.00
Discount rate: The discount rate used to measure the total pension liability was 7.50%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that employer and nonemployer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
Sensitivity of the net pension liability to changes in the discount rate: The following presents the net pension liability, calculated using the discount rate of 7.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.50%) or 1-percentage point higher (8.50%) than the current rate (dollars in thousands):
Employer's net pension liability
1% Decrease (6.50%)
$
21,006
Current Discount
Rate (7.50%)
16,260
1% Increase (8.50%)
12,405
Actuarial valuation date: June 30, 2013 is the actuarial valuation date upon which the total pension liability is based. An expected total pension liability is determined as of June 30, 2014 using standard roll forward techniques. The roll forward calculation adds the annual normal cost (also called service cost), subtracts the actual benefit payments and refunds for the plan year, and then applies the expected investment rate of return for the year.
(13) Funded Status and Funding Progress - Defined Benefit OPEB Plans
The funded status of the SEAD-Active and SEAD-OPEB plans as of June 30, 2013, the most recent actuarial valuation date, are as follows (dollar amounts in thousands):
Actuarial value of plan
assets (a)
SEAD - Active $ SEAD - OPEB
204,779 907,831
Actuarial accrued liability (AAL) projected unit credit
(b)
37,512 754,786
Unfunded AAL/(funded
excess) (b-a)
(167,267) (153,045)
Funded ratio (a/b)
545.9 %
120.3
Annual covered payroll
(c)
$ 1,767,052 1,767,052
Unfunded AAL/ (funded excess) as percentage
of covered payroll [(b-a)/c]
(9.5) %
(8.7)
The SBF does not have an actuarial valuation as there are no funding requirements and no liabilities related to the fund.
The schedules of funding progress, presented as required supplementary information (RSI) following the notes to the financial statements, present multi-year trend information about whether the actuarial values of plans assets are increasing or decreasing over time relative to the AALs for benefits.
47
Notes to Financial Statements
Additional information as of the latest actuarial valuation follows:
Valuation date Actuarial cost method Amortization method
Remaining amortization period Asset valuation method
Actuarial assumptions: Investment rate of return Projected salary increases ERS GJRS LRS
Post-retirement cost-of-living adjustment
1 Includes inflation rate of 3.00%.
SEAD-Active June 30, 2013 Projected Unit Credit Level dollar, open
N/A Market value of assets
7.50%
5.45-9.25% 6.00% 0.00% N/A
Financial
SEAD-OPEB June 30, 2013 Projected Unit Credit Level dollar, open N/A Market value of assets
7.50% 5.45-9.25% 6.00% 0.00% N/A
48
Financial Required Supplementary Information (UNAUDITED)
Schedules of Employers' and Nonemployers' Contributions - Defined Benefit Pension Plans
For year ended June 30 (In thousands)
49
Employees' Retirement System 1 Public School Employees Retirement System 2 Legislative Retirement System 3
Year ended
6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014
6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014
6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014
Actuarially determined contribution
(a)
$ 243,074 258,482 270,141 286,256 282,103 263,064 261,132 273,623 358,376 428,982
840 3,638 6,490 2,869 5,529 5,530 7,509 15,884 24,829 27,160
-- -- -- -- -- -- -- -- -- --
Contributions in relation to the actuarially determined contribution
(b)
243,074 258,482 270,141 286,256 281,206 263,064 261,132 274,034 358,992 429,752
840 3,638 6,490 2,869 5,529 5,530 7,509 15,884 24,829 27,160
54 54 62 73 71 75 75 76 128 45
Contribution deficiency (excess) (a-b)
-- -- -- -- 897 -- -- (411) (616) (770)
-- -- -- -- -- -- -- -- -- --
(54) (54) (62) (73) (71) (75) (75) (76) (128) (45)
Covered employee
payroll (c)
2,514,430 2,630,167 2,680,972 2,809,199 2,674,155 2,571,042 2,486,780 2,414,884 2,335,773 2,335,773
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Contributions as a
percentage of coveredemployee
payroll (b/c)
9.7% 9.8 10.1 10.2 10.5 10.2 10.5 11.3 15.4 18.4
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Financial Required Supplementary Information (UNAUDITED)
Schedules of Employers' and Nonemployers' Contributions - Defined Benefit Pension Plans
For year ended June 30 (In thousands)
50
Year ended
Actuarially determined contribution
(a)
Contributions in relation to the actuarially determined contribution
(b)
Contribution deficiency (excess) (a-b)
Covered employee
payroll (c)
Contributions as a
percentage of coveredemployee
payroll (b/c)
Georgia Judicial Retirement System Georgia Military Pension Fund 4
6/30/2005 $ 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014
6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014
1,594 1,683 1,778 2,395 1,703 2,600 1,932 2,083 2,279 2,375
891 891 1,005 1,103 1,323 1,434 1,282 1,521 1,703 1,892
1,594 1,683 1,778 2,395 1,703 2,600 1,932 2,083 2,279 2,375
891 891 1,005 1,103 1,323 1,434 1,282 1,521 1,703 1,892
--
42,916
--
45,308
--
48,621
--
51,102
--
52,803
--
51,293
--
52,331
--
51,898
--
52,807
--
54,787
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
3.7% 3.7 3.7 4.7 3.2 5.1 3.7 4.0 4.3 4.3
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
This data, except for annual covered payroll, was provided by the System's actuary. 1 An employer group within ERS did not contribute the full actuarially determined contribution. This employer is making additional contributions to repay this shortfall. 2 No statistics regarding covered payroll are available. Contributions are not based upon members' salaries, but are simply $4.00 per member, per month, for nine months,
each fiscal year if hired prior to July 1, 2012 and $10 per month, per member, per month, for nine months, if hired after July 1, 2012. 3 The General Assembly of Georgia makes contributions each year that are not required. 4 No statistics regarding covered payroll are available. Active and inactive plan member information is maintained by the Georgia Department of Defense.
See accompanying notes to required supplementary schedules and accompanying independent auditors' report.
Financial
Required Supplementary Information (UNAUDITED)
Schedules of Employers' and Nonemployers' Net Pension Liability Defined Benefit Pension Plans
(In thousands)
Employees' Retirement System: Total pension liability Plan fiduciary net position
Employers' and nonemployers' net pension liability
Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll Employers' and nonemployers' net pension liability as a percentage of covered-employee payroll
June 30, 2014
$
17,042,149
13,291,531
$
3,750,618
77.99 %
$
2,335,773
160.57 %
Public School Employees Retirement System: Total pension liability Plan fiduciary net position
Employers' and nonemployers' net pension liability
Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll Employers' and nonemployers' net pension liability as a percentage of covered-employee payroll
$
930,745
821,733
$
109,012
88.29 % n/a
n/a
Legislative Retirement System: Total pension liability Plan fiduciary net position
Employer's net pension liability (asset)
Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll Employer's net pension liability (asset) as a percentage of covered-employee payroll
$
25,216
32,794
$
(7,578)
130.05 % n/a
n/a
Georgia Judicial Retirement System:
Total pension liability
$
Plan fiduciary net position
Employers' and nonemployers' net pension liability (asset)
$
Plan fiduciary net position as a percentage of the total pension liability
Covered-employee payroll
$
Employers' and nonemployers' net pension liability (asset) as a percentage of covered-employee payroll
350,443 400,790
(50,347)
114.37 % 54,787 (91.90) %
Georgia Military Pension Fund: Total pension liability Plan fiduciary net position
Employer's net pension liability
Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll Employer's net pension liability as a percentage of covered-employee payroll
$
31,511
15,251
$
16,260
48.40 % n/a
n/a
Schedules above are intended to show information for 10 years. Additional years will be displayed as they become available. See accompanying notes to required supplementary schedule and accompanying independent auditors' report.
51
Financial
Required Supplementary Information (UNAUDITED)
Schedules of Changes in Employers' and Nonemployers' Net Pension Liability
Defined Benefit Pension Plans
(In thousands)
Employees' Retirement System: Total pension liability: Service cost Interest Benefit changes Differences between expected and actual experience Changes of assumptions Benefit payments Refunds of contributions
Net change in total pension liability Total pension liability-beginning
Total pension liability-ending (a)
Plan fiduciary net position: Contributions-employer Contributions-nonemployer Contributions-member Net investment income Benefit payments Administrative expense Refunds of contributions Other
Net change in plan fiduciary net position Plan fiduciary net position-beginning
Plan fiduciary net position-ending (b)
Net pension liability-ending (a)-(b)
June 30, 2014
$
150,075
1,224,380
--
--
--
(1,305,998)
(8,757)
59,700 16,982,449
17,042,149
418,807 10,945 32,423
2,021,748 (1,305,998)
(7,440) (8,757)
--
1,161,728 12,129,803
13,291,531
$
3,750,618
Public School Employees Retirement System: Total pension liability: Service cost Interest Benefit changes Differences between expected and actual experience Changes of assumptions Benefit payments Refunds of contributions
Net change in total pension liability Total pension liability-beginning
Total pension liability-ending (a)
Plan fiduciary net position: Contributions-nonemployer Contributions-member Net investment income Benefit payments Administrative expense Refunds of contributions Other
Net change in plan fiduciary net position Plan fiduciary net position-beginning
Plan fiduciary net position-ending (b)
Net pension liability-ending (a)-(b)
$
11,049
66,143
--
--
--
(56,189)
(514)
20,489 910,256
930,745
27,160 1,659
123,799 (56,189)
(1,450) (514) --
94,465 727,268
821,733
$
109,012
52
Financial
Required Supplementary Information (UNAUDITED)
Schedules of Changes in Employers' and Nonemployers' Net Pension Liability
Defined Benefit Pension Plans
(In thousands)
Legislative Retirement System: Total pension liability: Service cost Interest Benefit changes Differences between expected and actual experience Changes of assumptions Benefit payments Refunds of contributions
Net change in total pension liability Total pension liability-beginning
Total pension liability-ending (a)
Plan fiduciary net position: Contributions-employer Contributions-member Net investment income Benefit payments Administrative expense Refunds of contributions Other
Net change in plan fiduciary net position Plan fiduciary net position-beginning
Plan fiduciary net position-ending (b)
Net pension liability (asset)-ending (a)-(b)
June 30, 2014
$
344
1,799
--
--
--
(1,801)
(30)
312 24,904
25,216
45 282 4,969 (1,801) (152) (30) --
3,313 29,481
32,794
$
(7,578)
Georgia Judicial Retirement System: Total pension liability: Service cost Interest Benefit changes Differences between expected and actual experience Changes of assumptions Benefit payments Refunds of contributions
Net change in total pension liability Total pension liability-beginning
Total pension liability-ending (a)
Plan fiduciary net position: Contributions-employer Contributions-nonemployer Contributions-member Net investment income Benefit payments Administrative expense Refunds of contributions Other
Net change in plan fiduciary net position Plan fiduciary net position-beginning
Plan fiduciary net position-ending (b)
Net pension liability (asset)-ending (a)-(b)
$
7,584
24,530
--
--
--
(17,441)
(22)
14,651 335,792
350,443
1,373 1,002 4,731 60,012 (17,441)
(754) (22) --
48,901 351,889
400,790
$
(50,347)
53
Financial
Required Supplementary Information (UNAUDITED)
Schedules of Changes in Employers' and Nonemployers' Net Pension Liability Defined Benefit Pension Plans
(In thousands)
Georgia Military Pension Fund Total pension liability: Service cost Interest Benefit changes Differences between expected and actual experience Changes of assumptions Benefit payments Refunds of contributions
Net change in total pension liability Total pension liability-beginning
Total pension liability-ending (a)
Plan fiduciary net position: Contributions-employer Contributions-member Net investment income Benefit payments Administrative expense Refunds of contributions Other
Net change in plan fiduciary net position Plan fiduciary net position-beginning
Plan fiduciary net position-ending (b)
Net pension liability-ending (a)-(b)
June 30, 2014
$
73
2,223
--
--
--
(841)
--
1,455 30,056
31,511
1,892 --
2,179 (841) (110) -- --
3,120 12,131
15,251
$
16,260
Schedules above are intended to show information for 10 years. Additional years will be displayed as they become available. See accompanying notes to required supplementary schedule and accompanying independent auditors' report.
54
Required Supplementary Information (UNAUDITED) Schedule of Investment Returns
Financial
June 30, 2014
Pooled Investment Fund: Annual money-weighted rate of return, net of investment expense
5.95 %
Schedule is intended to show information for 10 years. Additional years will be displayed as they become available. See accompanying notes to required supplementary schedule and accompanying independent auditors' report.
55
Financial Required Supplementary Information (UNAUDITED) Schedules of Funding Progress - Defined Benefit OPEB Plans
June 30, 2014 (In thousands)
56
State Employees' Assurance DepartmentActive
State Employees' Assurance DepartmentOPEB
Actuarial valuation
date
6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
Actuarial value of plan assets
(a)
$
172,595
144,161
156,132
184,783
183,390
204,779
737,114 628,199 680,449 807,893 818,284 907,831
Actuarial accrued liability (AAL) projected unit credit
(b)
62,171 61,351 40,523 40,145 39,317 37,512
699,884 733,671 691,001 678,421 704,617 754,786
Unfunded AAL/ (funded excess)
(b-a)
(110,424) (82,810) (115,609) (144,638) (144,073) (167,267)
(37,230) 105,472
10,552 (129,472) (113,667) (153,045)
Funded ratio (a/b)
277.6 % 235.0 385.3 460.3 466.4 545.9
105.3 85.6 98.5 119.1 116.1
120.3
Annual covered payroll
(c)
$ 2,850,850 2,653,527 2,401,974 2,166,982 1,962,800 1,767,052
2,850,850 2,653,527 2,401,974 2,166,982 1,962,800 1,767,052
Unfunded AAL/ (funded excess) as percentage of covered payroll
[(b-a)/c]
(3.9) % (3.1) (4.8) (6.7) (7.3) (9.5)
(1.3) 4.0 0.4 (6.0) (5.8) (8.7)
This data, except for annual covered payroll, was provided by the System's actuary. The SBF does not obtain an actuarial valuation as there are no funding requirements or liabilities related to the fund. See accompanying notes to required supplementary schedules and accompanying independent auditors' report.
Financial
Required Supplementary Information (UNAUDITED)
Schedules of Employer Contributions-Defined Benefit OPEB Plans
June 30, 2014 (In thousands)
State Employees' Assurance Department-Active State Employees' Assurance Department-OPEB
Year ended June 30
2008 2009 2010 2011 2012 2013
2008 2009 2010 2011 20121 20131
State annual required
contribution
Percentage contributed
$
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
--
N/A
-- -- -- -- 12,724 5,009
N/A N/A N/A N/A 100.0 % 100.0 %
This data was provided by the System's actuary.
There are no required contributions to the SBF Fund. 1 During fiscal year 2012 in lieu of a required employer contribution $12,724,000 was transferred from Survivor Benefit Fund to SEAD-OPEB.
During fiscal year 2013, in lieu of a required employer contribution, $5,009,000 was paid from Survivor Benefit Fund.
See accompanying notes to required supplementary schedules and accompanying independent auditors' report.
57
Financial
Notes to Required Supplementary Information (UNAUDITED)
June 30, 2014
(1) Schedule of Employers' and Nonemployers' Contributions Defined Benefit Pension Plans This schedule presents the required contributions and the percent of required contributions actually contributed.
(2) Schedule of Employers' and Nonemployers' Net Pension Liability Defined Benefit Pension Plans The components of the net pension liability as of the fiscal year end and the fiduciary net position as a percentage of the total pension liability as of that date are presented in this schedule. This trend information will be accumulated to display a ten year presentation.
(3) Schedule of Changes in Employers' and Nonemployers' Net Pension Liability Defined Benefit Pension Plans Net pension liability which is measured as total pension liability less the amount of the fiduciary net position is presented in this schedule. This trend information will be accumulated to display a ten year presentation.
(4) Schedule of Investment Returns This schedule presents historical trend information about the annual money-weighted rate of return on plan investments, net of plan investment expense. This trend information will be accumulated to display a ten year presentation.
