
<p>Retirement insights from a Colorado PERA perspective</p>



<p></p>


A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.


<p>The PERA Board of Trustees held its annual Planning Session September 18 to 20 in Colorado Springs.</p>



<p>Over the course of three days, Trustees participated in informational meetings, workshops, and took action on a number of important items, some of which are summarized below.</p>



<h4 class="wp-block-heading"><strong>Strategic planning</strong></h4>



<p>An important part of the Board’s duties is laying out PERA’s strategic direction and priorities, and the Trustees have spent several meetings working on the organization’s next strategic plan.</p>



<p>During the most recent meeting, the Board reviewed the results of surveys sent to various stakeholders, including members, retirees, and employers. Through those surveys, the Trustees were able to identify some of PERA’s top strengths, weaknesses, opportunities, and threats, which will help lay out the organization’s goals for the next several years.</p>



<p>The Board expects to have a plan draft ready for Trustee review in January.</p>



<h4 class="wp-block-heading"><strong>CEM Benchmarking report</strong></h4>



<p>Each year, the PERA Board receives a report from CEM Benchmarking that rates PERA on the various services it provides to members and the cost of providing those services, as well as comparing PERA to other similar public pensions.</p>



<p>This year’s CEM report gave PERA a service score of 85 compared to the peer average of 81. PERA earned particularly high scores on factors such as the average time a member spends waiting on the phone to talk to a customer service representative, the features and functionality of the secure online member portal, and participation in member education webinars.</p>



<p>CEM found PERA’s administrative costs amount to $58 per member, below the peer average of $67. Overall, the CEM report found PERA provides a higher level of service at a lower cost than the average public pension plan.</p>



<h4 class="wp-block-heading"><strong>Pension Review Subcommittee’s review of assumptions</strong></h4>



<p>Every three years, the State Legislature’s Pension Review Subcommittee is tasked with commissioning a report from an independent firm that is meant to evaluate the various assumptions PERA uses to forecast its financial health, as well as determining whether PERA is on track to meet its goal of full funding and a handful of other assessments.</p>



<p>The Subcommittee began that process in January and chose Switzerland-based PNYX Group to conduct the analysis. PNYX then presented its findings and recommendations in July.</p>



<p>Using its own models and projections, PNYX opined that some of PERA’s key assumptions should be adjusted based on their own assumptions and methodologies, and stated the fund could be facing a significant shortfall in future years as a result. Therefore, PNYX recommended a handful of policy options, primarily related to increasing contributions—including $2 billion from the State—in order to improve the fund’s position. Members of the Pension Review Subcommittee and Pension Review Commission expressed doubts about the feasibility of such changes.</p>



<p>In discussing with the Board, PERA staff and the board’s consultants presented on some of the methods and findings of the report, and highlighted their own confidence in the assumptions, methodologies, and models that form the basis of their own recommendations to the PERA Board. Additionally, the review missed key elements that would have made the report more comprehensive and on point, they said. For example, the Board just concluded a study of PERA’s strategic asset allocation and is beginning a study comparing actual experience over the past four years to actuaries’ projections, both of which could help address some of the findings of the PNYX report.</p>



<p>PERA staff, along with the PERA Board’s actuarial and investment consultants, presented a <a href="https://leg.colorado.gov/content/ipensionrevewsubcomm2024ascheduleandmeetingmaterials" target="_blank" rel="noreferrer noopener">formal response</a> to the PNYX report on September 23 and may also address the report and its findings with the Pension Review Commission on September 27.</p>



<h4 class="wp-block-heading"><strong>Asset/liability study</strong></h4>



<p>The Board concluded its yearlong asset/liability study and adopted new long-term asset allocation targets for the PERA Defined Benefit Plan portfolio. The changes aim to add diversification to the portfolio over time and enhance the potential for future returns.</p>



<p><strong>READ MORE:</strong> <a href="http://copera.org/pera-on-the-issues/pera-board-adopts-new-strategic-asset-allocation-following-study">PERA Board Adopts New Strategic Asset Allocation Following Study</a></p>



