FY2018 & FY2019
Budget Request
Presented to

Governor Terry E. Branstad
&

Lt. Governor Kim Reynolds

Donna M. Mueller, CEO
IOWA PUBLIC EMPLOYEES’ RETIREMENT SYSTEM
November 29, 2016

 Our Mission
Administer a cost-efficient retirement plan that provides
lifetime pension payments to public employees and serves
to attract and retain a quality workforce.

2

 'Ihble ofOIganization

 

Investment Board Chief Execu?ve Officer Benefits Advisory Commi?ee

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Internal Auditor Executive Assistant
General Counsel Office Communications Office
Investments Information Financial Benefits
. . . Management . . . . . .
Diwalon . Diwalon DIVISIDU
D1v151on

 

 

 

 

 

 

 

 

 

 

 

 

350,000 Members
Regular
members
make up
95%.
Special
Service
members
make up
5%.

As of 6/30/2016
4

 Benefit Payments by County
•
•

•

As of 6/30/2016

Over 114,000
retirees
$1.8 billion
paid in
benefits
$1.6 billion
paid to
Iowans

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 Prefund – Not Pay-as-You-Go
Contributions + Investments = Benefits + Expenses
Membership Class
Regular
7/1/13–6/30/18

Sheriffs and Deputies
7/1/16–6/30/17
7/1/17–6/30/18

Protection Occupations
7/1/16–6/30/18

Member

Employer

Total

5.95%

8.93%

14.88%

9.63%
9.38%

9.63%
9.38%

19.26%
18.76%

6.56%

9.84%

16.40%

Investment earnings contribute 70% of IPERS benefits paid.
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- Employee Rate - Employer Rate

Fiscal Year

Actuarial Co ntribution Rate

 

15Historical Contribution Rates
Regular Members

Contribution Ratesvs. Re

 

 

qulre



 

Contribution Rate Funding Policy
Goal:


Fully fund the benefits as swiftly and efficiently as is
reasonable



Closed 30-year amortization as of FY2014



No rate reduction unless:


Membership group is at least 95% funded, and



The actuarial rate is at least 50 basis points lower
than the rate paid



Provides stability in the contribution rates



Prepares for periods of market downturns
8

 Investment Performance History

Annualized Returns
1-Year
2.15%
10-Year
6.31%
20-Year
7.85%
30-Year
8.64%
For periods ending June 30, 2016

Actuarial Assumed Investment Return
1953–1993
6.50%
1994–1995
6.75%
1996–present 7.50%
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 Key Funding Measurements
FY2016
 Ratio of actuarial assets to actuarial liabilities

83.9% (up from 83.7%)

 Unfunded actuarial liability (UAL) increased
by $131

million

 Deferred investment loss of

$708 million
10

 The IPERS Trust Fund
In FY2016, the Trust Fund
remained at

$28 billion
after paying $1.8 billion in
benefits.
11

 Key GASB Measurements
Total Pension Liability

$35 billion

Fiduciary Net Position

$28 billion

Net Pension Liability

$ 6 billion

Ratio of Fiduciary Net Position
to Total Pension Liability

81.8%
12

 Consistent Low Cost
IPERS’
total pension
administration
cost of $45 per
active member
and annuitant
has remained
significantly
IPERS

below its 4-year
peer group cost
of $97.

Source: CEM Benchmarking Inc.
13

 Budget Appropriation Request Summary
• No General Funds requested.
• IPERS administrative expenses are paid by the IPERS
Trust Fund.
• Pension administration system upgrade is underway.
• FY2018 and FY2019 request:
$17,686,968 and 88.13 FTE
NO increase from FY2016

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 FY2018 & FY2019
Budget Appropriation Request
Service Category

FTEs

FY2018

FY2019

Investment Management
(Oversee investments and investment policy)

9.06

$1,399,332

$1,532,645

Retirement Services
(Paying benefits; service purchases; disability services)

25.27

$3,864,821

$4,273,721

Member Services
(Benefit education and estimates; retirement counseling)

20.68

$3,158,491

$3,492,661

Employer Relations & Data Management
(Employer training; compliance reviews; employer reporting)

13.00

$1,985,718

$2,210,545

Governance, Plan Design, and Financial Control
(Legal compliance; administrative rules; internal auditing; actuarial services)

19.07

$2,918,606

$3,227,396

Facility Maintenance

1.05

$1,020,000

$1,020,000

Pension Administration Software System

0.00

$3,340,000

$1,930,000

FY2018 & FY2019 appropriation

88.13

$17,686,968

$17,686,968

FY2017 appropriation

88.13

$17,686,968

$17,686,968

0.00

$0.00

$0.00

Increase/(Decrease) from FY2017 appropriation

15

 IPERS Fun Facts
• 134 members over the age of 100
• Provided over 11,294 preretirement
counseling sessions in FY2016
• Received over 88,389 phone calls
• Prepared more than 43,149 estimates
• Welcomed 6,011 retirees
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 Contact Us
For additional information, visit our website at
www.ipers.org
E-mail: ceo@ipers.org
Phone: 515-281-0070
Toll-free: 1-800-622-3849

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