(5) Notes to Required Supplementary Information This note provides information about changes of benefit terms, changes of assumptions, and methods and assumptions used in calculations of actuarially determined contributions.
Employees' Retirement System Changes of benefit terms - a new benefit tier was added for members joining the System on and after January 1, 2009.
Changes of assumptions - in 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
Public School Employees Retirement System Changes of benefit terms - the member contribution rate was increased from $4 to $10 per month for members joining the System on or after July 1, 2012.
Changes of assumptions - in 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience.
Legislative Retirement System Changes of benefit terms - none.
Changes of assumptions - in 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal and mortality were adjusted to more closely reflect actual experience.
Georgia Judicial Retirement System Changes of benefit terms -spouses benefits were changed for members joining the System on and after July 1, 2012.
Changes of assumptions - in 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal, retirement, disability and mortality were adjusted to more closely reflect actual experience. In 2010, assumed rates of salary increase were adjusted to more closely reflect actual and anticipated experience.
58
Financial
Notes to Required Supplementary Information (UNAUDITED)
Georgia Military Pension Fund Changes of benefit terms-none.
Changes of assumptions - in 2010 and later, the expectation of retired life mortality was changed to the RP-2000 Mortality Tables rather than the 1994 Group Annuity Mortality Table, which was used prior to 2010. In 2010, rates of withdrawal and mortality were adjusted to more closely reflect actual experience.
Method and assumptions used in calculations of actuarially determined contributions. The actuarially determined contribution rates in the schedules of employers' and nonemployers' contributions are calculated as of June 30, three years prior to the end of the fiscal year in which contributions are reported. The following actuarial methods and assumptions were used to determine the most recent contribution rates reported in those schedules:
Actuarial cost method Amortization method Remaining amortization period Asset valuation method
Inflation Salary Increases:
Fiscal Year 2011 Fiscal Year 2012-2013 FiscalYear 2014+, including inflation Investment rate of return
ERS
Entry age Level dollar, open 30 years 7-year smoothed market 3.00%
PSERS
Entry age Level dollar, open 30 years 7-year smoothed market 3.00%
LRS
Entry age Level dollar, open 30 years 7-year smoothed market 3.00%
0.00% 2.725-4.625% 5.45-9.25% 7.50% net of pension plan invesment expense, including inflation
n/a n/a n/a 7.50% net of pension plan invesment expense, including inflation
n/a n/a n/a 7.50% net of pension plan invesment expense, including inflation
Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation Salary Increases:
Fiscal Year 2011 Fiscal Year 2012-2013 FiscalYear 2014+, including inflation Investment rate of return
GJRS
Entry age Level percent of pay, open 10 years 7-year smoothed market 3.00%
0.00% 3.00% 6.00% 7.50% net of pension plan invesment expense, including inflation
GMPF
Entry age Level dollar, open 20 years 7-year smoothed market 3.00%
n/a n/a n/a 7.50% net of pension plan invesment expense, including inflation
(6) Schedule of Funding Progress Defined Benefit OPEB Plans The actuarial value of assets recognizes a portion of the difference between the fair value of assets and the expected actuarial value of assets, based on the assumed valuation rate of return. The amount recognized each year is 1/7th of the difference between fair value and expected actuarial value.
(7) Schedule of Employer Contributions Defined Benefit OPEB Plans The required employer contributions and percent of those contributions actually made are presented in the schedule.
(8) Actuarial Assumptions Defined Benefit OPEB Plans The SBF does not have an actuarial valuation as there are no funding requirements and no liabilities related to the fund. The information presented as the required supplementary information was determined as part of the actuarial valuations for the SEAD-Active and SEAD-OPEB plans at the dates indicated. Additional information from the actuarial valuations for the most recent two-year period is as follows:
59
Financial
Notes to Required Supplementary Information (UNAUDITED)
Valuation date Actuarial cost method Amortization method Remaining amortization period of the funded excess Asset valuation method Actuarial assumptions:
Investment rate of return Projected salary increases:
ERS GJRS LRS
SEAD - Active June 30, 2013 Projected Unit Credit Level dollar, open n/a Market value of assets
7.50%
5.45-9.25% 6.00% 0.00%
SEAD - Active June 30, 2012 Projected Unit Credit Level dollar, open 30 years Market value of assets
7.50%
5.45-9.25% 6.00% 0.00%
Valuation date Actuarial cost method Amortization method Remaining amortization period of the funded excess Asset valuation method Actuarial assumptions:
Investment rate of return Projected salary increases:
ERS GJRS LRS
SEAD - OPEB June 30, 2013 Projected Unit Credit Level dollar, open n/a Market value of assets
7.50%
5.45-9.25% 6.00% 0.00%
SEAD - OPEB June 30, 2012 Projected Unit Credit Level dollar, open 30 years Market value of assets
7.50%
5.45-9.25% 6.00% 0.00%
Includes inflation rate of 3.00% in the 2013 and 2012 valuations.
60
Financial
Additional Information
Schedule of Administrative Expenses - Contributions and Expenses
Year ended June 30, 2014 (with comparative amounts for the year ended June 30, 2013) (In thousands)
Contributions: Employees' Retirement System Public School Employees Retirement System Legislative Retirement System Georgia Judicial Retirement System State Employees' Assurance Department - Active State Employees' Assurance Department - OPEB Georgia Defined Contribution Plan 401(k) Plan 457 Plan Georgia Military Pension Fund Superior Court Judges Retirement Fund District Attorneys Retirement Fund
Total contributions
Expenses: Personal services: Salaries and wages Retirement contributions FICA Health insurance Miscellaneous
Communications: Postage Publications and printing Telecommunications Travel
Professional services: Accounting services Computer services Contracts Actuarial services Medical services Professional fees Legal services
Management fees: Building maintenance
Other services and charges: Temporary services Supplies and materials Repairs and maintenance Courier services Depreciation Miscellaneous Office equipment
Total expenses
Net income
2014
2013
$
7,440 $
7,818
1,450
1,745
152
116
754
203
46
21
414
195
991
1,105
2,300
2,247
812
906
110
32
6
6
1
1
14,476
14,395
4,961 881 349
1,529 93
7,813
228 11 71 14
324
585 715 2,753 213 177 172
37
4,652
5,060 775 355
1,523 76
7,789
206 9
71 12
298
564 632 2,687 213 158 169
32
4,455
617
636
673
675
54
106
17
22
3
3
270
362
50
46
3
3
1,070
1,217
14,476
14,395
$
$
Note: This schedule reflects the implementation of GASB 67 which requires investment-related costs to be reported as investment expense, a component of net investment income. For fiscal year 2013, these costs have been reclassified from administrative expense to investment expense, for comparative purposes.
See accompanying independent auditors' report.
61
Financial
Additional Information
Schedule of Investment Expenses
Year ended June 30, 2014 (with comparative amounts for the year ended June 30, 2013)
2014
2013
Investment advisory and custodial fees Miscellaneous
Total investment expenses
$
8,254,438 $
11,116,668
7,153,611 9,352,370
19,371,106
16,505,981
See accompanying independent auditors' report.
62
Investment Section
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63
Investment
Investment Overview
The media continues to report on the pedestrian domestic recovery, the weak economy in Europe, and China's slowing growth rate. Throw in turmoil in the Middle East and the Ukraine, along with the end of Quantitative Easing, and one might expect subpar returns. Instead, the U.S. stock market has had returns exceeding 20% for two consecutive years.
It is difficult not to get caught up in the headlines, but as a pension plan it is more important to stay focused on the longterm. The System continues to invest in a mix of liquid, high quality bonds and stocks. These types of investments allow the System to participate in rising markets while moderating the risks on the downside. A high quality balanced fund has proven to be a successful strategy in a variety of markets over long periods of time.
As in previous years, the bias to quality was a primary goal and was successfully met. "Conservation of Capital" and "Conservatism" remain the guiding principles for investment decisions. The Board of Trustees continues to use a diversified portfolio to accomplish these objectives.
The economy continued to grow for the fiscal year. Industrial production, personal income and housing all improved last year. Employment growth continued its relatively slow improvement, but there are some noticeable weaknesses overseas. A combination of stimulative policies by central bankers and a stronger domestic economy appeared to be working as far as financial markets go.
Studies undertaken to evaluate the investment returns of pension funds over very long time horizons indicate that the asset allocation decision has the largest impact on the fund's returns. Although the returns for the various asset categories vary from year to year, over the long term equities usually outperform fixed income and cash by a very wide margin. For that reason, the System has generally maintained a significant equity exposure with the remainder of the fund invested in fixed income securities designed to generate income and preserve capital.
Returns for one, three, five, ten and twenty year periods are presented in this section. Longer time periods, such as the twenty-year period, allow for more valid evaluation of returns, both in absolute terms and relative to an asset class index, by reducing emphasis on the short-term volatility of markets. The Daily Valuation Method was used to calculate rates of return which is in accordance with the CFA Institute's objectives as stated in its publication "Global Investment Performance Standards Handbook," third edition.
As mentioned earlier, the domestic equity markets had a very good year. The return for the S&P 500 was 24.6% and the Dow Jones Industrial Average rose 15.6%. U.S. small and midcap stocks outperformed large cap stocks last year. The S&P 400 Mid-Capitalization and the S&P 600 Small Capitalization Indexes had similar returns of 25.2% and 25.5%, respectively. Among individual companies, returns varied depending upon the company's size, industry, and exposure to global markets.
International markets also did well. The MSCI EAFE Index had a 23.6% return and the MSCI Emerging Market Index had a return of 14.3%. Developed markets, particularly the European markets, were uniformly strong as participants anticipated additional easing from various foreign Central Banks. The markets in economically troubled Spain and Italy were up over 50% for example. Emerging markets were more of a mixed bag as commodity weakness, concerns of higher U.S. rates and weaker growth in China affected some markets more than others, not to mention local political and domestic events.
The longer the maturity of the bond the better the performance, and corporate bonds provided extra returns as corporate spreads tightened. After negative fixed income returns in fiscal year 2013, the total return on the 10-year Treasury Note was 2.8% and the 30-year Treasury Bond had a 6.2% return. The return on short-term Treasury bills was negligible again due to the Federal Reserve's policies to stimulate the economy.
We look at two fixed income indexes to measure the bond market's performance. The Barclays Government / Credit Index had a return of 4.3%. It is a broad index containing corporate and government sponsored bonds as well as Treasuries. The Citigroup Treasury / Sponsored / AAA/AA had a return of 2.3% and is a broad index containing higher rated corporate bonds as well as Treasuries and Government securities. Higher quality bonds underperformed lower quality bonds as evidenced by the 5.1% return for AA rated bonds versus 9.6% for BBB rated bonds.
In summary, the investment status of the System is excellent. The high quality of the System's investments is in keeping with the continued policy of "Conservatism" and "Conservation of Capital."
Prepared by the Division of Investment Services
64
Pooled Investment Fund
As of June 30, 2014
Employees' Retirement System (ERS) Public School Employees Retirement System (PSERS) Legislative Retirement System (LRS) Georgia Judicial Retirement System (GJRS) State Employees' Assurance Department (SEAD) - Active State Employees' Assurance Department (SEAD) - OPEB Survivors Benefit Fund Georgia Military Pension Fund (GMPF)
Total
Investment
$
13,254,495,721
822,743,851
32,808,310
400,722,672
235,209,676
1,037,189,760
114,951,881
15,278,496
$
15,913,400,367
Rates of Return
25 20 15 10
5 -
1 Year
Equities S&P 500
3 Year
5 Year
10 Year
20 Year
10 9 8 7 6 5 4 3 2 1
1 Year
Fixed Income Barclays Govt/Credit
3 Year
5 Year
10 Year
20 Year
18 16
14 12 10
8 6 4 2 -
1 Year
Total Portfolio CPI
3 Year
5 Year
10 Year
20 Year
1 year 3 year 5 year 10 year 20 year
Equities
23.44 % 13.71 % 17.15 %
7.61 % 9.43 %
S&P 500
24.61 % 16.58 % 18.83 %
7.78 % 9.79 %
Fixed Income 2.97 %
Barclay's Govt/ Credit
4.28 %
Total Portfolio 17.29 %
3.23 %
4.08 %
10.75 %
4.24 %
5.09 %
12.83 %
4.92 %
4.94 %
7.26 %
6.80 %
6.18 %
8.71 %
CPI
2.08 % 1.83 % 2.02 % 2.31 % 2.41 %
Note: Rates of return are calculated using the Daily Valuation Method, a time-weighted rate of return, based on market rates of return.
65
Asset Allocation at Fair Value
Investment
70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0%
0.0% 2014 2013 2012 2011 2010 2009
Equies Fixed Income Short-term Securies Mutual funds, etc Private Equity
Investment Summary
Asset Allocation as of June 30 (in percentages)
Equities Fixed Income Short-Term Securities Mutual and Common Collective Trust Funds and Separate Accounts Private Equity Total
2014
67.2% 25.6
-- 7.1 0.1
2013
68.1 25.0
-- 6.9 --
2012
65.9 27.3
-- 6.8 --
2011
67.2 26.2
-- 6.6 --
2010
59.4 34.1
-- 6.5 --
2009
52.3 39.8
1.8 6.1 --
100%
100
100
100
100
100
Asset Allocation as of June 30 (in millions)
Equities Fixed Income Short-Term Securities Mutual and Common Collective Trust Funds and Separate Accounts Private Equity
2014
$ 11,372 4,314 -- 1,209 22
2013
10,374 3,811 -- 1,057 --
2012
9,600 3,972
-- 995
--
2011
10,060 3,902 -- 992 --
2010
7,870 4,506
-- 867
--
2009
6,857 5,212
236 799
--
Total
$ 16,917 15,242 14,567 14,954 13,243 13,104
66
Investment
Schedule of Fees and Commissions
For the Year Ended June 30, 2014
Investment Advisors' Fees:* U.S. Equity International Equity Fixed Income
Investment Commissions: U.S. Equity International Equity
Transaction Fees: Miscellaneous:*
Total Fees and Commissions
$
4,413,226
3,356,005
--
2,806,674 727,884 313,600
11,601,875
$
23,219,264
*Amount included in total investment expenses shown on page 62.
Twenty Largest Equity Holdings
As of June 30, 2014
Shares
Company
1,956,226 1,699,913 3,286,594 1,266,360
225,280 919,119 1,930,643 1,208,588 1,924,183 3,158,427 2,496,219 3,344,670 1,503,788 2,553,924 621,300 1,694,390 544,264 812,814 682,686 1,042,541
Apple Inc. Exxon Mobil Corp. Microsoft Corp. Johnson & Johnson Google Inc. Chevron Corp. Wells Fargo & Co. Procter & Gamble Co. Verizon Communications Inc. Pfizer Inc. AT&T Inc. General Electric Co. JPMorgan Chase & Co. Intel Corp. Berkshire Hathaway Inc. Coca Cola Co. Schlumberger Ltd. Wal-Mart Stores Inc. PepsiCo Inc. Merck & Co Inc.