<h4 class="wp-block-heading"><strong>2025 Board meeting dates</strong></h4>



<p>Finally, Trustees wrapped up the September Planning Session by approving the calendar for 2025 Board meetings, choosing the following five dates:</p>



<ul>
<li>January 17</li>



<li>March 14</li>



<li>June 27</li>



<li>September 17-19 (Planning Session)</li>



<li>November 21</li>
</ul>



<p></p>



<p>PERA Board meetings are streamed live on <a href="https://www.copera.org/about/board-of-trustees" class="broken_link">copera.org</a> and include time for public comment. In response to a recommendation from the Pension Review Commission, meeting recordings will be available online following the Board’s November 15, 2024 meeting.</p>


PERA Board Discusses Strategic Plan, Investment Strategy and More at 2024 Planning Session


<p>The PERA Board of Trustees has adopted new asset allocation targets following a year-long study into PERA’s investment portfolio and strategy.</p>



<p>The new allocation includes tweaks to several asset classes in an effort to reduce volatility in the portfolio while providing the potential for higher returns in the future.</p>



<h4 class="wp-block-heading"><strong>Background</strong></h4>



<p>Every four or five years, the PERA Board conducts what is known as an asset/liability study to examine the PERA Defined Benefit Plan portfolio and ensure the mix of stocks, bonds, and other investments aligns with PERA’s funding goals. That process last took place in 2019, after which the Board adopted the current <a href="https://copera.org/asset-allocation">strategic asset allocation</a>.</p>



<p>The most recent asset/liability study began in September 2023, and over the past year, PERA’s investment staff have been working with the Board’s Defined Benefit investment consultant, Aon, to carry out the analysis. After examining various factors, such as the fund’s risk tolerance, market conditions, and projections for future returns, Aon presented its recommendations at the Board’s September meeting.</p>



<h4 class="wp-block-heading"><strong>What’s changing</strong></h4>



<p>The new strategic asset allocation is expected to provide incrementally greater diversification in the portfolio by reducing the percentage allotted to Global Equity (i.e., stocks) and investing more in private asset classes such as Private Equity and Real Estate with the goal to slightly lower risk and add potential for higher returns over time for the entire investment portfolio.</p>



<p>The table below shows PERA’s current long-term target allocation and the new targets the Board adopted.</p>



<figure class="wp-block-table"><table><thead><tr><th>Asset Class</th><th>Current Target</th><th>New Target</th></tr></thead><tbody><tr><td>Global Equity</td><td>54.0%</td><td><strong>51.0%</strong></td></tr><tr><td>Fixed Income</td><td>23.0%</td><td><strong>23.0%</strong></td></tr><tr><td>Private Equity</td><td>8.5%</td><td><strong>10.0%</strong></td></tr><tr><td>Real Estate</td><td>8.5%</td><td><strong>10.0%</strong></td></tr><tr><td>Alternatives</td><td>6.0%</td><td><strong>6.0%</strong></td></tr></tbody></table></figure>



<p>Within the Alternatives asset class, the new policy increases allocations to real assets and private debt while reducing allocations to hedge funds and opportunistic investments.</p>



<p>By making these changes, the Board is aiming to strengthen PERA’s investment portfolio and ensure PERA remains on track to meet its goal of full funding.</p>



<p>“Asset allocation is the single largest driver of investment returns, and I appreciate the attention and care the Board has given to analyzing and updating our strategic asset allocation,” said Chief Investment Officer/Chief Operating Officer Amy C. McGarrity. “These new long-term targets are expected to help reduce risk in the portfolio and ensure we can continue to provide the lifetime retirement income that so many of Colorado’s public employees rely on.”</p>



<p>The Board also reaffirmed its long-term expected rate of return of 7.25%.</p>



<p><strong>Asset Classes Explained:&nbsp;<a href="https://www.copera.org/pera-on-the-issues/asset-classes-explained-global-equity" target="_blank" rel="noreferrer noopener">Global Equity</a>&nbsp;|&nbsp;<a href="https://www.copera.org/pera-on-the-issues/asset-classes-explained-fixed-income" target="_blank" rel="noreferrer noopener">Fixed Income</a>&nbsp;|&nbsp;<a href="https://www.copera.org/pera-on-the-issues/asset-classes-explained-private-equity" target="_blank" rel="noreferrer noopener">Private Equity</a>&nbsp;|&nbsp;<a href="https://www.copera.org/pera-on-the-issues/asset-classes-explained-real-estate" target="_blank" rel="noreferrer noopener">Real Estate</a>&nbsp;|&nbsp;<a href="https://www.copera.org/pera-on-the-issues/asset-classes-explained-alternatives" target="_blank" rel="noreferrer noopener">Alternatives</a></strong></p>



<h4 class="wp-block-heading"><strong>What’s next</strong></h4>



<p>With the Board’s adoption of a new strategic asset allocation, it’s up to PERA’s investment staff to begin the work of implementing the updated strategy. Aon expects the portfolio to reach its new long-term targets within two to three years.</p>


PERA Board Adopts New Strategic Asset Allocation Following Study


<p>The Colorado PERA Board of Trustees met virtually on Friday, March 15 for its second regularly scheduled meeting of the year.</p>



<p>Below is a summary of key actions and discussions that took place during the meeting.</p>



<h4 class="wp-block-heading"><strong>New Executive Director</strong></h4>



<p>At the beginning of the meeting, the Board announced it has selected PERA’s next Executive Director following an eight-month nationwide search.</p>



<p>Andrew Roth will fill that role beginning May 13. He comes to PERA from the Teacher Retirement System of Texas, and previously worked at the California State Teachers’ Retirement System and in various departments within the State of California.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/pera-board-names-andrew-roth-as-new-executive-director/" target="_blank" rel="noreferrer noopener">PERA Board Names Andrew Roth as New Executive D</a><a href="https://content.copera.org/pera-board-names-andrew-roth-as-new-executive-director/" target="_blank" rel="noreferrer noopener">irector</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>Board election update</strong></h4>



<p>The Board announced in January that four Trustee seats would be up for election in May. At the March meeting, Trustees voted to move forward with elections for three of those seats—one in the School Division and two in the State Division.</p>



<p>The Denver Public School Division seat, currently held by Amy Grant, is uncontested. The Board voted to reappoint Grant to another four-year term beginning in July.</p>



<p>Members in the School and State divisions will receive ballots in May, and the Board will announce election results at its June meeting.</p>



<h4 class="wp-block-heading"><strong>Legislative update</strong></h4>



<p>State lawmakers are halfway through the 2024 legislative session, and Public and Government Affairs Manager Michael Steppat joined Interim Executive Director/Chief Investment Officer Amy C. McGarrity to provide an update on PERA-related legislation.</p>



<p>So far this session, legislators have introduced more than 500 bills, <a href="https://content.copera.org/2024-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">seven of which pertain to PERA</a>.</p>



<p>Of those seven proposed bills, one—<a href="https://leg.colorado.gov/bills/hb24-1169" target="_blank" rel="noreferrer noopener">HB24-1169</a>, which would have repealed a 2016 law that requires PERA to divest all direct holdings from companies that have economic prohibitions against Israel—has died in committee. The other six remain under consideration at the State Capitol.</p>



<p>Steppat said it’s likely there will be some additional PERA-related legislation before the session is over. <em>PERA On The Issues</em> will continue to <a href="https://content.copera.org/2024-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">track all PERA bills</a> and post updates when they’re available.</p>



<blockquote class="wp-block-quote">
<p><strong>RELATED: </strong><a href="https://content.copera.org/an-update-on-2023-wep-gpo-legislation/" target="_blank" rel="noreferrer noopener">An Update on 2023 WEP/GPO Legislation</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>Asset/liability study continues</strong></h4>