Fair Value $ 181,792,082
171,147,241 137,050,970 132,486,583 130,699,023 119,990,985 101,474,596
94,982,931 94,150,274 93,742,113 88,266,304 87,897,928 86,648,265 78,916,252 78,631,728 71,774,360 64,195,939 61,017,947 60,991,167 60,310,997
Top 20 Equities Remaining Equities
$ 1,996,167,685 9,375,453,601
Total Equities
$ 11,371,621,286
A complete listing is available upon written request, subject to restrictions of O.C.G.A. Section 47-1-14. 67
Investment
Fixed Income Holdings*
As of June 30, 2014
Issuer
US TREAS. NOTE US TREAS. NOTE US TREAS. NOTE GENERAL ELECTRIC CO US TREAS. NOTE US TREAS. BOND US TREAS. NOTE PFIZER INC US TREAS. NOTE EMC CORP GENERAL ELECTRIC CAP CORP US TREAS. BOND US TREAS. NOTE SHELL INTERNATIONAL FIN SHELL INTERNATIONAL FIN US TREAS NOTE EXXON MOBIL CORP ANHEUSER-BUSCH CISCO SYSTEMS INC PROCTER & GAMBLE CO GENERAL ELECTRIC CAP CORP COMCAST-NBC JPMORGAN CHASE & CO PRAXAIR INC PRAXAIR INC US TREAS. NOTE MICROSOFT CORP UNITED PARCEL SERVICE WALT DISNEY COMPANY AT&T INC ONTARIO (PROVINCE OF) ROYAL BANK OF CANADA SCHLUMBERGER INVESTMENT INTEL CORP WAL-MART STORES INC US TREAS. NOTE COCA COLA CO PFIZER INC COCA COLA CO GENERAL ELECTRIC CAP CORP ILLINOIS TOOL WORKS INC GENERAL ELECTRIC CAP CORP ILLINOIS TOOL WORKS INC COCA COLA CO US TREAS. NOTE MICROSOFT CORP
Year of Maturity
2017 2021 2015 2022 2017 2028 2018 2015 2017 2020 2026 2036 2016 2018 2018 2014 2019 2017 2017 2018 2018 2018 2017 2019 2018 2021 2015 2021 2017 2017 2017 2017 2021 2021 2016 2022 2018 2018 2018 2020 2019 2016 2017 2020 2019 2017
Interest Rate
1.8750 2.1250 0.2500 2.7000 0.5000 5.2500 2.7500 5.3500 3.1250 2.6500 5.5500 4.5000 0.8750 2.0000 1.9000 0.1250 1.8190 1.1250 1.1000 1.6000 1.6250 1.6620 1.2500 1.9000 1.2000 3.1250 1.6250 3.1250 1.1250 1.4000 1.1000 1.1700 3.3000 3.3000 2.8000 1.6250 1.6500 1.5000 1.1500 3.2500 1.9500 1.4500 0.9000 2.4500 1.0000 0.8750
ERS Fixed Income Securities Defined Contribution Fixed Income Securities
Total ERS and Defined Contribution Fixed Income Securities
Par Value
$
259,000,000
160,000,000
151,000,000
151,000,000
138,000,000
104,000,000
118,000,000
118,000,000
110,000,000
114,000,000
94,000,000
87,000,000
99,000,000
98,000,000
98,000,000
99,000,000
98,000,000
98,000,000
98,000,000
98,000,000
98,000,000
98,000,000
98,000,000
98,000,000
98,000,000
82,000,000
83,000,000
78,000,000
79,000,000
79,000,000
79,000,000
79,000,000
62,000,000
62,000,000
59,000,000
64,000,000
59,000,000
59,000,000
59,000,000
50,000,000
50,000,000
49,000,000
49,000,000
40,000,000
34,000,000
20,000,000
$ 4,155,000,000 60,500,000
$ 4,215,500,000
Fair Value
$
266,143,220
159,900,800
151,141,940
148,288,040
136,178,400
133,217,760
124,748,420
122,059,200
116,840,900
114,932,520
109,064,440
105,664,110
99,719,730
99,358,280
99,157,380
99,019,800
98,690,900
98,479,220
98,304,780
98,248,920
98,160,720
97,936,300
97,813,800
97,477,660
95,578,420
87,541,560
84,371,160
81,323,580
79,414,750
78,668,990
78,651,610
78,248,710
64,310,120
64,199,760
61,383,600
60,760,320
59,148,090
58,506,760
58,421,210
50,997,500
50,055,500
49,266,560
48,953,450
40,210,800
32,841,960
19,850,600
$ 4,253,252,250 60,867,870
$ 4,314,120,120
*A complete listing is available upon written request, subject to restrictions of O.C.G.A. Section 47-1-14. 68
Actuarial Section
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
69
Actuarial
ERS
April 17, 2014
Board of Trustees Employees' Retirement System of Georgia Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attn: Mr. James Potvin, Executive Director
Members of the Board:
Section 47-2-26 of the law governing the operation of the Employees' Retirement System of Georgia provides that the actuary shall make annual valuations of the contingent assets and liabilities of the Retirement System on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the System prepared as of June 30, 2013. The report indicates that annual employer contributions at the rate of 19.97% of compensation for Old Plan Members, 24.72% of compensation for New Plan Members, and 21.69% of compensation for GSEPS Members for the fiscal year ending June 30, 2016 are sufficient to support the benefits of the System.
Since the previous valuation, the Board has adopted a funding policy. In accordance with this funding policy, the actuarial value of assets was set equal to the market value of assets on June 30, 2013. Fiveyear smoothing of investment gains and losses will commence in subsequent years.
In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the annual report and the supporting schedules in the actuarial section of the annual report.
In our opinion, the valuation is complete and accurate, and the methodology and assumptions are reasonable as a basis for the valuation. The valuation takes into account the effect of all amendments to the System enacted through the 2013 session of the General Assembly.
The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Governmental Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
objective of the plan is that contribution rates over time will remain level as a percent of payroll. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a level percent of payroll. Gains and losses are reflected in the total unfunded accrued liability which is being amortized on a level dollar basis in accordance with the funding policy adopted by the Board.
The System is being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law and the funding policy adopted by the Board. In our opinion the System is operating on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated.
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the System and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Sincerely yours,
Edward A. Macdonald, ASA, FCA MAAA President
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
70
Cathy Turcot Principal and Managing Director
Actuarial
PSERS
April 17, 2014
Board of Trustees Georgia Public School Employees Retirement System Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attn: Mr. James Potvin, Executive Director
Members of the Board:
Section 47-4-60 of the law governing the operation of the Georgia Public School Employees Retirement System provides that the employer contribution shall be actuarially determined and approved by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the System prepared as of June 30, 2013. Based on a monthly benefit accrual rate of $14.75, the valuation indicates that annual employer contributions of $28,580,000 or $764.97 per active member for the fiscal year ending June 30, 2016 are sufficient to support the benefits of the System.
Since the previous valuation, the Board has adopted a funding policy. In accordance with the funding policy, the actuarial value of assets was set equal to the market value of assets on June 30, 2013. Fiveyear smoothing of investment gains and losses will commence in subsequent years. In addition, the results of the valuation reflect that the Board did not grant the anticipated cost-of-living increases (COLAs) to retired members on July 1, 2013 and on January 1, 2014.
In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the annual report and the supporting schedules in the actuarial section of the annual report.
In our opinion, the valuation is complete and accurate, and the methodology and assumptions are reasonable as a basis for the valuation. The valuation takes into account the effect of all amendments to the System enacted through the 2013 session of the General Assembly.
The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Governmental Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of the plan
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
is that contribution rates over time will remain level as a dollar per active member. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a dollar per active member. Gains and losses are reflected in the total unfunded accrued liability which is being amortized as a level dollar per active member in accordance with the funding policy adopted by the Board.
The System is currently being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law and the funding policy adopted by the Board. In our opinion the System is currently operating on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated.
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the System and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Sincerely yours,
Edward A. Macdonald, ASA, FCA MAAA President
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
71
Cathy Turcot Principal and Managing Director
Actuarial
GJRS
April 17, 2014
Board of Trustees Georgia Judicial Retirement System Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attn: Mr. James Potvin, Executive Director
Members of the Board:
Section 47-23-21 of the law governing the operation of the Georgia Judicial Retirement System provides that the actuary shall make annual valuations of the contingent assets and liabilities of the Retirement System on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the System prepared as of June 30, 2013. The report indicates that annual employer contributions at the rate of 12.19% of compensation for the fiscal year ending June 30, 2016 are sufficient to support the benefits of the System.
Since the previous valuation, the Board has adopted a funding policy. In accordance with this funding policy, the actuarial value of assets was set equal to the market value of assets on June 30, 2013. Fiveyear smoothing of investment gains and losses will commence in subsequent years.
In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the annual report and the supporting schedules in the actuarial section of the annual report.
In our opinion, the valuation is complete and accurate, and the methodology and assumptions are reasonable as a basis for the valuation. The valuation takes into account the effect of all amendments to the System enacted through the 2013 session of the General Assembly.
The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Governmental Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of the plan is that contribution rates over time will remain level as a percent of payroll. The valuation method used is the entry age normal cost
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
method. The normal contribution rate to cover current cost has been determined as a level percent of payroll. Gains and losses are reflected in the total unfunded accrued liability which is negative and being amortized as a level percent of payroll in accordance with the funding policy adopted by the Board.
The System is being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law and the funding policy adopted by the Board. In our opinion the System is operating on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated.
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Sincerely yours,
Edward A. Macdonald, ASA, FCA MAAA President
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
72
Cathy Turcot Principal and Managing Director
Actuarial
LRS
April 17, 2014
Board of Trustees Legislative Retirement System of Georgia Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attn: Mr. James Potvin, Executive Director
Members of the Board:
Section 47-6-22 of the law governing the operation of the Georgia Legislative Retirement System provides that the actuary shall make periodic valuations of the contingent assets and liabilities of the Retirement System on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the System prepared as of June 30, 2013. The report indicates that no annual employer contributions for the fiscal year ending June 30, 2016 are required to support the benefits of the System.
Since the previous valuation, the Board has adopted a funding policy. In accordance with this funding policy, the actuarial value of assets was set equal to the market value of assets on June 30, 2013. Fiveyear smoothing of investment gains and losses will commence in subsequent years. In addition, the results of the valuation reflect that the Board did not grant the anticipated cost-of-living increases (COLAs) to retired members on July 1, 2013 and on January 1, 2014.
In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the annual report and the supporting schedules in the actuarial section of the annual report.
In our opinion, the valuation is complete and accurate, and the methodology and assumptions are reasonable as a basis for the valuation. The valuation takes into account the effect of all amendments to the System enacted through the 2013 session of the General Assembly.
The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Governmental Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of the plan
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
is that contribution rates over time will remain level as a dollar per active member. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a level dollar per active member. Gains and losses are reflected in the total unfunded accrued liability which is negative and being amortized as a level dollar per active member.
The System is being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law and the funding policy adopted by the Board. In our opinion the System is operating on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated.
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Sincerely yours,
Edward A. Macdonald, ASA, FCA MAAA President
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
73
Cathy Turcot Principal and Managing Director
Actuarial
GMPF
April 17, 2014
Board of Trustees Georgia Military Pension Fund Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attn: Mr. James Potvin, Executive Director
Members of the Board:
Section 47-24-22 of the law governing the operation of the Georgia Military Pension Fund provides that the actuary shall make periodic valuations of the contingent assets and liabilities of the Pension Fund on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the Fund prepared as of June 30, 2013. The report indicates that annual employer contributions of $1,989,530 or $146.58 per active member for the fiscal year ending June 30, 2016 are sufficient to support the benefits of the Fund.
Since the previous valuation, the Board has adopted a funding policy. In accordance with the funding policy, the actuarial value of assets was set equal to the market value of assets on June 30, 2013. Fiveyear smoothing of investment gains and losses will commence in subsequent years.
In preparing the valuation, the actuary relied on data provided by the Fund. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the annual report and the supporting schedules in the actuarial section of the annual report.
In our opinion, the valuation is complete and accurate, and the methodology and assumptions are reasonable as a basis for the valuation. The valuation takes into account the effect of all amendments to the Fund enacted through the 2013 session of the General Assembly.
The Fund is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the Fund and to reasonable expectations of anticipated experience under the Fund. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Governmental Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of plan is that contributions rates over time will remain level as a dollar per active number.
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a dollar per active member. Gains and losses are reflected in the total unfunded accrued liability which is being amortized as a level dollar per active member in accordance with the funding policy adopted by the Board.
The Fund is being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law and the funding policy adopted by the Board. In our opinion the Fund is operating on an actuarially sound basis. Assuming that contributions to the Fund are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the Fund may be safely anticipated.
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience is performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the Fund.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Sincerely yours,
Edward A. Macdonald, ASA, FCA MAAA President
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
74
Cathy Turcot Principal and Managing Director
Actuarial
SEAD Pre-Retirement
April 17, 2014
Board of Trustees Employees' Retirement System of Georgia Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attention: Mr. James Potvin, Executive Director
Members of the Board:
Chapters 47-2 and 47-19 of the Code of Georgia which govern the operation of the Georgia Employees' Group Term Life Insurance Plan provide that the actuary shall make periodic valuations of the contingent assets and liabilities of the Insurance Plan on the basis of regular interest and the tables last adopted by the Board of Trustees. In this report, we have determined liabilities for life insurance benefits payable upon death in active service (Pre-Retirement). Since the previous valuation, the Board has adopted a funding policy.
We have submitted the report giving the results of the valuation of the Plan prepared as of June 30, 2013. The report indicates that employee contributions at the rate of 0.05% of active payroll for Old Plan members of the Employees' Retirement System, and 0.02% of active payroll for New Plan members of the Employees' Retirement System, members of the Legislative Retirement System and members of the Judicial Retirement System are sufficient to support the preretirement benefits of the Plan. No employer contribution is required for the fiscal year ending June 30, 2016 for pre-retirement benefits.
The funding method used for this valuation is the unit credit actuarial cost method with projected benefits. Gains and losses are reflected in the unfunded accrued liability. The actuarial assumptions used are in the aggregate reasonably related to the experience under the Plan and to reasonable expectations of anticipated experience under the Plan. In our opinion, the Plan is operating on an actuarially sound basis and the sufficiency of the funds to provide the benefits called for by the Plan may be safely anticipated.
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the Plan.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Edward A. Macdonald, ASA, FCA MAAA President
Sincerely yours,
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
75
Cathy Turcot Principal and Managing Director
Actuarial
SEAD Post-Retirement
April 17, 2014
Board of Trustees Employees' Retirement System of Georgia Two Northside 75, Suite 300 Atlanta, GA 30318-7701
Attention: Mr. James Potvin, Executive Director
Members of the Board:
Chapters 47-2 and 47-19 of the Code of Georgia which govern the operation of the Georgia Employees' Group Term Life Insurance Plan provide that the actuary shall make periodic valuations of the contingent assets and liabilities of the Insurance Plan on the basis of regular interest and the tables last adopted by the Board of Trustees. In this report, we have determined liabilities for life insurance benefits payable upon death after retirement (Post-Retirement). Since the previous valuation, the Board has adopted a funding policy.
In accordance with GASB 43 and 45, we have determined the liabilities for life insurance benefits payable upon death after retirement. We have submitted the report giving the results of the valuation of the Plan prepared as of June 30, 2013. The report indicates, for postretirement benefits, there is no employer annual required contribution for the fiscal year ending June 30, 2016.
The funding method used for this valuation is the unit credit actuarial cost method with projected benefits. Gains and losses are reflected in the unfunded accrued liability. The actuarial assumptions used are in the aggregate reasonably related to the experience under the Plan and to reasonable expectations of anticipated experience under the Plan. In our opinion, the Plan is operating on an actuarially sound basis and the sufficiency of the funds to provide the benefits called for by the Plan may be safely anticipated assuming future annual required contributions (ARC) are contributed when due.
3550 Busbee Pkwy, Suite 250 Kennesaw, GA 30144 Phone (678) 388-1700 Fax (678) 388-1730 www.CavMacConsulting.com
This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience in performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the Plan.
Future actuarial results may differ significantly from the current results presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Since the potential impact of such factors is outside the scope of a normal annual actuarial valuation, an analysis of the range of results is not presented herein.