<p>The Board also received an update on its <a href="https://content.copera.org/asset-liability-study-a-guide-to-building-a-strategic-portfolio/" target="_blank" rel="noreferrer noopener">ongoing asset/liability study</a>. That study, which is an in-depth analysis of PERA’s investment portfolio and strategy, will help the Trustees determine if any changes are needed to PERA’s asset allocation, or mix of investments.</p>



<p>The Board’s consultants, Aon, modeled several different&nbsp;asset allocation—some with more risk than the current portfolio and some with less—across thousands of different economic scenarios to project how each option might affect PERA’s investment returns and progress toward its funding goals.</p>



<p>Overall, PERA’s current portfolio is within a reasonable range, Aon said, but there may be some opportunities to further diversify in a way that increases the potential for higher returns without adding unnecessary risk.</p>



<p>Consultants and PERA staff will continue to work on a recommendation and will present more information at the next Board meeting.</p>



<p>The Board’s next regular meeting, which will also include the release of PERA’s 2023&nbsp;<em>Annual Comprehensive Financial Report&nbsp;</em>and&nbsp;<em>Investment&nbsp;Stewardship&nbsp;Report</em>, is scheduled for June 21.</p>


Recap of PERA Board’s March 2024 Meeting


<p>The Colorado PERA Board of Trustees met on Friday, January 19 for its first regular meeting of 2024.</p>



<p>The agenda included important topics of discussion and various action items. Some of the Board’s major actions at the meeting are summarized below.</p>



<h4 class="wp-block-heading"><strong>Board appointment and Vice Chair election</strong></h4>



<p>Current Board Vice Chair Suzanne Kubec is retiring, and therefore vacating her seat on the PERA Board. In accordance with Board policy, Chair Marcus Pennell moved to fill that seat with the candidate from the State Division’s previous Board election who received the second-highest number of votes. As a result, Ashley M. Smith, who served on the Board from 2021 to 2022, was appointed to fill that seat until the next election in 2025.</p>



<p>Additionally, the Board held an election to replace Kubec as Vice Chair, and the Trustees elected Taylor McLemore to fill that role. McLemore has been on the Board since 2021 and currently serves as chair of the Ad Hoc Committee overseeing the search for PERA’s next Executive Director.</p>



<blockquote class="wp-block-quote">
<p><strong>REMINDER:</strong> <a href="https://peraontheissues.com/four-seats-on-pera-board-up-for-election-in-2024/" target="_blank" rel="noreferrer noopener">Four Seats on PERA Board Up For Election in 2024</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>Executive Director search update</strong></h4>



<p>McLemore provided an update on the Ad Hoc Committee’s Executive Director search, stating that more than 200 people have applied for the job. The committee is working with an outside search firm to screen applicants and identify candidates of high interest who will receive in-person interviews in February. The committee will then provide a list of top candidates to the full Board, which will be responsible for selecting a finalist.</p>



<h4 class="wp-block-heading"><strong>Legislative update</strong></h4>



<p>The 2024 legislative session is underway, and lawmakers have so far introduced <a href="https://peraontheissues.com/2024-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">three PERA-related bills</a>. Interim Executive Director/Chief Investment Officer Amy C. McGarrity and Public and Government Affairs Manager Michael Steppat updated the Trustees on the bills:</p>



<ul>
<li><strong>HB24-1044:</strong> Would expand the number of PERA retirees who can work for school districts without reductions in their benefits.</li>



<li><strong>SB24-013:</strong> Would increase district attorney and assistant district attorney pay&nbsp;and allow county boards to require assistant DAs to become a member of the PERA Defined Benefit Plan.</li>



<li><strong>SB24-044:</strong> Would create a temporary tax credit for qualifying PERA retirees in tax years 2024 and 2025.</li>
</ul>