Edward A. Macdonald, ASA, FCA MAAA President
Sincerely yours,
Edward J. Koebel, EA, FCA, MAAA Principal and Consulting Actuary
76
Cathy Turcot Principal and Managing Director
Actuarial
Summary of Plan Provisions
ERS Please see Notes to Financial Statements, (2)(a), pages 25-26. PSERS Please see Notes to Financial Statements, (2)(b), pages 26-27. LRS Please see Notes to Financial Statements, (2)(c), page 27. GJRS Please see Notes to Financial Statements, (2)(d), page 28. GMPF Please see Notes to Financial Statements, (2)(e), page 29. SEAD-Active Please see Notes to Financial Statements, (2)(f), pages 29-30. SEAD-OPEB Please see Notes to Financial Statements, (2)(g), page 30. The following Boards are responsible for establishing and maintaining the funding policies of the various defined benefit systems administered by ERSGA: Board of Trustees of the Employees' Retirement System: ERS, LRS, and GMPF Board of Trustees of the Public School Employees Retirement System: PSERS Board of Trustees of the Georgia Judicial Retirement System: GJRS Board of Directors of the State Employees Assurance Department: SEAD-Active and SEAD-OPEB ERS, PSERS, LRS, GJRS, and GMPF are all subject to the provisions of GASB 67; SEAD-Active and SEAD-OPEB are not. All of the systems covered under GASB 67 use the Entry Age Normal actuarial cost method for both funding and financial reporting purposes. This continues a long-standing practice for all of those systems and provides a point of consistency between the funding provisions and the new GASB 67 requirements. For all of the systems covered under GASB 67, the GASB 67 reports prepared as of June 30, 2014 were largely based on the data, assumptions, and results of the annual funding valuations as of June 30, 2013 (detailed in reports dated April 17, 2014). The Total Pension Liability (TPL) for each system, determined using the Entry Age Normal method, was then rolled forward to the June 30, 2014 measurement date. The Net Pension Liability for each system is equal to the rolled forward TPL less the market value of assets as of June 30, 2014. For the funding valuations as of June 30, 2013, the Actuarial Value of Assets was set equal to the Market Value of Assets as of June 30, 2013. In future valuations, the Actuarial Value of Assets will be calculated using a five-year smoothing methodology, whereby excesses and shortfalls of actual investment income over or under the expected investment return will be recognized over the succeeding five-year periods. For the funding valuations, each system covered under GASB 67 utilizes a 7.5% assumed rate of return and a 7.5% discount rate for the calculation of the respective systems' liabilities. The Single Equivalent Interest Rate required under GASB 67 has also been determined to be 7.5% by the systems' actuaries.
77
Actuarial
The laws governing the Employees' Retirement System and the plans it administers require an actuary to perform an annual valuation of the soundness of the systems. In addition, the actuary must perform at least once every five years an actuarial investigation of the mortality, service, and compensation experience of the members and beneficiaries of the System. The latest valuation was performed as of June 30, 2013 based on actuarial assumptions approved by the Board during the last experience study on December 16, 2010.
The more pertinent facts and significant assumptions underlying the computations included in the June 30, 2013 reports are as follows:
Summary of Actuarial Assumptions
Valuation Date Actuarial Cost Method
Amortization Method
Amortization Period
ERS June 30, 2013
Entry age
Level dollar, closed 25 years
PSERS June 30, 2013
Entry age
Level dollar, closed 25 years
GJRS
June 30, 2013 Entry age
Level percent of pay, closed 20 years
LRS June 30, 2013
Entry age
Level dollar, closed 20 years
GMPF June 30, 2013
Entry age
Level dollar, closed 20 years
Actuarial Asset Valuation Method
Investment Rate of Return Inflation Rate Projected Salary Increases COLA
For the fiscal year ended June 30, 2013, the actuarial value of assets was set equal to the market value of assets. For the fiscal year ended June 30, 2014 and later years, the actuarial value of assets will be based on the total fair value income of investments with the excess or shortfall of actual investment income over or under the expected investment return smoothed over 5 years. One-fifth of the excess or shortfall is recognized each year for five years.
7.50% 3.00% 5.45-9.25% None
7.50% 3.00%
n/a 1.50% Semi-annually
7.50% 3.00% 6.00% None
7.50% 3.00%
n/a 3.0% Annually
7.50% 3.00%
n/a None
Valuation Date Actuarial Cost Method
Amortization Method
Amortization Period
SEAD (Active & OPEB)
June 30, 2013 Projected unit credit
Level dollar, closed
20 years
Actuarial Asset Valuation Method
Investment Rate of Return Inflation Rate Projected Salary Increases
ERS GJRS LRS COLA
Market Value of Assets
7.50% 3.00%
5.45-9.25% 6.00% 0.00 n/a
78
Actuarial
Rates of Withdrawal Prior to Retirement (Withdrawal, Death, Disability)
ERS
Representative values of the assumed annual rates of separation other than retirement for non-law enforcement officers are as follows. Special rates of separation apply to law enforcement officers.
Annual Rates of Death
Annual Rates of Disability
Age
Men Women Men Women
20
.035 % .019 % .05 %
.02 %
25
.038
.021
.05
.02
30
.044
.026
.05
.02
35
.077
.048
.05
.02
40
.108
.071
.25
.10
45
.151
.112
.50
.25
50
.214
.168
.75
.50
55
.362
.272
1.10
.82
60
.675
.506
--
--
65 1.274
.971
--
--
69 1.980
1.486
--
--
Annual Rates of Withdrawal Years of Service
0-4
5-9
10 & over
Age
Men Women Men Women Men Women
20
31.00 % 31.00 %
--%
--%
--%
--%
25
26.00
24.00
17.00
19.00
--
--
30
22.50
21.00
12.00
13.00
7.50
7.75
35
21.00
19.50
10.00
10.50
7.00
6.75
40
19.00
17.50
9.50
9.00
5.00
4.50
45
18.00
15.50
9.00
8.00
3.75
3.50
50
15.50
15.00
7.00
7.00
3.75
3.50
55
13.00
12.50
6.50
6.50
4.00
4.00
60
15.00
12.50
7.00
6.50
--
--
65
15.00
17.00
9.50
10.00
--
--
79
PSERS
Actuarial
Annual Rates of Death
Annual Rate of Disability
Age
Men
Women
Both
20
.036 % .019 %
25
.038
.021
--% --
30
.050
.026
--
35
.084
.048
--
40
.114
.071
.01
45
.162
.112
.04
50
.245
.168
.09
55
.420
.272
.23
60
.778
.506
.35
65
1.441
.971
--
Annual Rates of Withdrawal Years of Service
0-4
5-9
10 & over
Age
Men Women Men Women Men Women
20
35.00 % 34.00 %
--%
--%
--%
--%
25
30.00
29.00
17.00
19.00
--
--
30
27.00
24.00
16.00
15.00
14.00
11.00
35
24.00
20.00
14.00
13.00
9.00
10.00
40
21.00
17.00
12.00
12.00
7.00
8.00
45
20.00
16.00
11.00
10.00
6.50
7.00
50
18.00
14.00
11.00
9.00
6.50
6.50
55
15.00
12.00
9.00
8.00
6.00
6.00
60
13.00
11.00
9.00
7.00
--
--
80
GJRS
Actuarial
Withdrawal
Annual Rates of Death
Disability
Age
Both
Men
Women
Both
20
8.0 %
.035 %
.019 %
.05 %
25
8.0
.038
.021
.05
30
8.0
.044
.026
.10
35
8.0
.077
.048
.15
40
8.0
.108
.071
.20
45
4.0
.151
.112
.35
50
3.0
.214
.168
.50
55
3.0
.362
.272
.90
60
3.0
.675
.506
1.45
65
3.0
1.274
.971
2.35
LRS
Annual Rates of
Withdrawal
Death
Disability
Age
Both
Men
Women
Both
20
6.0 %
.035 %
.019 %
.1 %
25
6.0
.038
.021
.1
30
6.0
.044
.026
.2
35
6.0
.077
.048
.3
40
6.0
.108
.071
.4
45
7.5
.151
.112
.7
50
8.5
.214
.168
1.0
55
10.0
.362
.272
1.8
60
10.0
.675
.506
2.9
65
10.0
1.274
.971
--
GMPF
Rates of Withdrawal from Active Service
Service
Rates
10 or less
17.5 %
11-13
15.0
14-19
9.5
20 or more
14.5
Age
Rates of Death
Men
Women
25
.038 %
.021 %
30
.044
.026
35
.077
.048
40
.108
.071
45
.151
.112
50
.214
.168
55
.362
.272
60
.675
.506
81
Actuarial
SEAD-Active and SEAD-OPEB
All Groups
ERS
LRS
GJRS
Annual Rates of Annual Rates of Annual Rates of Annual Rates of
Death
Disability
Disability
Disability
Age
Men Women Men Women
Both
Both
20
.035 % .019 % .05 % .02 %
.1 %
.05 %
25
.038
.021
.05
.02
.1
.05
30
.044
.026
.05
.02
.2
.10
35
.077
.048
.05
.02
.3
.15
40
.108
.071
.25
.10
.4
.20
45
.151
.112
.50
.25
.7
.35
50
.214
.168
.75
.50
1.0
.50
55
.362
.272
1.10
.82
1.8
.90
60
.675
.506
--
--
2.9
1.45
65 1.274
.971
--
--
--
2.35
69 1.980
1.486
--
--
--
--
ERS
Annual Rates of Withdrawal Years of Service
LRS
Annual Rates of Withdrawal
GJRS
Annual Rates of Withdrawal
0-4
5-9
10 & over
Age
Men Women Men Women Men Women
20
31.00 % 31.00 %
--%
--%
--%
--%
25
26.00
24.00
17.00
19.00
--
--
30
22.50
21.00
12.00
13.00
7.50
7.75
35
21.00
19.50
10.00
10.50
7.00
6.75
40
19.00
17.50
9.50
9.00
5.00
4.50
45
18.00
15.50
9.00
8.00
3.75
3.50
50
15.50
15.00
7.00
7.00
3.75
3.50
55
13.00
12.50
6.50
6.50
4.00
4.00
60
15.00
12.50
7.00
6.50
--
--
65
15.00
17.00
9.50
10.00
--
--
Both 6.00 % 6.00 6.00 6.00 6.00 7.50 8.50 10.00 10.00 10.00
Both 8.00 % 8.00 8.00 8.00 8.00 4.00 3.00 3.00 3.00 3.00
82
Actuarial
Annual Rates of Retirement
ERS
Old Plan
Early Retirement
Age 60 or 30 years
34 years
Age
Men
Women
Men
Women
Men
Women
55
3.0 %
4.0 %
11.5 %
9.0 % 100.0 %
100.0 %
56
3.5
6.0
12.0
11.0
100.0
100.0
57
4.0
6.0
12.0
13.0
100.0
100.0
58
5.0
6.0
13.0
15.0
95.0
95.0
59
6.0
6.0
16.0
16.0
95.0
95.0
60
--
--
17.0
20.0
95.0
95.0
62
--
--
37.0
40.0
90.0
90.0
64
--
--
20.0
30.0
90.0
90.0
66
--
--
30.0
35.0
30.0
35.0
68
--
--
20.0
25.0
20.0
25.0
70
--
--
45.0
35.0
45.0
35.0
75
--
--
100.0
100.0
100.0
100.0
More than 34 years
Men
Women
90.0 %
90.0 %
70.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0
50.0
60.0
50.0
60.0
15.0
60.0
30.0
35.0
20.0
25.0
45.0
35.0
100.0
100.0
Age
55 56 57 58 59 60 62 64 66 68 70 75
New Plan and GSEPS
Early Retirement
Men
Women
Normal Retirement*
Men
Women
10.0 %
8.0 %
50.0 %
40.0 %
10.0
8.0
50.0
40.0
10.0
9.0
50.0
40.0
10.0
10.0
30.0
40.0
10.0
15.0
30.0
40.0
--
--
17.0
20.0
--
--
38.0
36.0
--
--
25.0
28.0
--
--
35.0
35.0
--
--
20.0
25.0
--
--
20.0
25.0
--
--
100.0
100.0
*An additional 10% of active New Plan and GSEPS members less than age 60 are expected to retire in the year in which they attain 30 years of service.
83
PSERS GJRS LRS GMPF
Actuarial
Age
Annual Rate of Retirement
Age
Annual Rate of Retirement
60
15 %
68
25 %
61
15
69
25
62
22
70
25
63
18
71
25
64
18
72
25
65
28
73
25
66
25
74
25
67
25
75 & over
100
Age 60 61-64 65-66 67-69 70-74 75
Annual Rate of Retirement 12 % 12 15 20 30 100
Age 60 - 69 70 71 72
Annual Rate of Retirment 10 % 35 15 15
Age
Annual Rate of Retirement
73
25 %
74
40
75
100
Age 60 61 62 63 64 65 & over
Annual Rate of Retirement 65.0 % 65.0 65.0 65.0 65.0 100.0
84
Actuarial
SEAD-Active and SEAD-OPEB ERS Members
Old Plan
Early Retirement
Age 60 or 30 years
34 years
More than 34 years
Age
Men
Women
Men
Women
Men
Women
Men
Women
55
3.0 %
4.0 %
11.5 %
9.0 % 100.0 %
100.0 %
90.0 %
90.0 %
56
3.5
6.0
12.0
11.0
100.0
100.0
70.0
70.0
57
4.0
6.0
12.0
13.0
100.0
100.0
70.0
70.0
58
5.0
6.0
13.0
15.0
95.0
95.0
70.0
70.0
59
6.0
6.0
16.0
16.0
95.0
95.0
70.0
70.0
60
--
--
17.0
20.0
95.0
95.0
50.0
60.0
62
--
--
37.0
40.0
90.0
90.0
50.0
60.0
64
--
--
20.0
30.0
90.0
90.0
15.0
60.0
66
--
--
30.0
35.0
30.0
35.0
30.0
35.0
68
--
--
20.0
25.0
20.0
25.0
20.0
25.0
70
--
--
45.0
35.0
45.0
35.0
45.0
35.0
Age
55 56 57 58 59 60 62 64 66 68 70
New Plan and GSEPS
Early Retirement
Men
Women
Normal Retirement*
Men
Women
10.0 %
8.0 %
50.0 %
40.0 %
10.0
8.0
50.0
40.0
10.0
9.0
50.0
40.0
10.0
10.0
30.0
40.0
10.0
15.0
30.0
40.0
--
--
17.0
20.0
--
--
38.0
36.0
--
--
25.0
28.0
--
--
35.0
35.0
--
--
20.0
25.0
--
--
20.0
25.0
*An additional 10% of active New Plan and GSEPS members less than age 65 are expected to retire in the year in which they attain 30 years of service.
LRS Members
Age Annual Rate of Retirement
Age
Annual Rate of Retirement
60 - 69
10 %
73
70
35
74
25 % 40
71
15
75
100
72
15
--
--
85
SEAD-Active and SEAD-OPEB GJRS Members
Actuarial
Age 60-64 65-66 67-69 70-74 75
Annual Rates of Retirement 12 % 15 20 30 100
86
Actuarial
Annual Rates of Death After Retirement
For all plans except PSERS, the RP-2000 Combined Mortality Table is used for the period after retirement and for dependent beneficiaries. The RP-2000 Disabled MortalityTable set back eleven years for males is used for the period after disability retirement. For PSERS, the RP-2000 Combined Table set forward one year for males is used for the period after service retirement and for beneficiaries of deceased members. The RP-2000 Disabled Mortality Table set back two years for males and set forward one year for females is used for the period after disability retirement.
ERS
Age
Men
Women
Age
Men
Women
40
.108 %
.071 %
65
1.274 %
.971 %
45
.151
.112
70
2.221
1.674
50
.214
.168
75
3.783
2.811
55
.362
.272
80
6.437
4.588
60
.675
.506
85
11.076
7.745
PSERS
Age
Men
Women
Age
Men
Women
40
.114 %
.071 %
65
1.441 %
.971 %
45
.162
.112
70
2.457
1.674
50
.245
.168
75
4.217
2.811
55
.420
.272
80
7.204
4.588
60
.768
.506
85
12.280
7.745
GJRS
Age
Men
Women
Age
Men
Women
40
.108 %
.071 %
65
1.274 %
.971 %
45
.151
.112
70
2.221
1.674
50
.214
.168
75
3.783
2.811
55
.362
.272
80
6.437
4.588
60
.675
.506
85
11.076
7.745
LRS
Age
Men
Women
Age
Men
Women
40
.108 %
.071 %
65
1.274 %
.971 %
45
.151
.112
70
2.221
1.674
50
.214
.168
75
3.783
2.811
55
.362
.272
80
6.437
4.588
60
.675
.506
85
11.076
7.745
87
GMPF SEAD-OPEB
Actuarial
Age
Men
Women
Age
Men
Women
40
.108 %
.071 %
65
1.274 %
.971 %
45
.151
.112
70
2.221
1.674
50
.214
.168
75
3.783
2.811
55
.362
.272
80
6.437
4.588
60
.675
.506
85
11.076
7.745
Age
Men
Women
Age
Men
Women
40
.108 %
.071 %
65
1.274 %
.971 %
45
.151
.112
70
2.221
1.674
50
.214
.168
75
3.783
2.811
55
.362
.272
80
6.437
4.588
60
.675
.506
85
11.076
7.745
88
Active Members
ERS
Actuarial
Year
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Active Members
72,106 72,716 74,089 73,985 75,293 71,272 68,566 66,081 63,942 61,550
Annual Payroll (in thousands)
$
2,445,619
2,514,430
2,630,167
2,680,972
2,809,199
2,674,155
2,571,042
2,486,780
2,414,884
2,335,773
Average Pay
$
33,917
34,579
35,500
36,237
37,310
37,520
37,497
37,632
37,767
37,949
Change
(0.2) % 2.0 2.7 2.1 3.0 0.6 (0.1) 0.4 0.4 0.5
PSERS PSERS is not a compensation based plan.
Year
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Active Members
35,943 36,704 37,587 39,086 40,121 40,581 39,962 39,249 38,654 37,361
GJRS
Year
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Active Members
451 468 478 480 482 502 495 507 503 506
Annual Payroll (in thousands) Average Pay
$
40,908 $ 90,705
42,916
91,701
45,308
94,787
48,621
101,294
51,102
106,021
52,083
103,751
51,293
103,622
52,331
103,216
51,898
103,177
52,807
104,362
Change
(0.8) % 1.1 3.4 6.9 4.7 (2.1) (0.1) (0.4) (0.0) 1.1
LRS LRS is not a compensation based plan.
Year
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Active Members
210 217 218 218 218 218 216 218 220 223
89
Actuarial
GMPF GMPF is not a compensation based plan.
Year
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Active Members
8,573 8,870 10,320 12,017 11,623 12,019 13,032 13,776 13,526 13,573
SEAD-Active and SEAD-OPEB
SEAD-Active and SEAD-OPEB began in 2007.
Year
2008 2009 2010 2011 2012 2013
Active Members
75,859 69,745 62,305 55,516 49,261 43,512
Note: Payroll data may not equal that which is presented in the Financial section. Valuation data is a snapshot as of the valuation date, annualized for new hires and salary increases, and does not include those who terminated during the year.
90
Actuarial
Member and Employer Contribution Rates
ERS
Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Member
1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25%
Employer Rates
Old Plan* New Plan GSEPS**
10.41% 10.41% 10.41% 10.41% 10.41% 10.41% 10.41% 11.63% 14.90% 18.46%
10.41% 10.41% 10.41% 10.41% 10.41% 10.41% 10.41% 11.63% 14.90% 18.46%
n/a n/a n/a n/a 6.54% 6.54% 6.54% 7.42% 11.54% 15.18%
* Old Plan Rate includes an employer pick-up of employee contributions. ** GSEPS Plan began on January 1, 2009
PSERS
Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Pre 7/1/12 Member
$ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year $ 36 per year
Post 7/1/12 Member
$ 90 per year $ 90 per year
Employer
$
840,000
3,638,000
6,484,000
2,866,000
5,680,000
5,529,000
7,509,000
15,884,000
24,829,000
27,160,000
GJRS
Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Member
7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50%
Employer
3.85% 3.85% 3.85% 3.85% 3.85% 3.85% 3.85% 3.90% 3.90% 4.23%
LRS
Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Member
8.50% 8.50% 8.50% 8.50% 8.50% 8.50% 8.50% 8.50% 8.50% 8.50%
Employer
$
54,000
54,000
62,000
73,000
71,000
75,000
75,000
75,000
128,000
45,000
91
Actuarial
GMPF
Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Member
n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a
Employer
$
891,000
891,000
1,005,000
1,103,000
1,323,000
1,434,000
1,282,000
1,521,000
1,703,000
1,892,000
SEAD-Active*
Year
2008 2009 2010 2011 2012 2013 2014
Member - Old Plan
0.05% 0.05% 0.05% 0.05% 0.05% 0.05% 0.05%
Member - New Plan, LRS, GJRS
0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02%
Employer
0% 0% 0% 0% 0% 0% 0%
SEAD-OPEB*
Year
Member - Old Plan
2008 2009 2010 2011 2012 2013 2014
0.45% 0.45% 0.45% 0.45% 0.45% 0.45% 0.45%
*SEAD-Active and SEAD-OPEB began in 2007.
Member - New Plan, LRS, GJRS
0.23% 0.23% 0.23% 0.23% 0.23% 0.23% 0.23%
Employer
0% 0% 0% 0% 0.61% 0.27% 0%
92
93
Employees' Retirement System
Actuarial valuation
date
6/30/2004 6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
Public School Employees Retirement System
6/30/2004 6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
Legislative Retirement System
6/30/2004 6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
Georgia Judicial Retirement System
6/30/2004 6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
Actuarial value of plan assets
(a) $ 12,797,389
13,134,472 13,461,132 13,843,689 14,017,346 13,613,606 13,046,193 12,667,557 12,260,595 12,129,804
743,815 753,767 766,277 785,460 791,855 769,618 737,406 719,601 710,915 727,268
27,892 28,462 29,172 30,049 30,706 30,303 29,581 29,278 28,990 29,481
250,313 264,924 279,564 297,090 313,315 317,624 320,050 327,483 335,225 351,889
Actuarial accrued liablility (AAL) entry age (b) 13,106,648 13,512,773 14,242,845 14,885,179 15,680,857 15,878,022 16,295,352 16,656,905 16,777,922 16,982,449
666,883 671,040 691,651 746,078 770,950 823,232 875,396 885,927 895,324 910,256
22,023 23,531 23,407 24,357 24,454 23,523 25,003 25,245 24,966 24,904
196,502 213,060 229,837 249,278 268,516 282,474 281,496 290,486 308,862 335,792
Unfunded AAL/ (funded excess)
(b-a) 309,259 378,301 781,713
1,041,490 1,663,511 2,264,416 3,249,159 3,989,348 4,517,327 4,852,645
(76,932) (82,727) (74,626) (39,382) (20,905)
53,614 137,990 166,326 184,409 182,988
(5,869) (4,931) (5,765) (5,692) (6,252) (6,780) (4,578) (4,033) (4,024) (4,577)
(53,811) (51,864) (49,727) (47,812) (44,799) (35,150) (38,554) (36,997) (26,363) (16,097)
Funded ratio (a/b) 97.6 % 97.2 94.5 93.0 89.4 85.7 80.1 76.0 73.1 71.4
111.5 112.3 110.8 105.3 102.7 93.5 84.2 81.2 79.4 79.9
126.6 121.0 124.6 123.4 125.6 128.8 118.3 116.0 116.1 118.4
127.4 124.3 121.6 119.2 116.7 112.4 113.7 112.7 108.5 104.8
Annual covered payroll
(c) $ 2,445,619
2,514,430 2,630,167 2,680,972 2,809,199 2,674,155 2,571,042 2,486,780 2,414,884 2,335,773
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
3,402 3,586 3,602 3,688 3,778 3,780 3,745 3,780 3,815 3,867
40,908 42,916 45,308 48,621 51,102 52,083 51,293 52,331 51,898 52,807
Unfunded AAL/ (funded excess) as percentage of covered payroll
[(b-a)/c] 12.6 % 15.0 29.7 38.8 59.2 84.7
126.4 160.4 187.1 207.8
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
(172.5) (137.5) (160.0) (154.3) (165.5) (179.4) (122.2) (106.7) (105.5) (118.4)
(131.5) (120.9) (109.8)
(98.3) (87.7) (67.5) (75.2) (70.7) (50.8) (30.5)
Schedules of Funding Progress
(In thousands)
Actuarial
Schedules of Funding Progress
(In thousands)
Actuarial valuation
date
Actuarial value of plan assets
(a)
Actuarial accrued liability (AAL) entry-age
(b)
Unfunded AAL/ (funded excess)
(b-a)
Funded ratio (a/b)
Annual covered payroll
(c)
Unfunded AAL/ (funded excess) as percentage of covered payroll
[(b-a)/c]
Georgia Military Pension Fund
6/30/2004 6/30/2005 6/30/2006 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013
$
1,250
2,176
3,100
4,165
5,269
6,413
7,558
8,702
10,087
12,131
This data, except for annual covered payroll, was provided by the System's actuary.
12,343 14,454 17,625 19,887 19,124 21,021 23,773 26,767 28,231 30,056
11,093 12,278 14,525 15,722 13,855 14,608 16,215 18,065 18,144 17,925
10.1 % 15.1 17.6 20.9 27.6 30.5 31.8 32.5 35.7 40.4
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
No statistics regarding covered payroll are available. Contributions are not based on members' salaries, but are simply $4.00 per month, per member for nine months each fiscal year if hired prior to July 1,2012 and $10 per month, per member for nine months if hired after July 1, 2012. No statistics regarding covered payroll are available. Active and inactive plan member information is maintained by the Georgia Department of Defense.
See accompanying notes to required supplementary schedules and accompanying independent auditors' report. Please see Financial Section pages 49-50 for Schedules of Employer Contributions.
94
Actuarial
Actuarial
Schedule of Retirees Added to and Removed from Rolls
ERS
Added to Rolls
Removed from Rolls
Roll End of Year
Year Ended
2005 2006 2007 2008 2009 2010 2011 2012 2013
Number
n/a 2,338 2,410 2,422 2,444 2,665 2,797 2,956 3,664
Annual Allowances (in thousands) Number
Annual Allowances (in thousands) Number
$
n/a
n/a $
84,982
854
114,719
1,075
82,644
1,017
85,329
1,055
70,383
1,051
69,031
1,170
71,464
1,305
88,855
1,176
n/a 16,270 20,598 21,299 20,194 22,413 25,347 27,696 26,334
31,355 32,839 34,174 35,579 36,968 38,582 40,209 41,860 44,348
Annual Allowances (in thousands)
$
773,445
842,157
936,278
997,623
1,062,758
1,110,728
1,154,412
1,198,180
1,260,701
% Increase in Annual Allowance
n/a % 8.9 11.2 6.6 6.5 4.5 3.9 3.8 5.2
Average Annual Allowances
$ 24,667 25,645 27,397 28,040 28,748 28,789 28,710 28,624 28,427
PSERS
Added to Rolls
Removed from Rolls
Roll End of Year
Year Ended
2005 2006 2007 2008 2009 2010 2011 2012 2013
Number
n/a 870 816 899 886 1,001 1,174 1,133 1,298
Annual Allowances (in thousands) Number
$
n/a n/a
4,835 531
4,749 637
4,514 605
5,290 575
4,494 642
3,168 731
3,192 684
3,803 650
Annual Allowances (in thousands) Number
$
n/a 12,675
1,885 13,014
2,353 13,193
2,371 13,487
2,260 13,798
2,666 14,157
3,072 14,600
2,834 15,049
2,738 15,697
Annual Allowances (in thousands)
$
41,316
44,266
46,662
48,805
51,835
53,663
53,759
54,117
55,182
% Increase in Annual Allowance
n/a % 7.1 5.4 4.6 6.2 3.5 0.2 0.7 2.0
Average Annual Allowances
$ 3,260 3,401 3,537 3,619 3,757 3,791 3,682 3,596 3,515
GJRS
Added to Rolls
Removed from Rolls
Roll End of Year
Year Ended
2005 2006 2007 2008 2009 2010 2011 2012 2013
Number
n/a 5 13 14 29 16 15 22 42
Annual Allowances (in thousands) Number
$
n/a n/a
144
14
853
7
902
7
2,238
6
933
10
1,168
2
1,732
8
2,763
13
Annual Allowances (in thousands) Number
$
n/a 174
687 165
297 171
410 178
191 201
508 207
105 220
405 234
629 263
Annual Allowances (in thousands)
$
9,460
8,917
9,473
9,965
12,012
12,437
13,500
14,827
16,961
% Increase in Annual Allowance
n/a % (5.7) 6.2 5.2 20.5 3.5 8.5 9.8 14.4
Average Annual Allowances
$ 54,368 54,042 55,398 55,983 59,761 60,082 61,364 63,363 64,490
95
Actuarial
LRS
Added to Rolls
Removed from Rolls
Roll End of Year
Year Ended
2005 2006 2007 2008 2009 2010 2011 2012 2013
Number
n/a 13 17 13 10 10 18 10 32
Annual Allowances (in thousands) Number
$
n/a n/a
103
21
151
9
130
11
117
7
106
3
104
10
66
11
200
15
Annual Allowances (in thousands) Number
$
n/a 224
165 216
74 224
100 226
54 229
36 236
86 244
82 243
140 260
Annual Allowances (in thousands)
$
1,594
1,532
1,609
1,639
1,702
1,772
1,790
1,774
1,834
% Increase in Annual Allowance
n/a % (3.9) 5.0 1.9 3.8 4.1 1.0 (0.9) 3.4
Average Annual Allowances
$ 7,116 7,093 7,183 7,252 7,432 7,508 7,336 7,300 7,054
GMPF
Added to Rolls
Removed from Rolls
Roll End of Year
Year Ended
2005 2006 2007 2008 2009 2010 2011 2012 2013
Number
n/a 61 73 71 85 92 94 95 83
Annual Allowances (in thousands) Number
$
n/a n/a
69
1
83
1
76
2
91
3
100
1
101
3
106
3
87
5
Annual Allowances (in thousands) Number
$
n/a 103
1 163
1 235
2 304
4 386
1 477
4 568
3 660
5 738
Annual Allowances (in thousands)
$
110
178
260
334
421
520
617
720
802
% Increase in Annual Allowance
n/a % 61.8 46.1 28.5 26.0 23.5 18.7 16.7 11.4
Average Annual Allowances
$ 1,068 1,092 1,106 1,099 1,091 1,090 1,086 1,091 1,087
2004 data not available. SEAD-Active and SEAD-OPEB are life insurance plans which do not have annuity payments.