<p>The Board generally takes a position on a bill if it has a financial impact on PERA, and Trustees voted to take an “amend” position on HB24-1044. That means the Board is looking for lawmakers to amend the bill to include a way to offset potential negative impacts on PERA’s funding.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/2024-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">2024 Proposed Legislation Status</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>Asset/liability study update</strong></h4>



<p>In September, the Board began the process of examining PERA’s strategic asset allocation through what’s known as an <a href="https://peraontheissues.com/asset-liability-study-a-guide-to-building-a-strategic-portfolio/" target="_blank" rel="noreferrer noopener">asset/liability study</a>. The Board’s consultants, Aon, discussed the work that’s been completed so far, including meeting with PERA’s investment staff and modeling future funding scenarios based on the existing asset makeup.</p>



<p>That work will continue over the next several months, with more analysis and modeling to determine if different asset allocations or levels of diversification would better help PERA meet its goals.</p>



<h4 class="wp-block-heading"><strong>Future meetings</strong></h4>



<p>The Board has four more regular meetings scheduled for 2024:</p>



<ul>
<li>March 15</li>



<li>June 21</li>



<li>September 20</li>



<li>November 15</li>
</ul>



<p>In addition, the Ad Hoc Committee will be meeting to interview Executive Director candidates in February. All meetings are streamed live and include time for public comment.</p>



<p>For more information, visit <a href="https://www.copera.org/board-of-trustees" target="_blank" rel="noreferrer noopener" class="broken_link">copera.org/board-of-trustees</a>.</p>



<p></p>


Recap of PERA Board’s January 2024 Meeting


<p>The PERA Board of Trustees met on Friday, Nov. 17 for its final regular meeting of 2023.</p>



<p>Below are highlights of some of the major topics of discussion and important actions the Board took during the meeting.</p>



<h4 class="wp-block-heading"><strong>2024 Board election</strong></h4>



<p>The Board approved the calendar for the <a href="https://www.copera.org/four-seats-on-pera-board-up-for-election-in-2024" target="_blank" rel="noreferrer noopener">2024 Board election</a>, during which four seats will be up for election: Two in the State Division, one in the School Division, and one in the Denver Public Schools Division.</p>



<p>Candidacy information will be available to members of those divisions in early January, and the election will take place in May.</p>



<h4 class="wp-block-heading"><strong>Member contribution interest rate</strong></h4>



<p>Every PERA Defined Benefit Plan account accrues interest, compounded annually. If a PERA member leaves PERA-covered employment and requests a refund of their account, they receive their contributions, the interest earned on that balance, and any applicable employer match. If that member keeps their account with PERA, the balance will continue to accrue interest and the member has multiple options upon reaching retirement eligibility, including choosing a lifetime monthly benefit.</p>



<p>The Board is responsible for setting the interest rate every year; it currently stands at 3 percent. The Board’s policy, <a href="https://content.copera.org/recap-of-the-pera-boards-november-2022-meeting-2/" target="_blank" rel="noreferrer noopener">updated in 2020</a>, evaluates the interest rate as a component of members’ overall retirement benefit. After discussing the issue, Trustees voted to keep the interest rate at 3 percent for 2024.</p>



<h4 class="wp-block-heading"><strong>Asset/liability study update</strong></h4>



<p>In September, the Board kicked off an important analysis of PERA’s investment portfolio and asset allocation strategy known as an asset/liability study. The project will help the Board determine if it needs to make any changes to PERA’s mix of investments. PERA’s strategic asset allocation is the primary driver of investment returns, and the Board adopted its current allocation following the last asset/liability study in 2019.</p>



<p>The Board’s investment consultant, Aon, said in the meeting that it continues to work with PERA’s investment staff to gather and analyze information. That process will continue over the next few months, with additional discussion in January.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/asset-liability-study-a-guide-to-building-a-strategic-portfolio/" target="_blank" rel="noreferrer noopener">Asset/Liability Study: A Guide to Building a Strategic Portfolio</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>PERA-related legislation</strong></h4>