96
Analysis of Change in Unfunded Accrued Liability (UAL)
ERS
Interest (7.50) added to previous UAL
Accrued liability contribution
Experience: Valuation asset growth Pensioners' mortality Turnover and retirements New entrants Salary increases Method changes Amendments (COLAs) Assumption changes Lawsuit Programming modification Data changes Misc. changes
Total
PSERS
Interest (7.50) added to previous UAL
Accrued liability contribution
2013
2012
2011
2010
2009
2008
2007
2006
2005
Amount of Increase (Decrease) (in Millions)
$
338.8 $
299.2 $
243.7 $
169.8 $
124.8 $
78.1 $
(239.1)
(147.7)
(122.9)
(89.4)
(99.7)
(86.3)
253.7 20.6
103.7 14.1 (46.8)
(128.3) 0.0 0.0 0.0 0.0
18.7 (0.1)
396.3 15.5 93.8 12.1 (74.2) 0.0
(118.8) 0.0 0.0
26.3 12.9 12.6
$
335.3 $
528.0 $
433.6 16.4 91.4 28.4 49.0 0.0 0.0 0.0 0.0 (28.7) 9.1 20.2
740.2 $
710.1 49.2 118.4 15.0
(259.2) 0.0 0.0
250.7 0.0 0.0 (2.4)
22.5
984.7 $
609.1 65.4
107.3 16.7
(296.9) 0.0
(358.6) 0.0
75.9 0.0
270.5 86.4
600.9 $
129.3 51.3
103.0 22.9 (22.7) 0.0
188.8 0.0 0.0 0.0 0.0
157.6
622.0 $
Amount of Increase (Decrease) (in Thousands)
58.6 $
(35.3)
(59.5) 51.0 115.7 35.7 (33.2)
0.0 5.9 0.0 0.0 0.0 0.0 120.9
259.8 $
28.4 $
23.2
7.4
140.2 50.1 28.1 34.4 (84.2) (69.0)
245.2 0.0 0.0 0.0 0.0
22.8
403.4 $
7.0
102.4 (24.2) 39.1 39.4 (109.2) (66.0) 225.8 (168.5)
0.0 0.0 0.0 0.0
69.0
$ 13,830.7 $ 12,474.4 $ 10,349.3 $ 4,021.0 $ (1,567.9) $ (2,953.7) $ (5,596.9) $ (6,204.6) $ (5,769.9)
(12,497.7)
(4,843.8)
4,022.8
6,403.4
5,026.0
7,267.0
4,729.2
6,961.2
9,691.0
2004
Not provided by actuary
Not provided by actuary
97
Actuarial
Experience: Valuation asset growth Pensioners' mortality Turnover and retirements New entrants Salary increases Method changes Amendments (COLAs) Assumption changes Lawsuit Data changes Allotment for expenses Misc. changes
Total
13,868.0 (381.9)
4,772.4 2,757.7
0.0 (9,259.0) (14,813.1)
0.0 0.0 0.0 0.0 301.7
21,922.0 (1,149.5) 4,974.5 2,783.8
0.0 0.0 (20,664.9) 0.0 0.0 0.0 0.0 2,586.9
24,002.0 (3,000.5) 3,403.6 3,167.0
0.0 0.0 (16,603.6) 0.0 0.0 0.0 2,122.7 872.4
39,729.0 (828.9)
12,375.8 3,047.8 0.0 0.0
(14,121.2) 33,717.7
0.0 (2,192.3) 2,029.0
195.0
$ 1,421.2 $ 18,083.4 $ 28,335.7 $ 84,376.3 $
34,015.0 973.7
6,201.3 3,267.7
0.0 0.0 0.0 0.0 2,168.0 24,199.5 433.0 (197.3)
74,519.0 $
6,623.0 420.3
3,381.4 4,021.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 (281.8)
18,477.2 $
(3,737.0) (320.5)
1,053.3 3,556.9
0.0 0.0 36,404.3 0.0 0.0 0.0 0.0 (846.1)
35,243.2 $
7,359.0 1,146.2 (1,717.5) 4,151.6
0.0 (3,594.0)
0.0 0.0 0.0 0.0 0.0 0.0
5,256.0 (3,354.4) 4,608.2 4,121.2
0.0 (1,559.2) 23,008.5 (41,797.1)
0.0 0.0 0.0 0.0
8,101.9 $ (5,795.4)
2013
2012
2011
2010
2009
2008
2007
2006
2005
GJRS
Interest (7.50) added to previous UAL
Accrued liability contribution
Experience: Valuation asset growth Pensioners' mortality Turnover and retirements New entrants Salary increases Method changes Amendments (COLAs) Assumption changes Lawsuit Data changes Programming modification Misc. changes
Total
Amount of Increase (Decrease) (in Thousands)
$ (1,977.2) $ (2,774.8) $ (2,891.5) $ (2,636.2) $ (3,360.0) $ (3,585.9) $
5,187.8
4,710.8
4,079.8
4,592.1
3,596.2
4,498.3
4,949.6 533.8
3,941.4 3,138.0 (4,620.6) (6,827.0)
0.0 0.0 0.0 0.0 4,606.4 1,333.8
8,638.5 376.9
2,080.7 442.3
(4,536.5) 0.0
(870.0) 0.0 0.0 0.0
1,648.9 917.5
9,404.0 2,076.8
(276.3) 750.1 1,265.9
0.0 0.0 0.0 0.0 0.0 0.0 (12,852.1)
16,228.0 560.9
2,290.6 0.0
(10,213.5) 0.0 0.0
(14,826.5) 0.0
579.1 0.0
21.3
13,941.0 1,102.3 1,982.9 967.2
(10,561.2) 0.0
(2,359.4) 0.0 0.0
4,581.2 0.0
(240.6)
$ 10,266.0 $ 10,634.3 $ 1,556.7 $ (3,404.2) $ 9,649.6 $
3,164.0 409.3
1,243.3 354.2
(3,432.4) 0.0
1,265.0 0.0 0.0 0.0 0.0
(903.4)
3,102.3 $
(3,729.5) $
3,953.2
(1,026.0) (154.4)
(1,614.7) 659.5 369.8 0.0 24.1 0.0 0.0 0.0 0.0
3,433.5
1,915.5 $
(3,889.8) $
6,928.7
3,464.0 709.7
1,649.8 322.6
(3,293.9) (1,738.0) 2,383.8
0.0 0.0 0.0 0.0 (4,400.5)
2,136.4 $
(4,035.8)
6,330.0
2,648.0 (950.0)
(2,694.5) 1,638.0 (5,002.0) 1,702.3 5,036.8 (2,725.8)
0.0 0.0 0.0 0.0
1,915.5
2004
Not provided by actuary
Actuarial
98
LRS
Interest (7.50) added to
$
previous UAL
Accrued liability contribution
Experience: Valuation asset growth Pensioners' mortality Turnover and retirements New entrants Salary increases Method changes Amendments (COLAs) Assumption changes Lawsuit Data changes Misc. changes
Total
$
(301.8) $
(62.4)
513.9 (29.6) 17.4 144.5
0.0 (418.0) (488.1)
0.0 0.0 0.0 71.1
(553.1) $
Amount of Increase (Decrease) (in Thousands)
(302.5) $
(343.4) $
(508.5) $
(468.9) $
(426.9) $
33.9
107.1
(32.5)
(21.1)
(26.3)
829.0 19.1 (84.3) 16.9 0.0 0.0
(549.7) 0.0 0.0 0.0
46.4
8.8 $
906.2 (18.7) 254.5 74.0
0.0 0.0 (481.8) 0.0 0.0 0.0 46.9
544.9 $
1,534.0 339.2 105.1 98.8 0.0 0.0 (465.3) 975.2 0.0 114.8 41.6
2,202.4 $
1,307.4 240.7 (5.7) 0.0 0.0 0.0 0.0 0.0 0.0
(1,529.1) (51.7)
(528.4) $
241.7 (2.2)
(429.8) 35.9 0.0 0.0 0.0 0.0 0.0 0.0 47.4
(560.2) $
(432.3) $
(31.1)
(155.0) 119.4 423.8
0.0 0.0 0.0 0.0 0.0 0.0 0.0 147.9
72.7 $
(369.8) $ (43.1)
(440.1) 43.1
Not provided by actuary
289.0 (412.7) (154.7)
0.0 0.0 (142.0) 0.0 0.0 0.0 0.0 0.0
(833.3) $
208.0 172.6 350.0 158.5
0.0 291.1 1,491.7 (1,337.6)
0.0 0.0 0.0
937.3
2013
2012
2011
GMPF*
Interest (7.50) added to previous UAL
Accrued liability contribution
Experience: Valuation asset growth Pensioners' mortality Turnover and retirements New entrants Method changes Assumption changes Expense Deficit Misc. changes
Total
Amount of Increase (Decrease) (in Thousands)
$
1,360.8 $
1,354.9
(1,661.5)
(1,502.4)
39.3 80.2 186.4 137.8 (393.0)
0.0 0.0 30.6
$
(219.4) $
107.0 68.3 17.9
127.1 0.0 0.0 0.0
(93.6)
79.2
1,216.1
(1,173.3)
113.8 58.5 205.4 1,469.6
0.0 0.0 37.0 (77.0) 1,850.1
*Note: Data prior to 2011 is not available for GMPF.
SEAD-Active and SEAD-OPEB: Data is not available.
Actuarial
99
Actuarial
Solvency Test Results
Dollar amounts in thousands
ERS
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2006 2007 2008 2009 2010 2011 2012 2013
Active
Active Member
Member
Retirants &
(Employer
Contributions Beneficiaries Funded Portion)
Valuation Assets
(1)
(2)
$ 672,679 $ 8,462,884 $
645,907
9,020,890
616,177
9,756,529
589,012
10,034,939
551,607
10,652,040
503,867
11,058,344
460,861
11,420,011
405,841
11,935,364
(3)
5,107,282 $ 13,461,132
5,218,382
13,843,689
5,308,151
14,017,346
5,254,071
13,613,606
5,091,705
13,046,193
5,094,694
12,667,557
4,897,050
12,260,595
4,641,244
12,129,804
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(2)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
98.2%
(3)
84.7% 80.0% 68.7% 56.9% 36.2% 21.7%
7.8% 0.0%
PSERS
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2006 2007 2008 2009 2010 2011 2012 2013
Active
Active Member
Member
Retirants &
(Employer
Contributions Beneficiaries Funded Portion)
Valuation Assets
(1)
$ 14,321 $ 14,796 15,285 15,862 16,361 16,627 16,917 17,016
(2)
428,543 $ 456,868 469,601 506,659 528,808 532,509 537,284 549,796
(3)
248,787 $ 274,414 286,064 300,711 330,227 336,790 341,123 343,444
766,277 785,460 791,855 769,618 737,406 719,601 710,915 727,268
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(2)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(3)
100.0% 100.0% 100.0%
82.2% 58.2% 50.6% 45.9% 46.7%
GJRS
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2006 2007 2008 2009 2010 2011 2012 2013
Active Member Contributions
(1)
$ 48,896 52,707 59,838 61,188 67,293 71,047 73,998 73,949
Active Member
Retirants &
(Employer
Beneficiaries Funded Portion)
(2)
(3)
$
86,194 $
87,333
90,601
108,923
117,730
128,991
141,880
162,364
94,747 109,238 118,077 112,363
96,473 90,440 92,984 99,479
Valuation Assets
$ 279,564 297,090 313,315 317,624 320,050 327,483 335,225 351,889
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(2)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(3)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
100
Actuarial
LRS
Actuarial Valuation as of 7/1
2006 2007 2008 2009 2010 2011 2012 2013
Actuarial Accrued Liability for:
Active
Active Member
Member
Retirants &
(Employer
Contributions Beneficiaries Funded Portion)
(1)
$ 2,507 2,484 2,853 2,908 3,166 2,921 3,185 2,951
(2)
$ 18,734 19,847 19,366 18,465 19,208 19,759 19,200 19,623
(3)
$ 2,166 2,026 2,235 2,150 2,629 2,564 2,581 2,330
Valuation Assets
$ 29,172 30,049 30,706 30,303 29,581 29,278 28,990 29,481
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(2)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(3)
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
GMPF
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2006 2007 2008 2009 2010 2011 2012 2013
Active Member Contributions
(1)
$ 0 0 0 0 0 0 0 0
Active Member
Retirants &
(Employer
Beneficiaries Funded Portion)
(2)
$ 6,392 7,655 9,449
12,742 14,015 15,379 17,518 19,396
(3)
$ 11,233 12,232 9,675 8,279 9,758 11,388 10,713 10,660
Valuation Assets
$ 3,100 4,165 5,269 6,413 7,558 8,702
10,087 12,131
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
(2)
(3)
n/a
48.5%
0.0%
n/a
54.4%
0.0%
n/a
55.8%
0.0%
n/a
50.3%
0.0%
n/a
53.9%
0.0%
n/a
56.6%
0.0%
n/a
57.6%
0.0%
n/a
62.5%
0.0%
SEAD-Active 2
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2007 2008 2009 2010 2011 2012 2013
Active Member Contributions
(1)
$ 0 0 0 0 0 0 0
Active Member
Retirants &
(Employer
Beneficiaries Funded Portion)
(2)
$ 0 0 0 0 0 0 0
(3)
$ 59,509 62,171 61,351 40,523 40,145 39,317 37,512
Valuation Assets
$ 185,335 172,595 144,161 156,132 184,783 183,390 204,779
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
(2)
(3)
n/a
n/a
100.0%
n/a
n/a
100.0%
n/a
n/a
100.0%
n/a
n/a
100.0%
n/a
n/a
100.0%
n/a
n/a
100.0%
n/a
n/a
100.0%
101
Actuarial
SEAD-OPEB 2
Actuarial Accrued Liability for:
Actuarial Valuation as of 7/1
2007 2008 2009 2010 2011 2012 2013
Active Member Contributions
(1)
$ 0 0 0 0 0 0 0
Active Member
Retirants &
(Employer
Beneficiaries Funded Portion)
(2)
$ 436,530 486,569 524,718 516,633 503,327 528,165 586,228
(3)
$ 206,001 213,315 208,953 174,368 175,093 176,452 168,558
Valuation Assets
$ 778,048 737,114 628,199 680,449 807,893 818,284 907,831
Portion of Aggregate Accrued Liabilities Covered by Assets
(1)
(2)
(3)
N/A
100.0%
100.0%
N/A
100.0%
100.0%
N/A
100.0%
49.5%
N/A
100.0%
93.9%
N/A
100.0%
100.0%
N/A
100.0%
100.0%
N/A
100.0%
100.0%
Data prior to 2006 is not available for Defined Benefit Pension Plans. 2 SEAD-Active and SEAD-OPEB began in 2007.
102
Statistical
Statistical Section
E RSGA
Serving those who serve Georgia
Employees' Retirement System of Georgia
Statistical
Introduction
The objective of the statistical section is to provide a historical perspective, context and relevant details to assist readers in evaluating the condition of the plans. All nonaccounting data is taken from ERSGA's internal sources except for information which is derived from the actuarial valuations. FY2010 was the first year ERSGA added this information in their Annual Financial Report. Therefore, historical detail may not be complete for some schedules. Statistical information is not presented for SCJRF and DARF as both plans are immaterial, have no active members, and are closed to new members.
Financial Trends
The following schedules have been included to help the reader understand how the System's financial position has changed over the past 10 years:
Additions by Source Deductions by Type Changes in Fiduciary Net Position
Operational Trends
The following schedules have been included to help the readers understand how the System's financial report relates to the services provided by the System and the activities it performs:
Retiree Information Withdrawal (Refund) Data New Retiree Elections Overall Plan Statistics
104
Statistical
Additions by Source - Contribution/Investment Income (in thousands)
105
ERS
Employee Contributions Employer Contributions Nonemployer Contributions Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
PSERS
Employee Contributions Employer Contributions Nonemployer Contributions Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
GJRS
Employee Contributions Employer Contributions Nonemployer Contributions Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
LRS
Employee Contributions Employer Contributions Nonemployer Contributions Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
$
49,973
50,963
49,250
48,324
43,978
42,052
39,480
36,561
38,955
32,423
243,074
258,482
270,141 286,256
281,206
263,064
261,132 274,034
358,992
418,807
--
--
--
--
--
--
--
--
--
10,945
930,287
774,724 1,869,113 (482,679) (1,726,302) 1,176,741 2,269,270
231,782 1,495,849 2,021,748
--
--
90,333
--
--
--
--
--
--
--
$ 1,223,334 1,084,169 2,278,837 (148,099) (1,401,118) 1,481,857 2,569,882 542,377 1,893,796 2,483,923
$
1,352
1,380
1,420
1,451
1,472
1,483
1,451
1,426
1,538
1,659
840
3,638
6,490
2,869
5,096
5,530
7,509
15,884
24,829
--
--
--
--
--
--
--
--
--
--
27,160
53,970
44,561
106,833
(27,052)
(97,156)
66,404
128,096
13,554
88,067
123,799
588
588
588
588
588
--
--
--
--
--
$
56,750
50,167
115,331
(22,144)
(90,000)
73,417
137,056
30,864
114,434
152,618
$
4,779
4,221
4,040
4,698
4,612
5,018
4,721
4,904
4,408
4,731
1,826
1,683
1,778
2,395
1,703
3,369
1,163
2,083
2,279
1,373
--
--
--
--
--
--
--
--
--
1,002
18,422
15,665
39,324
(10,702)
(38,164)
27,378
57,330
6,571
42,104
60,012
175
175
175
175
175
175
--
--
--
--
$
25,202
21,744
45,317
(3,434)
(31,674)
35,940
63,214
13,558
48,791
67,118
$
302
324
320
320
320
318
320
54
54
62
73
71
75
75
--
--
--
--
--
--
--
2,034
1,684
4,072
(1,051)
(3,772)
2,610
5,194
110
110
110
110
110
110
--
$
2,500
2,172
4,564
(548)
(3,271)
3,113
5,589
323
373
282
76
128
45
--
--
--
550
3,573
4,969
--
--
--
949
4,074
5,296
GMPF
Employee Contributions Employer Contributions Nonemployer Contributions Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
SEAD - Active*
Employee Contributions Employer Contributions Insurance Premiums Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
SEAD - OPEB*
Employee Contributions Employer Contributions Insurance Premiums Net Investment Income (Loss) Other
Total Additions to (Deductions from) Fiduciary Net Position
2005
$
--
891
--
103
--
$
994
$
--
--
--
--
--
$
--
$
--
--
--
--
--
$
--
2006
-- 891
-- 131
--
1,022
-- -- -- -- --
--
-- -- -- -- --
--
2007
-- 1,005
-- 503
--
1,508
-- -- -- -- --
--
-- -- -- -- --
--
2008
-- 1,103
-- (191)
--
912
-- -- 864 (6,321) --
(5,457)
-- -- 7,756 (27,032) --
(19,276)
2009
-- 1,323
-- (657)
--
666
-- -- 880 (22,656) --
(21,776)
-- -- 7,551 (96,424) --
(88,873)
2010
-- 1,434
-- 565
--
1,999
-- -- 900 15,910 --
16,810
-- -- 6,755 69,340 --
76,095
2011
-- 1,282
-- 1,465
--
2,747
-- -- 847 33,023 --
33,870
-- -- 6,437 144,270 --
150,707
2012
-- 1,521
-- 221
--
1,742
-- -- 771 3,876 --
4,647
-- -- 5,532 17,193 --
22,725
2013
-- 1,703
-- 1,374
--
3,077
-- -- 699 24,274 --
24,973
-- -- 5,075 108,148 --
113,223
2014
-- 1,892
-- 2,179
--
4,071
-- -- 607 35,073 --
35,680
-- -- 4,502 154,868 --
159,370
Statistical
106
*Plans began in 2008.