<p>With the 2024 General Assembly around the corner, the Trustees discussed the upcoming session and potential PERA-related legislation. The conversation included two bills that lawmakers on the Pension Review Commission expect to introduce: One that aims to expand the number of PERA retirees who can work for school districts without reductions in their benefits, and one that proposes a $700 tax credit for qualifying retirees in tax years 2024 and 2025.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/pension-review-commission-eyes-two-bills-for-2024-legislative-session/" target="_blank" rel="noreferrer noopener">Pension Review Commission Eyes Two Bills for 2024 Legislative Session</a></p>
</blockquote>



<p>The Board’s first meeting of 2024 will take place on Jan. 19.</p>


Recap of PERA Board’s November 2023 Meeting


<p>At its <a href="https://copera.org/pera-on-the-issues/recap-of-pera-boards-september-planning-session-meeting-2/">September meeting</a>, the PERA Board of Trustees kicked off an important analysis of PERA’s investment portfolio and strategy. Known as an asset/liability study, the project will help Trustees determine whether changes are needed to PERA’s mix of investments.</p>



<h4 class="wp-block-heading"><strong>The importance of asset allocation</strong></h4>



<p>PERA’s strategic asset allocation—the mix of stocks, bonds, and other investments that make up the portfolio—is the most important factor that drives the fund’s investment performance. PERA needs to be able to pay monthly benefits to current and future retirees for decades to come, so it’s important we have a portfolio that supports that mission.</p>



<p>Each category of assets serves a distinct purpose, with the result being a diversified portfolio that’s meant to withstand ups and downs in the market and produce returns over the course of decades. Read more about the role each asset class plays in our series, <a href="https://peraontheissues.com/asset-classes-explained-global-equity/" target="_blank" rel="noreferrer noopener">Asset Classes Explained</a>.</p>



<p>The Board is responsible for determining the asset allocation, which staff then implement. The PERA Board typically conducts an asset/liability every four or five years and adopted PERA’s current asset allocation following the last study in 2019. That study resulted in the following targets:</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Asset class</strong></td><td><strong>Long-term target</strong></td><td><strong>Permissible range</strong></td></tr><tr><td>Global Equity</td><td>54.0%</td><td>48% to 60%</td></tr><tr><td>Fixed Income</td><td>23.0%</td><td>18% to 28%</td></tr><tr><td>Private Equity</td><td>8.5%</td><td>4% to 13%</td></tr><tr><td>Real Estate</td><td>8.5%</td><td>4% to 13%</td></tr><tr><td>Alternatives</td><td>6.0%</td><td>0% to 12%</td></tr><tr><td>Cash</td><td>0.0%</td><td>0% to 3%</td></tr></tbody></table></figure>



<p>The actual percentages in each asset class can vary based on market fluctuations, but must fall within the allowable range set by the Board. This ensures PERA’s portfolio is in line with the Board’s goals and strategy.</p>



<p>Through the process of regular asset/liability studies, the Board has made incremental adjustments to PERA’s asset allocation over time to achieve an annualized return of 8.3% over the past 30 years.</p>



<h4 class="wp-block-heading"><strong>What is an asset/liability study?</strong></h4>



<p>Over the next several months, PERA’s investment consultants will work with staff and the Board to conduct the asset/liability study. It’s an in-depth analysis that looks at various factors, including:</p>



<ul>
<li><strong>The relationship between assets (investments) and liabilities (benefits owed):</strong> The study will involve modeling various scenarios over time to see how different investment decisions could impact the plan’s funding long-term. Are there any asset mixes that are more likely to help PERA reach its funding goals?</li>



<li><strong>The fund’s risk tolerance</strong>: How much risk can the fund take on appropriately? Should the portfolio include more potentially volatile investments like stocks, or more lower-risk investments like bonds? Increasing the amount of risk can bring the potential for higher returns while lowering risk can protect the fund from losses in down markets.</li>