Statistical
Deductions by Type (in thousands)
ERS
Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Benefit Payments
Service
Partial Lump-Sum
Option
$
605,688
664,891
721,869
797,052
889,669
878,482
921,136
964,485
1,007,816
1,051,993
6,289 14,360 17,821 24,792 22,011 23,480 30,946 31,963 35,933 24,567
Disability
111,902 120,315 127,091 131,709 135,743 146,031 140,849 143,317 145,152 146,245
Survivor Benefits
54,584 58,294 61,873 66,397 69,735 82,676 75,891 76,973 80,300 83,193
Total Benefit Payments
$
778,463
857,860
928,654
1,019,950
1,117,158
1,130,669
1,168,822
1,216,738
1,269,201
1,305,998
Net Administrative
Expenses
9,587 10,596 14,901 18,805 16,809 14,505 14,431 12,051 12,889
7,440
Refunds
6,510 6,978 6,696 7,815 6,597 6,483 7,515 7,767 7,390 8,757
Total Deductions
from Fiduciary Net Position
$
794,560
875,434
950,251
1,046,570
1,140,564
1,151,657
1,190,768
1,236,556
1,289,480
1,322,195
PSERS
Benefit Payments
Fiscal Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Service
$
35,278
37,505
40,070
41,607
45,159
45,741
46,548
46,911
47,805
48,911
Disability
4,341 4,534 4,814 4,956 5,232 5,402 5,369 5,369 5,328 5,280
Survivor Benefits
1,397 1,465 1,580 1,682 1,806 2,052 2,063 1,903 1,908 1,998
Total Benefit Payments
$
41,016
43,504
46,464
48,245
52,197
53,195
53,980
54,183
55,041
56,189
Net Administrative
Expenses
588 588 588 588 588 1,956 2,046 2,040 2,021 1,450
Refunds
287 316 319 308 261 251 267 349 492 514
Total Deductions
from Fiduciary Net Position
$
41,891
44,408
47,371
49,141
53,046
55,402
56,293
56,572
57,554
58,153
GJRS
Benefit Payments
Fiscal Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Service
$
6,827
7,663
7,908
8,259
9,453
10,633
11,245
12,608
14,273
15,305
Disability
76 103 106 110 112 114 112 113 112 112
Survivor Benefits
1,069 1,136 1,285 1,498 1,546 1,618 1,654 1,695 1,865 2,024
Total Benefit Payments
$
7,972
8,902
9,299
9,867
11,111
12,365
13,011
14,416
16,250
17,441
Net Administrative
Expenses
175 175 175 175 175 270 290 310 313 754
Refunds
93 379
76 14 263 139 260 146 105 22
Total Deductions
from Fiduciary Net Position
$
8,240
9,456
9,550
10,056
11,549
12,774
13,561
14,872
16,668
18,217
107
Statistical
LRS
Benefit Payments
Fiscal Year
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Service
$
1,169
1,210
1,187
1,228
1,265
1,308
1,309
1,364
1,376
1,336
Survivor Benefits
384 381 401 406 425 436 452 446 448 465
Total Benefit Payments
$
1,553
1,591
1,588
1,634
1,690
1,744
1,761
1,810
1,824
1,801
Net Administrative
Expenses
110 110 110 110 110 120 131 110 119 152
Refunds
69 18 33 65 49 47 60 74 88 30
Total Deductions
from Fiduciary Net Position
$
1,732
1,719
1,731
1,809
1,849
1,911
1,952
1,994
2,031
1,983
GMPF
Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Benefit Payments
Service*
$
93
150
225
303
382
489
579
678
772
841
Total Benefit Payments
$
93
150
225
303
382
489
579
678
772
841
Net Administrative
Expenses
43 37 34 31 110
Total Deductions
from Fiduciary Net Position
$
93
150
225
303
382
532
616
712
803
951
*The only type of retirement in GMPF is a service retirement.
SEAD-Active
Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Benefit Payments
Death Benefits**
$
-
-
-
7,261
6,636
4,817
5,197
6,018
3,562
5,055
Total Benefit Payments
$
-
-
-
7,261
6,636
4,817
5,197
6,018
3,562
5,055
Net Administrative
Expenses
22 22 22 22 22 22 46
Total Deductions
from Fiduciary Net Position
$
-
-
-
7,283
6,658
4,839
5,219
6,040
3,584
5,101
**The only type of benefit in SEAD-Active is a death benefit. Plan began in 2008.
108
SEAD-OPEB
Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Benefit Payments
Death Benefits**
$
-
-
-
21,455
19,839
23,642
23,060
24,855
28,482
28,891
Total Benefit Payments
Net Administrative
Expenses
-
-
-
-
-
-
21,455
203
19,839
203
23,642
203
23,060
203
24,855
203
28,482
203
28,891
414
Total Deductions
from Fiduciary Net Position
$
-
-
-
21,658
20,042
23,845
23,263
25,058
28,685
29,305
**The only type of benefit in SEAD-OPEB is a death benefit. Plan began in 2008.
Statistical
109
Changes in Fiduciary Net Position (in thousands)
ERS
Total Additions
$
Total Deductions
Transfer In (Out)
Changes in Fiduciary Net Position
PSERS
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
GJRS
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
LRS
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
GMPF
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
SEAD - Active*
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
SEAD - OPEB*
Total Additions Total Deductions Transfer In (Out) Changes in Fiduciary Net Position
2005
1,223,334 794,560 -- 428,774
56,750 41,891
-- 14,859
25,202 8,240 --
16,962
2,500 1,732
-- 768
994 93 --
901
-- -- -- --
-- -- -- --
2006
1,084,169 875,434 -- 208,735
50,167 44,408
-- 5,759
21,744 9,456 --
12,288
2,172 1,719
-- 453
1,022 150 -- 872
-- -- -- --
-- -- -- --
2007
2008
2009
2,278,837 950,251 --
1,328,586
(148,099) 1,046,570
-- (1,194,669)
(1,401,118) 1,140,564
-- (2,541,682)
115,331 47,371
-- 67,960
(22,144) 49,141
-- (71,285)
(90,000) 53,046
-- (143,046)
45,317 9,550 --
35,767
(3,434) 10,056
-- (13,490)
(31,674) 11,549
-- (43,223)
4,564 1,731
-- 2,833
(548) 1,809
-- (2,357)
(3,271) 1,849
-- (5,120)
1,508
912
666
225
303
382
--
--
--
1,283
609
284
--
(5,457)
(21,776)
--
7,283
6,658
--
--
--
--
(12,740)
(28,434)
--
(19,276)
(88,873)
--
21,658
20,042
--
--
--
--
(40,934) (108,915)
2010
1,481,857 1,151,657
-- 330,200
73,417 55,402
-- 18,015
35,940 12,774
-- 23,166
3,113 1,911
-- 1,202
1,999 532 --
1,467
16,810 4,839 -- 11,971
76,095 23,845
-- 52,250
2011
2012
2013
2,569,882 1,190,768
-- 1,379,114
542,377 1,236,556
(12,724) (706,903)
1,893,796 1,289,480
(5,009) 599,307
137,056 56,293 -- 80,763
30,864 56,572
-- (25,708)
114,434 57,554
-- 56,880
63,214 13,561
-- 49,653
13,558 14,872
-- (1,314)
48,791 16,668
-- 32,123
5,589 1,952
-- 3,637
949 1,994
-- (1,045)
4,074 2,031
-- 2,043
2,747 616 --
2,131
1,742 712 --
1,030
3,077 803 --
2,274
33,870 5,219 --
28,651
4,647 6,040
-- (1,393)
24,973 3,584 --
21,389
150,707 23,263 --
127,444
22,725 25,058 12,724 10,391
113,223 28,685
5,009 89,547
2014
2,483,923 1,322,195
-- 1,161,728
152,618 58,153 -- 94,465
67,118 18,217
-- 48,901
5,296 1,983
-- 3,313
4,071 951 --
3,120
35,680 5,101 --
30,579
159,370 29,305 5
130,070
110
Statistical
* Plans began in 2008.
Number of Retirees
Statistical
111
Average Monthly Payments to Retirees
Statistical
112
Annual Benefit (in thousands)
Statistical
113
Withdrawal Statistics
Statistical
Note: The GMPF Plan does not have a refund feature.
114
Statistical
Average Monthly Benefit Payment for New Retirees - ERS
2005
Average Monthly Benefit Average Final Average Salary Number of Retirees
2006
Average Monthly Benefit Average Final Average Salary Number of Retirees
2007
Average Monthly Benefit Average Final Average Salary Number of Retirees
2008
Average Monthly Benefit Average Final Average Salary Number of Retirees
2009
Average Monthly Benefit Average Final Average Salary Number of Retirees
2010
Average Monthly Benefit Average Final Average Salary Number of Retirees
2011
Average Monthly Benefit Average Final Average Salary Number of Retirees
2012
Average Monthly Benefit Average Final Average Salary Number of Retirees
2013
Average Monthly Benefit Average Final Average Salary Number of Retirees
2014
Average Monthly Benefit Average Final Average Salary Number of Retirees
10-15
Years of Credited Service
16-20
21-25
26-30
Over 30
Total
$704.19 $2,979.35
309
$991.76 $2,858.79
312
$1,440.14 $3,219.54
254
$1,816.69 $3,553.20
299
$3,440.48 $4,321.38
1,091
$2,291.20 $3,711.85
2,265
$632.54 $2,867.00
281
$1,022.68 $2,971.73
299
$1,347.20 $3,087.80
219
$1,789.67 $3,587.30
298
$3,458.78 $4,345.99
1,011
$2,281.17 $3,715.95
2,108
$655.86 $2,935.70
307
$961.27 $3,071.63
303
$1,317.36 $3,265.26
247
$1,789.83 $3,745.37
292
$3,423.26 $4,373.83
1,022
$2,229.02 $3,778.07
2,171
$701.03 $3,025.39
309
$1,068.51 $3,181.44
306
$1,457.03 $3,408.23
280
$1,899.48 $3,767.28
290
$3,576.69 $4,489.73
1,032
$2,342.60 $3,873.97
2,217
$717.65 $3,109.07
344
$1,059.22 $3,179.28
320
$1,458.18 $3,483.90
301
$1,910.75 $3,875.27
324
$3,627.21 $4,548.96
949
$2,272.58 $3,891.02
2,238
$694.23 $3,023.45
391
$1,086.00 $3,345.36
324
$1,502.32 $3,555.21
332
$1,849.65 $3,802.65
375
$3,653.29 $4,588.73
981
$2,247.01 $3,900.93
2,403
$734.74 $3,228.07
437
$1,107.16 $3,205.88
322
$1,504.51 $3,478.73
389
$1,995.24 $3,762.88
461
$3,575.54 $4,532.07
885
$2,143.95 $3,825.88
2,494
$729.60 $3,040.00
518
$1,247.16 $3,275.37
385
$1,624.82 $3,388.85
414
$2,125.35 $3,807.26
486
$3,708.26 $4,702.47
776
$2,109.84 $3,775.94
2,578
$836.73 $3,391.36
684
$1,183.19 $3,339.84
453
$1,650.14 $3,411.24
466
$2,120.33 $3,765.16
780
$3,487.96 $4,659.17
1,033
$2,088.46 $3,855.98
3,416
$770.41 $3,319.05
475
$1,229.79 $3,336.74
305
$1,518.77 $3,258.94
309
$2,060.46 $3,717.87
476
$3,239.79 $4,484.41
542
$1,873.22 $3,702.67
2,107
115
Statistical
Average Monthly Benefit Payment for New Retirees - PSERS
2005 Average Monthly Benefit Number of Retirees
2006 Average Monthly Benefit Number of Retirees
2007 Average Monthly Benefit Number of Retirees
2008 Average Monthly Benefit Number of Retirees
2009 Average Monthly Benefit Number of Retirees
2010 Average Monthly Benefit Number of Retirees
2011 Average Monthly Benefit Number of Retirees
2012 Average Monthly Benefit Number of Retirees
2013 Average Monthly Benefit Number of Retirees
2014 Average Monthly Benefit Number of Retirees
10-15
Years of Credited Service
16-20
21-25
26-30
Over 30
Total
$140.98 322
$203.00 197
$269.23 131
$325.73 113
$422.95 93
$229.90 856
$137.90 347
$206.87 206
$265.04 127
$324.20 84
$413.20 115
$226.26 879
$143.42 323
$208.47 174
$265.12 106
$331.55 89
$426.70 93
$229.16 785
$149.91 362
$219.81 199
$279.58 116
$349.05 99
$439.31 98
$238.04 874
$156.52 391
$224.92 200
$289.93 157
$357.58 91
$460.04 90
$242.89 929
$157.66 448
$224.92 200
$300.93 162
$359.24 76
$464.07 105
$243.41 1001
$158.67 463
$227.68 200
$297.01 126
$374.01 79
$479.42 114
$245.04 982
$159.25 480
$236.46 182
$303.66 136
$362.36 74
$476.51 87
$238.59 958
$159.34 580
$232.10 255
$300.66 175
$360.75 113
$478.49 133
$245.72 1,256
$155.47 566
$227.56 246
$293.83 139
$352.25 107
$436.25 118
$232.98 1,176
Note: PSERS is not a final average pay plan.