<li><strong>Market conditions</strong>: Since PERA is a long-term investor, it’s important to look at what the future might hold. While the Board doesn’t have a crystal ball, it will work with experts to forecast market conditions for the various asset classes to understand the potential returns over the next several decades.</li>
</ul>



<p>The study will help the Board determine if the current mix of investments is appropriate to help PERA reach its funding goals, or if changes are needed to adjust the level of risk in the portfolio. If the Board decides to make changes to the strategic asset allocation, staff will work to modify the portfolio accordingly.</p>



<p>The Board expects to dive deeper into the details at its November meeting, with the possibility of finalizing the study as soon as the spring.</p>


Asset/Liability Study: A Guide to Building a Strategic Portfolio


<p>The&nbsp;<a href="https://www.copera.org/board-of-trustees" target="_blank" rel="noreferrer noopener" class="broken_link">Colorado PERA Board of Trustees</a>&nbsp;convened for three days in Colorado Springs for its annual September planning session. The planning session concluded with the Board meeting on Friday, Sept. 22.</p>



<p>Over the course of the three days, Trustees engaged in a number of discussions, education sessions, and planning meetings. Below is a summary of some of the highlights and important actions the Board took.</p>



<h4 class="wp-block-heading"><strong>Executive Director search</strong></h4>



<p>The Board committee tasked with overseeing the search for PERA’s next Executive Director announced to the full Board that it has selected an outside firm to assist in that search. Hudepohl &amp; Associates, a firm with experience in executive searches for public pension plans, will conduct a nationwide search over the coming months.</p>



<p><strong>READ MORE:</strong>&nbsp;<a href="https://peraontheissues.com/pera-board-selects-firm-to-conduct-executive-director-search" target="_blank" rel="noreferrer noopener">PERA Board Selects Firm to Conduct Executive Director Search</a></p>



<h4 class="wp-block-heading"><strong>CEM&nbsp;Benchmarking&nbsp;Report</strong></h4>



<p>Each year, CEM&nbsp;Benchmarking&nbsp;releases a report comparing PERA to other public pension plans on factors such as plan administration costs and the quality of services provided to members. The most recent report, which CEM presented at the planning session, shows PERA continues to provide a high level of service at low cost to its members relative to its peers.</p>



<p>According to CEM, PERA’s administrative cost was $55 per member in 2022, below the peer average of $63. PERA’s service score of 83 was the 10<sup>th</sup>&nbsp;highest of the 61 pension systems around the world that were included in the report. Among its peers of similarly sized U.S. plans, PERA ranked fourth.</p>



<p>Notably, the report showed that most plans are seeing an increase in wait times and call lengths on their customer service phone lines in recent years, and PERA is no exception. Staff have been taking steps to improve service levels, including upgrading phone systems and better forecasting staffing needs to meet members’ expectations.</p>



<h4 class="wp-block-heading"><strong>Asset/liability study</strong></h4>



<p>An important action the Board undertakes every few years is conducting what’s called an asset/liability study. The last study&nbsp;<a href="https://peraontheissues.com/board-directed-asset-liability-study-informs-peras-investment-strategy/" target="_blank" rel="noreferrer noopener">was completed in 2019</a>.</p>



<p>The asset/liability study is what ultimately informs PERA’s strategic&nbsp;asset allocation&nbsp;— or the mix of stocks, bonds, and other investments that make up PERA’s portfolio.</p>



<p>Over the next several months, PERA’s investment consultants will work with staff and the Board to discuss PERA’s long-term investment goals, risk tolerance, expectations of future performance and other factors to determine if PERA should adjust its&nbsp;asset allocation&nbsp;. A notable change that resulted from the last study was allocating slightly more of the portfolio to&nbsp;<a href="https://peraontheissues.com/asset-classes-explained-global-equity/" target="_blank" rel="noreferrer noopener">global equity</a>.</p>



<p>The Board will discuss the asset/liability study further at its November meeting, with the possibility of finalizing the study as soon as next spring.</p>



<p>The Board will hold its final meeting of 2023 on Nov. 17.</p>


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