116
Statistical
Average Monthly Benefit Payment for New Retirees - GJRS
2005
Average Monthly Benefit Average Final Average Salary Number of Retirees
2006
Average Monthly Benefit Average Final Average Salary Number of Retirees
2007
Average Monthly Benefit Average Final Average Salary Number of Retirees
2008
Average Monthly Benefit Average Final Average Salary Number of Retirees
2009
Average Monthly Benefit Average Final Average Salary Number of Retirees
2010
Average Monthly Benefit Average Final Average Salary Number of Retirees
2011
Average Monthly Benefit Average Final Average Salary Number of Retirees
2012
Average Monthly Benefit Average Final Average Salary Number of Retirees
2013
Average Monthly Benefit Average Final Average Salary Number of Retirees
2014
Average Monthly Benefit Average Final Average Salary Number of Retirees
10-15
16-20
Years of Credited Service
21-25
26-30
Over 30
Total
$4,918.69 $9,420.45
2
$5,972.47 $8,785.09
8
$6,854.45 $9,481.56
10
$5,422.44 $7,262.55
3
0
$5,792.01
0
$8,737.41
0
23
$1,648.42
0
$7,018.67
0
0
$4,333.55
$3,680.42
0
$8,421.30
0
0
$6,050.86
1
0
1
0
0
2
$4,635.56 $7,888.25
4
$1,821.81 $8,213.52
3
$5,338.65 $7,150.62
3
$7,603.57 $10,184.26
1
0
$4,849.90
0
$8,359.16
0
11
$2,485.43 $6,662.15
4
0
$7,368.55
$4,735.08
0
$9,934.33
$6,342.20
0
2
2
0
$4,863.02
0
$7,646.23
0
8
$4,874.28 $9,519.58
8
$5,883.17 $8,825.88
5
$7,366.55 $10,071.58
7
$6,630.61 $8,881.08
5
$7,639.64 $10,232.57
2
$6,478.85 $9,506.14
27
$6,337.43 $10,490.01
1
$4,563.90 $7,018.08
5
$7,643.86 $10,490.01
2
$6,422.80 $8,602.74
4
0
$6,242.00
0
$9,150.21
0
12
$4,632.24 $9,211.23
4
$10,170.24 $14,910.13
2
$9,799.81 $13,052.66
2
$8,428.40 $11,264.63
3
0
$7,614.02
0 $11,505.85
0
11
$4,204.95 $7,788.39
5
$6,610.26 $9,887.17
4
$7,565.84 $10,361.29
4
$8,791.96 $11,714.95
7
$7,831.84 $10,490.01
1
$6,915.64 $10,035.77
20
$5,179.20 $9,271.48
8
$5,844.29 $8,344.35
7
$6,170.52 $8,370.72
7
$7,954.14 $10,624.52
5
$6,169.77 $8,864.27
7
$6,132.24 $9,010.27
34
$2,989.92 $6,265.39
6
$4,468.12 $7,772.95
2
$6,496.50 $8,998.48
7
0
$2,703.82
$4,470.15
0
$4,289.57
$7,166.46
0
3
18
117
Statistical
Average Monthly Benefit Payment for New Retirees - LRS
2005 Average Monthly Benefit Number of Retirees
2006 Average Monthly Benefit Number of Retirees
2007 Average Monthly Benefit Number of Retirees
2008 Average Monthly Benefit Number of Retirees
2009 Average Monthly Benefit Number of Retirees
2010 Average Monthly Benefit Number of Retirees
2011 Average Monthly Benefit Number of Retirees
2012 Average Monthly Benefit Number of Retirees
2013 Average Monthly Benefit Number of Retirees
2014 Average Monthly Benefit Number of Retirees
Note: LRS is not a final average pay plan.
8 - 14
Years of Credited Service
15 - 19
20 - 24
25 - 29 30 & over
Total
$358.41 $456.84
0
0 $981.11 $598.79
9
2
0
0
8
19
$355.63 $517.30
0
0
0 $436.47
3
3
0
0
0
6
$256.96 5
$476.39 5
$762.02 2
$939.00 $1,195.52
1
1
$725.98 14
$324.74 $604.63 $698.86
0
0 $542.74
4
4
2
0
0
10
$425.39 2
$650.99 1
0 $921.00 $1,203.00 $800.10
0
2
3
8
$372.93 $558.00
0
0
0 $465.47
8
1
0
0
0
9
$341.79 12
$589.12 1
0 $843.26 $934.73 $456.99
0
2
1
16
$363.66 $549.08
0
0 $1,286.43 $548.46
4
2
0
0
1
7
$308.15 14
$568.93 4
$670.94 2
0 $1,166.93
0
3
$497.03 23
$289.25 $480.21
0
0
0 $336.99
3
1
0
0
0
4
118
Statistical
Average Monthly Benefit Payment for New Retirees - GMPF
2005 Average Monthly Benefit Number of Retirees
2006 Average Monthly Benefit Number of Retirees
2007 Average Monthly Benefit Number of Retirees
2008 Average Monthly Benefit Number of Retirees
2009 Average Monthly Benefit Number of Retirees
2010 Average Monthly Benefit Number of Retirees
2011 Average Monthly Benefit Number of Retirees
2012 Average Monthly Benefit Number of Retirees
2013 Average Monthly Benefit Number of Retirees
2014 Average Monthly Benefit Number of Retirees
Note: GMPF is not a final average pay plan.
Years of Credited Service
20-25
26 - 30 Over 30
Total
$54.00 5
$83.57 7
$100.00 28
$91.37 40
$61.25 4
$85.00 13
$100.00 44
$94.26 61
$60.83 6
$83.46 13
$100.00 54
$93.84 73
$55.63 8
$83.61 18
$100.00 47
$91.10 73
$59.50 20
$87.63 19
$100.00 53
$88.64 92
$63.82 17
$85.83 18
$100.00 56
$90.44 91
$63.16 19
$91.47 17
$100.00 52
$90.40 88
$61.54 13
$90.33 15
$100.00 63
$92.83 90
$59.44 18
$89.55 22
$100.00 42
$88.29 82
$61.11 9
$90.53 19
$100.00 31
$91.02 59
119
Statistical
Retired Members by Retirement Type
ERS June 30, 2014
Amount of Monthly Benefit
$ 1 - 500 501 - 1,000 1,001 - 1,500 1,501 - 2,000 2,001 - 2,500 2,501 - 3,000 3,001 - 3,500 3,501 - 4,000 4,001 - 4,500 4,501 - 5,000 over 5,000
Totals
Retirement Type
Service Disability Survivor
3,354
257
320
7,064
969
326
5,568
1,107
230
4,337
899
148
3,396
742
109
2,887
601
74
2,442
429
49
2,147
328
43
1,736
229
22
1,568
188
12
3,932
280
26
38,431
6,029
1,359
PSERS June 30, 2014
Amount of Monthly Benefit
$ 1 - 100 101 - 200 201 - 300 301 - 400 401 - 500 over 500
Totals
Retirement Type Service Disability Survivor
83
3
203
5,034
34
137
4,363
265
45
2,543
417
6
1,616
309
1
1,187
188
-
14,826
1,216
392
120
Statistical
Retired Members by Retirement Type
GJRS June 30, 2014
Amount of Monthly Benefit
$ 1 - 1,000 1,001 - 2,000 2,001 - 3,000 3,001 - 4,000 4,001 - 5,000 5,001 - 6,000 6,001 - 7,000 7,001 - 8,000 over 8,000
Totals
Retirement Type Service Disability Survivor
15
-
-
21
-
6
20
-
1
31
-
1
23
2
1
20
-
-
25
-
-
83
-
-
29
-
-
267
2
9
LRS June 30, 2014
GMPF June 30, 2014
Amount of Monthly Benefit
$ 1 - 250 251 - 500 501 - 750 751 - 1,000 over 1,000
Totals
Retirement Type
Service Disability Survivor
21
-
-
105
-
3
68
-
-
36
-
1
25
-
-
255
0
4
Amount of Monthly Benefit
$
1 - 49
50 - 100
over 100
Retirement Type Service 795 -
Totals
795
121
Statistical
Retired Members by Optional Form of Benefit
ERS June 30, 2014
Amount of Monthly Benefit
$ 1 - 500 501 - 1,000 1,001 - 1,500 1,501 - 2,000 2,001 - 2,500 2,501 - 3,000 3,001 - 3,500 3,501 - 4,000 4,001 - 4,500 4,501 - 5,000 over 5,000
Maximum Plan
1,293 3,889 3,093 2,341 1,788 1,470 1,060 832 604 495 901
Option 1
358 1,075 967 884 653 522 385 267 197 120 277
Form of Benefit Option 2 Option 3
1,210
415
1,705
597
1,175
601
753
521
530
433
405
324
278
324
242
235
163
194
134
186
277
460
Option 4
488 641 567 443 447 557 627 709 679 709 2,089
Option 5A Option 5B
113
54
277
175
298
204
207
235
189
207
108
176
106
140
93
140
38
112
43
81
76
158
Totals
17,766
5,705
6,872
4,290
7,956
1,548
1,682
Maximum Plan Single life annuity
Option 1
Reduced single life annuity with a guarantee of the remainder of the annuity savings fund account (contributions and interest), if any, to be paid upon the retiree's death
Option 2
100% joint and survivor annuity with a popup option upon divorce
Option 3
50% joint and survivor annuity with a popup option upon divorce
Option 4
Various options, including a specified monthly amount payable to a beneficiary upon the retiree's death, several period certain annuities of varying length, and a five-year accelerated benefit
Option 5A
100% joint and survivor annuity with a popup option upon divorce or the death of the beneficiary before the retiree
Option 5B
50% joint and survivor annuity with a popup option upon divorce or the death of the beneficiary before the retiree
122
Retired Members by Optional Form of Benefit
PSERS June 30, 2014
Statistical
Amount of Monthly Benefit
$ 1 - 100 101 - 200 201 - 300 301 - 400 401 - 500 over 500
Form of Benefit Maximum Plan Option AA Option AB Option AC Option AD
0
45
217
9
6
3,853
789
282
9
44
3,951
415
148
5
23
2,636
205
49
9
8
1,775
91
32
3
0
1,299
40
14
6
0
Option B
12 228 131 59 25 16
Totals
13,514
1,585
742
41
81
471
Maximum Plan Single life annuity
Option AA
100% joint and survivor annuity
Option AB
50% joint and survivor annuity
Option AC
Joint and survivor annuity with a specified monthly amount payable to a beneficiary
Option AD
Joint and survivor annuity with the amount payable to a beneficiary limited by the age difference between the retiree and the beneficiary
Option B
Annuity for a guaranteed period of time (5, 10,15, or 20 years). If retiree outlives guarantee period, there is no benefit due after retiree's death
123
Statistical
Retired Members by Optional Form of Benefit
GJRS June 30, 2014
Amount of Monthly Benefit
$ 1 - 1,000 1,001 - 2,000 2,001 - 3,000 3,001 - 4,000 4,001 - 5,000 5,001 - 6,000 6,001 - 7,000 7,001 - 8,000 over 8,000
Totals
Form of Benefit Maximum Plan Spousal Coverage
0
15
2
25
0
21
2
30
6
19
6
14
4
21
15
69
5
24
40
238
Maximum Plan Single life annuity Spousal Coverage Indicates the member elected at enrollment that a survivor annuity be paid to a surviving spouse
LRS June 30, 2014
Amount of Monthly Benefit
$ 1 - 250 251 - 500 501 - 750 751 - 1,000 over 1,000
Totals
Form of Benefit
Maximum Plan Option B1 Option B2
0
17
4
40
59
9
36
20
12
9
23
5
8
13
4
93
132
34
Maximum Plan Single life annuity
Option B1
100% joint and survivor annuity
Option B2
50% joint and survivor annuity
GMPF and SEAD-Active and SEAD-OPEB June 30, 2014
The GMPF Plan provides a benefit only in one form, a life annuity. All 795 current retirees, therefore, have this same form of benefit. The SEAD-Active and SEAD-OPEB plans provide only a lump sum death benefit to a member's beneficiary(ies).
124
Statistical
Top Participatory Employers FY10
ERS
Department of Corrections Department of Behavioral Health and Developmental Disability Department of Transportation Department of Labor Department of Juvenile Justice Department of Natural Resources Department of Human Resources Department of Driver Services Department of Community Health Department of Revenue
Total Top Employers Total ERS Member Count
PSERS
Gwinnett County Schools Cobb County Schools Dekalb County Schools Clayton County Schools Muscogee County Schools Henry County Schools Cherokee County Schools Forsyth County Schools Richmond County Schools Paulding County Schools
Total Top Employers Total PSERS Member Count
GJRS
Council of Superior Court Judges Council of State Court Judges Prosecuting Attorney's Council Council of Juvenile Judges
Total Top Employers Total GJRS Member Count
Member Count % of total plan
12,527 6,869 4,846 3,867 3,679 2,079 1,942 1,674 1,351 1,154
39,988 68,567
18.2% 10.0%
7.1% 5.7% 5.4% 3.0% 2.8% 2.4% 2.0% 1.7%
58.3%
3,931 2,471 2,234 1,382
970 909 902 894 877 715
15,285 39,962
9.8% 6.2% 5.6% 3.4% 2.4% 2.3% 2.3% 2.2% 2.2% 1.8%
38.2%
203
41.0%
108
21.8%
96
19.4%
71
14.4%
478
96.6%
495
Data from 9 years prior is unavailable. FY10 data is the first available.
125
Statistical
Top Participatory Employers FY14
ERS
Department of Corrections Department of Behavioral Health and Developmental Disability Department of Transportation Department of Juvenile Justice Department of Human Services Department of Public Safety Department of Natural Resources Department of Labor Department of Revenue Department of Public Health
Total Top Employers Total ERS Member Count
PSERS
Gwinnett County Schools Cobb County Schools Dekalb County Schools Clayton County Schools Muscogee County Schools Forsyth County Schools Richmond County Schools Houston County Schools Paulding County Schools Cherokee County Schools
Total Top Employers Total PSERS Member Count
GJRS
Council of Superior Courts Council of State Court Judges Prosecuting Attorney's Council Council of Juvenile Courts
Total Top Employers Total GJRS Member Count
SEAD-Active and SEAD-OPEB
Department of Corrections Department of Transportation Department of Behavioral Health and Developmental Disability Department of Labor Department of Juvenile Justice Department of Natural Resources Department of Human Services Department of Public Safety Department of Revenue Department of Public Health
Total Top Employers Total Active Member Count
Member Count % of total plan
11,735 4,549 4,088 3,586 3,213 1,773 1,652 1,463
969 933
33,961 60,490
3,683 2,435 2,139 1,175
827 820 798 758 671 670
13,976 36,109
209 121
96 72
498 514
6,787 3,451 2,309 2,049 1,823 1,312 1,254 1,190
580 533
21,288 38,711
19.40% 7.52% 6.76% 5.93% 5.31% 2.93% 2.73% 2.42% 1.60% 1.54%
56.14%
10.20% 6.74% 5.92% 3.25% 2.29% 2.27% 2.21% 2.10% 1.86% 1.86%
38.71%
40.66% 23.54% 18.68% 14.01%
96.89%
17.53% 8.91% 5.96% 5.29% 4.71% 3.39% 3.24% 3.07% 1.50% 1.38%
54.99%
126
Statistical Data at June 30, 2014
System ERS
PSERS GJRS LRS GDCP SCJRF
Net Position $ 13.3 billion
Employer Contributions
Old Plan: 13.71% New Plan: 18.46%
GSEPS 15.18% ($430 mil)
Employee Contributions
Old Plan: 6% (with 4.75% pickup)
New Plan: 1.25% GSEPS: 1.25% ($32.4 mil)
Active Members
Old Plan: (1%) 382 New Plan: (69%) 38,244
GSEPS: (30%) 21,864 Total: 60,490
Retirees
Total: 45,819 Service: 34,451 Beneficiary: 5,389 Disability: 5,279 Inv. Sep.: 558 Law. Enf.: 142
$ 822 million
$27.2 million
$90 yr after 7/1/12 $36 yr before 7/1/12
($1.7 million)
36,109
16,434
$401 million
4.23% ($2.4 million)
7.5% +2.5% Spousal ($4.7 million)
514
278
$ 33 million
0% ($45 thousand)
8.5% (with 4.75% pickup)
($282 thousand)
222
259
$ 108.5 millon
None
7.5% ($16.3 million)
15,152
1
$ 3 thousand
$1.5 million
None
None
20
Annual Payment
$1.3 billion
Average Monthly Benefit
$2,375
$56.2 million
$285
$17.4 million $1.8 million $9 thousand $1.5 million
$5,228
$580 Paid Annually $6,267
127
DARF SEAD GMPF
$ 2 thousand
$80 thousand
None
$1.3 billion
None
New Plan: 0.25% Old Plan: 0.50%
$ 15.2 million
$1.9 million
None
None
No. Insured: 38,711
13,573*
7
$80 thousand
$952
No. Insured: 40,789
No. of Claims: 1025 Average Claim:
Amt.Pd: $33.9 mil
$33,118
795
$841 thousand
$88
Statistical
*Active members at June 30, 2014 is unavailable. This represents active members at June 30, 2013 from the latest actuarial valuation.